Organizational legitimacy in innovation units with radical mandates : an exploratory case study unpacking the role of New tech lab in the DNB organization

Abstract

This thesis aims to explore how innovation units with radical mandates work to achieve organizational legitimacy. The context for the study is the Norwegian banking institution DNB and its innovation unit New Tech Lab. Interviews with New Tech Lab members and other DNB employees were used as the basis for the research and the findings of this research are presented and considered in relation to the existing literature on organizational ambidexterity and radical innovation. The findings of the research project suggest that three main factors affect the legitimacy of these units – structural requirements, actions by the unit, and distractions. The findings are used to create a framework that shows the relationships between these factors and outlines the importance of elements such as managerial support, autonomy, and clear innovation mandates, as well as identifying the core behaviors that support the legitimacy of these units. The research also uncovers two challenges that may arise as a result of efforts to establish legitimacy, that may in fact undermine the legitimacy of the innovative unit. One key finding of this thesis is the importance of the innovative unit’s ability to provide tangible value that is visible to the members of the organization. The thesis finds that by engaging in activities and collaborations that create value for the main organization, radical innovation units can generate attitudes and relationships that support their legitimacy in the organization. While the majority of the findings in this thesis are in alignment with existing research on organizational ambidexterity and radical innovation, virtually no prior research on the topic of internal organizational legitimacy has been done. This thesis establishes a point of departure for future research projects on the topic and proposes a new perspective on the concept of establishing internal legitimacy within organizations.