Organizations rely on their employees to produce many high-quality ideas for the improvement of products, processes, and strategies. Evaluators such as managers and technical experts need to not only assess these ideas but also face expectations to contribute ideas of their own. We investigate this task duality by asking how idea evaluation activities affect evaluators’ ideation performance. Although much of the creativity and innovation literature points to a crowding-out effect, some theoretical arguments support idea crowding-in. Using data from a multinational firm’s idea management system and a difference-in-differences framework, we find robust evidence of substantial idea crowding-in: Evaluators’ likelihood of idea generation increases by 205% on the day that they evaluate ideas and remains elevated for the following two weeks. Extensive analyses support knowledge recombination as the key mechanism: By exposing evaluators to unfamiliar knowledge, idea evaluation creates new opportunities for recombination and idea generation. The ideas that evaluators generate postevaluation are 19% more valuable (but not more novel) than those they generate outside the postevaluation window. We contribute to innovation scholarship by identifying a hitherto overlooked effect of idea evaluation: triggering idea generation among evaluators. 

This paper introduces strategic nay-saying as a new answer to the question of why organizations fail to seize valuable opportunities for innovation. We argue and show that managers, who are tasked with selecting ideas for implementation under uncertainty, reject ideas to protect their reputation from overestimation errors. By rejecting ideas, managers prevent their implementation so that the true value of ideas is not revealed and managers cannot later be proven wrong. Using detailed data on 6,799 ideas evaluated by 1,265 managers in a large multinational firm and a difference-in-differences design, we show that strategic nay-saying is widespread. We find that managers, upon realizing that they previously made an overestimation error, become 52-76% more likely to reject subsequent ideas. A disproportionately high number of these rejections are later appealed, indicating that managers falsely rejected them. In support of the strategic, reputation-saving nature of these rejections, we show that overestimation errors impose real reputational costs on managers and that rejections soar when managers face stronger incentives to protect their reputation. Our evidence does not support two alternative mechanisms: managers learning from past errors or intensifying their search for flaws in ideas. Overall, our findings reveal a darker side of managerial gatekeeping: to protect their own reputation, managers entrusted with identifying innovation opportunities may systematically forgo them.

Because the value of ideas is inherently difficult to assess prior to implementation, organizations inevitably reject some ideas that would ultimately prove valuable. How can organizations recognize and correct such false negative decisions? We argue that evaluator turnover—when incumbent evaluators leave and are replaced by new ones—facilitates the recovery of valuable ideas through two complementary channels. First, turnover encourages ideators to resubmit falsely rejected ideas. Second, new evaluators bring fresh perspectives that can lead them to reconsider proposals rejected by their predecessors. We test our argument using administrative data from the Novo Nordisk Foundation, a large private Danish research foundation supporting biomedical and life sciences research. We find that complete evaluator turnover, in which all evaluators who rejected a proposal are replaced, increases applicants’ likelihood of resubmitting by 42% and the likelihood that these resubmissions receive funding by 15%. Moreover, funded resubmissions subsequently outperform funded non-resubmissions (i.e., proposals funded upon first submission), suggesting that evaluator turnover helps resurface valuable proposals that were initially overlooked. We contribute to research on innovation by shifting attention from how organizations can reduce false negatives to how they can recover from them after they occur.