Market structure and innovation: a theoretical model and its operationalisation

This paper contributes to the debate on the relationship between supply network configuration and innovation by presenting a conceptual model and an operationalisation. This model aims to shed light on a relational capability: the lead firm’s capability to sustain synchronously multiple types of innovation by leveraging the supply network configuration. The relationship between network attributes and multiple innovations is specified with respect to the fashion industry. Several hypotheses are presented in order to explore the influence of both the diversity and density of the lead firm’s supply network on the firm’s stylistic and process innovations. This framework departs from the current dominant logic of analysing each innovation type separately and explores the network configurations enhancing the joint generation or adoption of multiple innovation types.