The top management team and corporate performance

This research tested the relationship between the characteristics and background of U.S. top executives, and measures of corporate performance. Data were obtained from 953 top managers; the dominant coalition of the largest 150 companies within five U.S. industries—dairy, footwear, tyres, mobile homes, and machine tools. Results were generally positive: managerial characteristics not only predicted performance variations within industries—the top performers having significantly different managerial profiles than poorly performing companies—but also that the characteristics of managers within high-performing companies were similar across the five industries.     

Sectoral Heterogeneity in New Service Development: An Exploratory Study of Service Types and Success Factors

The service industry is of fundamental relevance for the economies of industrialized countries, as the service industry produces the highest growth in the gross domestic product. In this regard, new service development (NSD) represents a critical resource for competitive survival and a decisive factor of growth in the service industry. However, service firms across many industries are increasingly faced with the challenge of determining how best to manage their development of new service offerings. Although researchers have shown growing interest in NSD issues, this area is still underutilized. Furthermore, although the heterogeneity of the service industry has been emphasized for years, the current body of research on NSD mainly focuses on specific service environments, providing data that are often not comparable across different service sectors. Additionally, there is no study to date that comprehensively examines innovation activities and the relevance of service innovations’ success factors within different service industries. The aim of this exploratory study is to establish a more balanced picture of the nature of innovation activities in terms of NSD characteristics and success factors in the heterogeneous service industry. From this perspective, this paper begins with an examination of the factors that contribute to the success of NSD. Based on a meta‐analysis of new service success factor studies, 17 different success determinants are classified and aggregated to service‐related success determinants. Subsequently, a cluster analysis of 1016 service companies is used to identify different service innovation types. For the service sector, four service innovation types are determined: efficient developers, innovative developers, interactive adopters, and standardized adopters. Furthermore, based on interviews with service innovation managers, the previously identified success factors are examined for each innovation type using a standardized survey. Finally, based on the results of this exploratory study, the paper concludes with recommendations for NSD management and research propositions for each service innovation type. These propositions support innovation managers to successfully manage service innovations for the innovation type they are operating in.     

The Influence of Regulation and Disruptive Potential on Incumbents' Submarket Entry Decision and Success in the Context of a Network Industry

This paper uses the theoretical perspectives of disruptive innovation, network externalities, and regulation to study the submarket strategies of incumbent firms that operate in a regulated network industry. In this setting, the impact of potentially disruptive innovations might be different because of the tighter regulation of incumbent firms. By analyzing the entry and success patterns of incumbent mobile network operators (MNOs) in the public hotspot markets in 17 Western European countries, we focus on how regulation and network effects as well as disruption factors influence the incumbent firms' strategies. In doing so, this paper departs from prior research that has primarily focused on unregulated industries and combines contradicting explanations from disruptive innovation theory, the motivation/ability framework, regulation theory, as well as network effects to provide a comprehensive analysis on how incumbents behave in a regulated network industry that is being confronted with a potentially disruptive innovation. In particular, while disruptive innovation theory predicts that the incumbents' vast experience in an industry could cause them to avoid entering new submarkets created by potentially disruptive innovations, the desire to avoid regulation could encourage such submarket entry. Furthermore, in regulated network industries, incumbent firms might have a stronger motivation to enter new submarkets as the importance of single customers and high market shares could be substantially different. These contrasting insights are used to develop an integrative research model and to derive hypotheses on incumbents' submarket entry decision and success. Drawing on cross‐sectional, multicountry data of 62 MNOs that operate in 17 Western European countries, this study uses logit and tobit regressions to test the impact of disruption factors, regulation, and network externalities on the entry decision and success of incumbent firms. The results reveal that the incumbent MNOs are caught in an area of conflict between the regulated industry context and their international technology strategy. The findings suggest that the incumbent MNOs' motivation and ability to escape regulation positively influenced their submarket entry and success in the public hotspot market. Thus, the potentially disruptive scenario was successfully turned into a potentially sustaining one as the incumbent MNOs could enhance their presence in the mobile broadband market. The testing on a multicountry basis as well as the positive influence of ethnocentric technology strategies for public hotspots, which are devised in the headquarters' location and are then brought out internationally, shed new light on an industry that has typically been characterized by country‐by‐country decisions. These findings may also reveal challenges for future research on disruptive innovations in multinational industries and expose future challenges for regulative authorities and managers. This paper thereby adds to the theory of disruptive innovation as it includes the influence of regulation on incumbents in network industries. Additionally, this study expands on previous findings on the disruptive potential of wireless local area network technology by employing a multi‐country analysis in 17 Western European countries.     

Innovation among suppliers to automobile manufacturers: an exploratory study of barriers and facilitators1

This paper reports on an exploratory study of the barriers and facilitators that affect technological innovation by suppliers to the automotive industry and the adoption of such innovations by the industry. The specific focus in the study was on key decision and action points in the life of specific innovations or potential innovations (ideas for new products) which may affect their successful development and marketing. The major source of data for this study was in the form of brief cases obtained from interviews of managers and technical personnel in suppliers to the automotive industry. These cases related to specific projects engaged in or ideas proposed by the responding firms or others in their sector of the industry which were aimed at the introduction of new or improved products, components, systems, materials, designs, etc., to the automotive industry. The information and data for this study were collected by means of structured interviews with 15 managers in 13 first level supplier firms to the automotive industry. A total of 32 innovations were investigated and a corresponding number of 32 cases and additional information on barriers and facilitators were generated for these 32 innovations. In general it was found that the most important barriers and facilitators to innovating were federal laws and regulations. Overall, the two types of decisions that are made in the automotive supplier's environment which appear consistently throughout these cases are (1) the automotive customer's decision to accept, encourage development of, or adopt innovations, and (2) the government's decision to mandate changes in safety, environment or energy-relatedregulations or legislation. The policy implications of the results of this study are discussed as they relate to an evolving model of the effects of potential federal intervention in the R&D/innovation process.     

Innovation strategies for successful product and process commercialization in Government R&D

This study examines the rate at which product and process innovations emerging from Government R&D have been commercialized by the Irish dairy industry. Success rates for both product and process commercialization, which are high by international standards, were found. The study identifies two criteria which appear to influence success and failure. Some product and process differences were found and the data suggest that a user dominated innovation strategy may be best for products, while a technology dominated strategy appears to be best for process innovations. Remarkably high rates for product success can be achieved in Government R&D provided industry activates the R&D. On the other hand R&D activation by research staff, without any industry involvement in the conduct of the R&D, appears to have a very poor chance of success. However, research staff can activate and achieve high success rates, particularly for process innovations, provided industry involvement in the R&D is secured.     

Technological and non-technological innovations,performance and propensity to innovate across industries: The case of an emerging economy

Innovation in a firm may be non-technological, such as organizational and marketing innovation, and technological, such as product and process innovation. The aim of this article is to explore how different types of innovation affect the innovation development of the firm across industries. We chose Chile as an emerging market context. Our results show that only product innovations affect significantly innovation performance across industries. However, different types of propensities to innovate are affected differently by technological and non-technological innovations. We discuss implications for managers and policy makers in emerging economies, in which data tends to be scarce to develop new policy models and increase the effect of non-technological innovation on innovative performance.     

Using Product Bundling to Facilitate the Adoption Process of Radical Innovations*

Generally, radical innovations are not easily adopted in the market. Potential adopters experience difficulties to comprehend and evaluate radical innovations due to their newness in terms of technology and benefits offered. Consequently, adoption intentions may remain low. This paper proposes bundling as an instrument to address these problems. More specifically, this paper examines how consumer comprehension, evaluation, and adoption intention of radical innovations may be enhanced by bundling such products with existing products. In addition, it is argued that the proposed effects are contingent upon the level of fit perceived to exist between the radical innovation and the product that accompanies it in the bundle. Furthermore, consumers' prior knowledge may affect the influence of bundling on the innovation adoption process as the interpretation of the meaning of new products may be strongly related to prior knowledge. This study therefore investigates whether consumer prior knowledge has such a moderating effect. Hypotheses are tested by means of an experimental study with three different radical innovations and distinguishing among offering the radical innovation separately, offering the radical innovation in a bundle with moderate perceived fit between the products, and offering the radical innovation in a bundle with high perceived fit between the products. Results show that product bundling enhances the new product's evaluation and adoption intention, although it does not increase comprehension of the radical innovation. Moreover, the results show that comprehension, evaluation and adoption intention of the innovation significantly decrease when consumers perceive a moderate fit between the products in a bundle. Taken together, these findings contribute to the bundling literature by showing not only that product bundling may indeed be an effective instrument to introduce a radical innovation but also that product bundling may be counterproductive when ignoring the critical role of perceived product fit as core characteristic of a product bundle. In addition, the notion that product bundling helps to enhance the evaluation and purchase intention of new and relatively complex products suggests a suitable strategy for new product managers to enhance benefits and reduce learning costs for radical innovations. Moreover, the effects of bundling on consumer appraisals of radical innovations are also shown to depend on the level of knowledge respondents possess regarding the product category of the radical innovation. More specifically, if bundled with a familiar product, novices tend to evaluate the innovative product more positively, but for experts no such effect can be detected. As such, these results provide additional specific implications for managers when introducing radical innovations in the market. Offering a radical innovation in a product bundle could be a fruitful strategy for companies that target customers with little or no prior knowledge in the product domain.     

Who Benefits from Teams? Comparing Workers,Supervisors, and Managers

This article offers a political explanation for the diffusion and sustainability of team-based work systems by examining the differential outcomes of team structures for 1200 workers, supervisors, and middle managers in a large unionized telecommunications company. Regression analyses show that participation in self-managed teams is associated with significantly higher levels of perceived discretion, employment security, and satisfaction for workers and the opposite for supervisors. Middle managers who initiate team innovations report higher employment security but otherwise are not significantly different from their counterparts who are not involved in innovations. By contrast, there are no significant outcomes for employees associated with their participation in off-line problem-solving teams.     

Trends in innovation and productivity: The case of chemical and textile industries in the U.S.

This paper attempts to investigate an empirical linkage between technological innovation and productivity in two industries in the United States. During the period 1967—82, the chemical and textile industries experienced different rates of productivity growth. In spite of stiff competition from foreign manufacturers, American textile firms maintained a steady growth in productivity. This industry benefitted from major technological innovations occurring in industries supplying to it. The chemical industry faced crisis due to sudden changes in petroleum prices. Changes in regulatory requirements also imposed a different set of constraints on the chemical industry. Rate of innovation decreased quite severely in this industry during this time period.
Innovation indicators were developed by obtaining data on new product/process announcements in the technical literature. Panels of technical experts from the industries and academia evaluated the data for their technical novelty. The data indicate a relationship between innovation and productivity growth.     

Supplier involvement in new product development in the food industry

Purchasing and supplier involvement as one possible explanatory factor of product development success has been gathering growing attention from both managers and researchers. This paper presents the results of a Dutch benchmark study into supplier involvement in product development, and discusses the topic more specifically in the context of the food industry. Regarding supplier involvement, this industry has not been studied intensively, although its specific characteristics make continuous development of new products imperative and the amount of outsourcing of production and development has increased substantially. The benchmark was conducted by means of an existing framework which has not yet been applied to the food industry. The food company in the benchmark study performs consistently better than companies from other industries. At the same time, the results of a similar case study carried out at a Scandinavian food company show contradictory results. By comparing the Dutch and the Scandinavian case, we illustrate that our analytical framework can explain these different results in terms of the underlying processes and pre-conditions, thereby validating its application to the food industry.     

Digital Transformation Through Exploratory and Exploitative Internet of Things Innovations: The Impact of Family Management and Technological Diversification*

This study examines the impact of family management on digital transformation with specific regard to the firm’s development of Internet of Things (IoT) innovations. Drawing on the distinctive characteristics of firms with family managers, such as the focus on family‐centered noneconomic goals, long tenure, emotional ties to existing assets, and rigid mental models, it hypothesizes that increasing family involvement in the top management team is negatively related to the development of IoT innovations that are distant from a firm’s existing technology base (i.e., exploratory IoT innovations) compared to exploitative IoT innovations. Further, the study proposes that the firm’s degree of technological diversification, especially in unrelated forms, reinforces this relationship. The longitudinal analysis between 2002 and 2013 on a sample of publicly traded German firms allows us to test our hypotheses from the beginning of the emergence of the IoT concept. Our findings show that due to the particular characteristics of their managers, family‐managed firms do not welcome the risks related to exploratory IoT innovations, and the benefit of risk diversification from technological diversification is lower than the cost of abandoning family‐centered goals. As our results imply that the involvement of family managers constrains the development of exploratory IoT innovation, the top management team composition in firms that intend to be at the forefront of the digital transformation should be accurately designed by avoiding a high proportion of family members.     

European Economic Community industrial research priorities for the early 1980s

Respondents claimed that European effort on basic research rnay have so diminished that the long-term competitiveness of its industries is endangered. They saw a major role for the Commission in redressing this imbalance. There was little support for Commission sponsorship of applied industrial research. Some respondents felt that this could even be counter-productive by diluting effort in areas seen as important by industrial management. A role was seen for the commission in supporting more research on the legislative context and general environment in which industry operates ('contextual research'). The need for such research imposes a growing burden on industry and diverts scarce resources from work directly related to competitiveness.
A study sponsored by the Commission of the European Communities aimed to identify the types of R & D activity in aid of European industry that the Commission might support over the next three or four years. The findings are based on interviews with senior managers from some fifty firms, representing eight sectors of manufacturing industry in five European countries.     

Strategy making in novel and complex worlds: the power of analogy

We examine how firms discover effective competitive positions in worlds that are both novel and complex. In such settings, neither rational deduction nor local search is likely to lead a firm to a successful array of choices. Analogical reasoning, however, may be helpful, allowing managers to transfer useful wisdom from similar settings they have experienced in the past. From a long list of observable industry characteristics, analogizing managers choose a subset they believe distinguishes similar industries from different ones. Faced with a novel industry, they seek a familiar industry which matches the novel one along that subset of characteristics. They transfer from the matching industry high‐level policies that guide search in the novel industry. We embody this conceptualization of analogy in an agent‐based simulation model. The model allows us to examine the impact of managerial and structural characteristics on the effectiveness of analogical reasoning. With respect to managerial characteristics, we find, not surprisingly, that analogical reasoning is especially powerful when managers pay attention to characteristics that truly distinguish similar industries from different ones. More surprisingly, we find that the marginal returns to depth of experience diminish rapidly while greater breadth of experience steadily improves performance. Both depth and breadth of experience are useful only when one accurately understands what distinguishes similar industries from different ones. We also discover that following an analogy in too orthodox a manner—strictly constraining search efforts to what the analogy suggests—can be dysfunctional. With regard to structural characteristics, we find that a well‐informed analogy is particularly powerful when interactions among decisions cross policy boundaries so that the underlying decision problem is not easily decomposed. Overall, the results shed light on a form of managerial reasoning that we believe is prevalent among practicing strategists yet is largely absent from scholarly analysis of strategy. Copyright © 2005 John Wiley & Sons, Ltd.     

Exploring How Peer Communities Enable Lead User Innovations to Become Standard Equipment in the Industry: Community Pull Effects

Literature on new product development indicates that on average around 40% of new products fail across different industries (e.g., Crawford, 1977 ; Crawford and Di Benedetto, 2008 ). Out of those that survive only few become widely accepted standard equipment in the industry (Utterback, 1996 ). Literature on entrepreneurship (e.g., Baron and Shane, 2008 ) and on innovation (e.g., Christensen, 1997 ) shows that such innovations often originate outside the boundaries of established firms. However, it is difficult to understand and analyze the exact source of such innovations and the entrepreneurial processes by which they are developed. It is therefore the aim of this study to shed light on how innovations become widely accepted by large segments of the market and specifically which demand‐side forces are at work. An approach suitable for pursuing this objective is to focus on those individuals who are on the leading edge with respect to an important market trend (lead users) and their respective peer communities. As little knowledge is available, an explorative case study design is applied, working with cases from two different industries, specifically the medical equipment and sporting equipment industry. A longitudinal research design is used, extracting data from multiple respondents and various other sources such as reports, publications, databases, or community web pages. The research framework takes a process perspective by following the entrepreneurial processes from invention to commercialization and diffusion. In this process, micro‐level variables at the individual and group level are analyzed as well as the barriers to be overcome by the individual innovator and the community. The findings show that communities play a central and active role in the entrepreneurial process. Community members provide valuable feedback on the overall potential of the lead users' ideas, participate by making concrete development contributions, acting as testers of the new products, and finally helping to diffuse the innovations inside and outside the community. We identify two pull effects on the part of the community: first, community members demand and facilitate the development of prototypes; and second, community members help to cross the chasm between first adopters and the early majority. This paper has various implications for entrepreneurship and innovation research. For entrepreneurship, this article points out peer communities as a specific kind of social network that plays a crucial role in entrepreneurial processes. For innovation research, this article emphasizes the interaction between lead users and their peer communities in the process of developing the next dominant product design.     

PERCEIVED MANAGERIAL DISCRETION: A STUDY OF CAUSE AND EFFECT

The notion that managers encounter differing levels of discretion across industries and organizations is becoming central to discussions of strategy formulation and implementation. However, discretion can be exercised or created only to the extent it is perceived, and theories of cognition and decision making suggest that managers’ perceptions of discretion may vary significantly. Despite the importance of perceptions to Hambrick and Finkelstein’s (1987) theoretical model of managerial discretion, no empirical tests examining perceived discretion have been published to date. Drawing on theories of issue interpretation and impression management, we find that managers differ systematically in the amount of discretion they perceive. Specifically, we find support for the predicted relationship between locus of control, a stable personality difference, and perceptions of managerial discretion. We also find that perceived discretion predicts managerial power, but only in situations in which the manager actually has little discretion. The dynamic model presented and tested here suggests that managers, in part through impression management activities and their ability to attend to critical contingencies, may both increase their power and enlarge their latitude for action. Implications for strategy formulation and implementation are discussed. © 1997 by John Wiley & Sons, Ltd.     

Export attitudes of industrial manufacturers

Small and medium-sized firms in three “high-tech” manufacturing industries were analyzed, in terms of their export attitudes and behavior, in order to provide beginning exporters and export promotion agencies with guidance to avenues of export success. Based on industry differences investigated, the study finds that managers in firms involved in exporting in each industry have similar attitudes toward international marketing opportunities, but that each industry exhibits different characteristics and strategies for exporting. Help is mainly needed in the areas of international communications and service delivery. The authors propose fewer government subsidies for export financing and more emphasis on encouraging joint ventures for service delivery purposes.     

Creating shareholder value via collaborative innovation: the role of industry and resource alignment in knowledge exploration

Collaborative innovation provides firms with a privileged opportunity to perform exploration in an externally oriented mode. The central challenges in exploration via collaborative innovation lie in the selection of relevant partners and in gaining access to potentially valuable external knowledge that the focal firm lacks. This article focuses on two aspects of inter-organizational alignment that affect knowledge differences and may thus help explaining the shareholder value implications arising from collaborative innovation: industry and resource alignment. Relying on data covering 97 bilateral collaborative innovations (194 innovation partners) in R&D intensive high-technology industries, we used event study methodology and follow-up hierarchical regression analyses to test our conceptual framework. With regard to industry alignment, results suggest that investors value greater industry distance between collaborating partners, especially when the partner firm provides high-level R&D resources. Furthermore, the results show a positive effect of supplementary resource alignment (i.e., a focal firm's R&D resources are supplemented by a partner firm's R&D resources) and, notably, a negative effect of complementary resource alignment (i.e., a focal firm's R&D resources are complemented by a partner firm's marketing resources) on investors' valuation of the collaboration's expected future performance. They, thus, contribute to research on shareholder value implications of collaborative innovation. From a managerial perspective, the study provides a better understanding of partner selection and shows how managers should position a collaboration to signal the shareholder value-creating potential to investors.     

The outcome of company and account manager relationship quality on loyalty, relationship value and performance

This study explores the effects of perceived relationship quality of the company and account managers with customers. It examines the effects of both types of relationship quality on relationship outcomes including: loyalty, relationship value, and performance. Consistency and relationship-specific investments are tested as mediating constructs between relationship quality and relationship outcomes. The model was tested in the automotive parts industry in Brazil. Findings indicate that relationship quality with account managers is directly related to loyalty and perceptions of relationship value. However, relationship quality with the firm is related to loyalty indirectly, through relationship-specific investment. Further, perceptions of consistency do not mediate the linkage between relationship quality with the company and account managers and specific investments. Theoretical and managerial implications of the findings are presented.     

产业发展的趋势研判与理性思考

在全球经济一体化，信息化，市场化的大背景下，国际产业发展也是呈现出新的特点，产业的集聚发展，相互间渗透发展以及产业持续发展构成了当今产业发展的主旋律。把握国际产业的发展趋势，可以在我国产业战略调整中通过簇群化进一步提高我国产业的国际竞争力；通过融合化实现产业创新和培育新的增长点；通过生态化促进我国经济的可持续发展。     

Working effectively in strategic alliances through managerial fit between partners: some evidence from Sino–British joint ventures and the implications for R&D professionals

To succeed in R&D strategic alliances requires not only strategic fit and cultural fit at the organisational level, but also managerial fit at the micro, inter–personal interaction level. This paper provides the results from a cross–cultural study of managerial fit between British and Chinese managers in joint ventures (JVs) initiated in 1993–1998 with a focus on two important issues: the perceived competence and managerial roles of the partners. Managerial fit between partners is critical for the success of R&D strategic alliances including JVs. Misfit in partners' managerial behaviour often results from the fact that JVs are characterised by the lack of specificity of various managerial tasks shared by the partners at the operational stage. In addition, a manager's managerial competence as perceived by the counterpart is a contributory factor to trust and supportive reaction from the counterpart, both of which are important for cohesive interaction between partners. This study has revealed that (1) there are similarities and significant differences in some of the characteristics of managerial competence perceived by the counterpart between the British and Chinese managers; and (2) there is often a mismatch of perceptions between the British and Chinese managers with regard to who plays a particular managerial role in a JV. Managerial implications are discussed and issues for further research are highlighted.