Serial Strategic Innovation and Sustainable Competitive Advantage: A Longitudinal Case Study

Pages: 46 (11636 words) Published: March 24, 2015
Journal of Case Research in Business and Economics

Serial strategic innovation and sustainable competitive advantage: a longitudinal case study
Kimberly S. Davey
University of Alabama at Birmingham
Tom J. Sanders
University of Montevallo
ABSTRACT
This paper examines serial strategic innovation as a basis of sustainable competitive advantage through a longitudinal case study of Proctor and Gamble (P&G) from its inception through 2008. For over 170 years P&G has been in continuous opera operation

tion in the consumer
products industry, growing to become a multi
multi-billion
billion dollar global corporation today. Over its
history, P&G has pioneered a series of strategic innovations that have sustained its competitive advantage in a number of highly contested market spaces. This paper reviews five key strategic innovations in the areas of direct to consumer advertising, direct product distribution, marketing research, brand management, and technological and product innovation. Contributions to sustainable competitive

petitive advantage are discussed in terms of product portfolio mix, market share growth, financial returns, and competitive positioning. Using multiple conceptual frameworks from the strategic management, disruptive innovation, value chain, and innovation embeddedness literatures, the paper concludes with discussion of the nexus between serial strategic innovation and sustainable competitive advantage that emerges from this review along with directions for future research.

Key words: Competitive Advantag
Advantage, Disruptive Innovation, Embeddedness, Marketing, Proctor and Gamble, Strategic
rategic Management, Value Chain

Strategic serial innovation, Page 1

Journal of Case Research in Business and Economics
INTRODUCTION
Strategic management theory posits that innovation is the primary means by which organizations adjust to their environmental suprasystem (Mintzberg, 2008) via strategic choices they make (Child, 1997). A classic definition of innovation is any change that is new to a social system (Rogers, 2003), such as an organization

organization. Innovation in this context includes both
invention of novel new changes or imitation of existing ones, with or without modifications or reinvention, by the adopting social system
system. Innovations can be major transformational/
transformational
revolutionary changes that are pervasive in their impact on the organization or incremental/evolutionary
evolutionary adjustments in ongoing activities th
that
at cumulatively result in substantive
change (Damanpour, 1991). Innovations can be viewed terms of the processes of the organization and/or its product/service outputs (Utterbeck, 1996). Serial innovation occurs when an organization is repeatedly successful in adopting changes over time (Hamel, 2000; 2006). Strategic innovations are transformational changes that are intended tto o achieve competitive

advantage for an organization. Sustainable comp
competitive advantage is enduring benefits
enefits that flow
to an organization over a prolonged time period. Organizations that create sustainable competitive advantage typically are serial innovators that are able to adopt transformative changes regularly and incrementally

mentally adjusting these changes on an ongoing basis to maintain superior performance results that yield competitive advantage (Hamel, 2000; 2006). 2006)
Firms that are able to attain sustainable competitive advantage over long periods of time have been of substantial
antial interest in the management literat
literature.
ure. Practitioner periodicals regularly
publish lists of top performing companies based on wi
widely
dely varying criteria, such as:
Businessweek “Top 50 Companies” and “Most Innovative Companies” (Businessweek, 2010); Fortune
ortune “100 Best Companies to Work For” and “Most Admired Companies” (Fortune, 2010); Baldridge quality award winners (Baldridge, 2010)
2010). Many
any other...

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