Open Conference Systems, Schumpeter 2010

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Dynamics of dominant innovation logic

Arne Stjernholm Madsen

Last modified: 2010-06-03

Abstract


The case study at hand describes the evolution of the medical device innovation activities at Novo Nordisk, a well established pharmaceutical company, during a period from 1980 to 2008. The research focus is on the adaptability of the innovation strategy. To include medical device development in a pharmaceutical company could be compared to letting in a Trojan horse; it implies a 'clash of cultures' for innovation. How far can the corporate 'dominant logic' for innovation adapt to the realm of medical devices in an incumbent pharmaceutical company with a purely drug-based strategy? In two periods, corporate management opened for strategic experiments, where devices were envisioned to create revenue, but each experiment only lasted approximately four years and was then closed down. These 'revolutions' displayed an autonomous, rule-changing mode of innovation strategy, whereas the 'normal' periods implied an induced, rule-abiding mode. The cycles between the two modes influenced the innovation performance, but did not lead to an enduring transformation of the dominant logic for innovation; the drug-based logic was sustained. The core elements of the cognitive inertia seem to be the business model, the level of reconfiguration and the culture for formation of new opportunities. Even if no meta-learning took place, the recurrent strategic reframing reinforced the entrepreneurial activity.

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