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Innovation, Competitive Advantage and Rent: A Model and Test

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Author Info

  • Rita Gunther McGrath

    (Columbia University, Graduate School of Business, 703 Uris Hall, New York, New York 10027)

  • Ming-Hone Tsai

    (National Central University, Taiwan, Republic of China)

  • S. Venkataraman

    (The Wharton School, University of Pennsylvania, Philadelphia, Pennsylvania 19104)

  • I. C. MacMillan

    (The Wharton School, University of Pennsylvania, Philadelphia, Pennsylvania 19104)

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    Abstract

    Four antecedents, it is argued, are necessary precursors for a firm to capture rents from innovation. The antecedents are causal understanding; innovation team proficiency; emergence and mobilization of new competences; and creation of competitive advantages, each of which are conceptually distinct and precisely defined in the paper. These constructs are linked together in a stage model and subsequently operationalized and tested using LISREL. Substantial support is found for the central thesis, that achieving each of the four antecedent processes increases the predicted rents from an innovation project.

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    File URL: http://dx.doi.org/10.1287/mnsc.42.3.389
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    Bibliographic Info

    Article provided by INFORMS in its journal Management Science.

    Volume (Year): 42 (1996)
    Issue (Month): 3 (March)
    Pages: 389-403

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    Handle: RePEc:inm:ormnsc:v:42:y:1996:i:3:p:389-403

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    Related research

    Keywords: innovation; competitive advantage; LISREL analysis; competences; capabilities;

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    Cited by:
    1. Thierry Burger-Helmchen, 2006. "Option chain and change management : a structural equation application," Working Papers of BETA 2006-28, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
    2. Briand-Decre, Gwenaëlle & Royer, Isabelle, 2008. "Champions pour le meilleur et pour le pire : propositions de résolution du paradoxe entre les littératures sur le champion et sur l’escalade de l’engagement," Economics Papers from University Paris Dauphine 123456789/2966, Paris Dauphine University.
    3. Baoshan Ge & Robert D. Hisrich & Baobao Dong, 2009. "Networking, Resource Acquisition, and the Performance of Small and Medium-Sized Enterprises: An Empirical Study of Three Major Cities in China," Managing Global Transitions, University of Primorska, Faculty of Management Koper, vol. 7(3), pages 221-239.
    4. Chowdhury, Sanjib, 2005. "Demographic diversity for building an effective entrepreneurial team: is it important?," Journal of Business Venturing, Elsevier, vol. 20(6), pages 727-746, November.
    5. Jaafar, Harlina Suzana & Endut, Intan Rohani & Faisol, Nasruddin & Omar, Emi Normalina, 2011. "Innovation in logistics services – halal logistics," MPRA Paper 34665, University Library of Munich, Germany.
    6. Amason, Allen C. & Shrader, Rodney C. & Tompson, George H., 2006. "Newness and novelty: Relating top management team composition to new venture performance," Journal of Business Venturing, Elsevier, vol. 21(1), pages 125-148, January.
    7. Dimária Silva e Meirelles & Eduardo Sérgio Ulrich Pace & Leonardo Fernando Cruz Basso, 2005. "The Contributions Of Firm'S Productive Assets To Its Competitive Performance: A Resource-Based View Approach In The Software Sector," Anais do XXXIII Encontro Nacional de Economia [Proceedings of the 33th Brazilian Economics Meeting] 103, ANPEC - Associação Nacional dos Centros de Pósgraduação em Economia [Brazilian Association of Graduate Programs in Economics].
    8. Nerkar, Atul A. & McGrath, Rita Gunther & MacMillan, Ian C., 1996. "Three facets of satisfaction and their influence on the performance of innovation teams," Journal of Business Venturing, Elsevier, vol. 11(3), pages 167-188, May.
    9. Özlem Yaþar Uðurlu & Nurettin Ýbrahimoðlu & Sibel Ayas, 2013. "A Content Analysis on Management Fashions in Turkish Manufacturing Companies," International Review of Management and Marketing, Econjournals, vol. 3(4), pages 164 - 183.
    10. Gunday, Gurhan & Ulusoy, Gunduz & Kilic, Kemal & Alpkan, Lutfihak, 2011. "Effects of innovation types on firm performance," International Journal of Production Economics, Elsevier, vol. 133(2), pages 662-676, October.
    11. Manuel Portugal Ferreira & Fernando Ribeiro Serra & Emerson Maccari, 2013. "When the innovator fails to capture rents from innovation," Working Papers 101, globADVANTAGE, Polytechnic Institute of Leiria.
    12. Karim Moustaghfir, 2012. "Explicating Knowledge-based Competitive Advantage," International Journal of Synergy and Research, ToKnowPress, vol. 1(1), pages 23-38.
    13. Shepherd, Dean A. & Covin, Jeffrey G. & Kuratko, Donald F., 2009. "Project failure from corporate entrepreneurship: Managing the grief process," Journal of Business Venturing, Elsevier, vol. 24(6), pages 588-600, November.

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