Purdue University Graduate School
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Essays on Product Innovation and Failures

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thesis
posted on 2020-07-30, 17:03 authored by Moonsik ShinMoonsik Shin

In this dissertation, I investigate how firms’ various strategic decisions lead to innovation failures. Extant research in the strategic management field has suggested that a firms’ strategic choices determine its innovation trajectories and outcomes. While previous studies predominantly have emphasized firms’ successful innovation outcomes, very little research has been conducted on the antecedents of innovation failures. Although firms’ successful innovation outcomes provide important implications in understanding the source of firms’ competitive advantages, failed innovations would provide us with critical insight about firms’ ability to survive and develop as they may result in unfavorable consequences, such as financial risks and negative impacts on firms’ reputations In this light, I examine how various strategic choices – such as interorganizational relationships, acquisitions, and internal R&D – affect firm’s innovation trajectories and failures.

In Essay 1, I explore how firms’ decision to form interorganizational relationships can affect their innovation failures. In particular, I investigate how a venture’s choice to form an investment relationship with a particular venture capitalist (VC) could determine the venture’s innovation failures. I propose that the time pressure that VCs face may elicit negative consequences for their portfolio companies’ innovation quality. In Essay 2, I examine how firms’ efforts to acquire technology and knowledge from external markets through acquisitions could affect their innovation failure rates. I suggest and find that adverse selection and post-acquisition integration problems impose substantial costs on firms pursuing acquisitions leading them to experience high rate of innovation failures. In Essay 3, I examine how firms’ efforts to develop new products incrementally affect their innovation failures. I suggest that, due to the path dependent nature of product development, when firms develop and introduce new products through an incremental approach, they may face the risk of their new products being exposed to the failure associated with the products and underlying technologies upon which the new products are built.


History

Degree Type

  • Doctor of Philosophy

Department

  • Management

Campus location

  • West Lafayette

Advisor/Supervisor/Committee Chair

Umit Ozmel

Additional Committee Member 2

Thomas Brush

Additional Committee Member 3

Richard Makadok

Additional Committee Member 4

Tony Tong