Can Employee Networks Improve Innovation in India's IT Services Sector? - TCD (2024)

A key partner for this project is a leader in IT industry transformation. This company’s initiatives have gradually transformed it from a traditional IT services company to one that now works closely with its clients on new products, product design, and general continuous improvement of client operations.

Prior to this, two of the researchers (Gibbs and Siemroth, along with a co-author) conducted research at an Indian IT company on two innovative policies instituted as part of long-term organizational transformation. The first was the company’s Value Portal – a formal, intranet-based employee suggestion system that employees use to suggest new ideas that can benefit the organization and/or its clients. The second was an experimental reward that was implemented to see if it could foster more or higher quality ideas from employees.

In the first project, it emerged that the reward did motivate employees to be more innovative: though the number of ideas did not increase, more employees became involved in ideation, and the ideas submitted were of higher quality. It was further estimated that benefits of both the reward and suggestion systems were likely to be very high as compared to their administrative costs. In response to the findings, the partner organization then implemented a version of the reward throughout the company.

These policies–employee suggestion systems, rewards for innovation, and employee collaboration networks (the proposed new topic)–are widely relevant since they can be implemented in any Indian corporation.

An employee with a sufficiently broad, high quality and active network is more likely to be exposed to different ideas and perspectives, and gains access to greater expertise than can be tapped to find solutions and implement ideas. The research question is, therefore, what is the causal effect of the employee’s network position, and network size, on the amount and quality of ideas suggested?

In order to test this, the researchers are developing a field experiment with the company, in which some new hires will randomly be assigned to receive training on social network concepts. Over their first year at the company, the study will track how their social networks develop. Simultaneously, it will also track their innovation activity, as well as other indicators of job performance. These outcomes will be compared to those of a control group of new hires who did not receive this training.