1. Introduction
In recent years, many enterprises regard technology as the way to drive business operations and implement business strategies, as the technology-driven business model stimulates enterprises’ continuous innovation and growth [
1]. This trend highlights the fact that strategic orientation plays a key role in the sustainable growth of organizations [
2,
3].
The impact of strategic orientation on the competitive advantage of enterprises has been extensively discussed in previous studies [
4,
5]. For example, when a company has excellent market orientation (MO), it has excellent market performance [
6,
7], as it understands customers’ wants and potential needs better than its competitors do, and consequently, show better competitiveness and strategies. The interaction orientation (IO) of a company is important to new product development (NPD), as it is able to effectively interact with individual customers [
8,
9]. When a company has entrepreneurial orientation (EO), its product innovation activities will be driven and higher corporate performance will be generated [
10,
11,
12]. However, these arguments are mainly based on competition among enterprises, while ignoring the co-evolution amid the cooperation and conflict between enterprises and other members of the overall environment [
13]. Moreover, regarding the competitive advantage of companies, a systematic point of view that discusses these strategic orientations remains absent till nowadays, and the perspective on integration of strategic orientation is still unclear.
Enterprises are in a complex and competitive business environment. According to the open systems perspective, it is difficult for enterprises to develop all resources and technologies independently, thus, they must rely on external resources [
14,
15,
16,
17] to overcome resource constraints [
18,
19], which makes co-evolution a necessary business model. As different ecological groups depend on each other in an ecosystem, the members of the economic community feature co-existence and co-evolution to ensure the development of the business ecosystem [
20]. For example, by providing software, hardware, and services, Xiaomi has fostered a disruptive innovation model that should not be underestimated by the global technology industry; the iPhone-centered ecosystem, as created by Apple, delivers a complete customer experience, which shows that competition is no longer confined to enterprises, but to ecosystems [
21,
22]. Successful innovation relies on cooperation among members of the ecosystem in which the enterprise is located [
23], meaning that under such paradigm shift, it is an important academic and practical topic to understand the impact of strategic orientation on the ecosystem of enterprises and to create competitive advantage [
24,
25].
In retrospect, to examine how the research streams of an innovation ecosystem evolves in different periods, the present study finds that this concept was raised around 2000. Initially, the literature mainly explored the elements of the innovation ecosystem, and focused on the roles played by these elements in the ecosystem, such as outsourcing R&D, technology in-sourcing [
14,
26], and open innovation platforms [
27,
28]. As there is more research on this concept, the focus shifts to the industry application of the innovation ecosystem, such as the type [
29] or the composition [
30] of the innovation ecosystems. The concept of innovation ecosystem has increasingly gained ground in the literature on strategy, innovation, and entrepreneurship [
31,
32,
33,
34]. Recent research has just begun to explore the interaction between the external environment and ecosystem, such as science parks [
35], and the impact of governmental organizations on the ecosystem [
31,
36]. These studies have laid a solid theoretical foundation for the research of innovation ecosystems. However, most previous studies tended to observe individual cases at the industrial level, while research at the corporate level is scarce. In addition, most of these studies focused on a single case or conceptual description without comparing different industries; therefore, the applicability of innovation ecosystem models must be clarified. Moreover, EO, MO, and IO seem to be complementary for the corporate competitive advantage. The observation of similar arguments shows that more and more studies use different strategic-orientation combinations to observe company performance [
37,
38]. However, the impact of different strategy-oriented combinations on the development path of innovation ecosystems awaits clarification. Finally, technological innovation and the development of new business are complex [
39]. Different ways of development are affected by the logic of different strategic orientations, and at present, few studies have explored the complete dynamic context. Therefore, in order to fill the existing theoretical gap, this paper presents a case study of three companies in different industries in Taiwan, and intends to discuss the role of strategic orientation in the innovation ecosystem from a corporate-level perspective. In addition, this study observes the impact of strategic orientation on technological innovation and new market development.
This study contributes to the innovation ecosystem theory by intending to answer the following questions. Firstly, from the perspective of corporate-level strategic orientation, this study constructs a dynamic development process of the links among technological innovation, market development, and business model. In addition to strengthening the theoretical basis of the innovation ecosystem model, micro-analysis can help enterprises understand how to interpret, decide, and act to create a successful blueprint of business models. Secondly, this study develops the causal loop models of three different industries; through the comparison and induction of multiple cases, the innovation ecosystem theory can be verified in a generalized manner. Finally, aiming at two factors in the innovation ecosystem model, this study observes technological innovation and new market development to determine the driving force and development trajectories of technological innovation and new market development, in order that enterprises can understand the development process of innovative and market systems.
This study includes the following parts. Firstly, the background of an innovation ecosystem is described on the basis of literature review, the research framework is developed, and the essence and implication of strategic orientation is introduced. Secondly, the research methods and case analysis are presented. Finally, the research results are discussed, and the theoretical and managerial implications are highlighted in such discussion.
3. Research Method
3.1. Case selection and Description
This study compares and summarizes different companies with the multiple-cases method, where Taiwanese enterprises are taken as the research subject. According to the ranking of the 2018 Global Competitiveness Report by World Economic Forum, Taiwan was described as a “super innovator” in terms of innovation capability as one of four economies, including Germany, Switzerland, and the U.S. The ranking of Taiwan shows that the industrial clusters and innovation ecosystem of Taiwanese vendors is so unique that it deserves further discussion. In the case selection process, this study was supported by the Ministry of Science and Technology and the National Applied Research Laboratories (NARLabs), which is important governmental agency and research insititute in Taiwan’s technological development and future technological research. According to the research purpose, this study selected three typical Taiwanese high-tech enterprises from over 50 candidate enterprises as the research subjects. The number of cases selected for this study follows the suggestion of Eisenhardt [
78] to improve research validity. These three companies are pro-active in product R&D and deliver significant market performance. In addition, they have strong personal contact for data acquisition, which is conducive to accumulating diversified and real cases. Therefore, this study describes the dynamic processes of the innovative models and the market development of the three cases, and determines the relationship between strategic orientation and the above-mentioned two cases to build a theoretical model [
79].
This study follows three criteria in case selection [
80]: (1) the research subjects should make certain contributions to scientific, technological, and market innovations; (2) the dynamic development of scientific and technological innovations and market developments can be observed; (3) the strategic orientation of the research subjects in different stages of the innovation ecosystem can be observed. Following the above criteria, this study presents, analyzes, compares, and summarizes the innovation ecosystems of the three cases. The following is a brief introduction of the companies and their development processes, and the basic data are incorporated into
Table 2.
(1) Imager-37
Imager-37 was founded in 1971 and started with foam production. Its initial products include synthetic sponges for the locomotive industry, integrally molded car interiors, rigid sponges for refrigeration equipment, and spray-painted molded sponges for toys. The original semi-rigid self-contained foam armrest from 1980 drove the vigorous development of OA office furniture in Taiwan. Since 2000, it has been developing its own bedding brand, which has gradually transformed and developed products in the field of intelligent life care. Material science and technology are combined with physiological sensing technology, and the IoT (Internet of Things) and big data analysis are being used to develop a series of mattress systems and related commodities, as applied to home-based long-term care and intelligent medical care.
(2) Brogent Technologies
Brogent Technologies was founded in 2001, and its main product is “i-Ride flying theater” with a unique global six-axis platform technology, which has created immersive experiences and is sold to all major theme parks, museums, exhibition halls, and shopping malls around the world. When Brogent Technologies developed the flying theatre, it not only saw the advantages of its own hardware technology, but also the shortcomings of its software and content. In recent years, it has cooperated with Taiwan’s universities and colleges through “Kodansha” (Giant Killing), which intends to acquire high value and high-quality IP, and strengthen the integration of software and hardware to develop more competitive innovative products.
(3) United Orthopedic Corporation
Founded in 1993, and starting from agency and contract manufacturing, it has now become the only bone material company in Asia capable of engaging in special processes, such as upstream forging, casting, and downstream plasma spraying of orthopedic equipment, titanium bead sintering, etc. United Orthopedic is a product market that meets the needs of Asian human body and life styles, as it refined its product manufacturing, and actively constructed a local cooperation network (dealers, doctors) to quickly enter the market during the transformation process. Moreover, it supports multinational clinical research and has established a platform for cooperation and communication among multinational orthopedic doctors, where the aim is to grow together with many partners, while creating a “one-stop service” of research and development, design, manufacture, and marketing.
3.2. Data Gathering and Analysis Procedures
The data sources of this study include secondary data collection and interviews. The secondary data include news reports and the official websites of the three companies. In terms of interviews, this study carried out four interviews with the senior management and groups of the case companies from February to April, 2019, and interviewees included deputy general managers, directors, and business managers. Each interview lasted for approximately 30–60 min, and was recorded for transcription after the interview. Interview questions are focused on questionnaires and include three types: (1) business history of enterprise, exploring the history and current situation of company development; (2) the relationship between technological innovation and market development, such as how market performance drives technological innovation, the driving force of technological innovation, and how new business develops; (3) strategic orientation of companies. However, these interview questions are adjusted according to what the interviewer response [
81].
In terms of data validation, this study adopts qualitative research credibility criterion, as advocated by Lincoln and Guba [
82], to ensure the credibility of this study. Triangulation is conducted by comparing and summarizing multilevel data types, where the differences in data sources are used to explain whether the constructed results are different, as shown in
Table 3. Later, according to the principles proposed by Bogdam and Bi [
83], data are transcribed by focusing on dialogue reconstruction, the description of external environments, and the presentation of events, which are followed by coding analysis. During the interviews and secondary data review, this study used open coding to collect and capture the views of respondents. In this stage, due to the divergence of data, this study rigorously and repetitively reviewed the data [
84], in order to determine and classify suitable codes for the research topics, and then, mapped them with theoretical models.
4. Research Finding
This study explains the innovation ecosystems of three case companies, describes the development context of the new business of the case companies, and finally, focuses on how different strategic orientations play a reinforcing role in the innovation ecosystem. The findings are shown, as follows:
4.1. Description of an Innovation Ecosystem
Innovation ecosystems advocate that investment in technological innovation will drive technological innovation, and subsequently, the development of new business and competitiveness of industrial clusters, which ultimately results in rising economic performance, which will become the driving force of technological innovation and create a positive cycle. The three cases in this study all show the same trajectory of innovative development, as shown in
Figure 2.
Imager-37 specialized in the production of foamed cotton-related commodities in its early stage, thus, mold foaming was the core technology of Imager-37. With this technology, Imager-37 customized products by developing different ergonomic molds that fit ergonomically. These products were mostly applied to automobile components in the early stage; later, as automobile components were internalized by automobile manufacturers, the traditional foaming technology was elevated to the industry of high-precision medical materials, and was applied to bedding items, such as mattresses, cushions, and pillows. Currently, the focus of Imager-37 has diverted from the brand bedding industry to intelligent health care and technological nursing, and its products include numerous innovative applications, such as sleep medicine, technological aids, and mental retardation care.
Brogent Technologies initially focused on website design, where the design of broadband service content was its major service. Later, it stepped into the mobile software business and made a breakthrough in technology by transplanting the compressed format of some videos and audios to mobile devices, and thus, became a rare developer of mobile device multimedia technology in Taiwan. The company’s strength in software was also noticed by amusement manufacturers, and they asked the company to develop amusement equipment, thus, it has gradually been moving towards somatosensory amusement facilities. Nowadays, according to the customer needs of theme parks or large entertainment centers, the company uses its core technology, which is coupled with the novel 3D somatosensory simulation technology, to create a variety of new-generation and new-media somatosensory amusement facilities.
The United Orthopedic Corporation was merely a trading company, which acted as an agent for orthopedic equipment in its infancy. While products sold, suggestions given by customers for products were often heard. However, limited by market size, the original factory failed to differentiate the products that target the Taiwanese market. Thus, President Lin of the company established Joint in 1993 to manufacture various types of knee joints, hip joints, and accessories for medical treatment. To date, the company has won numerous awards and new patents both at home and abroad, including product group and capabilities in R&D and design.
Innovation ecosystems advocate that technological innovation will exert positive impact on new business development; however, this study finds that technological innovation first drives the development of new products, then generates new business development, and finally, extends to the development of new markets. This trajectory is observed in the three case companies. For example, through R&D, Imager-37 changed the hardness of its materials through a slight change of temperature, and developed memory foam with temperature-sensitive pressure relief; this product was first applied to pillows, and was appreciated by Wang Yung-ching, ex-president of the Formosa Plastic Group. Since then, the case company has developed bedding-related products, such as mattresses and cushions, and these products have gradually merged as a new business group with customized products in line with the market. Brogent Technologies was awarded an order for the Hunei amusement park in 2007 by virtue of its R&D capability in software and hardware, and contributed to completing the “Flying over Taiwan” sensory simulation equipment. Brogent was the second global manufacturer following Disney to master the technology of “somatosensory simulation equipment” combined with video and audio, and to date, it has stepped into the sector of sensory entertainment equipment. Today, the company is able to provide customized somatosensory experiences for customers of different countries. Households create customized body feeling experience. The United Orthopedic Corporation started with OEM, and over the years, it has provided artificial joint manufacturing services for over 38 medical markets in Europe, America, Asia, and Africa. However, the body shapes of Asians differ from that of Europeans and Americans, thus, existing product specifications do not fit the shape of Asians. Therefore, this company develops products for the artificial joints of Asians, and their business has evolved to a complete orthopedic business. In addition to providing products with specifications required by customers with special size, the Asia-based competitive strategy of the company helps it earn the name of the orthopedic company that knows Asian bodies the best.
4.2. The Role of EO in the Innovation Ecosystem: United Orthopedic Corporation
The business philosophy of the United Orthopedic Corporation fully reflects the significance of entrepreneurial orientation. Such thinking exerts a positive effect on the company’s investment in technological innovation, and promotes the development of new products, which is reflected in its revenue of recent years, as shown in
Figure 3.
In terms of motivation for innovation, one third of nearly 400 employees of Taiwanese companies are dedicated to R&D, design, and manufacturing engineering, and the percentage of the R&D expenditures of annual turnover is over 10%. This company has won a large number of awards and new patents at home and abroad, indicating that the company is able to compete with global major manufacturers, such as Johnson & Johnson and Stryker. The initiative of this company can be observed from the design thinking of its products. The average life span of artificial joints for the human body is only 15 years; however, due to the increasing average life expectancy of people, some patients may need to remove and replace old artificial joints with new ones. In this case, it is very important to retain the original bone proportion to facilitate the attachment of artificial bones; therefore, the company provides products and components of different scales, and even develops a variety of tools for bone reduction. These new products help doctors accurately install artificial joints; however, Western manufacturers fail to take this into consideration. Regarding risk-taking, the case company takes the niche market as its market competition strategy, which has higher risks, such as providing special artificial joints for patients with bone cancer, and such risk-taking is indicative of the company’s effort to meet the needs of special patients. Meanwhile, the company boasts the advantage of vertical integration in product processes, and masters all processes ranging from raw metal materials to finished products, while most major Western factories only master the core technology and entrust manufacturing to other manufacturers. This process reflects the company’s requirement for product quality, and explains why the company is so energetic in technological innovation and R&D, as shown in
Table 4.
4.3. The Role of IO in the Innovation Ecosystem: Imager-37
Imager-37’s business philosophy can fully reflect the significance of interaction orientation, and such thinking has positive reinforcing effect on the company in new product development, as shown in
Figure 4.
According to the sub-dimension of interaction orientation, Imager-37 regards individual customers as the market-segregated unit. This company can provide customized services of different sizes or specialties for different customer needs. For example, customers can adjust the thickness of mattresses, and the company provides pillows of different series for customers’ different sleeping postures; some products are even capable of alleviating snoring. In terms of interactive responsiveness, the products of the on-bed care system simultaneously satisfy the needs of different roles for users. This system allows nursing personnel to be informed of what is happening to their patients in real time without wearing any device, and provides a three-stage early warning system against falling down (sitting up, sitting on the bed edge, leaving bed). Medical and nursing personnel can link electronic signboards with a nursing mattress system or use the mobile device APP to grasp the information of patients in bed, and address abnormal events. The mattress is also capable of posture identification. For patients at high risk of bedsores, the mattress can remind the nursing personnel of turning the patients over and patting their back on a regular basis to avoid the risk of bedsores caused by negligent work. The information of bedridden patients, such as sleep quality reports, can be obtained through mobile phones. Mattress can also distribute weight and pressure equally to prevent pressure ulcers. Therefore, the company’s interactive responsiveness is reflected in its sleep health management and long-distance home care. In terms of customer empowerment, the company will observe the sleep quality of patients or recipients through clinical tests in cooperation with hospitals, record the information of contact stress, and create product value jointly with users in the process of developing products. Finally, regarding customer value management, the Internet of Things and big data analysis are used to send the data collected by sensors into the machine learning software, which indicates the corresponding data of patients lying in bed for the development of long-term intelligent medical products, as shown in
Table 5. This case shows that interaction orientation is the reason why the case company can step into intelligent health care and successfully develop new businesses.
4.4. The Role of MO in the Innovation Ecosystem: Brogent Technologies
The business philosophy of Brogent Technologies fully reflects the significance of market orientation, and such thinking has positive reinforcing effect on the company’s efforts to expand the market scale of its products, as shown in
Figure 5.
According to the sub-dimension of market orientation, the company collects market intelligence through market research and exhibitions, such as the exhibition of IAAPA (International Association of Amusement Parks and Attractions), annual exhibitions of theme park and equipment, and the Digital Entertainment Media Trend Forum. Through these exhibitions, the company can be more widely known and obtain the information of its competitors. Graham Quirk, the Mayor of Brisbane (Australia), even invited the company to visit Australia after the Global Harbor Cities Forum in 2016, aiming to promote the local investment and market intelligence generation of the company. Regarding external publicity, the company carries out cross-industry cooperation and holds somatosensory game competitions to present the company’s products to the market. For example, in 2015, the company signed a MOU with Kodansha, Japan’s largest publisher, in order to expand its bilateral cross-industry cooperation in the entertainment market; while internally, the company holds cross-department meetings to convey market information to the members of the organization. Therefore, the company can be highly responsive to factory demands and reflect market performance. For example, the LEGO MOVIE Masters of Flight (a flying theatre), as co-created by LEGO LAND and the company, will open in the spring of 2019 at LEGO LAND in the state of Florida, and the company’s unique technology-patented large amusement facilities can be seen in EUROPA PARK, Germany’s largest theme amusement park, and Ferrari Land in Spain, as shown in
Table 6. This serves as testimony to the impact of market-oriented mentality on the market size of the company.
5. Discussion
5.1. Theoretical Contributions
This study selects three representative case companies from a nation-wide database of the Ministry of Science and Technology in Taiwan to observe the impacts of different strategic orientations on the innovation ecosystem at the corporate level. By comparing the companies of different countries selected as subjects for previous studies, this study identifies how the meanings of innovation ecosystems vary from one country to another. For example, Rao and Jimenez [
29] observed the innovation ecosystems of Apple and Google, which both digitally link the elements of innovation ecosystems. According to their study, consumers, users, and developers can foster synergy on online platforms, and generate network externalities that increase the value of software and hardware innovation. Other studies also found that some innovation ecosystems are university-based, thus, universities are regarded as a source of innovation. The university-enterprise relationship plays an important role in technological success, such as the Technical University of Madrid [
85,
86]. In Finland, the government integrates resources to build an innovation ecosystem powered by national technological policies, and boosts the close collaboration between industry and university through investments in education, R&D, corporate technology innovation, entrepreneurship, and corporate export capability enhancement. Many well-known global startups, such as RAVIO Mobile and PAPTIC, have sprung up in Finland, which indicates the positive impact of government support on innovation ecosystems [
87]. Taiwan features a high-tech centered SME ecosystem; in an industrial environment dominated by small and medium-sized enterprises, only enterprises with critical strategic thinking and enhanced ability can drive the development of the ecosystem [
87]. This study further finds that market orientation, interaction orientation, and entrepreneurial orientation can generate a positive reinforcing causal loop on the overall innovation ecosystem.
More specifically, when an organization has market orientation, it means that the organization has market intelligence and responds to it [
88], and such response will deliver superior customer value and more two-way communication, which will have positive reinforcing effect on the development of new products and new businesses. Interaction orientation represents the belief in customers, value co-creation with customers, and interaction with customers to solve common problems jointly. Therefore, market orientation has positive reinforcing effect on the development of new products and businesses, as well as technological innovation. Entrepreneurial orientation will increase the exploratory activities of enterprises [
61,
88,
89], and such orientation emphasizes the process of strategic decision-making and the stakeholder-centered business philosophy. It also attaches importance to risky investments in resources of unknown environments, or the introduction of new products/services to meet customers’ future needs, thereby, exerting positive reinforcing effect on technological innovation and investment in technological innovation.
Further, this study also finds that the development of new businesses should be divided into phases, such as Mosey’s [
90] view on new to market products, meaning new product development and new market development are two elements of technological innovation, new business development, and market size. Technological innovation will have positive impact on the development of new products, and new businesses will not develop until the performance of new product developments are improved (e.g., product novelty and speed of product development). The development of new businesses must be in line with the market by collecting information on customers and competitors, in order that products and services can effectively meet customer needs, indicating that the company is starting to develop a new market.
In summary, this study contributes to the literature addressing the role of strategic orientation in innovation ecosystem literature by developing and empirically testing a theoretical framework informed by systems thinking.
5.2. Managerial Implications
In practice, understanding the strategic orientations of an enterprise is critical to the impact of its innovative ecosystem. This study proposes the following suggestions for business managers. First, companies must develop market-oriented thinking, as market orientation can produce a positive reinforcing effect on industry sales and economic performance. If a company focuses on boosting its economic performance, it must have access to marketing intelligence, and establish internal and external communication mechanisms, in order that intelligence can be fully understood internally and disseminated within the enterprise, thus, enabling the company to be responsive to market demands. Therefore, managers must be sensitive to the market, and be responsive through internal communication and coordination.
Second, when an enterprise fosters interaction-oriented thinking, it will have a positive reinforcing effect on the development of new products, services, and business models. Therefore, an enterprise must understand its consumers, allow them to be part of product development, and adopt customer value management methods to interact with consumers, thus, tightening the link between new product development and the market.
Finally, when an enterprise develops entrepreneurial orientation, it contributes to continuous investment in technological innovation; therefore, enterprises must foster the proactive innovation spirit and dare to take risks. Enterprises can apply the results of this study as a map for an innovation ecosystem model to understand how different kinds of strategic thinking impact the link between innovation activities and market activities.
5.3. Limitation and Future Research Direction
This study explores the innovation ecosystems of three case companies at the corporate-level, however, companies must develop various capabilities, such as marketing capabilities, R&D, information technological capabilities, and internal and external communication capabilities to maintain balance in its ecosystem. Therefore, future research can probe into the impact of corporate capabilities on innovation ecosystems [
91]. In addition, this study only takes the driving force of technologies into account, thus, future studies can focus on the impact of non-technological elements (such as strategy, culture, and institution) on innovation ecosystems [
92].