{"title":"Real options or fallen angels: Examining the complexities of learning from terminated projects","authors":"Andrew M. Hess","doi":"10.1111/caim.12527","DOIUrl":null,"url":null,"abstract":"<p>Do organizations learn from innovative failures? Extant research has been mixed. We posit that these disparate findings likely reflect an underlying (and under-researched) spectrum of failure severity, which is comprised not only by the magnitude of the failure in question but by the frequency with which it occurs. Using fine-grained, project-level data, consisting of 33,905 projects in 2496 pharmaceutical firms, we decompose 1251 terminated projects into two types based on their phase of development: early- and late-stage terminations. We use hazard rate modelling and an analysis of abnormal equity returns to assess the likelihood of future failure and the market's reaction to the project termination. Specifically, we are interested in understanding the role that magnitude and frequency of project terminations play in the likelihood and magnitude of future project terminations.</p>","PeriodicalId":47923,"journal":{"name":"Creativity and Innovation Management","volume":"31 4","pages":"559-572"},"PeriodicalIF":3.7000,"publicationDate":"2022-10-17","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"1","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Creativity and Innovation Management","FirstCategoryId":"91","ListUrlMain":"https://onlinelibrary.wiley.com/doi/10.1111/caim.12527","RegionNum":3,"RegionCategory":"管理学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q2","JCRName":"MANAGEMENT","Score":null,"Total":0}
引用次数: 1
Abstract
Do organizations learn from innovative failures? Extant research has been mixed. We posit that these disparate findings likely reflect an underlying (and under-researched) spectrum of failure severity, which is comprised not only by the magnitude of the failure in question but by the frequency with which it occurs. Using fine-grained, project-level data, consisting of 33,905 projects in 2496 pharmaceutical firms, we decompose 1251 terminated projects into two types based on their phase of development: early- and late-stage terminations. We use hazard rate modelling and an analysis of abnormal equity returns to assess the likelihood of future failure and the market's reaction to the project termination. Specifically, we are interested in understanding the role that magnitude and frequency of project terminations play in the likelihood and magnitude of future project terminations.
期刊介绍：
Creativity and Innovation Management bridges the gap between the theory and practice of organizing imagination and innovation. The journal''s central consideration is how to challenge and facilitate creative potential, and how then to embed this into results-oriented innovative business development. The creativity of individuals, coupled with structured and well-managed innovation projects, creates a sound base from which organizations may operate effectively within their inter-organizational and societal environment. Today, successful operations must go hand in hand with the ability to anticipate future opportunities. Therefore, a cultural focus and inspiring leadership are as crucial to an organization''s success as efficient structural arrangements and support facilities. This is reflected in the journal''s contents: -Leadership for creativity and innovation; the behavioural side of innovation management. -Organizational structures and processes to support creativity and innovation; interconnecting creative and innovative processes. -Creativity, motivation, work environment/creative climate and organizational behaviour, creative and innovative entrepreneurship. -Deliberate development of creative and innovative skills including the use of a variety of tools such as TRIZ or CPS. -Creative professions and personalities; creative products; the relationship between creativity and humour; arts and amp; humanities side of creativity.
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