Achieving Agility in High-Reputation Firms: Agile Experimentation Revisited

Agility has become a key capability for contemporary firms, constantly facing fast-changing markets and evolving customer needs. The greatest challenge firms encounter today is to endure continuous change and successfully navigate through uncertainty, hence developing agility to identify and exploit market opportunities while striving within uncertain contexts. In recent years, several approaches have emerged to spur agility in business model innovation (BMI), advocating the principles of gathering customer feedback, through continuous testing and iteration, thus promoting the implementation of a quasi-scientific, experimental approach to cope with uncertainty. However, companies – particularly those fearing reputational threats – may face significant barriers when trying to implement such approaches. Indeed, in high-reputation firms, the risk of failure associated with the experiments performed may put their reputation at stake. By means of a multiple-case study on three high-reputation firms, this study aims at understanding how these high-reputation firms carry out BMI and strive to practice agility through experimentation notwithstanding their contingent and idiosyncratic constraints. Our findings suggest that high-reputation firms adopt already-validated assumptions on the most critical aspects of their BM, such as the value proposition, while still extensively experimenting on other BM elements. We then propose a process model highlighting how the Agile experimentation process in high-reputation firms unfolds. Our study holds relevant implications for both theory and practice, extending the domain of theory on BMI and experimentation to the context of high-reputation firms, while providing managers with useful guidelines to implement Agile when reputation is at stake.