Dynamic Innovation Strategy Model in Practice of Innovation Leaders and Followers in CEE Countries-A Prerequisite for Building Innovative Ecosystems

Abstract

The task of each firm's strategic management is to identify those sustainable sources of competitive advantage that represent a way to achieve business goals and competitive advantage. Business management should be able to define determinants that fundamentally influence the innovation activity of business. Innovation leaders are influenced by the same set of determinants that allow them to maintain their position in the market. Identifying these determinants is a key source of knowledge for defining or adjusting corporate strategies, enabling sustainable benefits and for efficient building and functioning of countries' innovation ecosystems based on cross-agents' interactions leading to sustainable development. The goal of this paper is to identify the combination of innovation determinants in Dynamic Innovation Strategic Model (DISM) driving creation and sustaining innovation leaders' competitive advantage in selected European countries belonging to the group of moderate innovators. Likewise, authors define a unique set or combinations of factors that will (fundamentally embedded in a company strategy) have a significant impact on the innovative production of the business, which are one of the key elements of innovative ecosystems. With the use of CIS data (from Eurostat) on the innovators and followers of nine EU countries and own regression models, the key determinants of the success of the innovation leaders and followers were found. These determinants are (also in appropriate combination) mainly: in-house R&D activities, co-operation with various partners, and marketing and design. The results clearly show that for innovative leaders, key determinants have a positive impact on produced innovations; for the followers, the same group has a negative influence.