Radical innovation (RI) offers significant benefits, but the challenges encountered during its implementation can be formidable. Recent literature suggests the use of practices such as prototyping, experimentation, piloting, and demonstration to address these challenges through small-scale, iterative approaches. While these practices are popular, they have not been specifically developed to counter the uncertainties inherent in RI. In addition, the fragmented nature of existing research has led to ambiguous conceptual boundaries between them. Furthermore, we lack a solid understanding of the role that the different practices should play in the different stages of the RI innovation development process. To address these gaps, we introduce the concept of radical innovation validation (RIV) and, based on comparative case study research, develop a comprehensive, process-oriented and empirically grounded framework for RIV which is composed of three activity categories (i.e., concept validation, technical trials, and market demonstrations) and five core principles (i.e., materializing solutions to stimulate creative thinking, enhancing the dialog with stakeholders, continuous learning, fast and non-confrontational hypotheses testing, scaling up in semi-controlled environments). We show that each of the three RIV activity categories provides a distinct contribution to a specific stage of the RI development process, while the RIV core principles support value creation throughout the entire process.

Although the interest in design thinking within innovation research and practice is growing, there is a lack of a holistic view of the relationship between design thinking and different types of innovation (i.e., radical and incremental innovation). This gap impedes a more thorough and nuanced comprehension of the role that design thinking plays in innovation. To bridge this gap, we investigate the impact of design thinking on both radical and incremental innovation by integrating resource orchestration theory. We further explore whether and how these impacts vary with the innovation stage (ideation stage vs. product development stage). Using survey data from 446 Chinese manufacturing firms, we find that design thinking positively affects both radical and incremental innovation. More interestingly, the innovation stage forms a different contingency factor in which design thinking affects the two types of innovation. The positive relationship between design thinking and incremental innovation is stronger in the ideation stage than in the product development stage. However, the positive relationship between design thinking and radical innovation does not differ significantly between the two stages of innovation. These findings advance the literature on when and how to apply design thinking in different types of innovation, providing practical implications for managers to adjust design thinking implementation strategies on the basis of innovation types and stages.

Previous research indicates that hassle cost reduces consumers’ utility and hurts sellers’ profits. However, counterintuitively, some sellers, particularly those who sell online, purposefully increase the hassle cost of purchasing their products. Our work examines how sellers effectively apply dual pricing with purchase hassle to increase their profit and how it affects consumers’ purchasing decisions and utility. Different from previous studies, we take into account both the heterogeneities of consumers’ product valuations and hassle costs. We find that when consumers’ hassle costs are independent of their product valuations, decrease or concavely increase in the product valuations, dual pricing with purchase hassle reduces sellers’ profits. When consumers’ hassle costs are convex increasing in their product valuations and the relative increasing rate is high, sellers can obtain additional profit through dual pricing. Moreover, under dual pricing, consumers’ utility is non-monotonic in their product valuations. Finally, we extend our model to the case where the former full price is kept while switching to dual pricing, the case with network effects, the case where the cost to sellers of offering dual pricing is higher than single pricing, as well as the implications on consumer surplus. In these cases, our findings remain applicable.

Global investment in emerging green technologies reached US$2.1 trillion in 2024, and government subsidies accounted for a significant portion of this investment. This study examines the optimization of the government subsidy portfolio, including the investment subsidy during research and development (R&D) periods and the adoption subsidy during usage periods, to inspire firms' investment in and adoption of green technologies. The study focuses on the interplay between the government's subsidy policies and the firm's decisions regarding the R&D investment and adoption time of green technologies. The findings indicate that it is optimal for the government to subsidize only when the green technology's initial unit production cost is not too low and/or the firm's learning rate is not too large. Therefore, policymakers should exercise deliberation in green technologies' inherent characteristics when formulating subsidy strategies. A noteworthy discovery is the perfect substitutability between the initial adoption subsidy coefficient and the investment subsidy rate in the government's optimal subsidy portfolio. This leads to multiple viable subsidy combinations, each with different regulatory expenditure. Specifically, the optimal subsidy portfolio that minimizes the amount of regulatory expenditure is the one containing a large investment subsidy paired with a comparatively small adoption subsidy that decreases over time. Therefore, policymakers can strike a trade-off between investment subsidies and adoption subsidies, thereby enhancing social welfare while concurrently curtailing regulatory expenditure. Finally, considering complexities across different industries, such as constrained R&D investment capacity in the energy industry and cost reduction phenomenon in the traditional manufacturing industry, this study investigates extended models to reinforce the validity of our conclusions.

Firms operating in regions with strict carbon regulations often face foreign competition from exports in regions with laxer regulations. Carbon tariffs, taxes imposed on imported goods, significantly affect these firms' technology choices and production. This study evaluates the efficiency of three prevalent carbon tariffs: the default low/high-pollution tariff and the nondefault tariff. The former is levied based on default green/existing technology, while the latter is based on firms' actual applied technology. We investigate the equilibrium decisions made by domestic and offshore firms regarding technology and production given the carbon tariffs established by the domestic government. The carbon tariffs are evaluated in terms of green technology incentivization, market share retainment, and total greenhouse gas (GHG) emissions reduction. Moreover, social welfare, a composite indicator of concern to policymakers, is considered so that a social maximum can be achieved. Our findings reveal that although the imposition of carbon tariffs incentivizes domestic firms to utilize green technology, it can disincentivize offshore firms from doing so. In terms of market share retainment and total GHG emissions reduction, the default high-pollution tariff performs at least as well as the default low-pollution tariff and the nondefault tariff. Moreover, for policymakers with the objective of social welfare maximization, it is not always optimal to impose carbon tariffs as carbon tariffs can fail to improve social welfare. Further, when the imposition of carbon tariffs improves social welfare, it is the default high-pollution tariff that improves the most.

Digital platform markets are emerging rapidly with technological innovation, creating new market opportunities and unique challenges. In response, platforms in such markets compete aggressively through high subsidies for market dominance, leveraging network effects to achieve success. We examine such aggressive subsidy wars between new competitors and dominant incumbents, where the one that first runs out of funds risks market expulsion or marginalization. Our analysis incorporates consumer heterogeneity in network effects to evaluate subsidy strategies from a cost-effectiveness perspective. That is digital platforms, whether serve as suppliers or channels in platform-based supply chains, optimize either per acquisition cost or total subsidy expenditure. Our findings reveal that it is optimal for the dominant platform to protect its market dominance when the competitor's market share reaches a certain level, varying in distinct competitive contexts. Specifically, for channel platforms connecting buyers and suppliers, subsidy allocation must be balanced between user groups. We find that new competitors should typically subsidize the side with lower market share, while dominant platforms maintain equal market shares on both sides by adjusting subsidies in most cases. Interestingly, our findings demonstrate that a dominator's larger market shares cannot guarantee its competitive advantage in subsidy wars, which is influenced by the factors such as cost structure, competitor's financial capabilities, network effect strength, and product differentiation. We also identify critical conditions for new competitors to successfully win market dominance through initiating subsidy wars, while offering strategic guidance for dominant incumbents to defend their positions.

Balancing exploitative innovation and exploratory innovation, i.e., innovation ambidexterity, is conducive to the survival, adaptation, and prosperity of firms, especially high-tech small- and medium-sized enterprises (SMEs). However, due to their liability of smallness, high-tech SMEs face greater challenges in achieving this balance. While many studies have examined the antecedents of innovation ambidexterity, they do not focus on high-tech SMEs, and the role of digitalization has received scant attention. Integrating the views of dynamic capability and organizational inertia, this study aims to offer novel insights into how digitalization affects the innovation ambidexterity of high-tech SMEs. Using the panel data of Chinese high-tech SMEs from 2010 to 2021, we find that as high-tech SMEs increase digitalization, their innovation ambidexterity first decreases, but then increases. Moreover, this U-shaped effect is found to be flattened by performance shortfall. These research findings offer critical implications for high-tech SMEs on their digital strategies and innovation management.

Platform envelopment, which describes the embedding of one platform into another platform, is widely adopted by platforms with network effects. The strategic use of platform envelopment is determined by the tradeoff between the benefits of sharing existing users and inconvenience of using the embedded platform. This study investigates when the pure envelopment strategy (PES), mixed envelopment strategy (MES), or no envelopment strategy (NES) should be adopted and examines several coordination schemes for the platforms. A centralized decision-making case and a decentralized decision-making case are first formulated and compared. The results show that NES is the only equilibrium solution under a decentralized decision-making case and the cooperation between the two platforms can lead to higher profit of both platforms by adopting the PES or the MES. We then propose a partial equity ownership (PEO) contract, a proportional fee (PF) contract, and a fixed fee (FF) contract to coordinate the system, benefiting both platforms. The PES or the MES may be the equilibrium strategy under a PEO contract, whereas the MES is the only equilibrium strategy under a PF or an FF contract. This study finds that the adoption of a PEO contract will lead to higher surplus of consumers and providers, and social welfare. In addition, we find that only PEO contract may perfectly coordinate platforms to achieve the same total profit as that under the centralized decision-making case, while PF and FF contracts cannot.

To date, existing studies have produced inconclusive empirical findings as to whether search scope impedes or benefits knowledge impact. To reconcile this controversy, we scrutinize the role of search scope and delve into the combination of knowledge components. Specifically, in this article, we propose that search scope connotes recombination of two types of novel components (i.e., recombining neighboring components or distant components). Drawing on the recombinant search and decomposability literature, we argue that recombining neighboring knowledge components is conducive to knowledge impact because these components provide absorbable variation and integration mechanisms, whereas recombining distant knowledge components impedes knowledge impact as the resultant outcome is difficult to understand and the value is not perceived. To empirically test these arguments, we draw on network function theory and develop a novel approach to build knowledge networks looking at the relatedness of knowledge components. Applying this method to data on patents granted from 1995 to 2009, we identify neighboring components and distant components as two related but different novel knowledge components. The results strongly support our hypotheses, even when controlling for the patent, inventor, as well as examiner level of covariates.

The efficiency of strategic outsourcing in reverse logistics (RL) depends on stakeholder requirements (SRs) directing organization development and experts’ knowledge decomposing and reconstructing strategic decision, which urges the adoption of hierarchical and interactive quality function deployment (QFD). Considering the uncertainty within a QFD, single valued neutrosophic number (SVNN) is introduced to capture both indeterminacy and inconsistency hidden in quantitive votes and qualitative judgments of stakeholders and experts. With unknown weight assignments, two maximum deviation models are constructed to obtain the priority of SRs and Shapley weights of experts. An SVNN-enabled grey relational analysis is extended to identify the interdependence priority of engineer characterizers (ECs). Due to the interactions among components such as experts in a group or ECs in QFD, two information aggregation tools under neutrosophic environments are presented based on fuzzy integral delineating the positive or negative effect. Built on these, we propose an integrated neutrosophic approach composed of a transformation module, weight module, integration module and QFD analysis module to support the outsourcing decision. Finally, an illustration example is used to confirm the practicality of the proposed approach. Sensitivity analysis and comparative analysis with multiple views have been conducted to show the flexibility and superiority of the given decision.

Many previous studies have examined factors that contribute to organizational resilience; however, the impact of supply chain members has received scant attention. This study aims to investigate whether placing supply chain associates on boards influences organizational resilience. Drawing on the dynamic capabilities perspective, we integrate strategic and operational aspects of organizational resilience and introduce the idea of placing supply chain members on corporate boards as a strategic approach for firms to create and maintain resilience. An analysis of the responses of 498 firms from the SP1500 list in the aftermath of the COVID-19 pandemic shows that firms with supply chain directors in their boardrooms had a higher capacity to cope with the COVID-19 pandemic, as indicated by shorter recovery times and less loss severity than firms without supply chain members on their boards. Furthermore, we found that the benefit of less loss severity is strengthened under high closeness centrality and betweenness centrality, whereas the benefit of shorter recovery time is strengthened under high degree centrality and low betweenness centrality. We add to the organizational resilience literature by theorizing that having supply chain members on boards is a viable approach to creating and maintaining resilience.

High-tech small- and medium-sized enterprises (SMEs) need to innovate and invest in research and development (R&D) activities to remain competitive. However, due to their liability of smallness, the returns from R&D in terms of financial performance may be not as expected in such firms. Combining the resource management perspective with managerial ability research, we elaborate upon how managerial ability influences the effect of R&D on the financial performance of high-tech SMEs. We also investigate how this moderation is affected by the external environment in which high-tech SMEs operate. Using a moderated moderating model and the panel data of 256 Chinese high-tech SMEs from 2007 to 2019, we find that managerial ability strengthens the impact of R&D on the financial performance of high-tech SMEs. This moderating effect is more pronounced during the economic downturn and in regions with better digital economy development. Our findings provide important implications for high-tech SMEs on their R&D strategies and human capital management as well as the government.

Carbon Tax and Carbon Cap-and-Trade policies, as the primary carbon pricing instruments, are designed to reduce greenhouse gas emissions. However, inconsistent global regulations for emissions may lead to emissions leakage, as firms strategically relocate production to regions with less stringent controls. This study contributes to existing research by evaluating Carbon Tax and Carbon Cap-and-Trade policies in conjunction with the impending Carbon Border Tax (CBT), designed to mitigate emissions leakage from cross-regional production. Specifically, we examine a firm's equilibrium strategies in investment and production in both domestic and offshore regions under two different carbon pricing instruments while subject to the CBT. The analysis includes a comparative assessment of technology investment, total greenhouse gas emissions, and social welfare. Our findings indicate that the Carbon Tax policy can be associated with lower emission intensity, albeit generating greater total emissions compared to the Carbon Cap-and-Trade policy. Notably, the CBT can serve as an equivalent stimulant for technology investment and a reducer of aggregate emissions under both pricing instruments. Moreover, the Carbon Cap-and-Trade policy proves more beneficial in terms of social welfare when the firm's optimal strategy is confined to either domestic or offshore production. Conversely, the Carbon Tax policy yields higher social welfare in cases of high emission prices when the firm's optimal strategy is cross-regional production. The introduction of the CBT enlarges the set of conditions under which the Carbon Tax policy proves more advantageous for social welfare.

Platforms often compete for market leadership through aggressive subsidies in the early stages of a market with network effects to reap huge profits in the future. In a subsidy war, the platform whose subsidy funds are exhausted first will lose the war and, as a result, often obtains a very small market share or may even be expelled from the market. We develop an analytical framework featuring consumer heterogeneity in terms of network effects to investigate how platforms maximize their competitive advantage to win the subsidy war. We find that, in either a one- or two-sided market, either platform can maximize its competitive advantage in cost per acquisition by occupying a dominant market share through subsidy, which is often above threefourths. However, in terms of total subsidy cost, if both platforms’ subsidy funds reach the threshold, neither platform can establish a competitive advantage, and the platforms share the market equally in equilibrium. The platform which cannot gain a competitive advantage has to subsidize its consumers with all subsidy funds to minimize its competitive disadvantage. This paper provides insights on when a subsidy war breaks out and how platforms compete in a subsidy war. Platforms should make subsidy decisions based on whether they compete on cost per acquisition or total subsidy cost. The platform with small initial market share is unlikely to has a competitive advantage in cost per acquisition, but has a chance to win the war when platforms compete on total subsidy cost if it has sufficient subsidy funds.

Recent research on recombinant search has paid close attention to the search for and recombination of useful knowledge pieces. However, the question of where to search and how to allocate inventive efforts remains underdeveloped. This article identifies knowledge relationship intensity and neighboring knowledge concentration as critical factors and highlights the contingent role of technological uncertainty. Drawing on a novel network construction method, we built knowledge networks of U.S. utility patents granted from 1995 to 2009. Then we developed an elaborated measure of knowledge relationship intensity and neighboring knowledge concentration. Our findings suggest that knowledge relationship intensity and neighboring knowledge concentration have a curvilinear (inverted U-shaped) relationship with knowledge impact. Furthermore, technological uncertainty accentuates both the effects of knowledge relationship intensity and neighboring knowledge concentration on knowledge impact in such a way that makes curvilinear relationships move upward. This article provides important theoretical and practical implications.

CEOs play a vital role in formulating corporate digital transformation and their cognitions and behaviours are often shaped by their experience. However, few studies have explored the impact of CEOs' experience, especially foreign experience, on firms' digital transformation. Drawing on upper echelons theory, we examine how CEO foreign experience affects corporate digital transformation. Since CEO foreign experience is one valuable human capital resource, we also examine how it interacts with other firm resources to affect digital transformation. Using a large sample of Chinese listed firms from 2007 to 2019, we find a significantly positive effect of returnee CEOs on corporate digital transformation. This effect is also strengthened by firm slack but weakened by the presence of digital leaders. Overall, our study suggests that returnee CEOs matter for corporate digital transformation, offering important implications for firms and government in emerging economies.

Governments are providing an increasing number of subsidy policies for biomass-based industries. Although one of the main barriers to the development of the biomass industry is the high cost of feedstock, it remains unclear how effective different subsidies are in addressing that barrier. In this paper, we categorize biomass subsidies and explore their effectiveness by developing a biomass feedstock supply model. First, we examined biomass subsidies in China and the United States and found that all biomass subsidies can be grouped into four categories based on the types of costs they seek to mitigate: production and transport subsidies for biomass utilization improvement and product and operating subsidies for specific biomass industry development. Then, we developed a game-theoretic model of the interactions between the government and biorefineries and compared the effectiveness of the subsidies. The results indicate that transport subsidies are more cost-effective at increasing biomass utilization. However, the production subsidy allows for more even use of biomass across different biorefineries. A combination of operating and product subsidies is more cost-effective in enhancing the profitability of specific biomass industries if the industry to be supported is quite unprofitable; otherwise, the product subsidy is better.

Given the rise in consumers' ecological awareness, many firms currently offering only nongreen products are extending their product lines with products applying green technology. We examine a monopolist's product line extension strategy and pricing strategy by explicitly considering the environment-related utility and spillover effects of a green product. The results show that a firm should introduce its green product when the spillover effects and the cost of the green product are small or the spillover effects are large enough. The firm should utilize a penetration pricing strategy for the functionally inferior green product when the environment-related utility is small or when the environment-related utility is moderate and the spillover effects are relatively small. Otherwise, the firm should adopt a skimming pricing strategy. However, the firm should adopt a penetration pricing strategy for the functionally superior green product when the spillover effects are relatively large and a skimming pricing strategy otherwise. Interestingly, the firm's total profit may decrease with the spillover effects when the spillover effects are small.

By integrating several third-party platforms that enter the market late (later entrants), a fourth-party platform can effectively compete with the third-party platform that enters the market early (early entrant). Our research develops an analytical framework to address the platform coopetition problem that the early entrant faces, i.e., integrating its service into the fourth-party platform or not, when there is a fourth-party platform in the market. This study provides optimal conditions and platform decisions for platform coopetition and then explores the impact of the implementation of the coopetition strategy on platform prices and consumer demands. Our analytical results show that the coopetition strategy is effective only when the sum of the strengths of direct and indirect network effects is low and the quality difference between the early and later entrants is higher than a certain threshold. Moreover, the early entrant always partially integrates its service into the fourth-party platform when the coopetition strategy is adopted. Such adoption always lowers the prices of the early and later entrants. The implementation of the coopetition strategy always increases the total consumer demand of the early entrant, but it also results in a reduction in the number of consumers in the standalone application of the early entrant.