The Customer is Always Right: Negative Side Effects of Open Innovation on Managers’ Assessment of Employee’s Ideas

The present research deals with the influence of managers’ construal level and anticipatory regret behavior on evaluations of customers’ and employees’ ideas in innovation contexts. While prior research focused on positive outcomes of open innovation, we provide theory and evidence to suggest that managers’ avoidance behavior in idea evaluation processes can result in negative side effects for the assessment of employees’ ideas. We conducted an experiment with 113 managers to reveal that top managers tend to higher creativity ratings of ideas from customers in comparison to identical ideas from employees. Lower level managers showed no difference in their creativity evaluations, but differentiated their feasibility rating in favor for customers’ ideas, whereas top managers did not. Our findings contribute to existing managerial decision making research and provide initial evidence on negative outcomes of open innovation for managers’ evaluation of employees’ ideas.