A bridge over troubled waters: Bridging organisations and entrepreneurial opportunities in emerging sectors

Publication Type  Journal Article
Year of Publication  2007
Authors  Sapsed, J.; Grantham, A.; DeFillippi, R.
Journal Title  Research Policy
Volume  36
Pagination  1314-1334
Key Words  Brokerage; Disruptive innovation; Entrepreneurship; Sectoral systems of innovation; Games industry
Abstract  

Bridging organisations are understood to play an important role in National and Sectoral Systems of Innovation (Freeman, 1987; Lundvall, 1993; Malerba, 2002) and Technological Systems (Carlsson and Stankiewitz, 1995) particularly in compensating for weaknesses in these systems, such as access to suppliers of technology, information, finance etc. However, to ensure their role is fulfilled we need to know more than we do currently about the organisational practices which make them effective. Furthermore, we need to develop theory on why and where they are needed. This paper will show how a public bridging organisation designs and manages an effective intervention through analysis of a complete sample of entrepreneurs participating in a series of ‘business clinics’, co-ordinated by the bridging organisation on behalf of the electronic games industry in the UK. It will show that this globally regarded creative industry has some weaknesses and conservative tendencies, which threaten its capacity for radical or disruptive innovation. It will show how bridging organisations can compensate for these weaknesses.

The UK electronic games sector is renowned for the creativity of its content. However, the games Sectoral System of Innovation (SSI) has a number of weaknesses. Firstly, the UK no longer has domestically owned global publishers. Publishers play the important roles of financing games development, as well as co-ordinating their marketing and distribution. To most of the UK industry’s independent developers they are distant and elusive (Spectrum-Strategy-Consultants, 2002; TerKeurst, 2003; Grantham and Kaplinsky, 2005).

Secondly, within a SSI certain types of innovation trajectory may be favoured at the expense of others. The dominant games trajectory is essentially greater processing power and photo-realistic graphics, with proven content in terms of franchises and movie tie-ins. The more radical propositions are unlikely to get a serious hearing from publishers. This creates a sector-wide “ Innovator’s Dilemma” (Christensen, 1997) where sustaining innovation trajectories of technical advance with rising costs are favoured at the expense of disruptive innovation- newer, cheaper technologies and ideas aimed at new markets.

The more creative and potentially disruptive ideas in the games industry are those that tend to overlap with other SSI. For example mobile phone games are emerging at the boundary of the games and mobile telecommunications SSI. In the SSI literature boundaries are thought to be dynamic, rather than fixed, and involve interdependencies between related sectors (Malerba, 2004:14; Edquist, 2004). Convergence may result in new sectors emerging from older established ones (Mowery and Nelson, 1999). But during the emergence there are institutional weaknesses in the areas of overlap.

Bridging organisations can mitigate the problems caused by these areas of weakness. Our study reports on a regional bridging organisation’s intervention. The process involved entrepreneurs presenting their business propositions to a panel of industry experts for validation, refinement or rejection. We analyse the nature of the propositions and the impact of the intervention on them, identifying key design and process choices. We show how bridging capabilities can respond to and compensate for weaknesses in SSI in emerging industries, drawing on the entrepreneurship and disruptive innovation literatures.

URL  http://www.sussex.ac.uk/Units/spru/events/ocs/viewpaper.php?id=237

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