How Do Constraints Affect the Survival of Innovative Firms?

Louise Lindbjerg, Lars Frederiksen

Research output: Contribution to conferencePaperResearchpeer-review

Abstract

When taking new offerings to the market, innovative firms face constraints more often than less innovative firms. We confirm that firms with higher innovation intensity, higher novelty, and greater search intensity experience more constraints with regards to human resources, financial capital, market barriers, and regulation. Research has looked at the impact of impediments on innovation performance and firm performance, but the link between constraints on innovation and survival is yet to be explored. We show that the constraints encountered by innovative firms positively affect survival in the medium term. Namely, the breadth of constraints experienced by firms in the introduction of their most recent innovation affects survival positively. To provide potential explanations for the finding, we discuss two mechanisms behind the positive relationship between constraints and survival. Building on the capabilities literature we theorize that a challenging environment stimulates organizational learning, and recognizing impediments in the environment is an essential strategic capability in succeeding with innovation. The creativity literature also lends an explanation from the positive effects of constraints on creativity. A novel survey linked to register data provides the empirical evidence for the study.
Original languageEnglish
Publication date2019
Number of pages33
Publication statusPublished - 2019
EventDRUID19 Conference - Copenhagen Business School, Frederiksberg, Denmark
Duration: 19 Jun 201921 Jun 2019
Conference number: 41
https://conference.druid.dk/Druid/?confId=59

Conference

ConferenceDRUID19 Conference
Number41
LocationCopenhagen Business School
CountryDenmark
CityFrederiksberg
Period19/06/201921/06/2019
Internet address

Keywords

  • Constraints on innovation
  • External environment
  • Firm survival

Cite this

Lindbjerg, L., & Frederiksen, L. (2019). How Do Constraints Affect the Survival of Innovative Firms?. Paper presented at DRUID19 Conference, Frederiksberg, Denmark.
Lindbjerg, Louise ; Frederiksen, Lars. / How Do Constraints Affect the Survival of Innovative Firms?. Paper presented at DRUID19 Conference, Frederiksberg, Denmark.33 p.
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Lindbjerg, L & Frederiksen, L 2019, 'How Do Constraints Affect the Survival of Innovative Firms?' Paper presented at, Frederiksberg, Denmark, 19/06/2019 - 21/06/2019, .

How Do Constraints Affect the Survival of Innovative Firms? / Lindbjerg, Louise; Frederiksen, Lars.

2019. Paper presented at DRUID19 Conference, Frederiksberg, Denmark.

Research output: Contribution to conferencePaperResearchpeer-review

TY - CONF

T1 - How Do Constraints Affect the Survival of Innovative Firms?

AU - Lindbjerg, Louise

AU - Frederiksen, Lars

PY - 2019

Y1 - 2019

N2 - When taking new offerings to the market, innovative firms face constraints more often than less innovative firms. We confirm that firms with higher innovation intensity, higher novelty, and greater search intensity experience more constraints with regards to human resources, financial capital, market barriers, and regulation. Research has looked at the impact of impediments on innovation performance and firm performance, but the link between constraints on innovation and survival is yet to be explored. We show that the constraints encountered by innovative firms positively affect survival in the medium term. Namely, the breadth of constraints experienced by firms in the introduction of their most recent innovation affects survival positively. To provide potential explanations for the finding, we discuss two mechanisms behind the positive relationship between constraints and survival. Building on the capabilities literature we theorize that a challenging environment stimulates organizational learning, and recognizing impediments in the environment is an essential strategic capability in succeeding with innovation. The creativity literature also lends an explanation from the positive effects of constraints on creativity. A novel survey linked to register data provides the empirical evidence for the study.

AB - When taking new offerings to the market, innovative firms face constraints more often than less innovative firms. We confirm that firms with higher innovation intensity, higher novelty, and greater search intensity experience more constraints with regards to human resources, financial capital, market barriers, and regulation. Research has looked at the impact of impediments on innovation performance and firm performance, but the link between constraints on innovation and survival is yet to be explored. We show that the constraints encountered by innovative firms positively affect survival in the medium term. Namely, the breadth of constraints experienced by firms in the introduction of their most recent innovation affects survival positively. To provide potential explanations for the finding, we discuss two mechanisms behind the positive relationship between constraints and survival. Building on the capabilities literature we theorize that a challenging environment stimulates organizational learning, and recognizing impediments in the environment is an essential strategic capability in succeeding with innovation. The creativity literature also lends an explanation from the positive effects of constraints on creativity. A novel survey linked to register data provides the empirical evidence for the study.

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KW - External environment

KW - Firm survival

KW - Constraints on innovation

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KW - Firm survival

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Lindbjerg L, Frederiksen L. How Do Constraints Affect the Survival of Innovative Firms?. 2019. Paper presented at DRUID19 Conference, Frederiksberg, Denmark.