HC 3 – Building a framework 21-04-2016
Study factors affect level of success/failure (product or service)
Structure
1. Introduce 3 core variables of frameworks
2. Social construction and legitimation: What, by whom, why, how
3. Resources
4. Organizational forms
To help you in developing your theoretical frameworks on factors that
influence the success of a product or service innovation (4th learning
objective).
Aldrich & Fiol, 1994: The more radical innovation, the higher the risk. Related
to liabilities of newness (= new activities/innovation/new ventures have a
higher risk of dying/not surviving. Do not have relationships to vendors etc.
Potential difference between new and existing organizations (e.g. Shell
liability of newness is lower, but completely new risk high).
To reduce risk: innovation requires:
- Legitimization (stakeholders understand an except your innovation)
- Resources (Assets, knowledge, money etc.)
- Appropriate organization form (do it yourself (hierarchical) or cooperate
(strategic alliance)
Links between factors.
- Legitimacy can be type of resources others say way of acquiring
resources.
- Also link resources and org form.
1. Legitimacy (Aldrich & Fiol, 1994)
a. Legitimacy is an important factor influencing a new industry
success.
b. Building industry around innovation: focus on new types of
innovation.
c. E.g. Tesla (battery needs infrastructure), Uber (taxi drivers,
government has to make rules) arrive when something is
new.
- Cognitive legitimacy: how much knowledge is there about the new
activity? (if people don’t understand where innovation is about, hard to
be legit)
- Sociopolitical legitimacy: Do key stakeholders, the general public,
key opinion leaders or government officials accept an activity as
appropriate and right? (want to achieve this, turn innovation into
industry: need instruments to create this).
- Need to be legitimated: innovation types:
o Product innovations
o Process innovations
Study factors affect level of success/failure (product or service)
Structure
1. Introduce 3 core variables of frameworks
2. Social construction and legitimation: What, by whom, why, how
3. Resources
4. Organizational forms
To help you in developing your theoretical frameworks on factors that
influence the success of a product or service innovation (4th learning
objective).
Aldrich & Fiol, 1994: The more radical innovation, the higher the risk. Related
to liabilities of newness (= new activities/innovation/new ventures have a
higher risk of dying/not surviving. Do not have relationships to vendors etc.
Potential difference between new and existing organizations (e.g. Shell
liability of newness is lower, but completely new risk high).
To reduce risk: innovation requires:
- Legitimization (stakeholders understand an except your innovation)
- Resources (Assets, knowledge, money etc.)
- Appropriate organization form (do it yourself (hierarchical) or cooperate
(strategic alliance)
Links between factors.
- Legitimacy can be type of resources others say way of acquiring
resources.
- Also link resources and org form.
1. Legitimacy (Aldrich & Fiol, 1994)
a. Legitimacy is an important factor influencing a new industry
success.
b. Building industry around innovation: focus on new types of
innovation.
c. E.g. Tesla (battery needs infrastructure), Uber (taxi drivers,
government has to make rules) arrive when something is
new.
- Cognitive legitimacy: how much knowledge is there about the new
activity? (if people don’t understand where innovation is about, hard to
be legit)
- Sociopolitical legitimacy: Do key stakeholders, the general public,
key opinion leaders or government officials accept an activity as
appropriate and right? (want to achieve this, turn innovation into
industry: need instruments to create this).
- Need to be legitimated: innovation types:
o Product innovations
o Process innovations
