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Abstract
An empirical investigation into two research questions pertaining to the adoption of technological innovations by small- and medium-sized home building firms was conducted by multiple regression analysis of data collected from interviewing over 100 home builders across the country.
How are home building firms that are more apt to adopt technological innovations before they are widely diffused different from those that are less apt to do so? The research showed that home builders who are more apt to adopt non-diffused innovations have superior information processing abilities related to building innovations. These builders were found to tap into more sources of information about new products from portions of their organizational environments than did non-adopters. Information processing significantly differentiates these builders from those who are less willing to adopt innovations that are not widely diffused because the uncertainty level of most building innovations is quite high due to the complexity of the home building task and the complexity of the organizational environment facing home builders. No significant relationships were found to exist between adoption behavior and either company size, number of years the company has been in business, or market segment served (i.e., average house price).
How are home building firms that are more apt to adopt high uncertainty technological innovations before they are widely diffused different from those that are more apt to adopt low uncertainty innovations before they are widely diffused? The data provided evidence that the two groups differ in the characteristics of the individuals involved in innovation related activities. Propensity to adopt high uncertainty, non-diffused innovations is associated with having higher numbers of functions (e.g., top management, office administration, sales, design, site supervision) involved in making adoption decisions. Each function possesses intimate knowledge of one or more sectors of the environment and can therefore help to reduce the uncertainty of how well an innovation would fit with the firm's task process and environment. Propensity to adopt high uncertainty innovations is also associated with having at least one individual with a building trades background involved in innovation-related activities. These individuals likely apply their tacit knowledge about the construction process to reduce the uncertainty relating to how well an innovation will be assimilated into the existing task process.
Propensity to adopt low uncertainty, non-diffused innovations is associated with having at least one individual with an architectural or engineering background involved in innovation-related activities. These individuals apparently apply engineering principles to reduce the uncertainty of innovations related to physical performance, but cannot reduce the uncertainty of high uncertainty innovations related to market acceptance. Propensity to adopt low uncertainty innovations is also associated with having a more positive attitude about adoption of innovations and/or higher tolerance of uncertainty. This factor does not play a critical role in relatively early adoption of high uncertainty innovations apparently because it is overwhelmed by the need for effective gathering and processing of information about innovations.
The results of this research suggest that, contrary to the prevailing opinion within the home building industry, builders' adoption of technological innovations substantially reflects factors within their control. However, contrary to widespread public perception, the majority of home builders are neither apathetic nor excessively conservative about new building technologies. The results also suggest that the construct of uncertainty deserves a more prominent position within organizational diffusion theory.