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Diversification through green innovations

Lessons learned from a German engineering firm

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Abstract

Established conventional firms increasingly aim to seize business opportunities in emerging sustainability-related markets. They can do so by developing innovations based on their core competences, for instance in the context of a strategic diversification. While the development of green innovations can open new business opportunities, many firms struggle with seizing opportunities in unknown product-market domains. Yet little is known about how firms actually develop green innovations and what challenges they face. This paper presents the anatomy of a “failed” innovation process of a German engineering firm to shed light on the management challenges of developing green innovations in the context of diversification. The paper draws the attention to five major management challenges: (1) the adoption of an exploration strategy that matches the degree and scope of an innovation, (2) the setup of appropriate organizational structures to separate old from new business, (3) the value of extensive networking and partnerships to access and acquire distant information, (4) the benefits of an entrepreneurial approach to uncertainty involving quick learning and (5) the advantages of business model innovation to widen the innovation space.

Zusammenfassung

Vermehrt versuchen auch etablierte Unternehmen Chancen zu nutzen, die sich in entwickelnden Nachhaltigkeitsmärkten bieten. Unternehmen können diese unter anderem ergreifen, indem sie auf Basis ihrer Kernkompetenzen Innovationen zur strategischen Diversifizierung entwickeln. Obwohl die Entwicklung grüner Innovationen neue Geschäftschancen eröffnen kann, haben viele Unternehmen Schwierigkeiten die Chancen in unbekannten Produkt-Markt Umfeldern zu ergreifen. Jedoch ist bisher wenig über die Entwicklung und den Erfolg-, oder Misserfolg, solcher Explorationsvorhabens bekannt. Der vorliegende Artikel analysiert einen „gescheiterten“ Innovationsprozess bei einem Unternehmen und präsentiert fünf zentrale Herausforderungen für das Management von nachhaltigkeitsorientierten Innovationen: 1) die Wahl einer Explorationsstrategie die dem des Innovationsgrades entspricht, damit die Innovation genügend Raum zur Entfaltung bekommt, 2) das Schaffen geeigneter Organisationsstrukturen, um Innovationsprozesse vom Kerngeschäft zu trennen, 3) die Bedeutung Netzwerke und Partnerschaften für neues Wissen aufzubauen, 4) die Nützlichkeit von unternehmerischem Denken und Handeln basierend auf schnellem Lernen, um Entscheidungen in Situationen der Unsicherheit zu treffen und 5) der Vorteil von Geschäftsmodellinnovationen, um den Innovationsspielraum zu erweitern.

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Authors and Affiliations

  1. Centre for Sustainability Management, Leuphana University Lüneburg, Scharnhorststraße 1, 21335, Lüneburg, Germany

    Samuel Wicki M.Sc.

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  1. Samuel Wicki M.Sc.
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Correspondence to Samuel Wicki M.Sc..

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Wicki, S. Diversification through green innovations. uwf 23, 197–203 (2015). https://doi.org/10.1007/s00550-015-0370-7

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  • DOI: https://doi.org/10.1007/s00550-015-0370-7

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