Learning from invention failure among research organizations: the role of top management team founding experiences and exposure to US culture

Abstract

Building on organisational failure learning and upper echelons theory, we examine the link between top management team (TMT) prior experiences and invention failure learning among research organisations. Specifically, we develop theoretical arguments to suggest that TMT founding experience and exposure to US culture facilitate organisational learning from failure. We test our theoretical reasoning using a longitudinal data set comprising 550 organisation-year observations of the patenting activities conducted by 39 research institutes in Germany. In support of our theoretical arguments, we find that TMT founding experience and TMT exposure to US culture positively moderate the link between prior invention failure and subsequent invention performance. Pointing to TMT experiences as a crucial contingency for whether organisations learn from failure, the present study contributes to the literature on organisational failure learning and upper echelons.