Business Commons^™

Investor Reaction To Exploration Versus Exploitation Using An Asorptive Capacity Lens, Kevin Walsh

Theses and Dissertations

In his seminal work, March (1991) points to innovation as a key to a firm’s survival. In this dissertation proposal, I seek to build on March’s research by leveraging his construct of balancing a focus on improving existing capabilities (“exploitation”) while simultaneously creating new competencies (“exploration”). These two approaches to innovation are often viewed as requiring a firm to leverage very different skills. Not only are there differing skills, but the level of risk and potential reward also vary based on a firm’s decision to focus on exploration versus exploitation. The reaction of investors to this dichotomy is the focus …