The topic has seen rapid growth since the 1990s, reflecting curiosity about the process of social change and "fueled by interest in institutional arguments and in network and dynamic analysis.
"[1] The theory uses a case study of the growth of business computing to explain different mechanisms of diffusion.
It is counterproductive for an organization to invest time, energy, and in most cases money, into a poorly developed or bad idea.
(Freeman) A firm's interaction with other players, along with its environment and organizational culture, are key in the social theory of diffusion.
Mass media can amplify trends and movements that occur in the marketplace, introducing new innovations to network members, exposing "best-practice" ideas, and conveying new principles.
[9] Change agents are usually business professionals (such as lawyers, consultants, bankers, or politicians) who spread new practices or aid in promoting new ideas.
[8] These individuals often introduce business models, legal strategies, or investment techniques that are picked up by several entities within a network and continue to diffuse.
Often, such external diffusion leads to conformity of a set of corporate strategies or structures, a phenomenon DiMaggio and Powell called "normative isomorphism".
Strang and Soule (1998) have shown that large, technical, and specialized organizations with informal cultures tend to innovate much faster than other firms.
[8] Mathematical models can be used to study the spread of technological innovations among individuals connected to each other by a network of peer-to-peer influences, such as in a physical community or neighborhood.
The interactions that link these individuals are represented by the edges of the network and can be based on the probability or strength of social connections.
[14] In threshold models the uptake of technologies is determined by the balance of two factors: the (perceived) usefulness (sometimes called utility) of the innovation to the individual as well as barriers to adoption, such as cost.
[15] The multiple parameters that influence decisions to adopt, both individual and socially motivated, can be represented by such mathematical models.
Computer models have been developed to investigate the balance between the social aspects of diffusion and perceived intrinsic benefit to the individuals.
The roles of communication networks, as described by traditional theories of diffusion, have been to facilitate information flow about a new innovation and thus remove one of the major barriers to adoption.
In order to adapt to evolving trends in business computing, organizations first needed to gain the technical knowledge necessary to operate the technology (Attewell 1992:3-6).
However, after these service institutions effectively lowered the barrier to adoption, many organizations became capable of bringing business computing in-house (Attewell 1992:7-8).
"Authority innovation decisions", on the other hand, need only the consensus of a few individuals with large amounts of power within the organization.
Therefore, a much broader consensus within an organization was required to reach the critical mass of technical knowledge and authority necessary to adapt to business computing.