*4.4. Movement between Quadrants*

Due to external threats such as climate change, which may affect supply, Mainstream firms may be motivated to look outside this quadrant. Transition to Growth most closely resembles exploitation, as articulated by March [56] because the firm is applying wellknown practices to extend itself into a different set of demand characteristics. Alternatively, Mainstream firms may pursue exploration via transition to Future Emergent. While we did not directly observe this in our sample, we have observed anecdotal examples of firms investing in Future Emergent startups as a hedge against future supply and demand shifts. A number of firms that engage in industrialized meat production, for example, have invested in one or more lab-grown meat startups, which could be considered a form of exploration [56]. These firms arguably are engaging in the exploration of both supply (e.g., production technology development) and demand (e.g., consumer perceptions, public conventions) characteristics. We have also observed firms in these situations exploiting

existing capabilities and differentiated demand by offering different varieties of plant-based proteins [77]. By engaging in transitions toward both Growth and Future Emergent FSCs, a firm is exhibiting a form of organizational ambidexterity [56,74]. This orientation is the potentially effective use of resources and a hedge against an uncertain future, however, this approach requires the firm to balance exploitation and exploration; imbalance or misfit with the external environment can threaten firm survival [57,58].

Mainstream FSCs are likely to pursue exploitation by adding Growth to their portfolio as a source of differentiation. Five cases (A, B, C, M, and O) operate in both Mainstream and Growth quadrants, maintaining a dominant orientation toward Mainstream products. These firms exploit existing industrial capabilities to produce differentiated products at high volumes and relatively low prices. To defend their differentiation, Growth FSCs need to align with and maintain appropriate quality conventions, which may be challenging when pursuing a competitive advantage in two different quadrants.

Niche FSCs appear to either be entrenched (Cases D, G, H, I, J, and N), or poised to attempt to transition to Growth, which will require a level of ambidexterity. We identified three cases (E, F, and U) that exist in both the Niche and the Growth quadrants. Each of these cases concerned egg products. As indicated in Figure 4, E, F, and U each compete as *alternative* FSCs within the Niche quadrant; these producers' methods are associated with aspects of the domestic, and ecological conventions, both of which are order winners and therefore suggest the public convention. We have also indicated that these firms occupy Growth for these cases and have shown Growth as the predominant positioning. This is based on our observation that these producers increasingly apply quality conventions that are more consistent with the Growth quadrant including increasing scale, scope, and process improvements for efficiency.

As shown in Figure 4, the typology predicts that firms transitioning from Niche to Growth FSCs must take on the associated industrial convention. In reviewing the practices that these cases employ to support the domestic convention, we note that the authenticity and transparency differentiating these FSCs as they occupy the Niche quadrant will necessarily be difficult, if not impossible, to maintain as their operations expand. Each of these egg producers relies on a network of smaller producers and the resource requirements (e.g., labor and land). As production volumes increase, the number of suppliers qualified, contracted, and managed, and therefore the level of resources and supply chain maturity required to successfully maintain consistency of quality conventions will grow as complexity increases [78,79]. Furthermore, increases in scale are likely to require substantial capital investments; as these producers take on debt, they will be under intense pressure to service debt, further increasing the potential for efficiency to drive prioritization of the industrial convention. These insights are supported by evidence from entrenched Niche producers (e.g., Case D); it remains to be seen how the transitioning firms will span both Niche and Growth, transition to Growth and associated conventions and priorities, or, alternatively, generate a new configuration of quality conventions.

While we did not observe Future Emergent transitions in our sample, the typology predicts that they have two likely future paths. If Future Emergent firms develop industrial conventions and produce high volume, relatively commoditized products at low prices, they will need to convert their exploratory efforts into exploitative capabilities and transition into the Mainstream quadrant. Alternatively, they may transition to Growth by developing differentiated products; this transition will also require industrial conventions. For example, if lab-grown protein can achieve differentiation via ecological conventions, or by being nutritionally superior to animal protein, a Future Emergent product could mature into a Growth product.

We identify a single firm (Case C) that occupies three quadrants (Mainstream, Growth, and Niche). This firm is a small family-owned grocer with a few locations. The paths through which Case C traveled to its current position is distinct from other retailers than occupy both Mainstream and Growth. Case C included Niche products relatively early in its history; such early introductions included wine, cheese, and condiments associated

with particular locations and traditional processes (e.g., Italian balsamic vinegar). In addition, Case C developed relationships with local producers of seasonal produce early in their history. As consumer interest in place associations of food increased, the retailer expanded the marketing of its sourcing practices. These practices include developing direct relationships with specialized, high quality providers; whether local or distant (e.g., locally grown corn and air-freighted lobsters are both promoted on the basis of the social and ecologically embedded characteristics of the producer). Later, as opportunities arose in terms of both supply and demand, this retailer added Growth products. Neither Niche nor Growth products dominate Case C's offerings; therefore, they are classified as predominately Mainstream.

While our limited sample cannot guarantee exhaustive identification of potential movement between quadrants, however, from a theoretical and practical perspective, as well as based on our empirical evidence, we find specific paths to be unlikely. Mainstream and Growth supply and demand characteristics, as well as their associated quality conventions, do not lend themselves to transitioning toward Niche production. While Case C is a notable exception, this firm spans both Mainstream and Niche quadrants, enabled, in part by its small size and position as a retailer. As a small retailer, Case C can accomplish Niche offerings with a select number of key procurement decisions. In contrast, a producer or processor would need to master entirely different capabilities to occupy the Niche space. While it might be attractive, to some extent, for a Mainstream or Growth firm to acquire a Niche producer, profound barriers to maintaining Niche conventions exist. As a result, we speculate that such acquisitions of Niche producers are likely to result in Niche products fully transitioning away from domestic conventions and occupying Mainstream or Growth quadrants. Theoretically and practically, the chief barrier to occupying combining Mainstream, Growth and Niche at the producer level is the absence of the domestic convention in Mainstream and Growth quadrants, and the corresponding absence of industrial conventions in the Niche quadrant. Similarly, we see little support for transitions from Niche or Growth to Future Emergent.

Three Niche cases (E, F, and U) are in currently in period of transition from Niche to Growth; we coded these firms as emphasizing Growth over Niche, based on the observed direction of this transition. Considering the evidence of some firms transitioning between or occupying both Niche and Growth (e.g., Cases E, F, and U), it remains to be determined if Niche and Growth can be maintained simultaneously at the producer level. Should such firms transition away from Niche into Growth, it is possible that eventually a transition could be made from Growth to Mainstream. The transition, currently under way, at McDonald's and Walmart from cage-raised eggs to cage-free eggs could represent an opportunity for this type of transition [80,81]. Several factors suggest this possibility. First, the transition from Growth to Mainstream could occur if consumers no longer widely accept or demand cage raised eggs consumers (i.e., loss of public convention). Second, from a technological perspective, both types of egg production share strong ties to the industrial convention. Practically speaking, cage-free eggs represent a small evolution in terms of resources required as compared to cage-raised eggs; industrial conventions ensure a focus on productivity improvements, increasing the likelihood of production at a relatively low cost [82]. Notably, the most rigorous standards for egg production that certify the humane treatment of animals do not certify cage-free facilities [60]. Finally, such a transition may be possible given that some of the largest commercial buyers of eggs are driving demand for cage-free eggs. In comparison, a similar transition to pasturing under the most rigorous standard is estimated to require roughly the same amount of land as Rhode Island in order to supply pastured eggs at current volumes of US demand, making such a transition substantially more difficult [82].
