How Strategic Distinctiveness Contributes to Incubator Performance: Evidence from China

Abstract

In this article, we extend the research on optimal distinctiveness to the business incubator context and explore how incubators orchestrate multiple strategic dimensions to manage the tension between conformity and differentiation. We develop the argument that incubators can pursue a moderately distinct position in the primary dimension to ‘join the battle’ and a highly distinct position in the personalized dimension to ‘secure victory’. In addition, we argue that the effect of orchestration strategy on incubator performance is magnified by competitive intensity. Using a large sample data from business incubators in China between 2016 and 2018, we find an inverted-U shaped relationship between strategic distinctiveness of market infrastructure development services and incubator performance, and a positive relationship between strategic distinctiveness of business capability development services and incubator performance. Moreover, we show that the decrease of market concentration or the development of regional innovation environment strengthens the relationship between strategic distinctiveness and incubator performance. These findings inject fresh insights into the orchestration view of optimal distinctiveness and advance our understanding of the strategic positioning of business incubators.