Small businesses in the new creative industries: innovation as a people management challenge

Purpose This paper seeks to present findings from an SME case study situated in the computer games industry, the youngest and fastest growing of the new digital industries. The study aims to examine changing people management practices as the case company undergoes industry‐typical strategic change to embark on explorative innovation and it seeks to argue that maintaining an organisational context conducive to innovation over time risks turning into a contest between management and employees, as both parties interpret organisational pressures from their different perspectives. Design/methodology/approach A single case study design is used as the appropriate methodology to generate in‐depth qualitative data from multiple organisational member perspectives. Findings Findings indicate that management and worker perspectives on innovation as strategic change and the central people management practices required to support this differ significantly, resulting in tensions and organisational strain. As the company moves to the production of IP work, the need for more effective duality management arises. Research limitations/implications The single case study has limitations in terms of generalisability. Multiple data collection and triangulation were used to mitigate the limitations. Practical implications The economic contribution of small businesses in the new creative industries is widely acknowledged. While the sector shows high business birth rates, the business failure rate is equally high. This remains of concern for policy makers. This study aims to contribute to understanding why businesses in the sector either fail to grow or decline. Social implications The economic contribution of small businesses in the new creative industries is widely acknowledged. While the sector shows high business birth rates, the business failure rate is equally high. This remains of concern for policy makers. This study aims to contribute to understanding why businesses in the sector either fail to grow or decline. Originality/value Few qualitative studies have examined people management practices in the industry in the context of organisational/strategic change, and few have adopted a process perspective.