Candidate cases Case selection

Second, we identified the radical and incremental innovation projects within this selection. We used the following two criteria, derived from Henderson and Clark 1990: ■ whether the technology developed in the project was new or already available; ■ whether the market for the new product was new or a current one. An innovation project was categorized as radical if both the technology and the market were new, and an innovation was considered to be an incremental one if both the technology was already available and the market was current. For our purposes we could dismiss all projects that were not clear-cut cases of radical or incremental innovations, such as projects in which the technology was new but not the market. Third, we assessed which projects had been successful, i.e. which projects had resulted in the market launch of a new product. This was assessed through inspection of press releases. Finally, we selected five radical and five incremental successful inno- vation projects from the two lists of radical and incremental successful innovation projects in which Nokia had been a partner. We did this in a rather arbitrary way, without using any criterion in particular.

5.2.7 Hypotheses

For the five successful radical innovation projects, we specified the three propositions in this study as follows. Hypothesis 1a: All five projects are alliances with new partners. Hypothesis 2a: All five projects are alliances with partners that have different technological capabilities. Hypothesis 3a: All five projects are alliances with contracts with a low level of commitment short-term. For the five successful incremental innovation projects, we specified the three propositions in this study as follows. Hypothesis 1b: All five projects are alliances with existing partners. Hypothesis 2b: All five projects are alliances with partners that have similar technological capabilities. Hypothesis 3b: All five projects are alliances with contracts with a high level of commitment long-term.

5.2.8 Measurement

In order to test the hypotheses, we needed to measure the three col- laboration characteristics; collaboration history, technological cap- abilities, and level of commitment. We needed to determine, for each case, the newness of the partners for Nokia, similarity of technological capabilities between Nokia and the partner, and level of commitment in the alliance. These three characteristics were measured in the fol- lowing ways. 1. The CGCP database contains data regarding all innovation projects in which Nokia was engaged since 1985. A partner in an alliance was considered to be a new partner for Nokia if that partner had not collaborated with Nokia in a previous alliance in the database since 1985. Old partners were partners with which Nokia had engaged in at least one innovation project in the database since 1985. 2. A partner’s technological capabilities were mainly determined by its code in the SIC Standard Industrial Classification. The SIC is a four-digit code developed by the US Office of Management and Budget to identify industrial sectors. Nokia is classified as a manufacturer of “telephone and telegraph apparatus” SIC 3661. Partners with code 3661 were considered to have similar technological capabilities, whereas partners with other codes were considered to have different capabilities. 3. The level of commitment is determined by the type of alliance agreement that the firms engaged in, in terms of investments made in the innovation project and innovation project dur- ation. This was done based on Hagedoorn 1990, who presents a classification of alliance agreements and their organizational interdependence. The largest organizational interdependence can be found in joint ventures and the smallest in licensing agreements. The organizational interdependence refers to the intensity of the relation, which we refer to as “commitment”.

5.2.9 Data presentation

5.2.9.1 Radical innovation projects

Case 1 is a project to create a new pen-based product category. It was organized as a joint development and licensing agreement between