How to Deal With Informal Competition? The Impact of Different Product Innovation Strategy on Firm Performance

Abstract

Abstract:

Although there are numerous studies that show product innovation can bring positive performance to enterprises, these studies are usually carried out in a formal economic environment, ignoring the impact of informal economy. Therefore, it is valuable and meaningful to study whether an enterprise's product innovation strategy is still able to bring good performance to the enterprise in face of informal competition (ie. the competitive pressure from informal enterprises in the informal economy). This study first discusses the impact of different product innovation strategies on enterprises' performance, and then discusses the moderating role of informal competition, and puts forward the theoretical hypotheses and establishes a research model. By analyzing the enterprises' survey data provided by European Bank for Reconstruction and Development, World Bank and European Investment Bank, this study reaches the following conclusions:when enterprises face informal competition, they can't achieve good performance by adopting product formalization innovation strategy, but they can gain a competitive advantage and increase profits by adopting product servitization innovation strategy. This can be effective for enterprises to deal with informal competition.

Key words: product formalization innovation, product servitization innovation, informal competition, informal economy

Zhang Wei, Wang Tao. How to Deal With Informal Competition? The Impact of Different Product Innovation Strategy on Firm Performance[J]. , 2019, 31(5): 89-99.

References

[1] Menguc B., Auh S. Development and Return on Execution of Product Innovation Capabilities:The Role of Organizational Structure[J]. Industrial Marketing Management, 2010,39(5):820-831
[2] Slater S. F., Mohr J. J., Sengupta S. Radical Product Innovation Capability:Literature Review, Synthesis, and Illustrative Research Propositions[J]. Journal of Product Innovation Management, 2013,31(3):552-566
[3] Hauser J., Tellis G. J., Griffin A. Research on Innovation:A Review and Agenda for Marketing Science[J]. Marketing Science, 2006,25(6):687-717
[4] Lau A. K., Tang E., Hultink E. J. Effects of Supplier and Customer Integration on Product Innovation and Performance:Empirical Evidence in Hong Kong Manufactures[J]. Journal of Product Innovation Management, 2010,27(5):761-767
[5] Ceylan C. Commitment-based HR Practices, Different Types of Innovation Activities and Firm Innovation Performance[J]. The International Journal of Human Resource Management, 2013,24(1):208-226
[6] Rubera G., Chandrasekaran D., Ordanini A. Open Innovation, Product Portfolio Innovativeness and Firm Performance:The Dual Role of New Product Development Capabilities[J]. Journal of the Academy of Marketing Science, 2016,44(2):166-184
[7] Webb J. W., Tihanyi L., Ireland R. D., et al. You Say Illegal, I Say Legitimate:Entrepreneurship in the Informal Economy[J]. Academy of Management Review, 2009,34(3):492-510
[8] Marcelli E. A., Pastor M. J., Joassart P. M. Estimating the Effects of Informal Economic Activity:Evidence from Los Angeles County[J]. Journal of Economic Issues, 1999,33(3):579-607
[9] Elgin C., Oztunali O. Institutions, Informal Economy, and Economic Development[J]. Emerging Markets Finance and Trade, 2014,50(4):145-162
[10] Schneider F. Size and Measurement of the Informal Economy in 110 Countries Around the World[R]. Paper Presented at a Workshop of Australian National Tax Centre, ANU, Canberra,2002
[11] McGahan A. M. Challenges of the Informal Economy for the Field of Management[J]. Academy of Management Perspectives, 2012,26(3):12-21
[12] Bruton G. D., Ireland R. D., Ketchen D. J. Toward a Research Agenda on the Informal Economy[J]. Academy of Management Perspectives, 2012,26(3):1-11
[13] Mendi P., Costamagna R. Managing Innovation Under Competitive Pressure from Informal Producers[J]. Technological Forecasting & Social Change, 2017,114:192-202
[14] Chen M. J. Competitor Analysis and Interfirm Rivalry:Toward a Theoretical Integration[J]. The Academy of Management Review, 1996,21(1):100-134
[15] Rindova V. P., Becerra M., Contardo I. Enacting Competitive Wars:Competitive Activity, Langu-age Games, and Market Consequences[J]. Academy of Management Review, 2004,29:670-686
[16] 邓新明,龙良智,龙贤义,等. 竞争者分析与企业市场、非市场进攻行动选择的关联性研究[J]. 管理评论, 2017,29(11):129-147
[17] 皮圣雷. 动态竞争理论研究视角与路径演进综述[J]. 外国经济与管理, 2014,36(9):12-19
[18] Grimm G. M., Lee H., Smith K. G. Strategy as Action:Competitive Dynamics and Competitive Advantage[M]. New York:Oxford University Press, 2006
[19] 赵立龙,刘洋,魏江,等. 制造企业服务创新战略与竞争优势获取:机制与权变情境[J]. 科研管理, 2017,5(38):20-29
[20] 蓝海林. 企业战略管理:"静态模式"与"动态模式"[J]. 南开管理评论, 2007,10(5):31-35
[21] 李忆,司有和. 探索式创新、利用式创新与绩效:战略和环境的影响[J]. 南开管理评论, 2008,11(5):4-12
[22] Katila R., Chen E. L. Effects of Search Timing on Innovation:The Value of Not Being in Sync with Rivals[J]. Administrative Science Quarterly, 2008,53(4):593-625
[23] Chen T., Tribbitt M. A., Yang Y., et al. Does Rivals' Innovation Matter? A Competitive Dynamics Perspective on Firms' Product Strategy[J]. Journal of Business Research, 2017,76:1-7
[24] Raijman R. Mexican Immigrants and Informal Self-employment in Chicago[J]. Human Organization, 2001,60(1):47-55
[25] Chattopadhyay S., Mondal R. Characterisation of Economic Growth in Developing Economies with Informal Sector[J]. Economic Papers, 2017,36(1):86-101
[26] McKenzie D., Seynabou S. Y. Does It Pay Firms to Register for Taxes? The Impact of Formality on Firm Profitability[J]. Journal of Development Economics, 2010,91(1):15-24
[27] Nakata C., Zhu Z., Izberk-Bilgin E. Integrating Marketing and Information Services Functions:A Complementarity and Competence Perspective[J]. Journal of the Academy of Marketing Science, 2011,39(5):700-716
[28] Phyra S., Aron O. C. Examining the New Product Innovation-Performance Relationship:Optimizing the Role of Individual-level Creativity and Attention-to-detail[J]. Industrial Marketing Management, 2005,47(SI):156-165
[29] Henard D. H., Szymanskid M. Why Some New Products Are More Successful Than Others[J]. Journal of Marketing Research, 2001,38(3):362-375
[30] 张婧, 段艳玲. 市场导向对创新类型和产品创新绩效的影响[J]. 科研管理, 2011,32(5):68-77
[31] Pullen A., de Weerd-Nederhof P. C., Groen A. J., et al. SME Network Characteristics vs. Product Innovativeness:How to Achieve High Innovation Performance[J]. Creativity and Innovation Management, 2012,21(2):130-146
[32] Ozer M., Zhang W. The Effects of Geographic and Network Ties on Exploitative and Exploratory Product Performance[J]. Strategic Management Journal, 2015,36(7):1105-1114
[33] 王玮,李随成,禹文钢,等. 产品创新导向与供应商网络形态适配对产品创新绩效的影响[J]. 管理评论, 2016,28(6):86-99
[34] 韩明君,蒋军锋. 基于产品创新类型的企业跨部门整合作用分析[J]. 研究与发展管理, 2015,27(2):101-112
[35] 姜铸, 李宁. 服务创新、制造业服务化对企业绩效的影响[J]. 科研管理, 2015,36(5):29-37
[36] Ngo L. V., O'Cass A. Creating Value Offerings via Operant Resource-based Capabilities[J]. Industrial Marketing Management, 2009,38(1):45-59
[37] Kendall W. A., Patricia M. N., Donald E. H., et al. A Longitudinal Study of the Impact of R&D, Patents and Product Innovation on Firm Performance[J]. Journal of Production Innovation Management, 2010,27(5):725-740
[38] Cho H. J., Pucik V. Relationship Between Innovativeness, Quality, Growth, Profitability, and Market Value[J]. Strategic Management Journal, 2005,28(6):555-575
[39] Damanpour F. An Integration of Research Findings of Effects of Firm Size and Market Competition on Product and Process Innovations[J]. British Journal of Management, 2010,21(4):996-1010
[40] 张慧颖,李振东. 创新投入、新产品开发绩效与新产品市场绩效的关系研究--顾客隐性需求的调节作用[J]. 科学学与科学技术管理, 2015,36(12):128-138
[41] Song L. Z., Song M., Benedetto C. Resources, Suppliers Investment, Product Launch Advantages, and First Product Performance[J]. Journal of Operations Management, 2011,29(1):86-104
[42] Lau A. K. W., Tang E., Yam R. C. M. Effects of Supplier and Customer Integration on Product Innovation and Performance:Empirical Evidence in Hong Kong Manufacturers[J]. Journal of Production Innovation Management, 2010,27(5):761-777
[43] Droge C., Calantone R., Harmancioglu N. New Product Success:Is It Really Controllable by Managers in Highly Turbulent Environments?[J]. Journal of Production Innovation Management, 2008,25(3):272-286
[44] 廖勇海,刘益,贾兴平. 基于Meta视角的市场导向、产品创新、产品竞争优势有新产品绩效关系研究[J]. 研究与发展管理, 2015,27(3):105-113
[45] Kim N., Im S., Slater S. F. Impact of Knowledge Type and Strategic Orientation on New Product Creativity and Advantage in High-technology Firms[J]. Journal of Product Innovation Management, 2013,30(1):136-153
[46] Chirumalla K. Organizing Lessons Learned Practice for Product-service Innovation[J]. Journal of Business Research, 2016,69(11):4986-4991
[47] 李纲,陈静静,杨雪. 网络能力、知识获取与企业服务创新绩效的关系研究--网络规模的调节作用[J]. 管理评论, 2017,29(2):59-68
[48] Oliva R., Kallenberg R. Managing the Transition from Products to Services[J]. International Journal of Service Industry Management, 2003,14(2):160-172
[49] Ulaga W., Reinartz W. J. Hybrid Offerings:How Manufacturing Firms Combine Goods and Services Successfully[J]. Journal of Marketing, 2011,75(6):5-23
[50] Tukker A. Eight Types of Product-service System:Eight Ways to Sustainability? Experience from SusProNet[J]. Business Strategy and the Environment, 2004,13(4):246-260
[51] Eloranta V., Turunen T. Seeking Competitive Advantages WithService Infusion:ASystematic Literature Review[J]. Journal of Service Management, 2015,26(3):394-425
[52] Livengood S. R., Reger R. K. That's Our Turf! Identify Domains and Competitive Dynamics[J]. Academy of Management Review, 2010,35(1):48-66
[53] Funkhouser E. The Urban Informal Sector in Central America:Household Survey Evidence[J]. World Development, 1996,24(11):1737-1751
[54] Oliver R. L. Cognitive, Affective, and Attribute Bases of the Satisfaction Response[J]. Journal of Consumer Research, 1993:418-430
[55] 范秀成,杜建刚. 服务质量五因素对服务满意度及服务忠诚的影响[J]. 管理世界, 2006,(6):111-118
[56] Ndofor H. A., Sirmon D. G., He H. Firm Resources, Competitive Actions and Performance:Investigating a Mediated Model with Evidence from the In-vitro Diagnostics Industry[J]. Strategy Management Journal, 2011,32(6):640-657
[57] Iriyama A., Kishore R., Talukdar D. Playing Dirty or Building Capability? Corruption and HR Training as Competitive Actions to Threats from Informal and Foreign Firm Rivals[J]. Strategic Management Journal, 2016,37(10):2152-2173
[58] Heidenreich S., Spieth P. Why Innovations Fail--The Case of Passive and Active Innovation Resistance[J]. International Journal of Innovation Management, 2013,17(5):1-42
[59] Szymanski D. M., Kroff M. W., Troy L. C. Innovativeness and New Product Success:Insights from the Cumulative Evidence[J]. Journal of the Academy of Marketing Science, 2007,35(1):35-52
[60] 汪丽. 公司风险投资与新创企业绩效:决策环境的约束机制[J]. 珞珈管理评论, 2017,15(3):18-32