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Market-Based Solutions to Vital Economic Issues


Kenan Institute 2024 Grand Challenge: Business Resilience
Market-Based Solutions to Vital Economic Issues
Mar 7, 2023

Adopting Dr. Robot: Responses to Competitor Adoption of Innovation


How do an organization’s task requirements affect the ways in which it reacts to competitors’ strategic investments? This study uses a novel measure of task requirements (Case Mix Index), to test the competitive and spillover effects of prior adoption on a focal organization’s timing of adoption, while accounting for the underlying demand-side drivers of adoption. Results of an empirical study of the adoption of robotic surgery systems by US hospitals validate our measure as a predictor of the timing of adoption. Further, this measure moderates the effect of adoption by competitors, delaying investment in the technology for those hospitals most likely to adopt robotic surgery based on their patient population, while accelerating adoption for those with the lowest demand for the technology.

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