Section7

Question 1

Exploration vs Exploitation

Answer 1

Definition:

• Exploration: Searching for new knowledge and ideas.
• Exploitation: Refining and capitalising on existing knowledge.

Question 2

Attention at the Individual Level

Answer 2

• Two primary types: focused vs divided.
• Attention control is crucial to balance exploration and exploitation.

Question 3

Socialisation (March, 1991)

and what are solutions?

Answer 3

• Over time, individuals learn how the organisation works.
• High socialisation → Good for performance but can hinder exploration.
• Solutions: Turnover, open boundaries, spin-outs.

Question 4

Outbound Open Innovation

Answer 4

• Letting internal ideas/people go beyond organisational boundaries.
• Involves spin-outs, licensing IP, or partnering externally.
• Encourages fresh perspectives and new domains.

Question 5

Spin-outs

What do they do? (3)

Answer 5

• Spin-outs can boost exploration by reducing over-socialisation.
• Facilitate new knowledge creation and external ventures.
• Can indirectly benefit the parent firm (e.g., knowledge flow).

Question 6

ARECO Case

Answer 6

• Founded to exploit a technology the parent firm (IMRA) did not pursue.
• Diverse product lines emerged from direct client engagement.
• Example of outbound open innovation success.

Question 7

Empirical Evidence

For spin-outs and inventors

Answer 7

• Post-spin-out inventors produce more new claims (↑ exploration).
• Rely less on parent’s knowledge base.
• Tenure intensifies the effect (over-socialised benefit more from leaving).