Intensity, timeliness, and success of incumbent response to technological discontinuities: a synthesis and empirical investigation

Abstract

The extant literature highlights numerous different factors influencing the timeliness and intensity of incumbent response to discontinuous technological change. However, this literature has so far not been synthesized and is therefore limited in its analytical, predictive, and normative power. We develop a comprehensive model of incumbent response that organizes different explanatory factors into the three distinct dimensions of (1) identification and interpretation, (2) decision making, and (3) organizational implementation. We also conceptualize how response intensity and timeliness affect business performance in new technological domains. We test the model against data from 320 firms from the German dental lab industry, finding substantial support for the majority of our hypotheses. This study offers unique empirical insight in observing that cognitive constructs such as framing and management flexibility have the strongest impact on both intensity and timeliness of incumbent response to technological, and thus, strategic discontinuities. Together, our findings have important implications for both theory and practice.

Entrepreneurial orientation in vertical alliances: joint product innovation and learning from allies

“…Individuals with high EO evaluate uncertainty more as an opportunity than a threat (Palich and Ray Bagby 1995;Weaver et al 2002). This kind of opportunity framing implies more intense and faster reactions (Bockmühl et al 2011) with the risk of working at high speed in the wrong directions and damaging product innovation.…”

Strategy implementation: What is the failure rate?

“…Some others have adopted a different approach and decided to empirically test the impact of these frameworks and of their success factors (e.g. Pinto and Prescott, 1990;Miller, 1997;Bauer et al, 2005;Bockmühl et al, 2011).…”

The middle manager in search of business model innovation

“…Firms with a high degree of market sensitivity continuously scan existing and potential markets, thus maintaining an ability to develop a timely response to discontinuous change (Bockmühl et al, 2011). A failure to detect changes in the political environment and engage with the firm's institutional context may lead to the demise of even the biggest corporations (Dixon and Day, 2010).…”

“…Technicians were now able to scan and produce customised prostheses through a highly automated process, instead of relying on traditional manual techniques. An empirical study of this industry's responses to the changes (Bockmühl et al, 2011) found that the firms that systematically searched and collected market information, intensively discussed and evaluated the impact and searched for new markets were able to adjust faster than the companies less conscious of changes outside of their traditional industry and core competences.…”

“…Top management's support is widely acknowledged as a prerequisite for the successful launch and maintenance of major initiatives. Established firms' reactions to change are affected by the ability of decision-makers to modify their mental models, including their fundamental beliefs and assumptions (Bockmühl et al, 2011). Dialogue as a form of reflective conversation can be helpful in changing managers' mind-sets (Jacobs and Heracleous, 2005).…”