Managing radical business innovations : a study of internal corporate venturing at Sonera Corporation

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School of Business | Doctoral thesis (monograph) | Defence date: 0000-00-00
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Organisaatiot ja johtaminen
Organization and Management
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234 s.
Acta Universitatis oeconomicae Helsingiensis. A, 320
This is a study of the managerial activities that produced two radical business innovations in a major Finnish telecommunications company called Sonera. The data clearly indicated the central impact of managers on these innovations, which involved the launch of new technologies in an emerging customer market. The two innovations were selected as research objects after a careful examination of innovations in the telecommunications industry in general and Sonera Corporation in particular. It was also recognized that during the history of the company, the management of Sonera had communicated four major changes in the company’s core business. The second and third of these changes were vitally based on the studied innovations, ARP and Zed. After these first observations, a more detailed research question emerged, i.e., to clarify and conceptualize how the managers at Sonera contributed to the emergence of these two innovations. This exploratory study was based on longitudinal field data from Sonera Corporation. The main data collection methods were participant observation, interviews, and respondent validations. This study suggests that certain managerial activities, which can be labelled as buffering and bridging, have a strong explanatory power for the development of innovations. Most importantly, the study indicates that the focal managers’ experience and motivation, together with the specific situational circumstances, influenced the way in which managerial activities enabled the progress of these innovations through the processes identified already in the widely known Bower-Burgelman process model. Managers facilitated the development through simultaneous buffering and bridging activities, which had an important role in the cyclical development of the innovations and in the emergence of their distinctive features. In general, this study highlights the influence of simultaneous buffering and bridging activities at multiple managerial levels in the organization. In fact, when innovations are bootlegged, it is crucial for the organization to be open towards third parties in order to raise intrapreneurial capacity and absorb external technology and market knowledge. Hence, bridging is then the core managerial activity. Furthermore, it is important to provide sufficient room and space for the innovation initiators to define principles for managerial activities that enable bringing the innovations to fruition. Therefore, buffering is the core managerial activity at the time when the initiators define the innovation. Moreover, in the buffered technical core, the focal managers need to reopen the innovation development to third parties in order to create a group or community of people with sufficiently similar or congruent sources of motivation, experience, or intentions. This allows them then to mutually assist one another over the long term to develop the market and provide impetus for the innovation. Thus, striking a balance between buffering and bridging activities is the core managerial activity when the focal managers provide impetus for the innovation development. This study also indicates that one way to create a common general intention that includes sufficient joint attention to both bridging and buffering activities is by building intra-corporate communities across formal hierarchical levels
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