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Launching reverse-innovated product from emerging markets to MNC’s home market: A theoretical framework for MNC’s decisions

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  • Zhu, Fengxia
  • Zou, Shaoming
  • Xu, Hui

Abstract

A reverse-innovated product is a new product that is originally developed for an emerging market by MNCs. The increasing number of MNCs engaging in reverse innovation and the criticality of new products to an MNC’s performance and competitive advantage make reverse innovation an important area for academic research and managerial practices. This paper integrates relevant literature and proposes a theoretical framework to understand the mechanisms by which the characteristics of a reverse-innovated product affect management’s decision to launch that product in a developed market (e.g., the MNC’s home market). By means of literature review, the paper identifies two underlying evaluation mechanisms through which the reverse-innovated product characteristics are linked to management’s reverse launch decision: the perceived degree of needed adaptation and the perceived risk of cannibalization. The authors also derive several propositions for future empirical research and discuss implications for future research.

Suggested Citation

  • Zhu, Fengxia & Zou, Shaoming & Xu, Hui, 2017. "Launching reverse-innovated product from emerging markets to MNC’s home market: A theoretical framework for MNC’s decisions," International Business Review, Elsevier, vol. 26(1), pages 156-163.
    • Handle: RePEc:eee:iburev:v:26:y:2017:i:1:p:156-163
    DOI: 10.1016/j.ibusrev.2016.06.003
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    Cited by:

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    2. Krohn, Malte & Petersen, Finn & Hochmuth, Dustin & Herstatt, Cornelius, 2020. "The Deliberative Frugal Mindset: A model of managerial opportunity recognition for frugal innovation," Working Papers 109, Hamburg University of Technology (TUHH), Institute for Technology and Innovation Management.
    3. Yingying Zhang Zhang & Sylvia Rohlfer, 2020. "A review of innovation and emerging markets," Working Papers EMS_2020_02, Research Institute, International University of Japan.
    4. Sarkar, Soumodip & Mateus, Sara, 2022. "Value creation using minimal resources – A meta-synthesis of frugal innovation," Technological Forecasting and Social Change, Elsevier, vol. 179(C).
    5. Malobi Mukherjee & Jacob Wood, 2021. "Consolidating Unorganised Retail Businesses through Digital Platforms: Implications for Achieving the UN Sustainable Development Goals," Sustainability, MDPI, vol. 13(21), pages 1-28, October.
    6. Sharmelly, Rifat & Ray, Pradeep Kanta, 2021. "Managing resource-constrained innovation in emerging markets: Perspectives from a business model," Technology in Society, Elsevier, vol. 65(C).

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