Path Dependence and the Incumbent's Survival in Cross Industries Under Radical Circumstances: Lessons From the Samsung Case

Abstract

Path dependence attempts to clarify the continuous survival of some technology firms in cross industries amid the failure of others under radical circumstances. Controversially, related studies suggest both findings that path dependence works positively and negatively on a firm's survival. In this paper, we present the disadvantages from the negative views, or those that restrict technology firms within one's business, and instead suggest expansion to cross businesses. This study aims to investigate the survival of some technology firms and their means to regain their dominant position, by analyzing the case of Samsung. Results show that Samsung, while facing radical change, successfully established a new strategic business. Our contributions confirm the positive views on path dependence. We also suggest three factors that contribute to the survival of the incumbent facing radical changes: dynamic technological capability, top management capability, and internal selection process.