Prof. Pablo Collazzo from our Competence Center for Business Controlling and Accounting was awarded the “Best Paper Award” at the MOC Conference of the renowned Harvard Business School in Boston.
His paper, entitled “How Unicorns Conquered the Red Queen: Perspectives on Competitive Dynamics, Innovation and Imitation”, examines the impact of external factors, such as competitive intensity, technological turbulence, and demand uncertainty, on the effectiveness of innovation and imitation decisions. Together with Carmen Padilla of Ecuador’s Catholic University of Santiago de Guayaquil, Prof. Collazzo studied billion-dollar Southeast Asian start-up companies (“unicorns”) that provide mobility through apps (“ride hailing”).
“Alice in Economics Wonderland”
Previous literature concluded that in a duopoly, where only two providers face a large demand, there is a linear evolution from an imitative strategy to an innovative strategy. The “red queen dynamics” play a crucial role in this process. This assumes that, due to the existing competitive pressure, new efforts of adaptation and development must constantly be made to avoid drowning in the economic competition. This model is inspired by Lewis Carroll’s novel “Alice Through the Looking Glass”. In this, the Red Queen explains to the curious Alice, “In this country, you have to run as fast as you can if you want to stay in the same spot.”
Contribution to the discussion on imitation and innovation
Now the article by Pablo Collazzo and Carmen Padilla shows that by varying their strategy between innovation and imitation, companies can break through the competitive dynamics of the Red Queen. The results suggest that in an environment of more intense competition, technological turbulence, and uncertain demand, an innovation-driven strategy yields greater long-term benefits than an imitation-driven strategy. As such, the study is a relevant contribution to the recurring debate on imitation and innovation in strategic competition, which was recognized by the Institute for Strategy and Competitiveness (ISC) at Harvard Business School.