127 7 Employee-Driven Innovation and Practice-Based Learning in Organizational Cultures Ulrik Brandi and Cathrine Hasse How can we understand employees as drivers of innovation and what prevents employees from being realized as an innovative capacity in organi- zations? The present definition of EDI contains a discrepancy: on the one hand, EDI is claimed to cover purely bottom-up processes, while, on the other hand, empirical examples show that EDI is dependent on a cultural context in which the employees’ everyday creative actions (based on prac- tice-based learning) are recognized as potential resources for innovation in the organization. Due to the lack of a concept of organizational culture in relation to the analysis of employee-driven innovation, we are unable to grasp fully why attempts to be innovative sometimes fail, and, which is even more widespread, why practice-based potential innovation is never realized. In this chapter, we will thus improve our knowledge of why innov- ation must be recognized as practice-based in the organizational culture. As Fagerberg and Verspagen (2009) demonstrate, the research community of innovation is a multidisciplinary field with a long-standing research trad- ition. Schumpeter, with his seminal work on economic development, marks the beginning of this vibrant and voluminous research field, and in 1928 he defines innovation as follows: ‘What we, unscientifically, call economic progress means essentially putting productive resources to uses hitherto untried in practice, and withdrawing them from the uses they have served so far’ (Schumpeter 1928: 378). This is what we call ‘innovation’. We follow the Schumpeterian definition in general terms and understand innovation as a qualitative, new combination of existing resources, experi- ences and knowledge aiming at generating improvement and novelty in either processes or products. On the basis of this definition, we ask how new combinations of existing resources and knowledge executed by employees on the basis of practice-based learning processes are recognized as innov- ation by the organization. Putting employees’ productive resources to uses hitherto untried in practice requires a supportive organizational culture. S. Høyrup et al. (eds.), Employee-Driven Innovation © Palgrave Macmillan, a division of Macmillan Publishers Limited 2012