PRODUCT DEVELOPMENT: IN-HOUSE INNOVATION OR INTERNATIONAL CLONE? A RESEARCH ON DIFFERENT PERFORMANCE OF TECHNOLOGY START-UPS IN VIETNAM

Le Thai Phong, Le Hong Ngoc Han

Abstract

Abstract:
New product development (NPD) is one critical stage deciding the nature and the success
of a start-up company. This research aims to compare the effectiveness of two approaches:
innovation and international clone in NPD of technological start-ups in Vietnam. The paper
utilises bothexploratory case study research and in-depth interview research methods and
revealed that in-house innovative products perform better generally but not as stable as
the copycats. This trend is obvious in revenue and compounded annual growth rate, but in
profit, both kind of product fluctuated and have opposite direction. There is no guarantee
of success no matter what approach entrepreneurs follow. On the other hand, qualitative
findings show that there is significant intersection between innovative and copycat products
that make it harder to decide which one is more efficient. However, best practice in Vietnam
should be copying new concept in the short term then innovating on the copycats to match
the market and win the long run. Hence, a clever combination of innovation and reference
would lead to more chance of success. For sustainable development of the company and the
economy, innovation is a critical approach that cannot be dismiss now and in the future. It is
the heart of entrepreneurship and the new product development, too. The paper sheds more
light, academically and practically, to the importance of the combination of different ways
of innovation in order to improve business performance in Vietnamese context.
Keywords: innovation, new product development, in-house innovation, international clone.
Date of submission: 22nd July 2014 – Date of approval: 10nd January 2015.