Exploring the relationship between incumbency and radical innovation: the case of business to consumer e-commerce applications

Davide Chiaroni, Vittorio Chiesa, Federico Frattini and Luca Turba

International Journal of Entrepreneurship and Innovation Management, 2010, vol. 11, issue 4, 419-439

Abstract: The purpose of the paper is to investigate the factors underlying the difficulty that incumbent firms encounter, in comparison with new entrants, in the development and exploitation of a radical innovation, a phenomenon also known as 'incumbent's curse'. The paper shows that incumbent's curse is determined by different factors (organisational, strategic and economic), depending on the dimensions of radicalness that characterise the innovation. Moreover, it reports the results of an exploratory study on the adoption of B2C e-commerce by Italian firms, designed to investigate if and how the factors underlying incumbent's curse have different impacts along the cycle of adoption of the innovation. The analysis suggests that the performance of incumbents in the first months that follow adoption is significantly influenced by their organisational characteristics. If these are not adequate to the innovation being adopted, incumbents are likely to be outperformed by new entrants and this initial drawback is difficult to recover as time passes.

Keywords: radical innovation; incumbent firms; new entrants; e-commerce; Italy; electronic commerce; incumbency; incumbent's curse; organisational factors; strategic factors; economic factors; business-to-consumer; B2C; cycle of adoption; entrepreneurship; innovation management; open innovation; collaboration. (search for similar items in EconPapers)
Date: 2010
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Citations: View citations in EconPapers (2)

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