It is hard to stop innovators from innovating — as we can see from the long history of skunkworks and unofficial side projects among R&D staff members.1 Consider Tetsuya Mizoguchi, an executive in Toshiba’s mainframe computing division, who was convinced that there was an emerging demand for lightweight, portable PCs at a time when all such devices were large desktop machines. After management rejected the idea, he went underground to develop the first laptop computer — positioning Toshiba as a leader in the new category when it debuted in 1985.2 Laptops now outsell desktops by more than 4 to 1.
In our research at Ford Motor Co., we surveyed employees in R&D and found that from 2018 to 2021, 45% had developed projects without a manager’s consent.3 Workers have a variety of reasons for doing this work out of sight. From earlier research, we know that underground innovators may want to defer discussion until they can present their best case or avoid the pressure that comes from managers demanding results.4 We learned that employees sometimes prefer a shortcut to solving problems encountered at work, don’t want to spend time getting permission, or are simply driven by curiosity and determined to push past constraints — even if they aren’t being paid for the work.
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Many R&D managers view underground projects as harmless and potentially beneficial and thus do not object to them as long as employees are meeting their formal responsibilities.
1. P. Augsdörfer, “Bootlegging and Path Dependency,” Research Policy 34, no. 1 (February 2005): 1-11.
2. P.A. Abetti, “Underground Innovation in Japan: The Development of Toshiba’s Word Processor and Laptop Computer,” Creativity and Innovation Management 6, no. 3 (September 1997): 127-139.
3. J.P.J. de Jong, M. Mulhuijzen, and B. Schemmann, “Underground Innovation: Missionary, User, and Lifestyle Projects,” SSRN, July 9, 2022, https://ssrn.com.
4. P. Augsdörfer, “Managing the Unmanageable,” Research-Technology Management 51, no. 4 (July 2008): 41-47.
5. Augsdörfer, “Managing the Unmanageable,” 42, 45.
6. P. Criscuolo, A. Salter, and A.L.J. Ter Wal, “Going Underground: Bootlegging and Individual Innovative Performance,” Organization Science 25, no. 5 (September-October 2014): 1287-1305.
7. C. Mainemelis, “Stealing Fire: Creative Deviance in the Evolution of New Ideas,” Academy of Management Review 35, no. 4 (October 2010): 558-578.
8. E. von Hippel, “Democratizing Innovation” (Cambridge, Massachusetts: MIT Press, 2005).
9. L. Zejnilovic, P. Oliveira, and S. Desic, “Online Idea Management System in the Presence of Non-Programmed Innovations, an Affordances Perspective” (paper presented at the 14th International Open and User Innovation Conference, Boston, Aug. 1-3, 2016).
10. M.R.K. Hartmann and R.K. Hartmann, “Hiding Practices in Employee-User Innovation,” SSRN, Dec. 30, 2015, https://papers.ssrn.com.
11. J. Coelho, M.T. Valente, L.L. Silva, et al., “Why We Engage in FLOSS: Answers From Core Developers,” in “CHASE ’18: Proceedings of the 11th International Workshop on Cooperative and Human Aspects of Software Engineering” (New York: Association for Computing Machinery, 2018).
12. Y. Song, D.R. Gnyawali, M.K. Srivastava, et al., “In Search of Precision in Absorptive Capacity Research: A Synthesis of the Literature and Consolidation of Findings,” Journal of Management 44, no. 6 (July 2018): 2343-2374.
13. M.A. Schilling, “Strategic Management of Technological Innovation,” 4th ed. (New York: McGraw-Hill, 2012).
14. “The Minds Behind the Ford Multimodal Journey,” Ford Motor Co., Nov. 19, 2015, https://media.ford.com.