Withdrawing a Project from the Corporate Innovation Portfolio: Person, Portfolio and Firm Level

Profitable resource allocation decisions are a key success factor for the corporate innovation portfolio. Therefore, managers need to withdraw projects to focus on profitable, high-return projects with solid commercial prospects to improve the corporate portfolio composition. We use a conjoint field experiment to collect data on 6944 decisions made by 217 R&D managers to test how individual failure experience and firm attributes influence the allocation decisions within a corporate innovation portfolio. Using hierarchical linear modeling, we (1) provide new theoretical insights and empirical evidence for the determinants of managers’ resource allocation decisions within the portfolio context, (2) contribute to cross-level innovation research while analyzing person and firm level aspects on the portfolio composition, and (3) contribute to the literature on failure experience and the resource based theory. Our study shows that failure experience and a firm’s level of growth influences managers’ resource all...