Revival of Innovation Failures in R&D-Intensive Environments: A Case Study From a Japanese Chemical Company

Failure is the most likely outcome of any innovation project, even within well-established firms. However, the failure of an innovation does not necessarily mark the end of its life cycle, as it can be revived. The existing literature primarily discusses two distinct revival approaches: external, involving a spin-out to external parties while retaining limited ownership of the innovation, or internal, occurring through accidental constellations, also known as serendipity. In this study we explore a third approach, which involves a deliberate revival process while preserving the innovation's value within firm boundaries. We investigate these innovation failure revivals through three embedded cases of a Japanese R&D-intensive chemical company that has successfully revived multiple failed innovation projects. The study finds that the intertemporal transferability of a technology is largely determined during its development phase, making ‘technology elaboration’ a critical prerequisite for successful revival. Additionally, firms must complement internal revival efforts with external exploratory processes, integrating absorptive capacity (AC) with transformative capacity (TC) to identify new opportunities and acquire external resources. We further identify a key enabler of intertemporal technology transfer: a technology commitment decision that precedes the selection of technologies to maintain, ensuring a structured selection process over time. Finally, we demonstrate that TC enables not only the transfer of previously successful or shelved technologies but also those from failed innovation attempts, provided they are designated as strategically important “core” technologies.