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product and process innovations, the experiences of these agribusinesses suggest that such approaches are not without their challenges. The data indicate that dynamic capabilities alone may not guarantee success, particularly when firms have multiple innovation focuses. Instead, this study introduces the idea that strategic simplicity and adaptability, rather than complexity, might offer better protection against external shocks. This challenges conventional understandings, and suggests that in certain sectors, particularly those characterised by volatility, more conservative and flexible strategies may be favourable over aggressive, proactive innovation strategies.
The distribution of innovation strategies observed in this study further challenges the traditional emphasis on proactive approaches that are often suggested in the literature. The dominance of passive and reactive strategies, coupled with a significant number of stagnant innovators, portrays a sector that is largely cautious, risk-averse, and reactive rather than forward-looking. This observation invites a reconsideration of how innovation strategies are applied across different contexts, suggesting that for agribusinesses, flexibility and risk management may take precedence over aggressive innovation. The results provide a deeper understanding of how firms navigate the delicate balance between innovation and risk in uncertain environments, offering a new perspective on the strategic choices that define success in the agricultural sector.
In particular, the analysis sheds light on the strategic importance of adopting an active innovation approach, especially during global crises like the COVID-19 pandemic. Firms that employed active strategies— characterised by strong internal R&D and collaborative efforts—demonstrated the highest levels of resilience, in line with established theories on dynamic capabilities. Conversely, passive and reactive strategies, while offering some benefits, were found to expose firms to greater risks when external conditions are highly volatile. These findings illuminate the complex and context-dependent nature of strategic decisions and their impact on a firm’s ability to innovate, grow, and thrive.
In light of these findings, several policy implications emerge. Policymakers should consider promoting innovation strategies that promote flexibility and adaptability, particularly in sectors prone to external volatility like agriculture. Support mechanisms, such as financial incentives for active innovation and collaborative R&D efforts, could help firms build stronger internal capabilities. Furthermore, there is a need to create environments where passive and reactive strategies can be supplemented with elements that enhance resilience, such as improved access to real-time market data and more
robust networks for external collaboration. Policymakers can help ensure that firms are better equipped to face future crises by developing instruments that aim to strike a balance between strategic simplicity and dynamic responsiveness, which can help contribute to the long- term sustainability and growth of the agricultural sector.
Supplementary Materials: No supplemental materials. Statement on data availability: Data is available upon
request.
funding: The funding for was provided by the Department of Science and Innovation (DSI) of the Republic of South Africa.
declaration of interest: The authors wish to declare no conflict of interest.
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