The role of corporate incubators as invigorators of innovation capabilities in parent companies

Abstract

Companies need to rethink their innovation strategies in an increasingly disruptive business environment. The long-term success of large established companies depends not only on their ability to leverage their current capabilities and improve efficiency but also on taking risks and exploring unknown areas. To meet this challenge, established companies are increasingly relying on corporate incubators to fuel innovation and growth with entrepreneurial mindset. Drawing on Zollo and Winter's (Organization Science:13:339-351, 2002) deliberate learning model in conjunction with Christensen's [Christensen, C.M., Anthony S.D., and Roth E.A, Seeing What’s Next? Using the Theories of Innovation to Predict Industry Change, 2004] resource-processes-values (RPV) theory, this paper attempts to answer the question “how can the entrepreneurial mindset fostered in corporate incubators drive the innovation capabilities in parent companies?” The study of four corporate incubators set up by companies from different industries reveals several factors that enable the entrepreneurial spirit fostered by corporate incubators to boost the innovation capability in their parent companies. These factors comprise the recruitment of employees with entrepreneurial potential, investments in knowledge articulation and codification, and a leadership that legitimizes the incubator as a means for the company to develop new ideas and provide support to entrepreneurs inside the organization.