CHAPTER 1: GENERAL INTRODUCTION TO THE THESIS
2.4 KEY DETERMINANTS OF SUCCESSFUL COMMERCIALIZATION OF TIs
that most of the determinant factors affecting successful commercialization of technological innovations are “controllable by company management” hence they emanate more from within than from the external environment. The same authors argue for the need for the management team to work towards improving all the NPD stages, with particular emphasis on improving the market introduction (new product launch or commercialization) phase. They are of the opinion that improvement of this key phase will probably increase the success chances of the new offering on the market. However, the researchers do not say much about how such an improvement can be achieved by referring the “how”
questions to more detailed NPD literature. Although this idea could be true, it can still be argued that the success of an innovation is also determined by several factors external to the organization, though management plays a pivotal role in both internal and external determinants.
2.4.1 “Successful Commercialization” of TIs Operationalized
Not much has been done to scrutinize how research institutes define successful commercialization. In fact, there has not been a common or generally agreed definition of just how successful, successful commercialization should be. A few researchers who have attempted to define it have often assumed a variety of ‘success’ measures and these would normally be used for the purposes of their respective studies.
Commercialization of research output is a quite complicated, diverse and an intricate concept that too requires some complex connections and / or interactions amongst researchers (or inventors), research institutes and the investment sector (Australian Research Commission (ARC), 2000).
Commercialization of technological TI’s is commonly viewed as a process of converting ideas into market-competent products in order to create some market and / or economic value (Pellikka and Lauronen, 2007; Jolly, 1997). Views on “successful” commercialization of TI’s are unquestionably multifaceted. For instance, Zahra (1996: 289) refers to “successful” commercialization as the “firm’s ability to develop and introduce a large number of product and process technologies” while Blair and Hitchens (1998) use productivity measures, such as sales per employee to determine commercialization success. It is all about the firm’s creation of new knowledge, which is then commercially exploited through identification of market opportunities (Petti and Zhang, 2011). Zahra (1996) believes that successful commercialization rests upon the firm’s aptitude to create radically new products.
However, Stevens et al. (1999) tend to differ. They believe that successful commercialization revolves around the firm’s skill in expediting the new products’ introduction to the market. Various other authors (e.g. Rothaermel et al., 2007; Leitch and Harrison, 2005; Shane, 2001a) use a basic measure for commercialization (spinoff) success – “whether or not” the institute’s innovation
“continues to exist”. Nerkar and Shane (2007) measure the likelihood of commercialization by the achievement of first sale. Interestingly, various other authors and researchers perceive the concept of
“successful” commercialization of TI’s quite differently, with some deciding to simply calling it
“commercialization” rather than “successful” commercialization. Based on the fact that this study is anchored on establishing factors affecting the “successful” commercialization of TI’s, it is necessary that the review focuses on views that attempt to quantify and / or measure the degree of “success” of the commercialization of technological innovations. Table 2.1 below therefore summarizes the above and other views on the different measures of successful commercialization of TIs.
Table 2.1: Summary of Literature on Definitions of Successful Commercialization
Author Successful Commercialization Measure (s)
O’Gorman (2008) From academic entrepreneurial innovation perspective – how well entrepreneurial activities bolster the academic career through peer recognition and traditional university rewards success
Nerkar and Shane (2007) Achievement of first sale Rothaermel et al. (2007); Leitch and Harrison
(2005); Rothaermel and Thursby (2005); Shane (2004); Shane and Stuart (2002)
Whether or not an innovation continues to exists
Wright et al. (2006); Lockett and Wright. (2005);
Shane and Stewart (2002), Zucker et al. (2002)
Whether or not the invention (spinoff) attract early- stage finance - venture capital funding, in particular Rothaermel and Thursby (2005); Leitch and Harrison
(2005); Shane (2004); Shane and Stuart (2002)
They use a basic measure for spinoff success: whether or not a firm continues to exist
Shane (2004); Goldfarb and Henrekson (2003) Whether or not the spinoff has an initial public offering Vohora et al. (2004) Achieved by passing through a series of iterative, non- linear “critical junctures”; specific resources and capabilities that must be acquired in order to pass to the subsequent phase
Meyer (2003) Defined in terms of the prospect to pursue their (academic) agenda through their entrepreneurial activities, not spinoff growth or profits
Zucker et al. (2002,1998) in support of Roberts (1991)
Number of patents and scientific papers,
index based on average sales growth and projections, length of company existence, and its profitability Blair and Hitchens (1998) Uses productivity measures, i.e. sales per employee Zahra (1996) The firm’s ability to develop and introduce a large
number of product and process technologies Source: Extracted from various sources
For the purposes of this study, the best way is probably to consider these various dimensions concurrently so as to understand the factors that influence commercialization of technological innovations. The researcher is of the opinion that different technological commercialization proportions contributed by different authors all have a unique function to play in enhancing a sustainable competitive advantage for the firm. Thus the firm’s commercialization rate dictates its capabilities in introducing new offerings promptly compared to competing firms, and this is especially important in a dynamic environment, which is typical of the twentieth century business environment, in which Zimbabwe’s research institutes are also operating.