This paper takes its starting point in an empirical problem, to which we believe current research have difficulties offering operational solutions. The root of the problem lies in the tensions between the common held expectations of small firms (SMEs) to contribute to society’s growth and innovation – and the different factors which makes such accomplishment challenging, including lack of time and the need to master different skills. Upon adding uncertainty with regards to goal definition; information scarcity or overflow and the pressure to manage an ever-changing market, this triggers frustration at instances where innovative action is needed the most.
The paper builds upon the idea that human interaction result in learning that either transforms or reproduces the processes involved. This relates back to the ideas of an organization’s need to explore new as well as exploit existing products and processes. The challenge for SMEs to deal with these both types of learning – and ultimately release innovative capacity – is at the core of this paper. We find that nature of the problem; degree of complexity and level of competence in the problem area are all important determinants for the chosen activities which also relates to the fit with the effectual learning processes.