Risk Management and Adoptive Innovation

Adoptive innovation becomes increasingly important in today's competitive world. However, in the presence of current economic downturn, cautions are voiced against potential risks; these innovative activities can bring to from firm to country level. Our research addresses such concerns. The research is drawn from two key streams of literature: risk management and innovation management. We developed a conceptual framework that consists of three components: risk behaviour, environmental conditions and adoptive innovative (REAI). Applying the REAI framework, we examined the risk management efficacy of adoptive innovation activities of one organisation under a historical perspective. We conclude that although adopters have a high tolerance for managing uncertainty and appetite for risk taking in line with competitors, there are two key elements that determine the performance of such behaviour: level of environmental turbulence and the role of senior management. It is the first time research determining the relationship between risk and adoptive innovative behaviour is being undertaken and will also provide direct guidance for managers regarding how to manage risk and uncertainty under different circumstances of their innovative practices.