Learn, Learn, but Not the Same Way: How does TMT Learning Influence Radical Innovation in SME?

Although firms need radical innovation to grow and gain competitive advantages, the way top management teams (TMT) foster this innovation through learning is not well understood. We address this research gap with a study of how TMT learning affects radical innovation in small and medium- sized enterprises (SME). Using longitudinal data from 241 TMT members in 77 information technology SME, collected over four years, we find that TMT with higher mean levels of team learning see more radical innovation. Because individual TMT members differ in their learning behaviors, we further explore how TMT learning asymmetry (the degree to which TMT members differ in their learning behaviors) influences SME radical innovation. We find support for an inverted U-shaped relationship between TMT learning asymmetry and firm radical innovation: medium levels of TMT learning asymmetry are related to the highest level of firm radical innovation. Moreover, TMT mean levels of learning moderate this relationship such that radical innovation is consistently high under high TMT mean learning behavior, regardless of TMT learning asymmetry.