Influence of the stage gate on innovation performance in creative organisations: An exploratory study

Abstract

This study investigates the direct and indirect effects on innovation performance when implementing stage gate systems in creative organisations. A stage gate system is a model that is used to make new product development processes as effective as possible and it is the most used model in the world for that purpose. Naturally this has meant a lot of researchers have looked into the effects of the stage gate on innovation performance, but past research has primarily dealt with the direct effects the model has on innovation and particularly on the creativity part of innovation. This study seeks to broaden to the scope of the current literature by investigating what indirect effects the stage gate has on innovation performance by influencing the strategy, structure and culture of an organisation. The study will also look upon what direct effects the stage gate has on the value creation abilities of an organisation, which neither have received much attention in previous research. All organisations have a natural balance between how well they are at being creative and how well they are at generating value from that creativity. In some organisations, particular the creative ones, this balance is not in a healthy state, as they naturally focus on being as creative as possible which sometimes make them forget, that without the ability to generate value their creative efforts will be in vain. The stage gate model is an ideal system for creative organisations to implement to improve the value creation side of the balance, but past research has in such a high degree criticised the stage gate model for being too structured, too rigid and causing creativity to wither. This has meant that many creative organisations have justified concern about implementing the stage gate in their organisations. This study seeks through an exploratory design to illuminate the influence of the stage gate in creative organisations. The goal is to provide such organisations with a better foundation to decide whether or not they want to implement the stage gate. This is accomplished by interviewing a line of people, in eight creative organisations, who all possess insights into the effects the stage gate has had in their specific organisation. The interviews and subsequently analysis result in six propositions of how the stage gate influences the innovation performance. This is further clarified by a numerical analysis of the before/after effects of the stage gate. The results are used to create a framework that explains how the stage gate influences creativity and value creation both directly and indirectly through the strategy, structure and culture of the organisation. The thesis concludes that the stage gate does possess some of the negative influences as described by previous research. However its direct and indirect positive effects on the innovation performance of creative organisations highly surpass the negative effects. Thus creative organisations should not be in doubt whether to implement a structured approach to innovation in the form of a stage gate – they should simply be aware of the effects both directly and indirectly it will have on the organisation and subsequently on its innovation performance.