Commercialising new-to-world innovations: An uncertain stakeholder co-creation journey

Published September 2019 by Dr Alexandra Kriz

Kriz, A. & Welch, C. 2018, "Innovation and internationalisation processes of firms with new-to-the-world technologies", Journal of International Business Studies, vol. 49, no. 4, pp. 496-522, DOI:10.1057/s41267-018-0147-7 

Dr Alexandra Kriz

Significance

  • New-to-world innovations involve both technical and market uncertainties−they can take a long time to develop, may fail technically with further testing, rely on the whims of current and emerging markets, struggle to attract external buy-in given many unknowns, and require regulatory support.
  • While internationalisation offers opportunities for value co-creation with a range of stakeholders, it can involve an uncertain and ‘marathon-like’ journey for ‘deep tech’ firms - despite them boasting innovations that can generate new sources of value creation globally.
  • There is an assumption that in order to internationalise, firms simply sell existing products and services, and offer value propositions abroad. But for deep tech firms developing new-to-world innovations, they often do not yet have a product and/or service that is ready to ‘sell’ internationally. Rather, internationalisation is a means by which they continue to construct their emerging innovation and value proposition amidst a complex array of global stakeholders and trends.

What’s new

  • Many Australian services firms with high-tech services innovations fail abroad. So what might be going on? There could be a number of reasons, but in the case of services firms that are also deep tech, just because an innovation is ‘novel’ does not guarantee a straight-sell in international markets, and getting new-to-world innovations to global markets can be prolonged and uncertain.
  • We develop an evidence-based model from a case study of CSIRO’s deep tech ‘spinoff’ firms, based on interviews with over 50 informants (e.g., CEO’s, Chief Scientists, venture capitalists, Board members, CSIRO Commercialisation Managers). Our model shows how tensions between technical and market uncertainties persist over time for deep tech firms as they pursue international markets.
  • Key insight? Our research shows: (1) internationalisation may be far from smooth sailing and can result in set-backs, failure, and ‘near-death’ experiences; (2) tensions between technical and market uncertainties are also influenced by other factors (e.g. industry trends); and (3) tensions do not necessarily ease as the innovation matures, given ongoing uncertainties related to markets, and uptake of the innovation.

Bottom line

Lessons for managers of deep tech firms include:

  1. knowing that persistent uncertainties mean learning from experience is tough as new challenges constantly arise, but learning from a network that have ‘been there/done that’ can help, as can support from trade and investment agencies;
  2. hiring talent that can simultaneously manage the tensions between technical and market uncertainties can provide a competitive edge;
  3. scanning the environment for opportunities and threats to more proactively navigate the uncertain environment and increase the chances for success can be key. These activities can reduce uncertainties and may help attract early investment to support ongoing R&D.  

Contact Dr Alexandra Kriz to learn more information about the research. 

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