Losing Balance: Trade-Offs between Exploration and Exploitation Innovation
Exploration and Exploitation in Early Stage Ventures and SMEs
ISBN: 978-1-78350-655-2, eISBN: 978-1-78350-656-9
Publication date: 4 August 2014
Abstract
Low labor costs and market access are no longer competitive differentiators; increasingly companies are looking to design and develop new products and services as a crucial source of competitive advantage. As the pressure to innovate increases, so does the tension between shorter-term exploitative development and longer-term exploratory innovation activities. We explore this tension using interview data from software SMEs and venture capitalist firms who invest in technology-driven companies. Findings indicate that, despite firm’s having established solid innovation plans, short-term exploitative demands crowd out their longer-term exploration innovation during the development phase. Agency and resource dependence theories are used to start to explore some of the reasons for this shift. Implications and suggestions for future research are discussed.
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Acknowledgements
Acknowledgment
The authors would like to acknowledge Scott Latham and Mike Hitt for their helpful comments on a previous version of this document.
Citation
Randall, C., Edelman, L.F. and Galliers, R. (2014), "Losing Balance: Trade-Offs between Exploration and Exploitation Innovation", Exploration and Exploitation in Early Stage Ventures and SMEs (Technology, Innovation, Entrepreneurship and Competitive Strategy, Vol. 14), Emerald Group Publishing Limited, Leeds, pp. 97-121. https://doi.org/10.1108/S1479-067X20140000014002
Publisher
:Emerald Group Publishing Limited
Copyright © 2014 Emerald Group Publishing Limited