Diffusion in the Face of Failure: the Evolution of a Management Innovation

Recent work has questioned the institutional model of management innovation by highlighting interactions between the field-level actors engaged in diffusing innovations, and implementation of the innovation at organization level. Focussing on the adaptation of management innovations to their context, rather than their creation, we review this work and use it to analyse the global diffusion of Resource Planning (RP), counterposing this case with the widely studied example of TQM. Both of these innovations experienced a high level of failure when implemented by organizations. TQM’s diffusion was characterised by a ‘boom and bust’ cycle. RP, however, has continued to spread globally in the form of its variants; MRP, MRPII and ERP. Our analysis seeks to account for the long run diffusion of RP through a processual model which highlights the interplay between RP’s discursive framing at field-level, the affordances of the innovation itself, and its adaptation within organizations. This demonstrates how objectifying RP in software not only helped to spread the innovation, but also allowed field-level actors to differentiate its development as a successful innovation from the many failures experienced by organizations attempting to adapt it.