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Innovation strategies of New Technology-Based Firms for managing crises: reconciling short-term survival and long-term success. The case of gene therapy pioneers


Type

Thesis

Change log

Authors

Wolff, Johannes 

Abstract

New Technology-Based Firms (NTBFs) are pioneers in innovation and play a key role in creating and disrupting high-tech industries. However, these firms usually lack product revenues and are initially very reliant on external investments to innovate and to survive. This renders them particularly vulnerable to technology-specific or industry-wide external crises which suddenly and drastically constrain their access to these external resources. When facing a crisis, NTBFs have to ensure survival in the immediate crisis environment, without compromising their long-term success and potential after the crisis. This creates a tension between the risk of investing in managing the crisis, which may drain the already constrained resources, and the risk of not investing in long term innovation during the crisis, which may endanger the firm’s long-term potential to recover and capture new opportunities once the crisis has resolved. The thesis identified ‘innovation strategies’ that NTBFs may use in a crisis to achieve and reconcile both short-term and long-term benefits. The strategies are identified by studying the behaviours adopted by pioneering gene therapy NTBFs which survived over decades, including a severe and lasting period of crisis and setback.

The study merges two extant concepts which together define ‘innovation strategies’: Firms may pursue explorative and exploitative innovation (the exploration/exploitation or ambidexterity concept) and may do so through intra- or inter-organisational modes (the internal and Open Innovation concept). Both concepts are well known for their critical role during crises and for their differing short-term and long-term benefits and risks. However, only very few studies have combined both dimensions to capture the full range of innovation strategy configurations that a firm can choose from. Further, the evolution and dynamics of these configurations over time in a crisis context, their short-term and long-term outcomes and the contingencies for (successfully) adopting one strategy over another remain elusive to date.

This study seeks to address these research gaps by using a longitudinal case study methodology of pioneering gene therapy NTBFs which successfully survived through periods of setback and progress, including a sudden, drastic and lasting technology-specific external crisis. The thesis presents an original strategy typology which allows to objectively and quantitatively capture different configurations of intra-/inter-organisational exploration/exploitation together to compare these configurations across firms and over time. Supplemented with interviews with (ex-)executives of these case firms, the longitudinal data presents: a) which configurations (Strategy Types) NTBFs use before, during and after a crisis, b) how these configurations change over time across crisis and non-crisis periods (Strategy Pathways) and c) the short-term and long-term outcomes of different Strategy Types. From these, the different Strategy Types and Pathways suitable for reconciling short-term and long-term survival and success in a crisis were drawn. Additionally, the study provides propositions on d) the contingencies for adopting and e) successfully implementing different crisis strategies.

The study thus contributes to theory and practice. For theory, it merges and expands the literature streams of ambidexterity and Open Innovation, and substantially contributes to the knowledge on strategic adaptation to crisis. For practice, it provides actionable recommendations to NTBF managers on which strategies to choose under which contingencies to maximise the chances of short-term survival and long-term success when facing a crisis.

Description

Date

2023-03-20

Advisors

Mortara, Letizia

Keywords

Crisis management, Firm strategy, Open Innovation, Technology Management

Qualification

Doctor of Philosophy (PhD)

Awarding Institution

University of Cambridge