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Evaluating Novelty: The Role of Panels in the Selection of R&D Projects

Authors/Editors: Grohsjean, T.
Salter, A.
Criscuolo, P.
Dahlander, L.
Published: Forthcoming
Type: Articles in Refereed Journals (International)
ISBN/ISSN: 0001-4273
Published by: Academy of Management Journal

Abstract

Building on a unique, multi-source, and multi-method study of R&D projects in a leading professional service firm, we develop the argument that organizations are more likely to fund projects with intermediate levels of novelty. That is, some project novelty increases the share of requested funds received, but too much novelty is difficult to appreciate and is selected against. While prior research has considered the characteristics of the individuals generating project ideas, we shift the focus to panel selectors and explore how they shape the evaluation of novelty. We theorize that a high panel workload reduces panel preference for novelty in selection, whereas a diversity of panel expertise and a shared location between panel and applicant increase preference for novelty. We explore the implications of these findings for theories of innovation search, organizational selection, and managerial practice.