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Strategic Pacing and the Progress Trap of Innovations

Strategic Pacing and the Progress Trap of Innovations. Pratim Datta Kent State University. Agenda. Motivation Theoretical Background The Strategic Pacing Model Hypothesis Development Contributions and Future Research Conclusion. Motivation.

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Strategic Pacing and the Progress Trap of Innovations

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  1. Strategic Pacing and the Progress Trap of Innovations Pratim Datta Kent State University

  2. Agenda • Motivation • Theoretical Background • The Strategic Pacing Model • Hypothesis Development • Contributions and Future Research • Conclusion

  3. Motivation • Progress Trap of Innovation defined as the opportunity costs of relinquishing opportunities from maintaining QoS for existing innovations for innovation intensity. • “Too much of a good thing”- Barnett and Freeman (2001)- There are limits to how much innovation a customer can absorb over time (Tony Scott, CIO, Disney) • Overshooting: the 37th button on your remote (Anthony 2008) • Inward vs. Outward facing- rigidity in productive rather than service and quality efficiencies • Not a prescription for not innovating- rather, a need for strategic pacing of innovation efforts • Two different trajectories- adoption vs. invention

  4. Theoretical Underpinnings • Value Theory: • The tension between donor-type value and receiver-type value: cost vs. instrumental benefits • If donor type value – receiver type value ≤ 0, exchange value = 0 • Production Frontier Model • Opportunity Costs: given fixed resource set, optimizing allocations between one more innovation and more service for existing innovations • Allocative efficiencies

  5. Production Frontier & Allocative Efficiencies Innovation Portfolio A = I > S B = S > I Service Focus for existing innovations

  6. Adoption Returns vs. Innovation Intensity (II) Adoption Returns Innovation Intensity (II) (II) (II) Areas of sustaining returns Time

  7. Progress Trap of Innovations (PTI) -Execution Shortfall -Channel Conflict -Cannibalization -User Engagement (Shelf Life) -Tech. Specificity (Competence rigidity) -Inventory Discounting Technology Innovation Portfolio -Idiocentric -Allocentric Strategic Pacing -Time between Innovations -Diversity of Innovations (product line x product width) -Quality (incremental vs. radical) Initial PTI Model

  8. Framework and Propositions • Progress Trap of Innovation: • The degree to which innovation intensity outperforms innovation servicing (forgoing budget dollars from service to R&D). • Type of Technology Innovation Strategy • Idiocentric: • Innovations with a standalone focus- unrealted diversification of innovation portfolio • Allocentric: • Innovations with a collective focus- related diversification of innovation portfolio • P1: Firms with a high allocentric innovation portfolio are less likely to fall in the PTI than firms with a high idiocentric portfolio

  9. Framework and Propositions • Strategic Pacing: • Time between Innovations • Quality of delivery and deployment • P2: Strategic pacing will positively dampen (diminish) PTI; the dampening effect will be higher for firms with a larger idiocentric innovation portfolio than for firms with a higher idiocentric portfolio. • Progress Trap of Innovations (PTI) • Execution Shortfall • Channel Conflict • Cannibalization • User Engagement (Shelf Life) • Tech. Specificity (Competence rigidity) • Inventory Discounting

  10. Contributions • Contribution: • Is there an optimal innovation portfolio and intensity that firms can follow? • TTM over QoS • Understanding the need for pacing innovations – absorptive capacity • The 37th button or a new remote • Future Research Direction: • Case-based reasoning • Scenario Analysis

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