Does rivals' innovation matter? A competitive dynamics perspective on firms' product strategy |
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| Institution: | 1. School of Business Administration, Portland State University, United States;2. Graziadio School of Business, Pepperdine University, United States;3. Management Department, Manning School of Business, University of Massachusetts Lowell, Lowell, MA 01854, United States;4. The College of Social and Western China Development Studies, Sichuan University, China;1. School of Management, Huazhong University of Science & Technology, Wuhan 430074, China;2. School of Management, Xi''an Jiaotong University, 710049, China;1. Department of Marketing, College of Business and Public Administration, University of North Dakota, Grand Forks, ND 58202, United States;2. Area of Marketing, Rawls College of Business, Texas Tech University, Lubbock, TX 79409, United States;1. College of Management, Guilin University of Electronic Technology, 1 Jinji road, Qixing district, Guilin city, Guangxi, 541004 China;2. College of Management, National Taiwan University, No. 1, Sec. 4, Roosevelt Rd., Taipei 10617, Taiwan (R.O.C.);1. Business School, Sun Yat-sen University, Guangzhou, Guangdong 510275, China;2. School of Business Administration, South China University of Technology Guangzhou, Guangdong 510640, China |
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| Abstract: | We build on the awareness-motivation-capability (AMC) framework of competitive dynamics research to examine how a signal of a rival's innovation, in the form of research and development (R&D) intensity, may influence a focal firm's product actions. We argue that a rival's R&D intensity increases a focal firm's awareness of a competitive threat and thus its motivation to react by increasing its product actions. However, this competitive impact is conditional on the focal firm's size and performance relative to the rival, as well as the strategic homogeneity of the two. We use the AMC framework to analyze such moderating effects. |
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