Creative innovation professor awarded Lund Economics and Management prize worth SEK 1 million

What success factors are the basis for optimal teamwork? What is it that makes a creative idea a real success for a company? And how can businesses work on open innovation with others to create value? These are some of the questions to which Berlin professor Linus Dahlander is seeking answers. He will visit Lund on 11 May as the 2022 recipient of the Jan Söderberg Family Prize in Economics and Management.

Note: Linus Dahlander visits Lund on 11 May to receive the Prize and deliver the Prize lecture. Learn more about this or register here (the registration form is in Swedish – e-mail event@ehl.lu.se if you want to register but doesn’t speak Swedish).

Innovation, entrepreneurship and ideas focusing on the individual – that is how Linus Dahlander, professor at ESMT Berlin, sums up his research. In the next breath, he describes his research methods as “eclectic”, in the sense that Linus Dahlander is driven by curiosity about questions he does not yet have answers for, as well as by a certain degree of impatience. He seeks the answers to his questions through interviews and observations, as well as experiments.

“There are those who conduct research on questions to which they already have the answers. I don’t think that’s very enjoyable. I have on several occasions been surprised that our results did not correspond at all with what we thought we would find. But it is this aspect, of course, that is exciting,” says Linus Dahlander, who today is being presented as the 2022 recipient of the Jan Söderberg Family Prize in Economics and Management.

The prize will be presented by the Lund University School of Economics and Management at the Economics and Management Day in Lund on 11 May. Linus Dahlander will visit Lund for the Economics and Management Day. In this article we aim to give an introduction to Linus and his research contributions.

Teams with the optimal degree of self-determination perform best

A fresh example of Linus Dahlander’s research is to be found in the article Organizing Entrepreneurial Teams: A Field Experiment on Autonomy over Choosing Teams and Ideas, which was recently published in the leading journal Organizational Science. Linus Dahlander and his colleagues studied 939 students who all participated in an eleven-week course in which they developed a company concept and then pitched it to real investors and business angels. The students were divided into groups of three, but the conditions for the groups were different. This was to enable study of what seems to provide the best effect for attracting a positive response and a willingness to invest from the participating investors.

The entire experiment was based on ideas about co-determination and autonomy: if you can be more involved in determining what you work on in your job, you get better results. Or do you? Major companies such as Google and Spotify have already tried this in practice.

The different conditions for the student groups were as follows: one quarter of the teams could not choose the group members or choose the idea they were to work on, the second quarter of the teams could choose their group members freely, but not the idea, the third could choose the idea freely, but not the members, and the fourth had a free choice of both members and idea.

“It was shown that those who were not able to choose at all performed worst according to the investors’ judgement. But what surprised us was that basically the performance was just as bad for those who could choose freely. The results were best for those who could choose either members or idea,” he says.

Teams that could choose either their ideas or their project members (but not both) were deemed to have a 50 per cent higher likelihood of succeeding than teams with no autonomy and 49 per cent higher likelihood of succeeding than teams with full autonomy. They also received 82 per cent more of the fictive investment budget than those with no autonomy and 23 per cent more of the budget than those who had full autonomy.

Linus Dahlander is careful to point out that the results based on the student project do not necessarily translate to all organisations. However, there are still important lessons to be learned.

“As a company, you should not think about if you will give your staff autonomy, but rather what type of autonomy and in what way,” he says.

Researching with Lego on ideas

Linus Dahlander is considered to be among the leading researchers in the field of “distributed innovation” or “open innovation”. This means, for example, that he studies how innovation can be created not only by the manufacturer of a product, but also from several sources, including customers and competitors.

He is collaborating with Lego in a current research project with Aarhus University. The project, called “Lego Ideas”, is based on Lego allowing users to upload their own creative Lego projects. All proposals that receive over 10 000 votes enter a decision-making process at Lego – with an opportunity for users’ projects to become actual products.

“Our role as researchers in this project is to try to find out if it is possible to foresee which ideas will be ‘the next big thing’. We have access to a lot of unique data and have developed our methods, using image recognition, among other things, but it has proved to be considerably easier to foresee which ideas are bad, rather than those that are really good. We can see which ones have potential, but above a certain threshold it becomes extremely random, or that there are so many interacting factors, such as social influences or that people peek at each other’s ideas,” says Linus Dahlander.

During the Covid-19 pandemic, he has seen how many companies dared to take the step to collaborate in unaccustomed ways.

“Crises often make it possible for changes in behaviour and new collaborations. When I write in the Harvard Business Review that it is now time for companies to embrace open innovation, I get a considerable response. Business representatives ask me how they can start working with these things. I respond that fundamentally, it concerns knowing what your starting points are. What do you want to achieve? What do you want to solve? If you know that, you should be able to design a process for innovation that benefits the company.”

Looking forward to making contacts in Lund

Linus Dahlander is from Sweden and completed his PhD at Chalmers. He has been active at both Stanford University and Imperial College Business School before joining the European School of Management and Technology (ESMT) in Berlin, he had a further spell at Stanford, as well as the. In May, he will be a guest of the Lund University School of Economics and Management as the third recipient of the Jan Söderberg Family Prize in Economics and Management. The prize, which is worth SEK 1 million, was initiated by the business executive Jan Söderberg and his family.

“It feels great and very surprising. I look forward to meeting colleagues in Lund. I was actually reading an article by the first prize-winner Marianne Bertrand when I received the information that I had won the prize. It was a strange, but amusing coincidence,” says Linus Dahlander.

He looks forward to making contacts with the researchers and companies that will take part in the popular science Economics and Management Day in Lund. Linus Dahlander will be the final speaker for the day with his prize-winner’s lecture.

“I think our personal networks have become a little poorer during the pandemic. You continue to talk to those you already know, or conduct research with those you have collaborated with before. There aren’t very many opportunities to create new connections. And that’s why it will be particularly enjoyable to come to Lund and expand my network,” he says.

Comment from LUSEM

Maria Stanfors is Deputy Dean at LUSEM and Professor of Economic History. She is also the current Chair of the Prize Committee. She comments:

”Linus Dahlander's research is highly relevant and fully in line with the ambitions of Lund University School of Economics and Management. His endeavors both inspires and complements our own research in entrepreneurship and innovation. Linus Dahlander’s research spans a broad field related to innovation and entrepreneurship with a focus on how ideas develop into popular innovations in firms and networks. He has published studies on inter-organisational collaboration with a focus on technologically advanced firms and industries, and has studied recent economic concepts such as ‘open innovation’, ‘crowdsourcing’, and ‘user communities’ using a wide range of methodologies. Linus Dahlander is a good representative of socially relevant research with a bearing on the future of business and entrepreneurship. Moreover, we at LUSEM are grateful for the generous donation that enables us to award the 2022 Jan Söderberg Family Prize in Economics and Management to Linus Dahlander and thereby build a new relationship and learn from him.”

Are you interested in hearing more about Linus Dahlander’s research? Welcome to Economics and Management Day in Lund on 11 May. You can also follow the day remotely, as we will livestream large parts of the programme.

Learn more about the Economics and Management Day

Learn more about Linus Dahlander’s research

When autonomy helps team performance and when it doesn’t (hbr.org)

Organizing entrepreneurial teams: A natural field experiment of the autonomy in choosing teams and ideas (ESMT Berlins webbplats)