The Double-Edged Sword of Recombination in Breakthrough Innovation

Reaction Paper 1

Yuhan Zhang

186B130B

For week one, I read three papers of “The double-edged sword of recombination in breakthrough innovation”, “Dominant designs, innovation shocks, and the follower’s dilemma” and “Interfirm networks in periods of technological turbulence and stability”.

After reading papers, I find the innovation sources can be divided into two parts: wide recombination and narrow recombination which is also called local search. The wide recombination or broad recombination is a recombination with different kinds of knowledge such as the existing ideas, technologies, strategies and genres. To fully explore the boundaries of new technologies, it is required to access to diverse and divergent ideas and will allows firms to be more creative and more innovative. The recombination with distance or diverse knowledge is usually occurs in places where firms intersect and interact, and the difference of the styles, rules, tradition or cognitive between the firms merged together will leads to creating successful novelty. During the periods of technological turbulence, this kind of recombination will enhance the connection of diverse network partners and will decreases the hazard of firm mortality. The production of new ideas from different parts may create innovative products and will bring great economic value to each side of participating companies.

The recombination with different fields can also bring innovation shocks. An innovation shock will create follower’s dilemma that launches the responses from rivals and potential competitors. The innovation shock may or may not leads to the dominant design because which design can become the dominant design not only depends on the technical factors, but also on the influence of social, cultural, investment, external effects, consumption habits and other factors. A dominant design is a product design or technical standard accepted by most companies in the industry and most customers in the market. For example, Ford's T-car design in the automotive industry. It marks the end of the flow phase of an emerging industry, and the technical and market uncertainty of the products is greatly reduced and will embark on a path of rapid development. In order for industry competitors to gain a foothold in new industries, their products must use this design or design their products based on this design. Other than that, they may have to make another innovation shock by a new recombination to try to create a new dominant design.

...