Making Innovation Last This page intentionally left blank Making Innovation Last: Volume 1 Sustainable Strategies for Long Term Growth Hubert Gatignon INSEAD, Sorbonne Universités, France David Gotteland Grenoble Ecole de Management, France Christophe Haon Grenoble Ecole de Management, France © Hubert Gatignon, David Gotteland and Christophe Haon 2016 Foreword © Thomas S. Robertson 2016 Softcover reprint of the hardcover 1st edition 2016 978-1-137-56096-4 All rights reserved. No reproduction, copy or transmission of this publication may be made without written permission. No portion of this publication may be reproduced, copied or transmitted save with written permission or in accordance with the provisions of the Copyright, Designs and Patents Act 1988, or under the terms of any licence permitting limited copying issued by the Copyright Licensing Agency, Saffron House, 6-10 Kirby Street, London EC1N 8TS. Any person who does any unauthorized act in relation to this publication may be liable to criminal prosecution and civil claims for damages. The authors have asserted their rights to be identified as the authors of this work in accordance with the Copyright, Designs and Patents Act 1988. First published 2016 by PALGRAVE MACMILLAN Palgrave Macmillan in the UK is an imprint of Macmillan Publishers Limited, registered in England, company number 785998, of Houndmills, Basingstoke, Hampshire RG21 6XS. Palgrave Macmillan in the US is a division of St Martin’s Press LLC, 175 Fifth Avenue, New York, NY 10010. Palgrave Macmillan is the global academic imprint of the above companies and has companies and representatives throughout the world. Palgrave® and Macmillan® are registered trademarks in the United States, the United Kingdom, Europe and other countries. ISBN 978-1-349-56541-2 ISBN 978-1-137-56098-8 (eBook) DOI 10.10~07/978-1-137-56098-8 This book is printed on paper suitable for recycling and made from fully managed and sustained forest sources. Logging, pulping and manufacturing processes are expected to conform to the environmental regulations of the country of origin. A catalogue record for this book is available from the British Library. Library of Congress Cataloging-in-Publication Data Gatignon, Hubert, author. M aking inn ovation last : sustainable strategies for long term growth / H ubert Gatignon, David Gotteland, Christophe Haon. volumes cm 1. Technological innovations—Management. 2. New products. 3. Creative ability in business. I. Gotteland, David, 1975– author. II. Haon, Christophe, 1972– author. III. Title. HD45.G35 2015 658.4’063—dc23 2015026452 To Erin’s memory – HG To Gaspard, Firmin, and Emma – DG To Isabelle, Louis, and Elise – CH This page intentionally left blank Contents List of Tables viii List of Figures xi Foreword Thomas S. Robertson xiii Preface and Acknowledgments xvi 1 Introduction 1 Part I Understanding Innovations 17 2 Assessing Innovations from the Technology Perspective 19 3 Assessing Innovations from the Market Point of View 53 Part II Organizational Context for Innovations 95 4 Strategic and Market Orientations 97 5 Managing Capabilities 153 6 When to Forge Alliances? 201 Index 249 List of Tables 1.1 Firm innovativeness scale 5 1.2 Innovativeness means 5 1.3 Drivers of new product success 8 2.1 Generational consolidation scale 30 2.2 Generational expansion scale 31 2.3 Architectural innovation scale 35 2.4 Radicalness of innovation scale 37 2.5 Competence-destroying/enhancing scale 38 2.6 New competence acquisition scale 41 2.7 Examples of process innovations 42 2.8 Examples of process innovations by radicalness and competence-destroying characteristics 43 3.1 Examples of style changes 55 3.2 Examples of product improvement 56 3.3 Examples of product line extensions 57 3.4 Examples of new products for the currently served market 57 3.5 Examples of new products for the established market 59 3.6 Examples of major innovations 59 3.7 Ansoff’s diversification matrix 59 3.8 Measures of new product innovativeness 61 3.9 Innate innovativeness scale 65 3.10 Domain-specific innovativeness scale 66 3.11 Motivated consumer innovativeness scale 67 3.12 The 15 characteristics in Fliegel and Kivlin (1966) 69 viii List of Tables ix 3.13 Representative items for the measurement of new product advantage 70 3.14 Multi-item scales of innovation characteristics 76 3.15 Competencies in Technology/Production and Marketing 82 3.16 Selected innovations in automotive industry according to the transilience map 84 3.17 Air France statement on Pitot probes after the AF 447 crash 88 4.1 Market orientation scale – behavioral approach 103 4.2 Customer orientation scale 106 4.3 Competitor orientation scale 107 4.4 Questions to assess stakeholder orientation 109 4.5 Proactive market orientation scale 112 4.6 Technology orientation scale 120 4.7 Production orientation scale 121 4.8 Selling orientation scale 122 4.9 Entrepreneurial orientation scale 124 4.10 Strategic orientation dimensions and related items 126 4.11 Market orientation means 136 4.12 Strategic orientation means 137 4.13 Market orientation values 140 4.14 Individual level of market orientation scale 142 5.1 Szulanski’s scale of absorptive capacity 161 5.2 Lane and Lubatkin’s measure of absorptive capacity 162 5.3 Jansen et al.’s measure of absorptive capacity 163 5.4 Lichtenthaler’s measure of absorptive capacity 165 5.5 Zhou and Wu’s measure of technological capability 175 5.6 Vorhies and Morgan’s scale of marketing capabilities 178