Factors influencing incumbent energy firms’ radical innovations implementation – A review

Abstract

To address the challenges of energy transition necessary for sustainable development, incumbents must implement innovations, some of which are radical compared with their current competence-base or market solutions. This requires a thorough understanding of the prerequisites for implementing innovation. The literature on the factors influencing incumbents' implementation is vast and dispersed across multiple fields, with sometimes contradictory findings. As a result, it is difficult to get a clear picture what influences innovation implementation. This study explores the factors that condition the propensity of incumbent firms to implement radical innovations relevant to the energy transition and examines how these factors influence. A systematic literature review was conducted, covering 43 articles. The study identifies and explains the influence of 20 such factors on implementation. Nine factors are firm-external and relate to the themes of socioeconomic-political pressure, innovation conditions and industry conditions. Eleven factors are firm-internal and relate the themes of organisational properties, absorptive capacity, and internal alignment with the innovation. Causal relationships between these internal and external factors were discovered, as well as complementary influences on implementation. Potential future research venues are proposed, including scarcely recognized factors that merit further attention, factor complementarity and interdependency, and empirical gaps in terms of geographic context. It also offers policy and management implications, concluding that to gain a thorough understanding of the prerequisites for implementation, it is necessary to simultaneously consider a wide range of factors and their interconnectedness.