Page 79 - The Resilient Organization

66 Part Two: Step 1. Managing the Consequences of Past Performance

Individual trauma is defined by psychologists as an extreme condition
“outside the usual human experience, . . . a serious threat to his or her life
or physical integrity” (Kahn, 2003: 365). In organizational literature, trauma
is seen as a possible by-product of change (such as layoffs) that has a high
personal cost to individual employees (D’Aveni & MacMillan, 1990;
Iacovini, 1993; Weick, 1988). A crisis that necessitates severe measures for
which the organization (and consequently, its employees) is not prepared,
may cause trauma (Amabile & Conti, 1999; also Hamel & Välikangas,
2003). We define innovation trauma as the inability to commit to a new
innovation due to severe disappointment from previous innovation failures
(for example, new products rejected by the market or the company’s top
management). As such, rather than learning from failure and utilizing such
new knowledge in subsequent projects, innovation trauma inhibits the per-
sonal and emotional investment necessary to achieve high innovation per-
formance henceforth.
Thus, let us ask: What does it take to learn more from our failures,
rather than letting them drag down subsequent innovation endeavors?
Putting the spotlight on the traumatic experience itself, we first show how
innovation trauma played out as Sun Microsystems tried to launch a
thin-computing client technology called the Sun Ray in the aftermath of the
miserably unsuccessful JavaStation. This case serves as an illustration
identifying critical antecedents and symptoms of innovation trauma. We
then turn to key moderators that can minimize the detrimental effects of
innovation trauma on an organization’s innovative capabilities: How can
innovation trauma be treated so as to enable organizations to learn from
inevitable failures?

INNOVATION TRAUMA AT SUN MICROSYSTEMS

As is often the case with innovation, the story begins with a dream and lots
of hard work (see “About This Case Study” at the end of this chapter for a
description of our two-year research project). The Sun Ray was intended to
change an industry. The “simple, low-cost device, which requires no desk-
top administration,” was launched at the Enterprise Computing Forum in
New York City in September 1999 at a price of $399 per unit. It was