Navigating imposed innovation: A decision-making framework

Amir Bahman Radnejad and Oleksiy Osiyevskyy

Business Horizons, 2020, vol. 63, issue 1, 97-107

Abstract: Modern economies are characterized by the rising role of nonmarket actors (e.g., regulatory agencies, social activists, labor unions, media) that are gaining influence over the behavior of for-profit firms. These nonmarket stakeholders use their clout over industry players to impose innovations that require costly changes in business practices or technological trajectories while lacking firm-level economic justification. How should a company respond when it is pressured to adopt a new practice or change its products, while the economic calculations suggest that this is going to be a pure cost? Our study suggests alternative strategic responses to imposed innovation pressures and explores the factors determining the choice of an optimal strategy. Grounding the argument on the outside-in approach to pursuing imposed innovations, we propose a framework of organizational responses to external pressures to innovate, with varying degrees of firm engagement and different levels of cooperation with other industry actors. We also present a decision tree approach, allowing organizational decision makers to analyze the contextual determinants and ultimately arrive at the most appropriate, context-determined strategy.

Keywords: Imposed innovation; Nonmarket stakeholders; Stakeholder pressure; Competitor collaboration; Resistance to innovation (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:bushor:v:63:y:2020:i:1:p:97-107

DOI: 10.1016/j.bushor.2019.09.010

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