Exploitation, Exploration or Continuous Innovation? Strategy: Focus, Fit and Performance in different business environments

The purpose of this paper is to investigate the extent to which continuous innovation is pursued as a strategy for manufacturing firms in different types of competitive environments, and whether continuous innovation firms perform better than focused firms in certain environments. Statistical analyses are used of data collected from an international sample of manufacturing firms through the International Manufacturing Strategy Survey. The main findings are that, while focused as well as continuous innovation firms exist in all three types of business environments identified in this paper, continuous innovation appears the most advantageous strategy in terms of operational performance. In subsequent research, the findings should be generalized and extended using longitudinal data and in-depth case studies. Practical implications concern the appropriateness of continuous innovation within a certain economic context.