Learning After Doing: A Case of Corporate Incubation at Ericsson

Abstract

Innovation has since long been known as key to organizational success and survival, which has driven in particular large technology firms to systematize their research and development activities and explore various complementary approaches of corporate venturing and renewal, including corporate venture capital funding, open innovation and internal corporate venturing. Yet, corporations are increasingly facing ambiguous digital disruptions and lasting era of ferment rendering the known means of corporate innovation insufficient. In response several large corporates have started adopting more experimental approaches to their corporate innovation strategy, including lean start-up approach, corporate incubation and corporate acceleration. Addressing this increasingly relevant phenomenon, our study examines how large industry incumbents establish corporate incubation programs to facilitate strategic innovation in the wake of ambiguous environmental changes. Grounded in the context of telecommunications industry facing digital disruptions, our study reports an in-depth, longitudinal field study of corporate innovation strategy of Ericsson for the period of 2013 to 2019. We demonstrate the iterative and path dependent learning process of corporate experimentation and show indirect benefits of corporate incubation projects to the parent firm. Accordingly, we contribute to the emergent literature on corporate experimentation as well as the literatures on strategy-making processes and internal corporate venturing.