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Dynamic Commercialization Strategies for Disruptive Technologies: Evidence from the Speech Recognition Industry

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  • Matt Marx

    (MIT Sloan School of Management, Massachusetts Institute of Technology, Cambridge, Massachusetts 02142)

  • Joshua S. Gans

    (Rotman School of Management, University of Toronto, Toronto, Ontario M5S 3E6, Canada)

  • David H. Hsu

    (The Wharton School, University of Pennsylvania, Philadelphia, Pennsylvania 19104)

Abstract

When start-up innovation involves a potentially disruptive technology—initially lagging in the predominant performance metric, but with a potentially favorable trajectory of improvement—incumbents may be wary of engaging in cooperative commercialization with the start-up. While the prevailing theory of disruptive innovation suggests that this will lead to (exclusively) competitive commercialization and the eventual replacement of incumbents, we consider a dynamic strategy involving product market entry before switching to a cooperative commercialization strategy. Empirical evidence from the automated speech recognition industry from 1952 to 2010 confirms our main hypothesis. This paper was accepted by Bruno Cassiman, business strategy .

Suggested Citation

  • Matt Marx & Joshua S. Gans & David H. Hsu, 2014. "Dynamic Commercialization Strategies for Disruptive Technologies: Evidence from the Speech Recognition Industry," Management Science, INFORMS, vol. 60(12), pages 3103-3123, December.
    • Handle: RePEc:inm:ormnsc:v:60:y:2014:i:12:p:3103-3123
    DOI: 10.1287/mnsc.2014.2035
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    More about this item

    Keywords

    technology commercialization strategy; disruptive innovation;

    JEL classification:

    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D

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