Reinvention of management innovation for successful implementation

Philippe Giuliani*

Montpellier Business School (MBS).

Montpellier Research Management (MRM)
2300, Avenue des Moulins
34185 Montpellier Cedex 4
France
E-mail: p.giuliani@supco-montpellier.fr
Fax : +33 (0)4 67 40 56 50
*Corresponding author

Marc Robert*

Montpellier Business School (MBS).

Montpellier Research Management (MRM)
2300, Avenue des Moulins
34185 Montpellier Cedex 4
France
E-mail: m.robert@supco-montpellier.fr
Fax: +33 (0)4 67 40 56 50
*Corresponding author

Frédéric Le Roy
University of Montpellier and Montpellier Business School (MBS).
Montpellier Research in Management (MRM)
Espace Richter-–Bat B
Rue vendémiaire CS 19519
34960 Montpellier Cedex 2
France
E-mail: frederic.le_roy@univ-montp1.fr
Fax: +33 (0) 4 99 13 02 10

Abstract: This paper’s primary aim is to show how a management innovation is implemented due to the creation
of another new management innovation through an endogenous process. We call this process the “reinvention” of
a management innovation. Building on management innovation implementation literature, we elaborate a
theoretical framework that details the endogenous mechanisms through which the implementation phase of a
management innovation can be the foundation of another management innovation. A management innovation’s
adoption does not necessarily require its adaptation. Adopting a management innovation may lead to the generation
of another management innovation in order to successfully implement the first management innovation. We use
the term “reinvention” when a management innovation is generated through an endogenous process. We used an
exploratory method based on a qualitative and longitudinal case research study. The present paper contributes to
the understanding of emergence and implementation process of management innovations.

Keywords: Management innovation, Implementation, Reinvention, Multinational Company

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Biographical notes: Philippe Giuliani is Assistant Professor in Management Innovation within Montpellier
Business School. He conducts research in the laboratory of MRM. His work focuses on innovation and
management innovation in particular. He has co-published many works of research in international journals and
several chapters books, from technological innovation to management innovation, for Presses des Mines,
Collection Economie et Gestion (2014); Innovation management, for Éditions Dunod (2013).

Marc Robert is Assistant Professor of management within Montpellier Business School. He conducts research in
the laboratory of MRM. His current research concerns management innovation, networks of innovation and
coopetition. He has co-published many works of research in international journals and several chapters books,
from technological innovation to management innovation, for Presses des Mines, Collection Economie et Gestion
(2014); Innovation management, for Éditions Dunod (2013).

Frédéric Le Roy is Professor of management at the University Montpellier 1 - ISEM and an affiliate Group Sup
de Co Montpellier Business School professor. He conducts research in the MRM (Montpellier Management
Research) laboratory. His research focuses on the strategic management of companies. It focuses on new strategic
approaches in business like strategies breakdown and coopetition strategies. He has published and co-published
many works of research in international journals and several books including social business responsibility, for
the EMS editions (2006), strategic competition management, for editions Dunod (2009), coopetition strategies,
for Éditions De Boeck (2010), innovation management, for Éditions Dunod (2013).

1 Introduction

Innovation is a major element of mature and hypercompetitive economies (Ayerbe, 2006;

D’Aveny, 1995), allowing competitive advantage and guaranteeing the sustainability and
development of enterprises (Bhattacharyya and Jha, 2015; De Faria and Mendonça, 2011;
Hollen et al., 2013). Research interests have long been exclusively focused on the creation and
implementation of technological innovations (Abernathy and Utterback, 1978; Akrich et al.,
2002; De Martino et al., 2012; Madanmohan, 2005), while recent studies demonstrate that half
of the innovations implemented in European companies have no technological components
(sources OECD and database CIS-06). Such innovations are principally related to firms’
management and organization (Dubouloz and Bocquet, 2013; Morand and Manceau, 2009).
These types of innovations are called management innovations (Birkinshaw et al., 2008;
Damanpour, 2014; Hamel, 2006; Hamel and Breen, 2008) or organizational innovations
(Damanpour and Schneider, 2006; Dubouloz, 2014; Kimberly and Evanisko, 1981). Since first
defined by Kimberly (1981), management innovations have been described in various ways.
Damanpour (2014) describes the evolution of this concept over the past three decades. Different
conceptualizations overlap significantly in the literature, which leads to different definitions. In
this paper, we have adopted Mol and Birkinshaw’s definition: “Management innovation is the
introduction of management practices new to the firm and intended to enhance firm

2
performance” (Mol and Birkinshaw, 2009, p. 1269). We have selected this definition because
it is concise and directly linked with the improvement of firm’s performance.

Despite its importance and pervasive application in companies today (Damanpour and Aravind,
2012; Jaouen and Le Roy, 2013; Le Roy et al., 2013), this concept’s scope has long been
undervalued in the academic literature (Birkinshaw et al., 2008; Damanpour, 2014; Volberda
et al., 2013). In literature, the implementation phase is considered a critical phase in the
management innovation process (Birkinshaw et al., 2008). Moreover, previous empirical
studies state that management innovations have had to be adapted and customized during the
implementation phase to become part of the company’s routine (Akrich et al., 2002; Ansari et
al., 2010; Damanpour and Schneider, 2006; Peeters et al., 2014). These two assertions are valid,
whether a management innovation is invented within the company or abroad (Birkinshaw et al.,
2008; Damanpour and Wischnevsky, 2006). However, the literature has not consistently
highlighted what occurs when customization and adaptation of the implementation phase fails.
The implementation of a management innovation is unsuccessful when said innovation does
not achieve the objectives sought. To the best of our knowledge, no study has suggested an
alternative solution when implementation management innovation fails. These failures
represent an important managerial problem because companies are increasingly implementing
management innovations.

The literature does not analyze how the implementation phase of a management innovation can
lead to the creation of a totally new management innovation, thereby revealing a theoretical
gap. To the best of our knowledge, no work has identified and explained the endogenous
dimension of management innovations. In this study, we address the following question: How
can a management innovation be implemented thanks to the creation of another management
innovation through an endogenous process?

We used an exploratory method based on a qualitative and longitudinal case study. We choose
to study Schneider Electric Company, which has implemented major management innovations.

Our paper’s primary aim is to show how a management innovation can be implemented thanks
to the creation of another management innovation through an endogenous process. We call this
process the “reinvention” of a management innovation. We suggest that the implementation
phase of a management innovation can lead to a totally new management innovation. As such,
customization and adaptation are not the only ways to implement management innovations. A
management innovation’s adoption does not necessarily requires its adaptation. Adopting a

3
management innovation can lead to the generation of another management innovation, which
can result in the successful implementation of the first management innovation. Ultimately, the
firm implements two different management innovations.

This study makes several important contributions to the management innovation literature.
First, our research contributes to the development of a theory regarding the creation of
management innovations (Birkinshaw et al., 2008; Damanpour and Schneider, 2006;
Damanpour and Wischnevsky, 2006), whereby we define the endogenous process of
“reinventing a management innovation” and detail the mechanisms through which this
reinvention facilitates the creation of a new management innovation.

Second, our analysis helps elucidate the ways in which this reinvention facilitates the successful
implementation of another management innovation. This research contributes to the existing
literature on the implementation of management innovations (Ansari et al., 2010; Birkinshaw
et al., 2008; Damanpour and Schneider, 2006; Peeters et al., 2014; Zbaracki, 1998).

Building on implementation management literature, we elaborate a framework that describes

the central role of reinvention. These theoretical insights provide a basis for advancing
management innovation research from an endogenous perspective. Finally, our research
highlights the need to integrate the endogenous dimension of management innovations with
other theoretical frameworks, including generation and implementation literature of
management innovations, and the valuable insights that may result.

2 Theoretical background

2.1 Definition of concepts: adaptation, invention, and reinvention

We suggest using the following definition of Ansari et al. (2010) to define “adaptation”: “The
process by which an adopter strives to create a better fit between an external practice and the
adopter’s particular needs to increase its ‘zone of acceptance’ during implementation” [Ansari
et al., 2010, p. 71]. As such, we are in the process of adaptation if the organization customizes
its management practices to allow the implementation of an innovation that is created externally
or internally. This adaptation process refers to situations in which new ideas and practices are
adapted to the local context.

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We suggest using the following definition of Birkinshaw et al. (2008) to define “invention”:
“The invention is an initial act of experimentation out of which a new hypothetical management
practice emerges” [Birkinshaw et al., 2008, p. 831].

We use the term “reinvention” when a management innovation is generated through an

endogenous process. Reinvention occurs when a management innovation is generated thanks
to a previous management innovation; the company develops a totally new management
method that represents a shift in how to manage the company. In this case, the implementation
process of a management innovation can be itself a major management innovation.

In contrast with “reinvention”, “adaptation” is used when a management innovation is

customized during the implementation phase. In contrast with “reinvention”, “invention” is
used when a management innovation emerges independent of another management innovation
and its implementation phase.

2.2.1 Management innovation implementation in the literature

Previous studies have demonstrated that the implementation of management innovations
generates resistance to change (Ansari et al., 2010; Birkinshaw et al., 2008; Damanpour and
Schneider, 2006). Employee attitudes toward changes in management practices are generally
negative and often lead to the rejection of or a decrease in management innovations (Knights
and McCabe, 2002). Authors demonstrate that, in an international context, many business units
are reluctant to accept and adopt a major management innovation, especially when a top-down
diffusion mechanism is used (Lozeau et al., 2002).

In this context, managers play an essential role in a company’s actions to remove obstacles to
the implementation of management innovations (Boyer and Sovilla, 2003). Managers are
regarded as the guarantors of the conditions that promote and facilitate the implementation of
management innovations. The involvement and support of managers are major success factors
in the implementation phase of management innovations. The managers’ role in the
implementation of management innovations is widely recognized, having been the subject of
extensive research (Dubouloz and Bocquet, 2014; Jedynak, 2015; Taleghani, 2010; Volberda
et al., 2014).

Other authors focus specifically on the importance of including all human resources for the
successful implementation of management innovations (Dubouloz, 2014).

5
However, these factors are not the only ones, and their impact must be compared with that of
other factors. Other important elements, such as the organization’s communication, play a
fundamental role in the success or failure of the implementation of management innovation
(Worley and Doolen, 2006). The firm’s absorptive capacities are also crucial for incorporating
management innovations into its routine (Peeters et al., 2014).

The literature agrees that the implementation phase of a management innovation constantly
requires the modification, or adaptation, of said innovation (Akrich et al., 2002; Birkinshaw et
al., 2008; Damanpour and Schneider, 2006). Recently, some studies suggest that companies
must manage the implementation process and strive to strike a balance between extensive and
high-fidelity implementation and local adaptations to accommodate contextual idiosyncrasies
(Ansari et al., 2010; Ansari et al., 2014).

However, the literature does not explain what happens when, despite several attempts, the
customization and adaptation of the implementation phase fails. We consider a management
innovation’s implementation to be unsuccessful when that innovation fails to achieve the
objectives sought.

To the best of our knowledge, no study has suggested an alternative solution when the
implementation of a management innovation does indeed fail. Such failures represent an
important managerial problem because companies are increasingly implementing management
innovations, and they also expose a theoretical gap in the literature. To the best of our
knowledge, no work has identified and explained the endogenous dimension of management
innovations.

Building on management innovation implementation literature, we elaborate a theoretical

framework that details the endogenous mechanisms through which the implementation phase
of a management innovation can be the foundation of a new management innovation. In this
paper, we show how the generation of another management innovation can facilitate the
successful implementation of a previous management innovation. As such, we will answer the
following research question: How can a management innovation be implemented thanks to the
generation of another management innovation through an endogenous process?

3 Framework

The logic is as follows: the unsuccessful preliminary implementation of the “first management
innovation” leads the company to learn from these initial obstacles and to generate another

6
management innovation, which is based on control and autonomy, to successfully implement
the first management innovation.

The implementation of the first management innovation results in many organizational

problems. These problems can lead to implementation failure. After the firm observes that the
implementation has failed, it can decide to generate a specific new management innovation
rather than attempting to directly solve the problems created by the implementation of the first
management innovation through customization. This new management method allows the firm
to solve all the problems associated with the implementation of the first management
innovation. These problems can become obstacles and failures that emerge during the
implementation phase of the first management innovation. This method will break with the
usual organizational practices and will establish new management practices within the company
(cf. Figure 1).

Figure 1 Framework

The implementation Phase

Obstacles appears

Implementation Failure of
of a implementation
management
innovation

Modification, adaptation, customisation

The re-invention phase

Generation of a new
management method
Successful
that is itself a new
implementation of the
management innovation
first management Control and autonomy
innovation

(Source: Authors’ elaboration)

This new management method is successful because it is a new management innovation that is
based both on control and autonomy. Thanks to this new management innovation, employees

7
at every level are capable (given autonomy and responsibility) of generating their own solutions
for all types problems. This new management innovation enables employees to successfully
implement the first management innovation. This innovative management solution reconciles
the increased need for control and the virtues of autonomy in large industrial groups in order to
realize the objectives sought. It facilitates better reactivity, quicker decision making, better
cooperation and communication among the firm’s different services, and increased involvement
at all levels of management, which mitigates the main obstacles of the implementation of the
first management innovation. The implementation phase of a management innovation can be
the source of another management innovation.

In this case, the firm implements two different management innovations. Consequently,
invention or adoption does not necessarily precede the implementation of a management
innovation. Reinvention can facilitate the successful implementation of the first management
innovation.

4 Methodology

4.1 Research design

In this article, we use an empirical longitudinal case study because it represents the dominant
paradigm for analyzing structural changes in an organization (Dana and Dumez, 2015;
Dumez, 2013; Langley et al., 2013). The case study provides us with an opportunity to
investigate how the reinvention of a management innovation can emerge from the failed
implementation of a previous management innovation in a real-life setting. After obtaining
the permission of the company’s top management for this case study, immersion allowed us
to observe the history of the implementation of the first management innovation, i.e., lean
manufacturing, in five business units of Schneider Electric. Likewise, this case study allowed
us to observe the company’s reinvention of another management innovation, i.e., short
interval management (SIM).

4.2 Data collection

Data were collected during the 2010–2013 period. The Schneider Electric Company
implemented a new management innovation, i.e., SIM, throughout its business units after the
implementation of lean manufacturing failed (cf. Figure 3). To realize a longitudinal study,
information relating to the 2000–2013 period was collected.

8
Figure 2 Timetable of the implementation of company innovations

Phase N°1 Phase N°2

Implementation of Creation and implementation of

lean manufacturing the management innovation SIM
with SPS and failure and success of lean manufacturing
implementation

(Source: Authors’ elaboration)

We collected data from primary and secondary internal sources using triangulation techniques
to increase the quality and quantity of our data (Eisenhardt, 1989). With respect to the primary
data, we conducted 29 semi-directive interviews in five different business units of the same
company (Schneider Electric) at multiple hierarchical levels. We obtained abundant verbatim
accounts from various sources—from senior managers to front line managers (team leaders).
Each interview lasted at least one hour, and some lasted several hours during the immersion
phase. All the interviews were made in situ from 2010 to 2013. Certain key respondents were
interviewed several times. In addition to registering and transcribing all the interviews, we
physically assisted in the implementation of the SIM method in two business units, allowing
us to crosscheck and verify the accuracy of the data collected and to provide diverse
perspectives (Eisenhardt and Graebner, 2007). At the beginning of each interview, informants
were told that the purpose of the enquiry was to understand the main effects of the application
of the lean method. We transcribed each interview and asked the respondents to validate our
verbatim transcripts. In the interviews, we asked respondents to talk freely about the lean
management innovation and its direct or indirect effects on their daily managerial tasks. The
interviews included semi-structured questions that addressed three main themes: the direct,
indirect and meta effects of the introduction of the lean method. Construct validity is
supported by the literature (Miles and Huberman, 2003) and by key company informants,
particularly top managers who are responsible for the diffusion of management innovations.

9
This method is appropriate when investigating this innovation’s direct and indirect effects on
the organization (Yin, 2009).

Figure 3 Characteristics of research sites and respondents

Number of respondents Status of respondent

1 Vice president of quality and industrial

performance
1 Corporate chief responsible for industrial
performance and SIM deployment in the group
1 Director of manufacturing (France)
1 Manager of human resources
1 “Low voltage” manufacturing supervisor
1 SIM diffusion supervisor
1 Regional director of industrial automation
1 Senior account manager of industrial automation
1 Technical team coordinator
1 Maintenance supervisor
1 Head of production services
2 Technical productivity supervisor
2 Supervisor of supply chain excellence and
industrial performance
2 Business coordination manager
2 Team leader
2 Plant manager
2 Team manufacturing supervisor
3 Industrial performance manager
3 Business unit human resources supervisor
TOTAL 29

(Source: Authors’ elaboration)

We also collected secondary internal data from the company related the 2000–2013 period,
including an internal summary of the SIM method and descriptive documentation of how to
use the tools associated with the SIM method.

4.3 Data analysis

To exploit the interview transcripts, we used two principle stages of data analysis. We imported
all the verbatim accounts into a computerized system (Nvivo) and coded these data according
to distinct units of meaning (Goulding, 2002). The Nvivo software was only used to perform
first-level coding. Miles and Huberman’s matrices have been used to achieve second-level

10
coding to refine the data analysis. Our objective was to achieve complementarity between the
Nvivo software tool and Miles and Huberman’s matrices. The Nvivo software can analyze a
large amount of data; however, the use of the matrices provides a finer analysis. We found
causal relationships by using the matrices to identify pattern codes for the direct, indirect and
meta effects of the implementation of lean manufacturing according to specific segments of
respondents (Miles and Huberman, 2003).

To improve the validity of our results, we used the triangulation method described by Miles
and Huberman (2003). We used not only semi-structured interviews with stakeholders but
also immersion observations as part of our field study. Finally, we consulted internal
publications and documents (Miles, 1979). All these data guarantee a multidimensional view
and a wide range of research materials: “In fact, the various sources are highly
complementary, and a good case study requires the use of the number of possible sources"
(Yin, 2009, p. 101). Each respondent was identified with a number to ensure his or her
anonymity.

4.4 Presentation of the case study

4.4.1. Presentation of the company
Schneider Electric is a private French company operating in the energy sector. It was formed
by the fusion of three main companies that had worked in the same activity sectors for many
years, each of which was well known in its respective trade. At the turn of the 20th century,
the company decided to combine all its trades into one trademark name to emphasize its
reputation and visibility. When we conducted the interviews, the company employed more
than 140,000 employees at approximately 150 locations in more than 100 countries. The
company operates in an intensely competitive environment in which improving productivity
is crucial to maintain markets and financial performance. Manufacturing business units
compete with each other to reach the productivity objectives that the company has defined
and to increase efficiency. The top management considered the implementation of lean
manufacturing in 2000 to be the best means of achieving the company-defined productivity
objective. For this reason, business units cannot change the core model of lean
manufacturing; instead, they must apply this new organization of the manufacturing process
to their environments. All the instructions to deploy lean manufacturing are described in a
document with specific and precise codifications called the Schneider Electric Production
System (SEPS). In the SEPS, staff processes, the organization of production operations, and
the organization of the internal supply chain are precisely defined.

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 4.4.2. Presentation of the research context and description of the new management
innovation: short interval management (SIM)

At the beginning of the 20th century, the company increased its international development,
acquiring many smaller companies and redeploying its industrial assets in many low-cost
countries. Therefore, the business units based in mature economies needed to improve their
productivity performance to withstand competition of the business units based in countries with
low-cost labor. The company began by implementing the lean manufacturing method of
production, radically changing the way that it organized its business units:

In internal documents, the Schneider Electric Company defines the SIM method as follows: “A
new system of management that maximizes the flow of useful information while it minimizes
the amount of time people spend in meetings. SIM eliminates waste and standardizes and
sustains the continuous improvement process” (SIM Core Principles – LET 03 16 2011-
Edward Brekke).

To determine whether SIM is a major management innovation, we test it against the four criteria
of Mol and Birkinshaw (2009).

a. Management innovation represents a significant advance in the “state of the art” of

knowledge or practices in management at any given time.

With the SIM method, we are in a deep cultural change that can be traced
back to the “30 glorious years.” There are modes of management that are
rooted, and when you want to switch to a new approach, it is necessary to
gradually cut the roots that exist to grow new roots. (Interview No. 3)

b. The managerial innovation must concretely modify managers’ work. It must be

recognized in practices and innovative management processes, which mark a departure
from previous ways of managing or organizing relationships within the company.

The SIM method of management has an in-depth impact on the way that
managers’ work at all levels, and, at the same time, it structures the mode of
production. (Interview No. 2)

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 c. Innovation management must be implemented and truly operationally deployed within
the organization. It must become “tacit” and blend in with the organization’s routines
(Birkinshaw et al., 2008).

From TPJ [the CEO of the group] to the operators, all of us are on the same
path to management with the SIM method. (Interview No. 4)

d. Innovation management must be implemented to enable the achievement of the

company’s objectives, including performance (Abrahamson, 1991; Mol and Birkinshaw,
2009).

SIM allows the realization of the objectives of defined productivity. (Interview

No. 2)

For me, the purpose of SIM is efficiency; what I mean by efficiency is the
permanent improvement of our results by consuming fewer resources. I do better
by consuming less. (Interview No. 4)

Furthermore, the following perceptions of other company interviewees agree with the
assessments above:

The SIM approach has several specific features, but its essential characteristic is to be
a new global process management that is applied to the entire company with the
objective of improving the overall performance...And, at all hierarchical levels, the
work of managers has been deeply impacted by SIM. (Interview No. 2)

SIM is a new method of management, which needs us to see all problems generated by
implementation of lean and to consider these problems and to solve these problems with
a specific process. (Interview No. 3)

For a pyramidal organization, SIM is a cycle of different management events, which

links all firm actors, from the operator to the plant manager (and beyond). SIM allows
them to determine the main problems of lean and, then, to determine the actions plans.
This creates a new system of management that helps to visualize priorities. Thus, this
system organizes the actions of all the collaborators of the company. (Interview No. 12)

Considering all these data, the SIM method represents a real-world management innovation
based on the criteria defined in the literature (Birkinshaw et al., 2008). Moreover, SIM resulted
from a reinvention process.

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This new method has been conceptualized and theorized by Schneider Electric in specific
internal documents. Schneider Electric has gone on to develop a specific consulting unit to
commercialize this new management method (SIM) in industrial companies that have or have
not implemented lean manufacturing process. In the industrial sector, the consulting unit is
currently marketing this new major managerial innovation.

The core model of SIM is as follows.

Figure 4 Presentation of SIM as a management innovation

Team Leader + Technical and Head Plant manager and

TMS + Technical Plant manager and
Team Manufacturing of technical services team direction of the
- Actions plan Head of technical
Supervisor -Define load site
Selection and -Manage the
- Suggest 3 actions distribution -Check performance
validation (3 max) ongoing action plans
plan - Weekly meeting and actions plan
- Daily meeting 15 -Weekly meeting 20
- Daily meeting 10 « face to face » 20 - Weekly meeting 1h
minutes minutes
minutes minutes 30

Loop 1 Loop 2 Loop 3 Loop 4 Loop 5

Source: Authors’ elaboration

SIM starts with loop one and finishes with loop five. All problems identified in loop one have
to be solved. The solution can become from the team leader or the team manufacturing
supervisor or from the suggestions made by operator who identified the problem. If a solution
is not identified in loop one, this specific problem will proceed to loop two, where a higher
hierarchical level is implicated. If a solution is not identified in loops one or two, this problem
will precede to loop tree, where an even higher hierarchical level of management is implicated.
This process will repeat until the problem reaches loop five. Loop five will implicate the
business unit’s top management, and loop five+ will implicate the company’s top management.
In their loop, all managers have to search for a solution to the identified problem; if they do not
find a solution, the problem will continue to climb the managerial hierarchy. So SIM is based
on both responsibility and autonomy of all hierarchical levels.

14
The specificity of SIM is obvious. This management innovation generates an unbreakable string
of responsibility that stretches between all hierarchical levels. Top and middle management are
inextricably linked with the operators who have identified all the problems that have emerged
in organization. Employees at every level are capable of generating solutions themselves. SIM
facilitates the elimination of the obstacles that emerged during the implementation phase of the
first management innovation or problems that arose for others reasons.

5 Results

In the case of Schneider Electric, the implementation of lean manufacturing has generated many
problems within the organization. These problems have led the implementation of lean
manufacturing to fail. After observing this failure, Schneider Electric decided to generate a new
management approach, i.e., SIM, to solve the problems attributable to the implementation of
the first management innovation, i.e., lean manufacturing.

Two main phases can be distinguished in our longitudinal case study (cf. Figure 6.)

In addition, we distinguish three sub-phases in phase 1. Each sub-phase corresponds with

various types of effects of the implementation of lean manufacturing.

- Direct effects emerged immediately after the implementation of lean, which

reengineered the production process into different islands rather than a large production line
composed of seven or eight linked machines. However, dividing the manufacturing system into
several production islands necessitated a more reactive internal supply chain, better reactivity
between the production department and other departments, and a shorter decision circuit. The
decision circuit could be rather long and complex.

- The meta effects appeared after the direct effects. At Schneider Electric, cooperation
between different departments revolves around action plans. After lean manufacturing was
implemented, these action plans involved a long ascending and descending communication
circuit throughout the various services. The need for better cooperation and quicker
communication between the firm’s different services became apparent.

- The indirect effect was the lack of the managers’ involvement.

These negative effects led the implementation of lean manufacturing to fail. The term “failure”
is used because the implementation of lean manufacturing did not realize the productivity

15
objectives expected. The company then decided to create a radical new management approach
to mitigate these negative effects.

Figure 5 Timetable of the sub-phases of the implementation of the management innovation

SIM

Meta-effect of Indirect effect of Creation and implementation of the management

Direct effect of
Implementation of implementation of Implementation of innovation SIM:
implementation of lean
lean manufacturing manufacturing: lean manufacturing: lean manufacturing:
with SPS - Need for better - Need of better - A reactive and shorter decision
- Need of better
cooperation and involvement at circuit
reactivity and
communication all hierarchical - A better system of cooperation and
shorter decision
between the different levels of communication between the
making time
services of firm management different services of firm
- A interlinked system of
management which involves all
hierarchical levels

Years 2000 Years 2000/2003 Years 2003/2004 Years 2004/2005

5 Failure

Phase 1 Phase 2

(Source: Authors’ elaboration)

During phase 2, the SIM method facilitates better reactivity, quicker decision making, better
cooperation and communication among the firm’s different services of firm, and increased
involvement at all levels of management, thereby mitigating the main obstacles to the
implementation of the first management innovation.

- The SIM method facilitates better reactivity by reducing decision-making time. No

action plan takes more than a week to carry out. In loop 2, action plans are immediately chosen.
The time allotted to carry out an action plan is approximately one week. All action plans that
are chosen in loop 2 but not carried out within a week advance to loops 3, 4 and 5. Therefore,
the business unit’s top management is challenged to address action plans from the company
base within a short timeframe.

- The SIM method facilitates better cooperation and communication among a business
unit’s different services by holding a daily meeting with the different departments in loop 2.
This phenomenon has been combined a simple yet effective visual communication strategy,
i.e., the use of large information boards that contain all action plans per factory sector. On these
information boards, all the action plans—as well as the person responsible and the lead time for

16
each action plan—are always visible. Top and middle management implement this
communication strategy to achieve a communication standard across all business units.

- The SIM method facilitates increased managerial involvement. The company’s

response to the lack of managerial involvement was to engage middle managers through a
decision-making system that requires the active participation of each department that represents
the business unit in loop 2. Thus, the action plans that are decided each day (in loop 2) are
developed and validated through daily meetings that are held only if all the participants
predefined by the SIM method are present. In a manager is absent, the entire system fails to
come together. Furthermore, the different system loops ensure the solidarity of each hierarchical
level to guarantee the entire process’ success. Finally, the company’s top management leads by
example and respects the operations of the loop system by including loop 5+, which implicates
plant managers and department supervisors.

5 Discussion

In the case of Schneider Electric, the implementation of lean manufacturing has resulted in
many problems within the organization. These problems have led the implementation of lean
manufacturing to fail. Lean did not achieve the productivity objectives expected. Instead of
attempting to directly customize lean to solve every problem associated with its
implementation, the company implemented SIM. SIM breaks with usual organizational
practices and creates a new management system within the Schneider Electric. SIM generates
an unbreakable string of responsibility that stretches between all hierarchical levels. Top and
middle management are inextricably linked with operators who have identified problems
related to the implementation of lean manufacturing. SIM pushes the organization to gradually
develop problem-solving capabilities at all hierarchical levels. Due to the implementation of
SIM at every hierarchical level, salaried workers are capable (self-sufficient and responsible)
of generating their own solutions to facilitate the implementation of lean. In this case, the
implementation process can itself be considered a management innovation. This innovative
management solution reconciles the increased need for control and the virtues of autonomy
within Schneider Electric to realize its performance objectives.

Figure 6 The reinvention process of the management innovation at Schneider Electric

17
 The Implementation Phase

Obstacles appears
Implementation
Failure of
of a
management implementation
innovation,
(Lean)
Modification, adaptation, customisation
The re-invention
phase
Generation of a new
Successful management method that is
implementation of the itself a new management
first management innovation (SIM)
innovation (Lean) Control and autonomy

Team Leader + Technical and Head Plant manager and

TMS + Technical Plant manager and
Team Manufacturing of technical services team direction of the
- Actions plan Head of technical
Supervisor -Define load site
Selection and -Manage the
- Suggest 3 actions distribution -Check performance
validation (3 max) ongoing action plans
plan - Weekly meeting and actions plan
- Daily meeting 15 -Weekly meeting 20
- Daily meeting 10 « face to face » 20 - Weekly meeting 1h
minutes minutes
minutes minutes 30

Loop 1 Loop 2 Loop 3 Loop 4 Loop 5

(Source: Authors’ elaboration)

Consequently, the invention phase is not the only source of invention for management
innovations. We suggest that a management innovation’s implementation phase can lead to a
totally new management innovation. As such, customization and adaptation are not the only
ways to implement management innovations. A management innovation’s adoption does not
necessarily require its adaptation. Adopting a management innovation can lead to the
reinvention of a new management innovation. Ultimately, the firm implements two different
management innovations; the first one is possible due to the implementation of the second one
through an endogenous process.

Even if the invention and adoption of innovations are distinct phenomena, the case of
Schneider Electric demonstrates that a management innovation (lean manufacturing) can be

18
successfully implemented thanks to the creation of another management innovation (SIM).
The endogenous process of reinvention characterized this management innovation.

6 Theoretical and managerial contributions

6.1 Theoretical contributions

This research provides different theoretical contributions.

Our results help identify and explain the role of the reinvention during the implementation
phase of a management innovation. To the best of our knowledge, no study has yet highlighted
how the endogenous process of reinvention facilitates both the successful implementation of
a management innovation and the creation of yet another management innovation.

The literature generally considers that management innovations are generated during the
invention phase (Birkinshaw et al., 2008). Our results show that the implementation phase is
also important for the creation of new management innovations. A management innovation
can generate another management innovation through an endogenous process. The
implementation phase makes this endogenous process possible.

In the literature, the implementation phase of a management innovation is considered a

problem-solving process in which adapting the management innovation to the environment is
important. The organization has to change a bit, and the innovation itself has to be partially
modified (Ansari et al., 2010, 2014; Birkinshaw et al., 2008; Damanpour and Wischnevky,
2006). By contrast, our results show that customization and adaptation are not the only ways
to successfully implement management innovations; reinvention is another solution. In this
case, the firm operations must be radically changed.

However, in the literature, these changes and modifications can generate resistance (Ansari et
al., 2010; Birkinshaw et al., 2008; Damanpour and Schneider, 2006) and rejection (Knights
and McCabe, 2002; Lozeau et al., 2002). In this context, managers are very important because
they must provide a favorable context for change and the successful implementation of a
particular management innovation in their organization (Dubouloz, 2014; Jedynak, 2015;
Taleghani, 2010). Managers are also vital in reducing resistance and rejection (Boyer and
Sovilla, 2003). Others authors note the importance of all human resources for the successful
implementation of management innovations (Dubouloz, 2014). Our results confirm that all
employees—on all hierarchical levels—are important; they can be the key to success rather

19
than the source of resistance if an unbreakable string of responsibility connects all hierarchical
levels. The strong link between mangers and other employees is crucial to facilitate autonomy
and a respect for the firm’s objectives by all personnel.

Similarly, other works show the important roles of communication and absorptive capacities
in the successful implementation of management innovations (Worley and Doolen, 2006).
Our results confirm the importance of communication among all personnel. The
communication between employees and managers is essential. This communication is
simultaneously bottom up and top down when the time and place for communication are
institutionalized in the minds of personnel. In particular, daily contact that allows an exchange
between employees and managers is important.

In the literature, the firm’s absorptive capacities are also crucial in incorporating management
innovations into its routines (Peeters et al., 2014). However, our results show that, due to
reinvention, employees at every hierarchical level are capable of generating their own
solutions for all types of problems. The communication and management systems will
increase the absorption capacities of all employees through an endogenous process. The
learning-by-doing effect arises in the firm as personnel gain experience, which is a specific
characteristic of all endogenous processes.

Our study makes another contribution by addressing the role of internal agents in creating new
ideas. Our results demonstrate that the development of new management innovations is mainly
the work of internal actors in the company (Birkinshaw et al., 2008) through endogenous
processes. In contrast to Birkinshaw’s model, which assigns this creative role to external change
agents, our results show that all employees are very important and necessary in the process of
“reinventing” a management innovation. Our results reveal that internal change agents were
able not only to adapt and customize the first management innovation but also to generate new
ideas that facilitated the creation of the second management innovation through an endogenous
process.

6.2 Managerial contributions

This study offers important managerial implications.

20
First, this paper recommends that, following several implementation failures for a specific
management innovation, firms should attempt to elaborate and implement another management
innovation. The implementation phase of the first management innovation can allow a firm to
perform a self-analysis regarding the involvement of all its employees, the communication
among the firm’s various services, and the adequate involvement of all hierarchical levels in
the decision-making chain. The results of this diagnostic process can help the firm develop a
new managerial approach before it can successfully implement the first management
innovation.

Second, a firm must create a system that involves all hierarchical levels. To realize this
objective, this organization must generate an unbreakable string of responsibility that stretches
between all hierarchical levels. Top and middle management must be inextricably linked with
firm employees. The firm must create a new managerial system based on responsibility, with
specific objectives and autonomy for all personnel. Internal agents at every hierarchical level
are important. Imagining radical change in management is impossible if the top managers do
not lead by example.

Third, firms must encourage communication and collaboration between all links in the
hierarchical chain. Firms can thus benefit from all its human resources. Managers should not
operate outside the system of communication. Firms must hold daily meeting with employees
and managers to facilitate the exchange of information. Firms must institutionalize these
meetings. These obligatory meetings should appear on the schedules of all salaried workers.
They should also allow salaried workers in different services to exchange ideas with one
another. Meetings are held to increase the communication between firms’ services or
departments.

7 Conclusion and limitations

The successful implementation of a management innovation is a complex process, and

capturing all its multidimensional aspects seems practically impossible. Therefore, our study
has several limitations. The limitations of our research include this case study’s specific
approach. The use of a unique survey limits the generalization of the results obtained and the
external validity of our research (Miles, 1979). However, we have countered this argument
somewhat because our case study contains several sites that, to some extent, can be regarded as
distinct entities that belong to the same group. Another limitation is that our analysis is part of
a time "t" in the life of the company, as Wacheux explains: "A case analysis is an analysis of a

21
complex spatial and temporal phenomenon by the conditions, events, actors and implications"
(Wacheux, 1996, p. 89). Our results may derive from a specific industrial and manufacturing
environment.

What would be the result of management innovation SIM in a non-industrial sector? It would
be relevant and interesting to analyze management innovations in a service environment or in
a commercial service. In our view, this track for future work is of the greatest interest.

This work provides potential avenues for future research that analyze the relationship between
different types of innovation and introduces the endogenous dimension of the emergence of
management innovations.

22
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