Pilot, Pivot and Advisory Boards: The Role of Governance Configurations in Innovation Commitment

Thought Leadership Articles

Published 03 November 2021

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Article Summary

In research-intensive industries, innovation commitment is a vital input for generating technological capabilities and sustainable competitive advantage. The ability of a board to support effective innovation commitment by concerning other powerful actors (CEOs, family owners and institutional investors) depends on board capital breadth (BCB) and depth (BCD).

With a focus on the Canadian pharmaceutical industry, the study explores the manner in which numerous governance mechanisms interact in complementary ways as part of unique configurations that foster and facilitate innovation commitment. Such governance mechanisms work in tandem, rather than in isolation, to explain noteworthy organisational outcomes and are best understood by considering their interdependencies. Three governance archetypes – Pilot, Pivot and Advisory Boards – were illustrated to arise from complementarities allowing boards to enact their roles in resource provisioning and monitoring in ways that lead to high innovation commitment. Looking forward, these archetypes evidence how various combinations representing ‘effective governance’ may exist in contrast to the traditional view regarding universal connections between specific governance arrangements and organisational outcomes.

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