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Supplier involvement is essential to a new venture seeking to develop a radical innovation. Despite this, prior literature has not adequately addressed supplier involvement in radical innovation, nor what the antecedents to increased supplier involvement are. We build and test a conceptual model of the antecedents and new product performance outcomes of supplier involvement in the development of radical innovation by new ventures. Antecedent variables (supplier's specific investments and the new venture's qualification of the supplier's abilities) are drawn from the transaction cost analysis literature. We include new venture's relative power and new venture's level of commitment to the supplier as contingency conditions. We develop a set of hypotheses relating supplier involvement to radical innovation performance, relating the antecedent variables to supplier involvement, and also testing the interaction effects of the two contingency conditions. We gather data from both new ventures and their major suppliers for 173 recent radical innovation projects, and use hierarchical regression analysis to test our hypotheses. We find that the contingency conditions moderate achieved levels of supplier involvement, and also find a direct relationship between achieved level of involvement and performance. We conclude with theoretical contributions and managerial implications. Published by Elsevier B.V.
How do people approach marketing in the face of uncertainty, when the product, the market, and the traditional details involved in market research are unknowable ex ante? The authors use protocol analysis to evaluate how 27 expert entrepreneurs approach such a problem compared with 37 managers with little entrepreneurial expertise (all 64 participants are asked to think aloud as they make marketing decisions in exactly the same unpredictable situation). The hypotheses are drawn from literature in cognitive science on (1) expertise in general and (2) entrepreneurial expertise in particular. The results show significant differences in heuristics used by the two groups. While those without entrepreneurial expertise rely primarily on predictive techniques, expert entrepreneurs tend to invert these. In particular, they use an effectual or nonpredictive logic to tackle uncertain market elements and to coconstruct novel markets with committed stakeholders.
The Miles-Snow (M-S) strategic typology has continued to receive attention in the academic business press, even though it has been criticized for not making explicit the relationships between strategic type and ultimate profit performance. Using the market orientation and Resource-Based View literature, we develop hypotheses regarding relationships between M-S strategic type and four firm capabilities (technology, information technology, market-linking, and marketing capabilities), relationship between the four capabilities and performance, and the moderating role of M-S strategic type. An empirical test involves multiple data collections from 216 firms. The study results suggest that there are significant relationships between capabilities and performance if one does not account for the moderating role of strategic type. When strategic type is used as a moderating variable, we find that only certain capabilities had significant effects on profitability. For example, technology and information technology capabilities increase financial performance for prospector organizations, while a different set of capabilities (marketlinking and marketing) are positively related to financial performance for defender organizations. We discuss how our findings are consistent with the expectations of the Resource-Based View of the firm. We conclude with a discussion of theoretical and managerial implications.
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