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How coworking space impacts innovation: A literature review

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DOI: 10.1201/9781003036173-22

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How Coworking Space Impacts Innovation: A Literature Review

M. T. Amir
Department of Management, Universitas Bakrie, Jakarta, Indonesia

ABSTRACT: The global trend of coworking spaces also occurs in Indonesia, and its impact on promoting
a new climate for developing innovation is critical. However, how specifically the coworking spaces’
promises promote innovative behavior of individual tenants is relatively unknown. This study reviews the
extant literature on coworking spaces and evaluates the roles of the space manager on creating positivity,
interaction, and the process of innovation (generating, promoting, and implementing ideas) of the tenants.
It explores the combination of positive organizational scholarship, social interaction, and innovation
concepts, to describe the strategies of the managers, and the potential experiences of the tenants. This
study contributes to the domain of creativity and innovation research, especially in the context of
individual innovation. At the practical level, the study is expected to provide insights and applied
recommendations for coworking spaces managers to benefit tenants and gain loyalty from them. The
findings may inform further research in the area of innovation and the future of work.

1 INTRODUCTION
Since Brad Nueberg introduced the concept in 2005 (Bostman & Rogers 2010), the popularity of
coworking space (CWS) as an alternative work spatial continues to rise and its types and definitions are
developing.
Spinuzzi (2012) conceptualizes CWS as an “open-plan environment in which people work together with
other unaffiliated professionals for a fee.” Suggesting a collaboration environment, Capdevila (2015)
defined CWS as localized spaces where independent professionals work-sharing resources are open to
sharing their knowledge with the rest of the community. Interaction is one of the requirements in
developing creativity, and how the role of CWS in supporting the process of professional innovation
becomes the interest of scholars. The value offered by CWS seems relevant in promoting innovation
processes; in idea generation, promotion, as well as implementation.
In their study of dynamics of creativity in a creative city, Grandadam et al. (2013) suggested that the
interaction of diverse people has a significant role in generating new ideas, concepts, or skills. Bostman &
Rogers (2010) and Spinuzzi (2012) emphasized the collaboration benefits of CWS in creating a conducive
environment for innovation.
While growing in creative cosmopolitan cities, like San Francisco, NewYork, London, and Amsterdam
(Gandini, 2015), the phenomenon of coworking space also occurs in Jakarta, the capital city of Indonesia.
Despite this promising development, coworking spaces managers still have various challenges and
problems. For instance, coworking spaces in Indonesia need a different business model than their
counterpart in advanced industrial countries due to the different market characteristics (Low, 2017).
Although there is a trend to and phenomenon of the growing CWS, it is not fully understood how
coworking spaces can be effective in fostering innovation and what role of the CWS managers could play.
Also, there is still little academic research, particularly in the Indonesian context, dedicated to the domain
of innovative behavior of CWS users.
This study examines literature to check the link between positivity and the interactions that CWS involve
in tenants innovativeness. What kind of strategies do CWS normally take and how do the tenants perceive
them, or what kind of experiences do they have. The study will contribute to the domain of creativity and
innovation research, especially in the context of individual innovation. At the practical level, the study is
expected to provide insights and applied recommendations for coworking spaces managers in benefitting
tenants and gaining loyalty from them.
2 THE NATURE OF COWORKING SPACE
Coworking spaces, as one form of the continuum that includes working from the traditional home office,
can be viewed from two aspects: First, as a work facility, where it is defined as open-plan offices where
independent knowledge workers work, that normally used by a mobile, independent professional; and
second, as Water-lynch et al. (2016) suggest, it also involves professional work and its interaction
mechanism; that is, “working alone together” where collaboration occurrs with different backgrounds of
professionals and specific strategies of the office manager.
Kristensen (2004), for instance, found that workspace supported different stages of a creative process.
Examining an interdepartmental project team as a case study, the study found that creativity could take
place depending on the confinements of workspaces. The limitation was found to allow certain cognitive
processes but at the same time also restricts others. This, in turn, induces emotions that will facilitate or
reduce the enhancement of creativity. Samani et al. (2014) suggest an organization needs a flexible
workplace, in this kind of environment, to support creativity.
This study draws on the work of Raitis et al. (2017), where positivity involves positive attributes in the
organizational context. For the purpose of this study, positivity is defined as ambiance or setting that
produces positive perception. For instance, it may create attractiveness, ambiance, and atmosphere in
joyful, attractive or eye-catching, unique or distinctive physical facilities in the coworking space that
potentially create one of the positive emotions. In the creativity literature, some studies have indicated the
link of creativity and workspace arrangement. Fuzi et al. (2014) and Kristensen (2004) found the need to
develop a diverse office environment that provides a degree of comfort in order that collaboration is
facilitated to promote creative work.
3 POSITIVITY IN INNOVATION
This research is quantitative research with an explanatory study. Data was collected using questionnaires
distributed in the form of Google docs and filled out by 106 respondents. This research uses quantitative
method and Bernoulli sampling. With (α) =10%, the minimum number of respondents is 97. This research
uses Bernoulli sampling because the size of the existing population cannot be known with certainty
(Indrawati, 2015). This research uses a Likert scale.
Innovation is often viewed as a new idea or concept of how to organize a solution to a problem (de Jong
& den Hartog, 2007). Following the dynamic of competition and technology, labor mobility, and
distributed knowledge across organizations, the innovation setting has changed. Increasingly, innovation
emerges at the crossroads of knowledge territories. Organizations now recognize the need for external
capabilities, rather than relying solely on internal innovation capability. According to Enkel et al. (2009),
external actors have become an increasingly crucial part of companies’ innovation capability, including
from the environment of coworking space.
The assumption that innovativeness can be increased can be drawn from the study of positivity and
innovation, where innovation is seen as a process. In this perspective, innovation consists of stages
explaining the process of generating, promoting, and implementing useful ideas (Carmeli et al., 2006).
Each process involves certain challenges (Amir, 2014), where a certain work climate may have a role in
facilitating the innovation process.
Some studies seek the link between psychological aspects of creative or innovative behaviour. Sweetman
et al. (2010), for instance, found that the element of psychological capital is associated with creative
performance. It specifically emphasizes that the idea-generation phase of creativity needs psychological
resources such as hope or optimism.
Figure 1 depicts the connection between positivity, interaction, and innovativeness. The next section
discusses these aspects in more detail.

Coworking Spaces Innovativeness of

Strategies Tenants

Positivity Generating Ideas

Facilitating Promoting Ideas

Interaction
Implementing Ideas
.
Figure 1 Coworking space facilitating innovative behavior

3.1 Positivity in Generating Ideas

In positive psychology, Seligman (2012) also predicts that optimists incline to be imaginative and propose
new ideas easily as they are visionary. Positivity may facilitate a person’s creative self-efficacy, and
creative performance is found related (Tierney & Farmer, 2002). Coworking space can be expected to
stimulate prerequisite conditions for idea-generating.
The link between the positive emotion resulting from the CSW environment and the creativity produced
for its members can also be drawn from the opportunity recognition theory. Positive emotion may play an
important role in the process of noticing, interpreting, and evaluating the potential of opportunities, since
it enhances cognitive performance and broadens the scope of attention (Fredrickson & Branigan, 2005;
Isen, 2002), and increases the realization or implementation of opportunity.
3.2 Positivity in Promoting and Implementing Ideas
In the promoting and implementing stage, innovators need aspects that buffer their emotion when they
face challenges, such as persuading others. Positive emotion that results from a positive climate may
provide innovators with the energy for this purpose, as they need to persuade others reiteratively. When
they have negative feedback, such as rejecting ideas or avoiding discussion, positive emotion helps them
to be persistent (Amir, 2016). Consistent with this, Cohn et al. (2009) found positive emotion facilitates
innovators as a resource for adaptation in altered situations. Innovators also face challenges when many
parties need convincing. Positive emotion provides confidence and a positive outlook, helping innovators
to maintain their effort and find alternatives if one approach fails.
4 SOCIAL INTERACTION IN INNOVATION
Botsman and Rogers (2010) note that social interaction contributes to innovation. Hence, it is important
that managers of coworking spaces supporting the formation and nurturing of social capital. Social
interaction increases the chance of knowledge exchange between different people at coworking spaces.
To realize the interaction need for members, management of coworking spaces conduct several strategies.
For instance, management could promote interaction by coordinating and connecting the member through
several tools. Members recognize that appropriate connection is one of their purposes in choosing a
coworking space. The connecting role of management can lead to a reduction of the time needed to find
appropriate connections and to an increase in the chance of the connections being valuable (Hering &
Phillips 2005).
One of the popular strategies in promoting interaction in coworking space is by the mixing of tenants
(Cabral & Van Winden, 2016). Identifying and mixing specific characteristics of tenants will help them to
increase the chance to interrelate, cooperate, and benefit from each other’s attendance. Another strategy
often used to encourage interaction is using social networking tools, like social events, awareness
creating, and social network sites.
5 CONCLUSION AND RECOMMENDATION
The review above discussed the possibility of coworking spaces managers using strategies that lead to
positivity and interaction, that in turn facilitate the innovativeness of the tenants. Coworking spaces offer
an alternative workplace for various professions and its advantages are found to build individual and team
innovativeness. Creating positivity in the form of arranging comfortable ambiance is foundational to
increasing tenants’ creativity. The newness and uniqueness of the physical arrangement in the CWS is
also another crucial form of positivity. In forging these interactions, establishing the right communication
strategies and attractive, as well as relevant, events have a significant role. In later phases of innovation,
CWS needs to be more active in designing specific strategies in recruiting tenants, including cooperating
with relevant organizations that may become access points for tenants to realize their innovation. This
study contributed to innovation research by understanding the role of positivity and interaction. The
details of how each stage of innovation is impacted by those factors may be a further interesting area to be
explored.
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