Leveraging Incumbents’ Advantages at Their Technology-Based New Business Initiation Stage

  •  Xiao Yan    
  •  Xiaoping Cheng    


Researchers often talk about leveraging incumbent’s advantages. The ability of an organization to leverage its advantages accumulated in their existing fields for its new business development has been conceptualized as critical for incumbent manufacturing firms (IMf) long term development. Meanwhile, many studies have shown that most of the advantages (including knowledge which is this study’s focus) accumulated in existing fields will become obstacles to their new business initiations. Thus, this paper aims to find a knowledge accumulated in their existing field, which will not bring obstacles, but is of great significance to the initiation of new business. By observing two typical cases, this paper identified a kind of knowledge accumulated in existing fields of incumbent firms, which is called AKET (architecture knowledge about existing technology), can be applied to the initiation stage of TBNB (technology based new business). However, this knowledge is only valuable if it can generate diversification and creativity for their new business launch. For such value generation, this paper proposed an AKET Applying Mechanism.

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