Destiny or decision: competitive performance and its relationship to innovation

In this paper we consider competitive performance of 73 leading Croatian companies along eight dimensions which were determined based on exploratory research (interviews with managers). We link present competitive performance with past innovation and future innovation plans. We argue that if the past innovations have given firm neither product nor process advantage over competitors, there may be no sufficient resources at present to fuel future innovation. Therefore low performers may lack strength and means to improve their position through future innovation, being stuck in a vicious cycle. In other words, for low performers their past innovation record can shape their destiny regardless of their decision to innovate. The results show that low performance is indeed related to the past innovation results. We find that bad innovators have bad competitive positions, which means less commercial success and less actual resources to be invested in the future innovations. We find those 'strugglers' in every way as ambitious about their future innovation plans as good performers, but their limited resources prove to be drag on their goals. This paper illustrates that the destiny vs. decision dilemma can be very real for some firms.