what is opportunity discovery?

Teppo

Earlier this week I attended a small, experimental and stimulating conference at Washington University in St. Louis – the “Opportunity Discovery” conference organized by Jackson Nickerson, Jay Barney, and Todd Zenger.  In short, the raison d’etre of the conference was to ask and try to answer questions such as – what are opportunities, how do they get discovered or created, etc?  While the language varied rather widely between presentations – whether one discussed opportunities, problems, or possibilities – and, while most agreed that there were significant problems with the conference title of “opportunity discovery,” nonetheless, in all, there was a general sense that the question of the ‘new-new’ needs to be much more carefully addressed in organization theory and strategic management.

Overall, there is no question that organizations are remarkably good at mimicry, the exploitation of existing technologies, and the routine, but, the new-new seems to elude path-dependent organizations, and understanding the origins of the new-new seems paramount to understanding organizations themselves, and competitive advantage, progress, and innovation more generally. 

(Of course, entrepreneurship scholars have also long wrestled with these matters, though there was some sense and even  agreement, perhaps arrogantly so, that not much progress had been made.) 

Below some highlights from the conference:

1. Nicolai Foss gave a very interesting presentation about the role of property rights and transaction costs in opportunity discovery.  He highlighted the role that barbed wire (see the original patent document below) for example played at the nexus of property rights and transactions costs – both as a novel innovation itself, but also as an institution of sorts which allowed for other, new opportunities and innovations to emerge. 
2. Keith Sawyer – here’s an AJS paper of his that I have really enjoyed – discussed the historical, and unintentional emergence of mountain bikes (essentially, from user communities – a la von Hippel). (Sonali Shah also has some great work related to this – on the emergence of wind-surfing etc.)
3. David Meyer discussed opportunities as they arise from global networks and communities of practice in Asian financial services.
4. Many others had interesting presentations (more on these later) – Rich Makadok and Steve Postrel, Jay Barney and Sharon Alvarez, Anne Marie Knott, Peter Klein, Jeff Dyer, Markus Baer, Dan Elfenbein, Kurt Dirks, Bill Hesterly, Nile Hatch, Jackson Nickerson, etc.

The below questions, among many others, emerged for me as I both listened to presentations and presented myself:

1. Is discovery intentional or unintentional?
2. What is the role of history versus foresight?
3. What is the link between discovery at the individual and organizational level?
4. Is discovery and creation recombination or can we also talk about ex nihilo ’emergence’?
5. What is the role of experience in discovery?
6. Where does rent appropriation fit in all this?
7. Some deep epistemological (both social and cognitive) issues are implicated by all of the above – how do we reconcile them and make them more explicit?
8. Many disciplines are also implicated by the above questions – psychology, sociology, philosophy, economics, computer science etc – which of the above disciplines might help us more clearly understand the new-new in organizations?
9. What is the appropriate language for the ‘new-new’ in organizations – is it about problem-finding or problem-solving, about opportunity recognition or opportunity discovery, possibility identification etc? And, how does this reconcile with extant work on ‘search,’ exploration etc?

Undoubtedly there’ll be significantly more work in these areas in years to come. Overall, the conference was fantastic as it raised many key issues and questions (only some of which were answered), and also brought together a rather broad group of social scientists to begin addressing these matters.  More on all this later.