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Navigating imposed innovation: A decision-making framework

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  • Radnejad, Amir Bahman
  • Osiyevskyy, Oleksiy

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.

Suggested Citation

  • Radnejad, Amir Bahman & Osiyevskyy, Oleksiy, 2020. "Navigating imposed innovation: A decision-making framework," Business Horizons, Elsevier, vol. 63(1), pages 97-107.
  • Handle: RePEc:eee:bushor:v:63:y:2020:i:1:p:97-107
    DOI: 10.1016/j.bushor.2019.09.010
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    References listed on IDEAS

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    Cited by:

    1. Wen, Jun & Zhang, Sen & Chang, Chun-Ping, 2022. "Legal origins and innovation: Global evidence," Technological Forecasting and Social Change, Elsevier, vol. 174(C).

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