Opportunity-based approach vs. administrative control approach: Comparison between unstable Tunisia and Stable Japan

Emerging markets are characterized by uncertainty and instability of business environments. Companies are needed to adapt to such changing local situations, and thus continuous entrepreneurial challenge to create new products that fit with local environments is crucial in emerging markets. Those situations may be quite different from developed economies: Their market conditions are often stable and predictable, thus the more prudent, risk-averting management would be required to succeed in them for a long time. Therefore, we can assume that different management style is needed in innovating in emerging market from in developed economies. Then, this study introduced an alternative management approach to the conventional administrative control approach: Opportunity based approach that emphases on ceaseless search of opportunities. Traditional administrative control approach is often suitable to the stable developed countries’ market, because it brings members clear directions to predictable goal. On the other hand, opportunity-based approach would help organizational members to capture the trend that happened suddenly in unstable market, and thus it would improve product innovation performance in it. This study examined those ideas by the comparison of Tunisia and Japan. They seemed a suitable pair for comparison: The former was characterized by instability because of Jasmine Revolution in 2011, and the latter was one of the most stable economy and society in the world. From multi-group structural equation modeling we found that opportunity-based approach improved product innovation performance in unstable Tunisia, and administrative approach did in stable Japan.