Session 255

Exploration and Exploitation

Track I

Date: Tuesday, September 23, 2014


Time: 17:15 – 18:30


Room: Helsinki

Session Chair:

  • Daniella Laureiro-Martínez, ETH Zurich

Title: Exploration, Exploitaion, and Incentives to Innovate: The Disciplining Role of Debt


  • Shyam Kumar, Rensselaer Polytechnic Institute
  • Byungchul Choi, Rensselaer Polytechnic Institute
  • Fabio Zambuto, University of Palermo

Abstract: Extant research suggests when compared to equity, debt financing is less conducive to innovation activities. We argue that although equity sustains innovation by allowing experimentation, it may also encourage the pursuit of exploration at the expense of exploitation. Under these circumstances, the stricter rules associated with debt stimulate managers to shift resources back towards greater exploitation in order to mitigate risk and improve short-term pay-offs. In support of these arguments we show leverage is positively related to knowledge exploitation as reflected in self-citations. We also find that firms that over explore are likely to experience leverage increases in the short run, and these increases stimulate subsequent exploitation. These effects are consistent with firm value indicating equity holders value the role of debt in stimulating exploitation.

Title: Exploratory and Exploitative Innovation in the Context of Family Firms: A Longitudinal Analysis


  • Viktoria Veider, University of Innsbruck

Abstract: The underlying study examines the influence of the structure and composition of family influence and involvement on exploitative and exploratory innovation. Whereas exploitative innovation entails taking use of existing knowledge, exploratory innovation embodies knowledge that is novel relative to a firm’s extant knowledge stock. A longitudinal investigation of public German family and non-family firms between 2000 and 2009 shows that family ownership negatively influences the amount of exploratory innovation undertaken in the firm. Active family involvement in management and the supervisory board however, increases the amount of exploratory innovation. The results therefore show that how and to what extent family firms own and involve in the firm is important.

Title: Knowledge Creation and Exploitation in Nanotechnology: A Comparison between Japanese and Chinese Knowledge Structures


  • Daniela Baglieri, University of Messina
  • Fabrizio Cesaroni, Carlos III University

Abstract: This study focuses on the nanotechnology sector (and specifically on the most recent developments on carbon nanotubes and graphene) and compares the technological landscapes of China and Japan. By examining a dataset of 20,365 patent families from 1994 to 2013, we analyze the structure of the knowledge creation industry in the two countries and assess how such structures might affect future processes of nanotechnology exploitation. We find that China and Japan are characterized by two contrasting knowledge structures. While the Chinese nanotechnology sector has emerged as the result of an anchor-tenant development model, technological knowledge and capabilities in Japan are more dispersed among firms and other actors. Different patterns of technology exploitation and technology-based entrepreneurship can be thus expected for the two countries.

Title: Managerial Ties and Exploratory Innovation: An Opportunity-Motivation-Ability Perspective


  • Zhongfeng Su, Xi'an Jiaotong University
  • Haibin Yang, City University of Hong Kong

Abstract: Drawing on the opportunity-motivation-ability perspective, this study investigates the relationship between a firm’s managerial ties and exploratory innovation. We argue that the opportunities for exploratory innovation brought by managerial ties need to be considered jointly with a firm’s motivation (e.g., innovation orientation) and ability (e.g., absorptive capacity). We differentiate between business and political ties and then argue for their distinct linkages with exploratory innovation. Analyses of 212 Chinese manufacturing firms support our arguments that innovation orientation and absorptive capacity jointly strengthen the relationship between business ties and exploratory innovation, but reduce the relationship between political ties and exploratory innovation. This study contributes to the literature by offering a fresh perspective examining the distinctive effects of different types of managerial ties on exploratory innovation.

All Sessions in Track I...

Sun: 08:00 – 09:15
Session 278: Routines: Theoretical and Empirical Advancements and Avenues for Future Research
Sun: 09:30 – 10:45
Session 463: Big Data: Revolutionizing Innovation and Competition
Sun: 11:15 – 12:30
Session 464: Foundations Session: A conversation with Michael Tushman on Leadership, Innovation and Strategic Change
Sun: 15:45 – 17:00
Session 270: Innovation in MNCs and Global Networks
Session 275: Open Innovation: Outcomes and antecedents
Sun: 17:15 – 18:30
Session 605: Knowledge and Innovation IG Business Meeting
Mon: 08:00 – 09:15
Session 260: IPRs, Appropriability and Innovation
Session 274: Incumbents, Radical Innovations and Disruptive Technologies
Mon: 11:00 – 12:15
Session 276: Organizational Learning
Session 277: Learning From Others
Session 372: The Challenges of Global Operations: Managing R&D and Complexity
Session 423: Alliances and Innovation Performance
Mon: 14:45 – 16:00
Session 265: Learning, Search, Slack: The behavioral theory revisited
Session 269: Knowledge Flows: Transfer, sharing and replication
Mon: 16:30 – 17:45
Session 254: Conversations about Knowledge
Session 257: Spin offs, Venture Capital and Entrepreneurship
Tue: 08:00 – 09:15
Session 259: Institutionalizing Innovation: Norms, status and legitimacy issues
Session 273: From Internal Resources to Customer Needs
Session 383: Globalization of R&D: Implications for Learning and Innovation
Tue: 11:00 – 12:15
Session 267: The Role of Individuals in Innovation
Session 272: Research and Development: Antecedents and outcomes
Session 361: Creativity and Innovation
Session 469: M&As and Innovation
Tue: 15:30 – 16:45
Session 262: Networks of Innovators
Session 263: Innovation Models in Emerging Economies
Tue: 17:15 – 18:30
Session 255: Exploration and Exploitation
Session 256: Organizing for Open Innovation
Session 261: Practices and Processes for Innovation

Strategic Management Society