Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/172003
Authors: 
Schweisfurth, Tim
Zaggl, Michael A.
Schöttl, Claus P.
Raasch, Christina
Year of Publication: 
2017
Series/Report no.: 
Kiel Working Paper No. 2095
Abstract: 
To be successful innovators, organizations must select the best ideas for implementation. Extant research shows that idea selection is distorted by a number of biases, but has failed to consider hierarchy, a key element of organizations. We examine how hierarchical distance between an idea's creator and its evaluator affects evaluation outcomes and thus advance three competing theoretical predictions based on homophily, competition, and status. To test our predictions, we use a unique dataset from an enterprise crowdfunding initiative at Siemens where 265 employees evaluated 77 ideas by allocating corporate funds, resulting in 20,405 evaluation dyads. We find that idea evaluations are more favorable if the idea creator is hierarchically similar to the evaluator, thus supporting the homophily perspective. Idea novelty amplifies this bias, inducing more social evaluations. Our findings are robust to various specifications and tests, and are absent in a subsample where idea creators remained anonymous. We contribute to the idea evaluation research and inform organizational idea selection process designs.
Subjects: 
idea evaluation
idea selection
crowdfunding
hierarchy
homophily
status
competition
JEL: 
D91
M19
O31
Document Type: 
Working Paper

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