Innovation Management in Defensive Organizations

Innovation Management in Defensive Organizations

Increasing innovation and financial performance of international companies active in developing countries by overcoming institutional voids

Document Type : Original Article

Authors
Faremeh Askari 1
Kamal Sakhdari 2
Hassan Esmailpour 3
1 Ph.D. Student in Entrepreneurship, Qazvin Azad University, Qazvin, Iran
2 Faculty of Entrepreneurship, University of Tehran, Tehran, Iran
3 Faculty of Management, Islamic Azad University, Central Tehran Branch, Tehran, Iran
10.22034/qjimdo.2020.105785
Abstract
Financial and innovation performance are important issues for all companies, but achieving high performance in markets with underdeveloped institutions is a big challenge. One of the issues in emerging markets is the lack of developed institutions supporting market activities, which is referred to as institutional void. Therefore, companies need to identify appropriate strategies to respond to these voids in different parts of the market to increase their innovation and financial performance. For this purpose, we are seeking to provide a model of better performance in developing countries. In this research, by applying qualitative approach and using a template-based case study, 13 active companies in Iran were studied in a semi-structured way. The findings show that firms use diverse strategies to enhance their performance in the contexts with institutional voids. These results provide valuable insights for international business scholars and managers and firms seeking to increase their performance in developing countries.
Keywords
Emerging markets
Institutional voids
Financial performance
Innovation
پورتیموری فرد تبریزی، فرزین و جمشیدی، لاله. (1393). بررسی عملکرد نوآورانۀ شرکت‌های دانش‌بنیان مستقر در مرکز رشد علم و فناوری دانشگاه سمنان. نشریه صنعت و دانشگاه، (23 و 24) 7، 37-51.
طیبی، کمیل. زمانی، زهرا. نوروزی طالخونچه، محسن و شکری، محمود. (1393). اثر نوآوری بر توسعه صادرات خدمات فنی و مهندسی کشورهای منتخب نوظهور: درسی برای اقتصاد ایران. فصلنامه علوم اقتصادی، (27) 8، 11-27.
مرفوع، محمد و شاکری، رباب. (1395). استراتژی‌های کسب و کار و رابطه آن با عملکرد مالی شرکت‌ها. پژوهش‌های تجربی حسابداری، (29)6، 157-183.
منگلی، نسرین. رضائی، روح الله و صفا، لیلا. (1395). بررسی تأثیر قابلیت‌های بازاریابی بر عملکرد کسب‌وکارهای کوچک و متوسط. نشریه کارآفرینی در کشاورزی، (4)3.
نمازی، محمد و مقیمی، فاطمه. (1397). تأثیر نوآوری و نقش تعدیلی مسئولیت‌پذیری اجتماعی بر عملکرد مالی شرکت‌ها در صنایع مختلف. فصلنامه بررسی‌های حسابداری و حسابرسی، (2) 25، 289-310.
Doh, J., Rodrigues, S., Saka-Helmhout, A & Makhija, M. (2017). International business responses to institutional voids. Journal of International Business Studies. 48, 293–307.
El-Ghoul, S., Guedhami, O., & Kim, Y. (2016). Country-level institutions, firm value, and the role of corporate social responsibility initiatives. Journal of International Business Studies. 48(3), 360–385.
Fisher, G. (2012). Effectuation, Causation, and Bricolage: a Behavioral Comparison of Emerging Theories in Entrepreneurship Research, Entrepreneurship Theory and Practice, 1019 (5), 36- 1051.
Graham, B. A., Johnston, N. P., & Kingsley, A. F. (2016). A Unified Model of Political Risk Strategy Beyond Markets, Emerald Group Publishing Limited. 119-160.
Khanna, T., & Palepu, K. G. (2010). Winning in emerging markets: A road map for strategy and execution. Boston: Harvard Business Press.
Kim, H. & Song, J. (2016). Filling institutional voids in emerging economies: The impact of capital market development and business groups on M&A deal abandonment. Journal of International Business Studies, 48(3), 308-323 .
Kingsley, A. F. & Graham, B. A. T. (2017). The effects of information voids on capital flows in emerging markets. Journal of International Business Studies, 48(3), 324-343.
Marquisa, Ch., & Raynard, M. (2015). Institutional Strategies in Emerging Markets. The Academy of Management Annals, 9(1), 291–335.
Meyer, K. E., Estrin, S., Bhaumik, S. K., & Peng, M. W.(2009). Institutions, resources, and entry strategies in emerging economies. Strategic Management Journal, 30(1), 61–80.
North, D. C. (1990). Institutions, institutional change, and economic performance. Cambridge: Cambridge University Press.
Peng, M. W., Sun, S. L., Pinkham, B., & Chen, H. (2009). The institution-based view as a third leg for a strategy tripod. The Academy of Management Perspectives, 23(3), 63–81.
Pinkham, B. C., & Peng, M. W. (2016). Overcoming institutional voids via arbitration. Journal of International Business Studies, 48,  344–359.
Roberts, K. (2003). What strategic investments should you make during a recession to gain competitive advantage in the recovery? Strategy & Leadership, 31(4), 31-39.
Roberts, P. W., & Amit, R. (2003). The dynamics of innovative activity and competitive advantage: The case of Australian retail banking, 1981 to 1995. Organization science, 14(2), 107-122.
Rottig, D. (2016). Institutions and emerging markets: effects and implications for multinational corporations, International Journal of Emerging Markets, 11 (1),2 –17.
Su, W., Peng, M. W., Tan, W., & Cheung, Y.L. (2016). The signaling effect of corporate social responsibility in emerging economies. Journal of business Ethics, 134(3), 479-491.
Ushakova, Y. (2015). The effects of the institutional context on a foreign company´s entry strategy when entering an emerging market - A case study: Väderstad-Verken AB, Master Thesis in Business Administration Business and Economics Programme Advanced level.
Wiklund, J., & Shepherd, D. (2005). Entrepreneurial orientation and small business performance: a configurational approach. Journal of business venturing, 20(1), 71-91.
Yin, Robert K. (2009). Case study research: Design and methods: Sage publications.