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Businesses Unintentionally Discourage Diverse Ideas

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Businesses influence the ideas they receive from external contributors by unintentionally signalling which ideas they like, according to research from ESMT Berlin and INSEAD. This leads to a narrow set of non-diverse ideas.

The findings were published in the Academy of Management Journal.

Professor Linus Dahlander from ESMT Berlin, alongside Professor Henning Piezunka and PhD candidate Sanghyun Park from INSEAD, analysed 1.44 million ideas to understand how organisations unknowingly shape the ideas they receive. The data came from organisations that asked visitors how they could improve their websites before choosing which ideas to use. Chosen ideas were communicated for all to see.

The analysis reveals that organisations with higher consistency in selection tend to favour similar ideas. Over time, contributors adjusted their proposals to align more closely with perceived organisational preferences, enhancing their likelihood of acceptance but also resulting in reduced diversity in the ideas submitted. Individuals who felt their ideas were less likely to be selected gradually ceased making suggestions. Consequently, while the relevance of the ideas submitted may have increased, their diversity has diminished.

The researchers also found that idea diversity increased when new contributors, less aware of past organisational choices, made suggestions. After seasoned contributors stopped suggesting, which would have influenced earlier selections, there was also an increase in the diversity of ideas. However, when contributors interacted more, attention to a company’s preferences heightened, causing an increase in similar ideas.

Professor Dahlander explains, “The result of external searches often yields a more limited set of ideas than commonly perceived, representing a trade-off between fit and diversity. Organisations tend to favour ideas that align closely with their current interests, which can be beneficial.” He adds, “However, this preference for fit can incur costs: It may prevent organisations from encountering ideas that diverge from their usual practices, inadvertently narrowing the creative scope of external contributors. By not constructively engaging with diverse perspectives, organisations risk losing access to innovative ideas and may miss out on pivotal breakthroughs.”

As interactions among external contributors direct their attention towards existing ideas and away from novel ones, managers seeking diverse ideas may benefit from limiting interactions among external contributors. Reducing the visibility of ideas selected could also prevent contributors from being influenced by what they think companies want.

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