Incumbent Firm Capacity Building in Analytics: Strategy, Structure, and Innovation Management Perspectives

Focuses on discerning patterns of analytics adoption in incumbent firms using insights from strategy, structure, and innovation management disciplines. Patterns of analytics activity are studied for Honeywell, Emerson, Pfizer, and Merck as they strive to build capacities to achieve competitive success in analytics. First, keyword queries using a single database were run. Second, based on a wider set of public domain sources, analytics activity at these firms was further examined. Perspectives of strategy professionalism, incrementalism and adaptive strategy, and general management strategy were employed. In terms of structure, to leverage analytics' potential, incumbents try especially to navigate an explicit-implicit dichotomy, to acquire relevant knowledge and talent, to leverage external ecosystems, and to build complex, sophisticated structures. Incumbents increasingly utilize diverse innovation management approaches, including managed development of new technology (R&D), commercialization and scaling, renewal and disruption, and entrepreneurialism. Even in such a heavily quantitative arena, developing relevant general management competencies is identified as an especially prominent aim for incumbents. More generally, incumbent firms entering analytics not only aim at obtaining superior analytics-specific skills (e.g. coding and software development). Such firms also strive more broadly to upgrade relevant strategy, structure, and innovation management competencies. Questions for subsequent research are also offered.