Several implications for practitioners can be formulated from the results of this dis-sertation. First, implications for managers dealing with product innovation strategies are discussed, followed by implications for public policy makers.
Implications for Managers
The model for GPI strategy provides insights in how firms manage interfaces with multiple stakeholders and the effects on GPI strategies and outcomes. The entire model can be of assistance to managers wishing to develop products that benefit both firm performance and ecological preservation (Porter and Van der Linde 1995a), be-cause it identifies factors that relate positively to innovation performance and factors that do not. Specifically, four implications for managers arise.
The first implication for managers is to guard against ‘over-greening’. The presence of non-linearities in the relationships between greenness, introduction characteristics, and customer performance indicate that greening, be it in the product itself or in in-troduction characteristics, does not always improve performance. An optimum level of greening exists, i.e., ‘greener is not always better’. The case study data provide evidence that ‘over-greening’ sometimes takes place: informants reported about small competitors that market extremely green products, using highly green targeting and positioning strategies. These very green niche players are reported to have very low innovation performance. Furthermore, the case data show low performance outcomes when relative advantage is sacrificed for a high degree of greenness. ‘Over-greening’
can be avoided by circumventing trade-offs between greenness and relative advan-tage.
Secondly, and as a consequence of the first implication, managers should be aware of trade-offs between green and non-green issues and adopt methods that can resolve these trade-offs. Ideally, a way to circumvent the trade-off between green and non-green issues should be found. The case data suggest, however, that this can take a lot of time and/or resources. If a trade-off is not circumvented, an optimum level of greenness is to be found. The normative-ethical literature on GPI has traditionally recommended life-cycle analysis or other environmental costing methods as the pre-ferred method, but the current study points at several alternatives. Such alternatives include setting green constraints, ecolabel standards, benchmarking, and rank-ordering stakeholder issues.
Thirdly, the study points at the positive offsets of scope and scrutiny in stakeholder orientation. Whereas managers in recent years have tried to improve the market orien-tation with regard to product innovation strategies, they will be more able to deal with green issues if they include non-market stakeholders in their orientation as well. Non-market stakeholders can have an important impact on GPI strategies, especially in environments with stringent green regulation. The results of the theory-testing case studies show that generating information about non-market stakeholders has a posi-tive impact on ‘greening’ the product development process and product characteris-tics. Therefore, managers seeking to develop GPIs would be wise to generate
infor-mation about a range of non-market stakeholders. A method for increasing the scope is to implement a stakeholder management system. Furthermore, the case studies show that information about stakeholders can be generated that allows the firm to be proactive. Methods for generating such high-scrutiny information include establishing dialogues and regulatory early warning systems.
Fourthly, the emphasis that each of above implications should receive is likely to de-pend on the market environment and strategy type. Market environments that shift he optimal level of greenness to the deeper green end have high stringency and a size-able green market. In a stringent market environment, for instance, the level of green-ness is largely dictated by regulators, and a firm stands to benefit most of a stake-holder orientation that includes regulators in its scope and employs high scrutiny.
Moreover, GPIs were shown to differ significantly among each other, depending on the motivations for companies to include green issues in product innovation strate-gies. The typology in Chapter 5 distinguished three basic patterns, based on antece-dents of GPIs: social responsibility, legitimation, and competitiveness. Tentative im-plications are as follows. Managers in ‘social responsibility’ companies that want to push the envelope in greening product innovation strategies will find a wide scope in generating information beneficial. Managers in a ‘legitimation’ company should fo-cus on collecting high-scrutiny information about non-market stakeholders, particu-larly regulators. This likely to be the case for organizations where regulators are prin-cipal stakeholders, like quangos (quasi NGOs, like the Producer’s Organization of the Dutch Mussel Culture) and utility companies. Managers in a ‘competitiveness’ com-pany should heed the first and second implication and devote effort towards finding the right balance between green and non-green issues.
Implications for Public Policy
Although this study does not focus on public policy decision-making, the case data suggest recommendations for public policy makers. Green market size and stringency of green regulation, through their moderating effects, help increase the level of green-ing in several aspects of product innovation strategies. Public policy makers deter-mine the stringency of green regulation directly, and the case data suggest that public policy makers also can help to increase green market size, e.g. through convenants. In these cases, intervention by public policy makers has made a difference, as can be observed from those cases with significant intra-case variation in the importance of green issues in the market environment.
In case of non-intervention by public policy makers, GPI strategies are likely to origi-nate mostly from the ‘competitiveness’ type of companies and a few ‘social responsi-bility’ companies. The results suggest that the ‘competitiveness’ type of companies can indeed develop ‘win-win’ GPIs, but only with considerable effort and aided by serendipity. Intervention by public policy makers makes it easier for ‘social responsi-bility’ companies to further ‘green’ their product innovation strategies, and brings the
‘legitimation’ companies into action. Therefore, the results of the case studies suggest that public policy makers should not rely only on companies that serendipitously de-velop green competitive products, but to actively intervene, either through more stringent green regulation or stimulating green markets to develop. Furthermore, the
dominant green force differs between market environments. If public policy makers are aware of the green dominant force, they can decide to further increase its impact on greening, or alternatively, attempt to make another environmental component, like regulation, the new green dominant force.
A word of caution for policy makers is appropriate, though. In the theory-testing cases, examples of perverse effects of public policy interventions were encountered.
Interventions that are intended to benefit green issues induced companies to develop less green products instead. Systems, tools and practices for resolving trade-offs be-tween green issues that were identified in the case studies, like lifecycle analysis, can assist public policy makers to prevent perverse effects and design well-crafted inter-ventions.
6.3 Limitations
This dissertation has several limitations, mostly due to the method employed. The case study method allows for detailed observation of phenomena in product innova-tion strategies that otherwise would have remained hidden, as well as an understand-ing of relationships between constructs beyond mere association. It is, however, also the source of several limitations. It is important to realize what can and cannot be es-tablished using the chosen methods.
Firstly, although much has been done to improve generalizability of the case study results, results from a limited set of case studies can never be as generalizable as re-sults from large-sample methods. The findings reveal what is particularly singular about GPIs and establish support for relationships between important elements of GPI strategy, and yield a typology. The findings do not reveal, however, the incidence of phenomena, e.g., what percentage of product innovation strategies are characterized by high priority of green issues. Nor do the findings reveal which relationships are more prevalent, or what is the exact strength of each relationship. The results show which relationships exist, and why. Indications of the shape of relationships were un-covered, but the case study method is unsuited for determining the exact shape of the relationship. For instance, a ‘dissatisfier’ logic was shown to underlie a non-linear relationship between greenness and customer performance, but we do not know whether the shape of this relationship is increasing with a declining slope or more like a threshold-effect (hysteresis), nor do we know the defining parameters of the shape.
Furthermore, the typology proves the existence of certain combinations of phenom-ena, but we do not know the frequency in which each type occurs, nor can we be as-sured that the typology is comprehensive.
Secondly, a potential bias may exist because informants could have, consciously or unconsciously, based their answers on incorrect causal attributions. The assessments of the level of the constructs was done with great care, using triangulation wherever possible. Relationships were then tested using association and underlying logic. The causal attributions by the informants are prone to biases, because of collectively shared, yet wrong, beliefs about which decision leads to which outcome. Therefore, the underlying logic was formulated primarily by the researcher, rather than relying on the causal attributions made by the informants. This means that the statements of
the informants were carefully evaluated, and that the researcher’s interpretations of the statements about relationships formed the basis of the underlying logic. However, the logic to explain the association, may still be flawed. Decisions that were taken, and in hindsight led to positive outcomes, may in fact have been far from optimal, and different decisions that were never tried, either within or out of the company, might have had much better results. The possibility that bias entered the theory-testing method in this manner cannot be completely excluded.
Thirdly, not all possible relationships could be tested. Proposition 5 was not sup-ported because the data were lacking. This is inherent to the case method employed, because the richness of the collected data can never be entirely controlled, and restric-tions in time and resources prevent the data collection to proceed ad infinitum. In or-der to test all relationships, cases with more intra-case variation on the constructs (be it within the focal organization, or in the industry) are necessary. For constructs where the intra-case variation is low, it is extremely difficult for informants to elabo-rate on the relationships, beyond speculation and philosophizing. Furthermore, al-though relationships between some variables within a construct are established, the testing is not always complete. For innovation performance for instance, effects are mostly found for customer performance and reputation. A relationship with financial performance is only established through customer performance, and little can be con-cluded about relationships with technological performance.