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Exploratory innovation, exploitative innovation, and performance

Author

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  • Yi Li
  • Nan Zhou
  • Youhe Si

Abstract

Purpose - The purpose of this paper is to explore the impact of a firm's innovation activities on performance, and focus on the internal fit and external fit of two types of innovation activities – exploratory innovation and exploitative innovation. Design/methodology/approach - The paper adopts the survey data of 397 enterprises in eastern, middle, and western China. The business strategy attributes analysis based on strategic orientation of business enterprises (STROBE) scale was used to classify the business strategy types, and hierarchical regression analyses were employed to test the hypotheses. Findings - The results show: both exploratory innovation and exploitative innovation have a positive effect on firm performance; the internal fit between exploratory innovation and exploitative innovation, whether it is fit as moderating or fit as matching, has no significant effect on firm performance; the fit between innovation activity and firm business strategy has significant effect on firm performance, therefore, exploratory innovation activity fits defenders and exploitative innovation activity fits prospectors; and the fit between the innovation activity and external environment has a slight effect on firm performance. Environmental competitiveness can enhance exploratory innovation outcome but diminish exploitative innovation outcome. Originality/value - The paper has supplied the empirical evidence discovered in the context of China to the theoretical views of exploratory innovation and exploitative innovation, and achieved some results which differ from the ones drawn by similar researches done abroad.

Suggested Citation

  • Yi Li & Nan Zhou & Youhe Si, 2010. "Exploratory innovation, exploitative innovation, and performance," Nankai Business Review International, Emerald Group Publishing Limited, vol. 1(3), pages 297-316, July.
    • Handle: RePEc:eme:nbripp:v:1:y:2010:i:3:p:297-316
    DOI: 10.1108/20408741011069223
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    Citations

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    Cited by:

    1. Sandeep Vij & Harpreet Singh Bedi, 2016. "Effect Of Organisational And Environmental Factors On Innovativeness And Business Performance Relationship," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 20(03), pages 1-28, April.
    2. Sawsan A. Alshaer, 2020. "The Effect of Strategic Vigilance on Organizational Ambidexterity in Jordanian Commercial Banks," Modern Applied Science, Canadian Center of Science and Education, vol. 14(6), pages 1-82, June.
    3. Sarra Berraies & Belgacem Bchini, 2019. "Effect Of Leadership Styles On Financial Performance: Mediating Roles Of Exploitative And Exploratory Innovations Case Of Knowledge-Intensive Firms," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 23(03), pages 1-33, April.
    4. Dobni, C. Brooke & Sand, Christopher, 2018. "Strategy shift: Integrating strategy and the firm’s capability to innovate," Business Horizons, Elsevier, vol. 61(5), pages 797-808.
    5. Oerlemans, Leon & Chan, K.Y. & Knoben, Joris & Vermeulen, P.A.M., 2018. "Structural and geographical conditions for exploitative innovation : Evidence from South African manufacturing firms," Other publications TiSEM 4abcf615-a0d4-49ef-ba25-c, Tilburg University, School of Economics and Management.
    6. Salem AlAbri & Seyedeh Khadijeh Taghizadeh & Golam Mostafa Khan & Syed Abidur Rahman, 2022. "Exploratory innovation, exploitative innovation and operational performance: influence of informal social relations in environmental competitiveness," Quality & Quantity: International Journal of Methodology, Springer, vol. 56(3), pages 1223-1244, June.
    7. Jakub Tabas & Michaela Beranová & Josef Polák, 2011. "Classifications of innovations: approaches and consequences," Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, Mendel University Press, vol. 59(2), pages 399-406.
    8. Verreynne, Martie-Louise & Hine, Damian & Coote, Len & Parker, Rachel, 2016. "Building a scale for dynamic learning capabilities: The role of resources, learning, competitive intent and routine patterning," Journal of Business Research, Elsevier, vol. 69(10), pages 4287-4303.
    9. Uzairu Muhammad Gwadabe & Noor Aina Amirah, 2017. "Entrepreneurial Competencies: SMEs Performance Factor in the Challenging Nigerian Economy," Academic Journal of Economic Studies, Faculty of Finance, Banking and Accountancy Bucharest,"Dimitrie Cantemir" Christian University Bucharest, vol. 3(4), pages 55-61, December.

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