Market strategy renewal as a dynamic incremental process ☆ Rudy Martens ⁎, Paul Matthyssens, Koen Vandenbempt Faculty of Applied Economics, University of Antwerp and AMS, Antwerp Management School, Belgium University of Antwerp, Department of Management, Prinsstraat 13, B-2000 Antwerpen, Belgium abstract article info Article history: Received 1 August 2010 Received in revised form 1 November 2010 Accepted 1 December 2010 Available online 11 January 2011 Keywords: Incrementalism Muddling through Market strategy Renewal process Volatile environments often force companies to renew their market strategy. In this study, the focus is on the process aspects of a renewal that is characterized by a high degree of ‘muddling through’. This study wants to (1) show the complexity and incremental nature of market strategy renewal processes, (2) seek additional explanations for the antecedents of incrementalism in strategic decision-making and (3) illustrate the process of muddling by using critical incidents in a market strategy renewal effort of an industrial company. Using a longitudinal case design, this article highlights how incrementalism almost automatically creeps into market strategy renewal. Differences in rationality across managerial levels result in remedial, serial and socially fragmented incremental processes in these renewal efforts. Incrementalism in strategy is viewed as a natural phenomenon to be managed, rather than a deliberate course of action that is skillfully executed. © 2010 Elsevier Inc. All rights reserved. 1. Introduction Today's highly volatile and complex business market environ- ments call for a better understanding of market strategy renewal. Increasingly, the success of companies is dependent upon their ability to adapt and revitalize their market strategies (Ulaga and Eggert, 2006). Market strategy renewal not only refers to the formulation aspects of new customer value creation strategies but also to the implementation aspects of strategic reorientation and repositioning efforts. Attention to the formation aspects is useful as earlier research on strategic change and strategy renewal (Floyd and Lane, 2000; Huff et al., 1992; Pettigrew, 1992) demonstrates the difficulties of formulating and implementing new strategy, as well as realizing adequate organizational alignment. In this longitudinal study, market strategy renewal shows to be a Lindblomian process. This finding sheds new light on market strategy renewal. In particular, the differences in the nature of incremental decision making processes at different managerial levels in (industrial) companies seem to deserve more attention in market strategy renewal. This research aims at (1) showing the complexity and incremental nature of market strategy renewal processes, (2) looking for additional explanations for the antecedents of incrementalism in strategic decision-making and (3) illustrating the process of ‘muddling through’ using critical incidents in a market strategy renewal effort. Hence, this study provides a double contribution to the extant literature. First, the study investigates a strategic renewal effort of a business-to-business company using a longitudinal case study. Based on rich interview and focus group data, the paper analyzes the efforts taken and the problems encountered by the case company in renewing its market strategy. Secondly, the case illustrates how incrementalism almost automatically creeps into a strategy renewal process. Hence, this research helps to uncover incrementalism and muddling through processes in a business to business context. Contrary to seminal writings of Lindblom, incrementalism is not seen as a deliberate approach to policy/strategy renewal efforts. Rather, this empirical research illustrates that incre- mentalism is a natural phenomenon in strategy and renewal processes. The paper is structured as follows. The next section analyzes the concept of market strategy renewal (Section 2), which highlights the importance of understanding the process aspects of these strategic renewal efforts. Section 3 introduces the main ideas of Lindblom on incrementalism and relates this perspective to this study of strategic renewal. Section 4 introduces the methodology and the research design. Section 5 describes the case illustration, focusing on 5 critical incidents. The last sections give a discussion leading to managerial implications and avenues for further research. 2. Market strategy renewal Increasing market dynamics and competitive pressures erode the competitive differentiation of companies. Under these circumstances, companies are forced to rethink their market positioning and customer value creation strategies (see for instance, D'Aveni, 2010; Matthyssens and Vandenbempt, 2008; Teece, 2010; Thomas and D'Aveni, 2009). Although the marketing literature has mainly focused Journal of Business Research 65 (2012) 720–728 ☆ The authors thank the three anonymous reviewers and the special issue editors for their valuable comments. The authors also thank Marc Ingham (Groupe ESC Dijon Bourgogne, France) for valuable comments on a previous version of this article and Parul Goel (University of Antwerp, Belgium) for the English proofreading. ⁎ Corresponding author. University of Antwerp, Department of Management, Prinsstraat 13, B-2000 Antwerpen, Belgium. E-mail addresses: rudy.martens@ua.ac.be (R. Martens), paul.matthyssens@ua.ac.be (P. Matthyssens), koen.vandenbempt@ua.ac.be (K. Vandenbempt). 0148-2963/$ – see front matter © 2010 Elsevier Inc. All rights reserved. doi:10.1016/j.jbusres.2010.12.008 Contents lists available at ScienceDirect Journal of Business Research