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Profiting from innovation in the aftermath of an economic crisis

Profiting from innovation in the aftermath of an economic crisis The aim of this paper is to present systematically a variety of benefits from innovating in response to an economic crisis.Design/methodology/approachThis is a conceptual paper that draws on prior conceptual and empirical studies, especially the innovation-based view of firm performance.FindingsMany firms have cut their innovation expenditures in response to the COVID-19 crisis. However, the financial crisis in 2008/2009 has shown that these short-term cost savings may have severely negative consequences on competitiveness. Several innovation examples from the crisis due to the COVID-19 pandemic further indicate that companies may benefit from a variety of first-order innovations, which go considerably beyond product development. Consequently, researchers and executives need to consider the variety of innovation types beyond product development, and they further need to emphasize second-order innovations, which describe the dynamic transformation of innovation management.Originality/valueAcademics and practitioners need to put specific attention to the transformation of innovation processes at the beginning of a crisis because firms may have to redesign their innovation processes. This dynamic reconfiguration and realignment of innovation processes further is essential again if a crisis continues for a longer period, such as the crisis due to the coronavirus pandemic. For example, if a company currently does not respond to relevant trends, its competitive position will deteriorate because other companies will enter the market. If firms can afford to continue or strengthen the innovation activities, they may profit substantially after the crisis. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Research in Marketing and Entrepreneurship Emerald Publishing

Profiting from innovation in the aftermath of an economic crisis

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Publisher
Emerald Publishing
Copyright
© Emerald Publishing Limited
ISSN
1471-5201
DOI
10.1108/jrme-06-2020-0085
Publisher site
See Article on Publisher Site

Abstract

The aim of this paper is to present systematically a variety of benefits from innovating in response to an economic crisis.Design/methodology/approachThis is a conceptual paper that draws on prior conceptual and empirical studies, especially the innovation-based view of firm performance.FindingsMany firms have cut their innovation expenditures in response to the COVID-19 crisis. However, the financial crisis in 2008/2009 has shown that these short-term cost savings may have severely negative consequences on competitiveness. Several innovation examples from the crisis due to the COVID-19 pandemic further indicate that companies may benefit from a variety of first-order innovations, which go considerably beyond product development. Consequently, researchers and executives need to consider the variety of innovation types beyond product development, and they further need to emphasize second-order innovations, which describe the dynamic transformation of innovation management.Originality/valueAcademics and practitioners need to put specific attention to the transformation of innovation processes at the beginning of a crisis because firms may have to redesign their innovation processes. This dynamic reconfiguration and realignment of innovation processes further is essential again if a crisis continues for a longer period, such as the crisis due to the coronavirus pandemic. For example, if a company currently does not respond to relevant trends, its competitive position will deteriorate because other companies will enter the market. If firms can afford to continue or strengthen the innovation activities, they may profit substantially after the crisis.

Journal

Journal of Research in Marketing and EntrepreneurshipEmerald Publishing

Published: Oct 20, 2021

Keywords: Competitive advantage; Economic downturn; Innovation types; Innovation-based view; COVID-19 pandemic; Coronavirus crisis

References