Decoupling management and technological innovations: Resolving the individualism–collectivism controversy

This study aims to resolve the contradictory previous research findings on the relationship between individualism–collectivism and innovation. We draw on innovation theory and relate to the difference between non-technological (management) and technological innovation types as well as to the distinction between exploration and exploitation (invention and commercialization of technological innovations). Using Community Innovation Survey (CIS) 2006 micro data for innovation at the organizational level in 13 countries – along with Hofstede, 1980 and Hofstede, 2001, GLOBE (2005), and Schwartz (2006) scores for individualism–collectivism – we apply Hierarchical Linear Modeling (HLM). The results indicate that individualism is positively related to the invention phase, whereas collectivism is beneficial for the commercialization of innovative ideas. Furthermore, in collectivistic cultures, management innovation plays a more important stimulating role in enhancing technological innovation than it does in individualistic ones. This provides the managers with an idea of when innovation processes in their companies would be more favorable versus detrimental.