Green technology innovation: Anatomy of exploration processes from a learning perspective.

Samuel Wicki,Erik G Hansen

doi:10.1002/bse.2295

Abstract

This paper examines how established firms use their core competences to diversify their business by exploring and ultimately developing green technologies. In contrast to start‐ups dedicated to a green mission, diversifying into green markets by developing new products based on existing core competences has proven to be challenging. This is because the exploration processes to find a match between green technology opportunities and internal competences is complex and new to most established firms. This paper gains insights into exploration processes for green technologies and the learning modes and outcomes linked to these processes. We examined exploration processes at the microlevel in an embedded case study of an engineering firm using a combination of the “fireworks” innovation process model and organizational learning theory. First, we found that developing green technologies involves a long‐term exploratory process without guarantee of (quick) success and likely involves many exploration failures. Second, as exploration unfolds along multiple technology trajectories, learning occurs in individual exploration paths (on‐path), when new paths are pursued (path‐initiation), and when knowledge from one path is spilled over to subsequent paths (across‐paths). Third, to increase their chances for success, firms can increase the efficiency of exploration by fostering a failure‐friendly organizational culture, deliberately experimenting, and purposefully learning from failures.

Highlights

Despite important literature on why firms become more sustainable and what it means for a firm to be sustainable, there is still limited literature on how firms transform themselves in order to become more sustainable (Zollo, Cennamo, & Neumann, 2013)
We investigated microlevel learning processes in a business‐to‐business engineering firm previously operating solely in conventional markets, but later engaging in radical innovation targeted at green markets, sustainable energy technologies (SETs)
The aim of this paper is to investigate how green technology innovation processes unfold in organizations and what can be learned from exploration failures

Summary

Introduction

Despite important literature on why firms become more sustainable and what it means for a firm to be sustainable, there is still limited literature on how firms transform themselves in order to become more sustainable (Zollo, Cennamo, & Neumann, 2013). The literature on eco, green, or sustainability‐oriented innovations has grown considerably (Hansen et al 2009; Schiederig, Tietze, & Herstatt, 2012), but the innovation processes of how organizations are “going green” is still only marginally understood (Klewitz & Hansen, 2014) This is the case for established firms previously offering conventional product portfolios that aim to diversify into green markets—in contrast to entrepreneurial firms founded with a green mission. Focusing on the early phases of the innovation process and less on product development and diffusion, we examined how the firm explored green technology and related markets We analyzed these outcomes from an organizational learning perspective (Crossan, Maurer, & White, 2011; Lozano, 2014) with a focus on learning from failures (Cannon & Edmondson, 2005; Khanna et al, 2016; Sitkin, 1992)

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