Staging innovation projects : (when) does it pay off?


Andries, Petra ; Hünermund, Paul


[img]
Preview
PDF
dp14091.pdf - Published

Download (329kB)

URL: https://ub-madoc.bib.uni-mannheim.de/37328
URN: urn:nbn:de:bsz:180-madoc-373284
Document Type: Working paper
Year of publication: 2014
The title of a journal, publication series: ZEW Discussion Papers
Volume: 14-091
Place of publication: Mannheim
Publication language: English
Institution: Sonstige Einrichtungen > ZEW - Leibniz-Zentrum für Europäische Wirtschaftsforschung
MADOC publication series: Veröffentlichungen des ZEW (Leibniz-Zentrum für Europäische Wirtschaftsforschung) > ZEW Discussion Papers
Subject: 330 Economics
Classification: JEL: O32 , M,
Keywords (English): Staging of innovation projects , real options theory , new product development process , ressource allocation , innovation portfolios
Abstract: Building on real options literature, this study shows that the use of a staged approach for the management of innovation projects affects the innovation output of firms differently depending on firm characteristics and ambitions. In particular, while staged project management increases the effect of inno- vation expenditures on new product sales for firms envisaging incremental or continuous innovations, this moderating effect is absent for firms aspiring radical innovations. In addition, while staged project management has a pos- itive moderating effect in firms with resource slack, this is not the case when firms are resource-constrained. We further investigate the underlying mecha- nisms to this latter finding by demonstrating that in resource-abundant firms staged project organization is associated with delaying projects until more information becomes available. Thereby these firms reap the waiting value inherent to real options reasoning. By contrast, resource-constrained firms using staged project management are shown to abandon a larger share of their innovation projects and to concentrate resources on fewer projects. It appears, however, that, due to budgetary pressure, they make the decision to abandon at a too early stage where uncertainty is insufficiently resolved. This can explain why there is no effect of staged project management on the sales of resource-constrained firms from new products. The paper contributes to theory development on when and why the staging of innovation projects affects the innovation output of firms and to the literature on real options reasoning in general.

Das Dokument wird vom Publikationsserver der Universitätsbibliothek Mannheim bereitgestellt.




+ Citation Example and Export

Andries, Petra ; Hünermund, Paul (2014) Staging innovation projects : (when) does it pay off? Open Access ZEW Discussion Papers Mannheim 14-091 [Working paper]
[img]
Preview


+ Search Authors in

+ Download Statistics

Downloads per month over past year

View more statistics



You have found an error? Please let us know about your desired correction here: E-Mail


Actions (login required)

Show item Show item