The Sociology of Innovation: Organizational, Environmental, and Relative Perspectives

Innovation is risky. New products and firms are subject to high failure rates. To minimize the risk associated with innovation, most scholars agree that firms should engage simultaneously in two types of activities: exploring new alternatives and exploiting existing competencies. Firms that simultaneously engage in explorative and exploitative activities are called ambidextrous organizations. Research on ambidextrous organizations, however, inadequately considers the importance of the environment in which organizations operate for innovation success. The sociological view of innovation fills this gap by emphasizing the importance of social context for explaining innovative outcomes. The sociology of innovation highlights, first, the structural arrangements – characteristics of social networks, organizations, and institutions – that influence innovation and, second, the relative nature of innovation – whether an object is considered novel depends on one's vantage point. Drawing on the relative view of innovation, I develop a typology that outlines several paths to innovation with respect to two vantage points: the organization and the environment. I argue that minimizing the risks associated with innovation is most likely to occur when firms follow the path of innovation that consists of generating novel solutions that simultaneously exploit knowledge and resources that are both available to the firm and in the firm's environment.