Innovation strategies in emerging markets: what can we learn from Indian market leaders

TLDR: In this article, the authors compare the innovation strategies of five local market leaders in India on dimensions related to exploration and exploitation, internal and external sources, technology push and market-pull and product and process innovation.

Abstract: What role has innovation played in the leadership positions attained by local firms in emerging markets? What innovation strategies have these firms followed? This paper takes advantage of a natural experiment – the deregulation of the Indian economy – to investigate these questions. We compare the innovation strategies of five local market leaders in India on dimensions related to exploration and exploitation, internal and external sources, technologypush and market-pull and product and process innovation. This study establishes that innovation plays a key role in the leadership position attained by local leaders. These firms display a high degree of ambidexterity in both exploring and exploiting in parallel, an approach that is required to provide speed of response. External sources are tapped for knowledge and ideas, and this learning is integrated with internal innovation. Market exploration, particularly the development of products, services and business models that allow the companies to meet the affordability criteria of the mass market, plays an important role in the innovation strategy of these companies.