Organization Strategy and Structural Differences for Radical Versus Incremental Innovation

Abstract

The purpose of this study was to test a model of the organizational innovation process that suggests that the strategy-structure causal sequence is differentiated by radical versus incremental innovation. That is, unique strategy and structure will be required for radical innovation, especially process adoption, while more traditional strategy and structure arrangements tend to support new product introduction and incremental process adoption. This differentiated theory is strongly supported by data from the food processing industry. Specifically, radical process and packaging adoption are significantly promoted by an aggressive technology policy and the concentration of technical specialists. Incremental process adoption and new product introduction tends to be promoted in large, complex, decentralized organizations that have market dominated growth strategies. Findings also suggest that more traditional structural arrangements might be used for radical change initiation if the general tendencies that occur in these dimensions as a result of increasing size can be delayed, briefly modified, or if the organization can be partitioned structurally for radical vs. incremental innovation. In particular, centralization of decision making appears to be necessary for radical process adoption along with the movement away from complexity toward more organizational generalists. This suggests that a greater support of top managers in the innovation process is necessary to initiate and sustain radical departures from the past for that organization.research and development: innovation, organizational studies

Exploring Proactive Market Strategies : Managing the Market to Create Value

“…Firms' innovation efforts can be guided in different directions; often this is simplified to focusing on incremental innovation, radical innovation, or both (Ettlie, Bridges & O'Keefe, 1984;Garcia & Calantone, 2002;Li et al, 2008;March, 1991). Henderson & Clark (1990) present a framework wherein firms' innovation efforts are categorized based on how the core concepts are changed and how the linkages between these concepts are changed.…”

Diffusion of Technologies and Social Behavior

“…Productivity increases arise both from radical shifts to a new, more efficient technology, and from continued, incremental improvement in the way in which an existing technology is utilized (Dewar and Dutton, 1986;Ettlie et al, 1984). Indeed, for some period of time when both emerging and mature process technologies coexist, additional improvements in the mature techniques also occur and frequently accelerate (Harley, 1973).…”

Researching at the Intersection of Innovation, Operations Management, and Entrepreneurship

“…Second, although innovation outcomes are often classified as incremental or radical (Dewar & Dutton, 1986;Ettlie, Bridges, & O'keefe, 1984) and perhaps also architectural (Galunic & Eisenhardt, 2001;Henderson & Clark, 1990), with radical innovations representing risky investments, entrepreneurship research focuses on the high uncertainty surrounding potential opportunities (Knight, 1921;McMullen & Shepherd, 2006). In this chapter, we investigate the stage-gate process for evaluating innovations in terms of potential opportunities characterized by high uncertainty.…”