This research seeks to understand which of three different strategic orientations of the firm (customer, competitive, and technological orientations) is more appropriate, when, and why, in the context of developing product innovations. We propose a structural model of the impact of the strategic orientation of the firm on the performance of a new product. This impact is hypothesized to occur as a chain of events. Strategic orientation is viewed first as an antecedent of the characteristics of the innovation marketed by the firm. The subsequent market performance of the innovation is hypothesized to be a function of both the innovation's characteristics and the firm's strategic orientation. The ability of the firm to take advanta ge of its orientation to market,the innovation succesfully is also hypothesized to be moderated by the firm's environment.The results provide evidence for best practices as follows. (1) A firm wishing to develop an innovation superior to the competition must have a strong technological orientation. (2) A competitive orientation in high growth markets is useful because it enables firms to develop innovations with lower costs, a critical element of success. (3) Firms should be consumer oriented and technology oriented in markets where demand is relatively uncertain. These orientations together lead to products which perform better. and the firm will be able to market innovations better, thereby achieving a superior level of performance. (4) A competitive orientation is useful to market innovations when demand is not too uncertain but should be deemphasized in highly uncertain markets. In short, these results suggest that the appropriateness of a 6ven strategic orientation, even a customer orientiation, is not unconditional.
A "frontier issue" in international marketing is the appropriate choice of entry mode in foreign markets. The objective of this paper is to offer a transaction cost framework for investigating the entry mode decision. This framework provides 1) a theoretical basis for systematically interrelating the literature into propositions, 2) propositions about interactions which resolve the apparently contradictory arguments advanced to date. Specifically, the paper: * illustrates the feasibility of clustering 17 entry modes into the degree of control the mode provides the entrant; * proposes that the most appropriate (i.e., most efficient) entrymode is a function of the tradeoff between control and the cost of resource commitment * advances testable propositions delimiting the circumstances under which each mode maximizes long-term efficiency. The entry mode literature is reviewed in the context of these propositions, and guidelines are derived for choosing the appropriate mode of entry, given certain characteristics of the firm, the product, and the environment.
We take a structural approach to assessing innovation. We develop a comprehensive set of measures to assess an innovation's locus, type, and characteristics. We find that the concepts of competence destroying and competence enhancing are composed of two distinct constructs that, although correlated, separately characterize an innovation: new competence acquisition and competence enhancement/destruction. We develop scales to measure these constructs and show that new competence acquisition and competence enhancing/destroying are different from other innovation characteristics including core/peripheral and incremental/radical, as well as architectural and generational innovation types. We show that innovations can be evaluated distinctively on these various dimensions with generally small correlations between them. We estimate the impact these different innovation characteristics and types have on time to introduction and perceived commercial success. Our results indicate the importance of taking a structural approach to describing innovations and to the differential importance of innovation locus, type, and characteristics on innovation outcomes. Our results also raise intriguing questions regarding the locus of competence acquisition (internal vs. external) and both innovation outcomes.Technological Innovation, Competence Enhancing, Competence Destroying, Competence Acquisition
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