Analyzing new ventures’ innovation generation and adoption: a configurational analysis from the optimal distinctiveness perspective
Abstract
The institutional theory literature focuses on the legitimization of new ventures’ innovative behaviors, while the entrepreneurial orientation literature emphasizes differentiation of the pursuit of innovation by new ventures. We apply the optimal distinctiveness perspective to examine how the institutional environment and entrepreneurial orientation jointly influence two modes of innovation – innovation generation and innovation adoption – in new ventures. We employ fuzzy-set qualitative comparative analysis (fsQCA) based on country-level data obtained from the Global Entrepreneurship Monitor (GEM) project. Our findings reveal that there are five equifinal optima of distinctiveness rather than a one-size-fits-all optimal distinctiveness for high innovation generation and high innovation adoption, respectively. Moreover, the orchestrating mechanisms of the two modes of innovation are different: that of innovation generation is threshold orchestration and that of innovation adoption is compensatory orchestration. Furthermore, except for the difference, we also identify something similar shared by mechanisms of innovation generation and innovation adoption. These results extend the optimal distinctiveness theory by empirically verifying equifinality in optimal distinctiveness and articulating different practices of threshold orchestration and compensatory orchestration, and also contribute to the innovation literature by examining the differences and similarities of the mechanisms of innovation generation and innovation adoption.
Keyword : innovation generation, innovation adoption, institutional environment, entrepreneurial orientation, optimal distinctiveness perspective, fuzzy-set qualitative comparative analysis
How to Cite
Xie, Z., Xie, L., & Liu, L. (2024). Analyzing new ventures’ innovation generation and adoption: a configurational analysis from the optimal distinctiveness perspective. Journal of Business Economics and Management, 25(3), 572–589. https://doi.org/10.3846/jbem.2024.21704
This work is licensed under a Creative Commons Attribution 4.0 International License.
References
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Busenitz, L. W., Gómez, C., & Spencer, J. W. (2000). Country institutional profiles: Unlocking entrepreneurial phenomena. Academy of Management Journal, 43(5), 994–1003. https://doi.org/10.5465/1556423
Bogatyreva, K., Laskovaia, A., & Osiyevskyy, O. (2022). Entrepreneurial activity, intrapreneurship, and conducive institutions: Is there a connection? Journal of Business Research, 146, 45–56. https://doi.org/10.1016/j.jbusres.2022.03.062
Damanpour, F., & Wischnevsky, J.D. (2006). Research on innovation in organizations: Distinguishing innovation-generating from innovation-adopting organizations. Journal of Engineering and Technology Management, 23(4), 269–291. https://doi.org/10.1016/j.jengtecman.2006.08.002
De Clercq, D., Lim, D. S. K., & Oh, C. H. (2013). Individual–level resources and new business activity: The contingent role of institutional context. Entrepreneurship Theory and Practice, 37(2), 303–330. https://doi.org/10.1111/j.1540-6520.2011.00470.x
Deephouse, D. L. (1999). To be different, or to be the same? It’s a question (and theory) of strategic balance. Strategic Management Journal, 20(2), 147–166. 3.0.CO;2-Q> https://doi.org/10.1002/(SICI)1097-0266(199902)20:2<147::AID-SMJ11>3.0.CO;2-Q
Douglas, E. J., Shepherd, D. A., & Prentice, C. (2020). Using fuzzy-set qualitative comparative analysis for a finer-grained understanding of entrepreneurship. Journal of Business Venturing, 35(1), Article 105970. https://doi.org/10.1016/j.jbusvent.2019.105970
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Fiss, P. C. (2011). Building better causal theories: A fuzzy set approach to typologies in organization research. Academy of Management Journal, 54(2), 393–420. https://doi.org/10.5465/amj.2011.60263120
Furnari, S., Crilly, D., Misangyi, V. F., Greckhamer, T., Fiss, P. C., & Aguilera, R. V. (2020). Capturing causal complexity: Heuristics for configurational theorizing. Academy of Management Review, 46(4), 778–799. https://doi.org/10.5465/amr.2019.0298
Garud, R., & Rappa, M. A. (1994). A socio-cognitive model of technology evolution: The case of cochlear implants. Organization Science, 5(3), 344–362. https://doi.org/10.1287/orsc.5.3.344
GEM. (2022). Global Entrepreneurship Monitor 2021/2022 global report: Opportunity amid disruption. GEM.
Greckhamer, T., Furnari, S., Fiss, P. C., & Aguilera, R. V. (2018). Studying configurations with qualitative comparative analysis: Best practices in strategy and organization research. Strategic Organization, 16(4), 482–495. https://doi.org/10.1177/1476127018786487
Hechavarría, D. M., & Ingram, A. E. (2019). Entrepreneurial ecosystem conditions and gendered national-level entrepreneurial activity: A 14-year panel study of GEM. Small Business Economics, 53(2), 431–458. https://doi.org/10.1007/s11187-018-9994-7
Hoskisson, R. E., Chirico, F., Zyung, J., & Gambeta, E. (2017). Managerial risk taking: A multitheoretical review and future research agenda. Journal of Management, 43(1), 137–169. https://doi.org/10.1177/0149206316671583
Ionescu, A. M., Clipa, A. M., Turnea, E. S., Clipa, C. I., Bedrule-Grigoruță, M. V., & Roth, S. (2022). The impact of innovation framework conditions on corporate digital technology integration: Institutions as facilitators for sustainable digital transformation. Journal of Business Economics and Management, 23(5), 1037–1059. https://doi.org/10.3846/jbem.2022.17039
Li, K., Xia, Y., & Zhang, J. (2023). CEOs’ multicultural backgrounds and firm innovation: Evidence from China. Finance Research Letters, 57, Article 104255. https://doi.org/10.1016/j.frl.2023.104255
Lim, D. S. K., Oh, C. H., & De Clercq, D. (2016). Engagement in entrepreneurship in emerging economies: Interactive effects of individual-level factors and institutional conditions. International Business Review, 25(4), 933–945. https://doi.org/10.1016/j.ibusrev.2015.12.001
Ma, H., Guo, H., & Shen, R. (2019). Organisational regulatory legitimacy, entrepreneurial orientation, and SME innovation: An optimal distinctiveness perspective. Technology Analysis & Strategic Management, 31(7), 833–847. https://doi.org/10.1080/09537325.2018.1555320
March, J. G. (1991). Exploration and exploitation in organizational learning. Organization Science, 2(1), 71–87. https://doi.org/10.1287/orsc.2.1.71
McGrath, R. G. (1995). Advantage from adversity: Learning from disappointment in internal corporate ventures. Journal of Business Venturing, 10(2), 121–142. https://doi.org/10.1016/0883-9026(94)00021-l
McKnight, B., & Zietsma, C. (2018). Finding the threshold: A configurational approach to optimal distinctiveness. Journal of Business Venturing, 33(4), 493–512. https://doi.org/10.1016/j.jbusvent.2018.03.004
Miles, R. E., & Snow, C. C. (1978). Organizational strategy, structure, and process. McGraw-Hill.
Misangyi, V. F., & Acharya, A. G. (2014). Substitutes or complements? A configurational examination of corporate governance mechanisms. Academy of Management Journal, 57(6), 1681–1705. https://doi.org/10.5465/amj.2012.0728
Misangyi, V. F., Greckhamer, T., Furnari, S., Fiss, P. C., Crilly, D., & Aguilera, R. (2017). Embracing causal complexity: The emergence of a neo-configurational perspective. Journal of Management, 43(1), 255–282. https://doi.org/10.1177/0149206316679252
Mitchell, R. K., Busenitz, L., Lant, T., McDougall, P. P., Morse, E. A., & Smith, J. B. (2002). Toward a theory of entrepreneurial cognition: Rethinking the people side of entrepreneurship research. Entrepreneurship Theory and Practice, 27(2), 93–104. https://doi.org/10.1111/1540-8520.00001
Mohsen, K., Saeed, S., Raza, A., Omar, S., & Muffatto, M. (2021). Does using latest technologies impact new venture innovation? A contingency-based view of institutional environments. Journal of Small Business Management, 59(4), 852–886. https://doi.org/10.1111/jsbm.12534
Morgan, N. A. (1995). Managing imitation strategies: How later entrants seize market share from pioneers. Journal of Marketing, 59(4), 104–107. https://doi.org/10.1016/0737-6782(95)90182-5
Navis, C., & Glynn, M. A. (2010). How new market categories emerge: Temporal dynamics of legitimacy, identity, and entrepreneurship in satellite radio, 1990–2005. Administrative Science Quarterly, 55(3), 439–471. https://doi.org/10.2189/asqu.2010.55.3.439
Pérez-Luno, A., Gopalakrishnan, S., & Cabrera, R. V. (2014). Innovation and performance: The role of environmental dynamism on the success of innovation choices. IEEE Transactions on Engineering Management, 61(3), 499–510. https://doi.org/10.1109/tem.2014.2318085
Pérez-Luño, A., Wiklund, J., & Cabrera, R. V. (2011). The dual nature of innovative activity: How entrepreneurial orientation influences innovation generation and adoption. Journal of Business Venturing, 26(5), 555–571. https://doi.org/10.1016/j.jbusvent.2010.03.001
Ragin, C. C. (2008). Redesigning social inquiry: Fuzzy sets and beyond. University of Chicago Press. https://doi.org/10.7208/chicago/9780226702797.001.0001
Reyes, J. C. (2017). Establishing the causal relationship between entrepreneurial orientation, organizational competencies and market orientation on innovative orientation using the global entrepreneurship monitor (GEM) database for region III. https://animorepository.dlsu.edu.ph/etd_doctoral/579
Rihoux, B., & Ragin, C. C. (2009). Configurational comparative methods: Qualitative comparative analysis (QCA) and related techniques. Sage Publications.
Schmalensee, R. (1982). Product differentiation advantages of pioneering brands. American Economic Review, 72(3), 349–365.
Schneider, C. Q., & Wagemann, C. (2012). Set-theoretic methods for the social sciences: A guide to qualitative comparative analysis. Cambridge University Press. https://doi.org/10.1017/CBO9781139004244
Schillo, R. S., Persaud, A., & Jin, M. (2016). Entrepreneurial readiness in the context of national systems of entrepreneurship. Small Business Economics, 46, 619–637. https://doi.org/10.1007/s11187-016-9709-x
Sciascia, S., Naldi, L., & Hunter, E. (2006). Market orientation as determinant of entrepreneurship: An empirical investigation on SMEs. The International Entrepreneurship and Management Journal, 2(1), 21–38. https://doi.org/10.1007/s11365-006-7087-6
Shi, X., Zhang, Y., Wu, Y., & Wu, H. (2023). Political turnover and firm innovation in China: The moderating role of innovation and entrepreneurship environment. Journal of Asian Economics, 88, Article 101651. https://doi.org/10.1016/j.asieco.2023.101651
Slater, S. F., & Narver, J. C. (1993). Product-market strategy and performance: An analysis of the miles and snow strategy types. European Journal of Marketing, 27(10), 33–51. https://doi.org/10.1108/03090569310045870
Stenholm, P., Acs, Z. J., & Wuebker, R. (2013). Exploring country-level institutional arrangements on the rate and type of entrepreneurial activity. Journal of Business Venturing, 28(1), 176–193. https://doi.org/10.1016/j.jbusvent.2011.11.002
Suchman, M. C. (1995). Managing legitimacy: Strategic and institutional approaches. Academy of Management Review, 20(3), 571–610. https://doi.org/10.5465/amr.1995.9508080331
Suddaby, R., Bitektine, A., & Haack, P. (2017). Legitimacy. Academy of Management Annals, 11(1), 451–478. https://doi.org/10.5465/annals.2015.0101
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