Master Strategic Management
Corporate Entepeneurship
SUMMARY PAPERS & TURTORIALS
,Inhoud
Week 1...................................................................................................................................................3
The Innovator’s Dilemma - Christensen..............................................................................................3
“Darwin and the Demon” - Moore.....................................................................................................4
Meeting the challenge of disruptive change (Christensen and Overdorf, 2009)................................6
Week 2...................................................................................................................................................9
Building Ambidexterity into an Organization (Birkinshaw, 2004).......................................................9
Exploration vs. Exploitation: An empirical test of the Ambidexterity Hypothesis (He and Wong,
2004)................................................................................................................................................11
Transformational Leadership’s Role in Promoting Corporate Entrepreneurship: Examining the CEO-
TMT Interface - Ling, Simsek, Lubatkin, and Veiga (2008)................................................................12
Week 3.................................................................................................................................................14
Creating Incentives for Innovation – Manso (2017)..........................................................................14
How Apple Is Organized for Innovation It’s about experts leading experts. – Podolny & Hansen
(2020)...............................................................................................................................................16
Week 5.................................................................................................................................................18
Stage-Gate Controls, Learning Failure, and Adverse Effect on Novel New Products - Sethi and Iqbal
(2008)...............................................................................................................................................18
Innovation Killers: How Financial Tools Destroy Your Capacity to Do New Things - Christensen,
Kaufman and Shih (2008).................................................................................................................21
The dynamics of product innovation and firm competences – Danneels (2002)..............................24
Week 6.................................................................................................................................................29
Chesbrough (2003), The Era of Open Innovation..............................................................................29
Making Sense of Corporate Venture Capital - Chesbrough (2002)...................................................32
Why the Best and Brightest Approaches Don’t Solve the Innovator’s Dilemma - Denning (2005)...35
AGILENT TECHNOLOGIES: ORGANIZATIONAL CHANGE (less important)..........................................38
, Week 1
The Innovator’s Dilemma - Christensen
Well-managed companies listening to their customers, investing in new technologies and still fail.
- Disruptive changes in technology & market structure (simple extensions & complex
technologies)
Decisions that led to failure were made when leaders widely regarded as among the best companies
in the world. Two ways to solve this paradox:
1. The firms were never good managed
2. The way the decisions get made
Principles of innovation: if good firms fail, it is due to managers ignored this principles
The innovators dilemma: the logical, competent decisions of management that are critical to the
success of their companies are also the reasons why they lose their positions of leadership
Why good management can lead to failure Failure framework is built upon three findings:
1. Distinction between sustaining and disruptive technologies
a. Sustaining: improve the performance of established products
b. Disruptive: innovation that result in worse product performance different
value proposition, but other features that new customers value. (cheap, simple
and small)
2. Technological proces progress faster than market demand
a. Technologies can progress faster than market demand overshoot market: give
customer more than they need or welling to pay for
b. Disruptive innovations that underperform now, may be competitive later
3. Disruptive technologies vs rational investments
a. Disruptive technologies is not a rations financial decision, threes bases:
1. Disruptive is simpler and cheaper (lower margins, not grater profits)
2. Disruptive at first commercialized in emerging markets
3. Most provide customers don’t want the new product. The innovation is for
the least profitable customer
The principles of disruptive innovation
Principle 1: Companies depend on their customers and investors for resources:
- Companies will always be led by their biggest and most demanding customers and investors
Principle 2: Small markets cannot provide the necessary growth for larger companies:
- Companies seeking to grow, while disruptive innovations begin at the low-end and can grow
on small turnover and margins.
Principle 3: Markets that don’t exist can’t be analysed:
- The forecast of emerging markets are always wrong.
Principle 4: An organization's capabilities can define its disabilities:
- A companies processes and values are not flexible, you can’t
change them easily
Principle 5: Technology supply may not equal market demand
- Companies overshoot the needs of the general market, and
create a vacuum for lower-end, lower-cost technologies to enter
at the foot of the market, servicing the basic needs of customers.
, “Darwin and the Demon” - Moore
- Darwin remaining survival of the fittest
- Demon inertia: aligning development life cycle with product lifecycle to prevent inertia
Types of innovation:
1. Disruptive innovation: Technological discontinuities
2. Application innovation: take existing technology into new markets to serve new purposes
3. Product innovation: established offers in establish markets more effective or efficient
4. Experimental innovation: make modifications that improve customers experience
5. Marketing innovation: improve marketing
6. Structural innovation: disruption to restructure the industry relationships
The market development life cycle
1. Early market: technology is introduced and
attracts attention of early adopters
2. The Chasm
3. Bowling alley: acceptance
4. Tornado: passed the test of usefulness
5. Main street (early): hypergrowth
6. Main street (mature)
7. Main street (declining)
8. Fault line & End of life
Innovation within the lifecycle
1. Technology adoption life cycle:
- disruptive, application and product innovation
2. Market moves to main street:
- process, experiential and marketing innovation
3. Technology becomes obsolete:
- business model and structural innovation
Defeating the demon overcoming inertia
- Introduce new types of innovation while deconstructing old processes and organizations.
- Extract resources from the legacy processes and organizations and repurpose them to the
new innovation type (see life cycle above)
- Management must follow a twofold path of constructing the new innovation and
deconstructing the old one.
- Main challenge deconstructing: legacy work still needs to be done (brings no new customers)
- Core principle deconstructing its legacy: productivity, not differentiation. Differentiation that
does not drive customer preference is a liability. To do this there are four steps:
The principle of productivity
1. Centralize the legacy function
2. Standardize the process
3. Simplify the process
4. Automate or outsource the process
Corporate Entepeneurship
SUMMARY PAPERS & TURTORIALS
,Inhoud
Week 1...................................................................................................................................................3
The Innovator’s Dilemma - Christensen..............................................................................................3
“Darwin and the Demon” - Moore.....................................................................................................4
Meeting the challenge of disruptive change (Christensen and Overdorf, 2009)................................6
Week 2...................................................................................................................................................9
Building Ambidexterity into an Organization (Birkinshaw, 2004).......................................................9
Exploration vs. Exploitation: An empirical test of the Ambidexterity Hypothesis (He and Wong,
2004)................................................................................................................................................11
Transformational Leadership’s Role in Promoting Corporate Entrepreneurship: Examining the CEO-
TMT Interface - Ling, Simsek, Lubatkin, and Veiga (2008)................................................................12
Week 3.................................................................................................................................................14
Creating Incentives for Innovation – Manso (2017)..........................................................................14
How Apple Is Organized for Innovation It’s about experts leading experts. – Podolny & Hansen
(2020)...............................................................................................................................................16
Week 5.................................................................................................................................................18
Stage-Gate Controls, Learning Failure, and Adverse Effect on Novel New Products - Sethi and Iqbal
(2008)...............................................................................................................................................18
Innovation Killers: How Financial Tools Destroy Your Capacity to Do New Things - Christensen,
Kaufman and Shih (2008).................................................................................................................21
The dynamics of product innovation and firm competences – Danneels (2002)..............................24
Week 6.................................................................................................................................................29
Chesbrough (2003), The Era of Open Innovation..............................................................................29
Making Sense of Corporate Venture Capital - Chesbrough (2002)...................................................32
Why the Best and Brightest Approaches Don’t Solve the Innovator’s Dilemma - Denning (2005)...35
AGILENT TECHNOLOGIES: ORGANIZATIONAL CHANGE (less important)..........................................38
, Week 1
The Innovator’s Dilemma - Christensen
Well-managed companies listening to their customers, investing in new technologies and still fail.
- Disruptive changes in technology & market structure (simple extensions & complex
technologies)
Decisions that led to failure were made when leaders widely regarded as among the best companies
in the world. Two ways to solve this paradox:
1. The firms were never good managed
2. The way the decisions get made
Principles of innovation: if good firms fail, it is due to managers ignored this principles
The innovators dilemma: the logical, competent decisions of management that are critical to the
success of their companies are also the reasons why they lose their positions of leadership
Why good management can lead to failure Failure framework is built upon three findings:
1. Distinction between sustaining and disruptive technologies
a. Sustaining: improve the performance of established products
b. Disruptive: innovation that result in worse product performance different
value proposition, but other features that new customers value. (cheap, simple
and small)
2. Technological proces progress faster than market demand
a. Technologies can progress faster than market demand overshoot market: give
customer more than they need or welling to pay for
b. Disruptive innovations that underperform now, may be competitive later
3. Disruptive technologies vs rational investments
a. Disruptive technologies is not a rations financial decision, threes bases:
1. Disruptive is simpler and cheaper (lower margins, not grater profits)
2. Disruptive at first commercialized in emerging markets
3. Most provide customers don’t want the new product. The innovation is for
the least profitable customer
The principles of disruptive innovation
Principle 1: Companies depend on their customers and investors for resources:
- Companies will always be led by their biggest and most demanding customers and investors
Principle 2: Small markets cannot provide the necessary growth for larger companies:
- Companies seeking to grow, while disruptive innovations begin at the low-end and can grow
on small turnover and margins.
Principle 3: Markets that don’t exist can’t be analysed:
- The forecast of emerging markets are always wrong.
Principle 4: An organization's capabilities can define its disabilities:
- A companies processes and values are not flexible, you can’t
change them easily
Principle 5: Technology supply may not equal market demand
- Companies overshoot the needs of the general market, and
create a vacuum for lower-end, lower-cost technologies to enter
at the foot of the market, servicing the basic needs of customers.
, “Darwin and the Demon” - Moore
- Darwin remaining survival of the fittest
- Demon inertia: aligning development life cycle with product lifecycle to prevent inertia
Types of innovation:
1. Disruptive innovation: Technological discontinuities
2. Application innovation: take existing technology into new markets to serve new purposes
3. Product innovation: established offers in establish markets more effective or efficient
4. Experimental innovation: make modifications that improve customers experience
5. Marketing innovation: improve marketing
6. Structural innovation: disruption to restructure the industry relationships
The market development life cycle
1. Early market: technology is introduced and
attracts attention of early adopters
2. The Chasm
3. Bowling alley: acceptance
4. Tornado: passed the test of usefulness
5. Main street (early): hypergrowth
6. Main street (mature)
7. Main street (declining)
8. Fault line & End of life
Innovation within the lifecycle
1. Technology adoption life cycle:
- disruptive, application and product innovation
2. Market moves to main street:
- process, experiential and marketing innovation
3. Technology becomes obsolete:
- business model and structural innovation
Defeating the demon overcoming inertia
- Introduce new types of innovation while deconstructing old processes and organizations.
- Extract resources from the legacy processes and organizations and repurpose them to the
new innovation type (see life cycle above)
- Management must follow a twofold path of constructing the new innovation and
deconstructing the old one.
- Main challenge deconstructing: legacy work still needs to be done (brings no new customers)
- Core principle deconstructing its legacy: productivity, not differentiation. Differentiation that
does not drive customer preference is a liability. To do this there are four steps:
The principle of productivity
1. Centralize the legacy function
2. Standardize the process
3. Simplify the process
4. Automate or outsource the process
