430 Part 3: Strategic Actions: Strategy Implementation
study competitors’ responses to their innovations to have the knowledge required to
know how to adjust their innovation-based efforts, and even when to abandon those
efforts if market conditions indicate the need to do so.^103
In the next two sections, we discuss the other approaches firms use to innovate—
cooperative strategies and acquisitions.13-7 Innovation through Cooperative Strategies
Alliances with other firms can contribute to innovations in several ways. First, they
provide information on new business opportunities and the innovations that might
be developed to exploit them.^104 In other instances, firms use cooperative strategies to
align what they believe are complementary assets with the potential to lead to future
innovations. Compared to other approaches to innovation, combining complementary
assets through alliances has the potential to more frequently result in “breakthrough”
innovations.^105
Rapidly changing technologies, globalization, and the need to innovate at world-class
levels are primary influences on firms’ decisions to innovate by cooperating with other
companies. Indeed, some believe that, because of these conditions, firms are becoming
increasingly dependent on cooperative strategies as a path to innovation and, ultimately,
to competitive success in the global economy.^106 Both entrepreneurial ventures and estab-
lished firms use cooperative strategies to innovate. An entrepreneurial venture, for exam-
ple, may seek investment capital as well as established firms’ distribution capabilities
to successfully introduce one of its innovative products to the market.^107 Alternatively,
more-established companies may need new technological knowledge and can gain access
to it by forming a cooperative strategy with entrepreneurial ventures.^108 Alliances between
large pharmaceutical firms and biotechnology companies increasingly have been formed
to integrate the knowledge and resources of both to develop new products and bring
them to market.
In some instances, large established firms form an alliance to innovate. This is
the case for Inter IKEA Group, the parent company of the IKEA furniture brand, and
Marriott International, Inc. These firms formed an alliance to develop Moxy, a new
hotel brand that the companies believe is innovative in its design and the value it cre-
ates for customers. IKEA provided novel and innovative construction techniques to
keep manufacturing costs down while Marriott provided the value in unique design..
Thus, the Moxy brand was developed to
innovatively combine value with style. In
the words of Marriott’s CEO:
“This is a fresh new take on the economy seg-
ment. I think it benefits from being new and
combining value with style. Too much of the
value product you see in Europe is devoid of
style.”
The hotel was designed to serve the mil-
lennials with moderate prices and an open
lobby/restaurant/bar with music at one end
and space where guests can work on their
devises at the other. The first Moxy Hotel
opened in the summer of 2014.^109Courtesy of Marriott
The first Moxy Hotel that is innovative in both its design and the value
it creates for customers.