Introduction

Schumpeter's evolutionary theory of innovation suggests that the “gales of creative destruction” brought about by radical innovation will allow some organizations to gain competitive advantage and result in “… old concerns and established industries … perish[ing] that nevertheless would be able to live on vigorously and usefully if they could weather a particular storm [of this creative destruction]” (Schumpeter, 1942, 90). Although Schumpeter's argument does not specifically identify the organizational locus of the innovation, it does note that “new concerns or industries that introduce new commodities or processes” are likely to displace older industries (Schumpeter, 89).

Radical innovation and its organizational foundations became an important area of study in subsequent academic inquiry on innovation. Many commentators have highlighted the advantage small and de novo firms have over incumbent firms in generating and incubating radical innovations (Foster, 1986; Jewkes et al, 1958; Tilton, 1971; Abernathy & Utterback, 1978; Mitchell, 1989; Henderson & Clark, 1990). This suggests two key research questions.