Search Styles in Style Searching: Exploring Innovation

ARTICLE IN PRESS

Long Range Planning -- (2008) ---e--- http://www.elsevier.com/locate/lrp

Search Styles in Style Searching:Exploring Innovation Strategiesin Fashion Firms

Paola Cillo and Gianmario Verona

Style e namely, the aesthetic and symbolic choices a company makes regarding itsproducts, their main features and how they are combined e is increasingly influencing theinnovation strategies of firms. Currently, however, we still lack an understanding of searchstrategies behind new style creation. This paper provides a granular description of stylesearch by means of a semi-grounded analysis of the process of change of leadinginternational firms in the fashion industry. Our findings highlight two different approachesto search e a design-driven search and a market-driven one. The styles differ in terms oftriggers of change, locus of change, the role of individual vs structured units (teams anddepartments) in style creation and style selection, and the expected outcomes. We providedetailed evidence of the two approaches and conclude by highlighting managerial andacademic implications that might inform future research on the topic.� 2008 Elsevier Ltd. All rights reserved.

You think this has nothing to do with you (.) you go to your closet and you select that lumpy bluesweater because you are trying to say to the world you are taking yourself too seriously to care aboutwhat you put on your back, but what you don’t know is that that sweater is not just blue, is notturquoise, but it is actually cerulean, and you are unaware that in 2002 Oscar de la Renta dida collection of cerulean gowns and, then, YSL showed a cerulean military jacket and, then,cerulean quickly showed up in the collection of eight different designers and was filtered downinto the department stores and then trickled down in some tragic corner store (.) and it’ssomehow comical how you think you have made a choice that exempts you from the fashionindustry while in fact you are wearing a sweater that was selected for you by the people in this room.

The Devil Wears Prada

0024-6301/$ - see front matter � 2008 Elsevier Ltd. All rights reserved.

doi:10.1016/j.lrp.2008.08.001

Please cite this article in press as: P. Cillo, G. Verona, Search Styles in Style Searching: Exploring Innovation Strategies in Fashion

Firms, Long Range Planning (2008), doi:10.1016/j.lrp.2008.08.001

http://www.elsevier.com/locate/lrp

ARTICLE IN PRESS

IntroductionStyle is becoming increasingly influential in shaping the image of products launched on the marketand has become a fundamental driver in rejuvenating product portfolios as markets approachmaturity. Style can be defined as the aesthetic and symbolic choice a company makes regardingthe products and services, their main features and how they are combined. This notion of styleis based on previous works by leading sociologists who define style as a code composed of ele-ments that come together like letters of the alphabet that can be mixed up to generate endlesscombinations.1

While in the case of luxury industries, the aesthetic and symbolic elements of a product are thekey to sustaining competitive advantage, symbols are becoming extremely important in a largenumber of contexts, including those traditionally driven by only technological standards.2 The re-cent effort made by Nokia in the mobile phone industry and the huge success of the i-Pod in con-sumer electronics are examples of the prominent role played by style in industries that aretraditionally characterised by technology or product.

Change is an innate characteristic of style. The nature of style is that it is subject to frequentchanges driven by consumers’ eagerness for the new and from companies’ tendency to plan the sty-listic obsolescence of their products. As Davis pointed out: ‘‘Style is a code, however, radically dis-similar from those used in cryptography; (.) it is of ‘low semanticity’. Perhaps it can best beviewed as an incipient or quasi-code, which, although it must necessarily draw on the conventionalvisual and tactile symbols of a culture, does so allusively, ambiguously and inchoately, so thatmeanings evoked by the combination and the permutations of the code’s key terms are forevershifting or in process.’’3 However, if change is so closely related to the concept of style, what be-comes critical is to explore the processes of change driven by style. Understanding the triggers ofchange, the way companies engage in search processes that enable them to identify the trajectoriesof new style creation and selection, and deal with the risk of diluting their identity while embracinga process of change, are all important issues that still have not been completely addressed. For thisreason, in our research we investigate how companies scout around and acquire new ideas trigger-ing style changes. In order to do this, we develop a semi-grounded, multiple-case analysis within thefashion industry, which represents the quintessential context in the creation of style.4 The strategyliterature we start from pertains to the process of change.5 A relevant implication of our work is toenlarge our understanding of how companies change by leveraging style.

Symbols are becoming important in a number of contexts, including

those traditionally driven by only technological standards

Our findings show that while searching for new styles, companies tend to adopt different ap-proaches. Some show a predominantly internal focus because their search process is led by an in-dividual e the lead designer e that tends to generate incremental changes within the organisationalpath. Other companies are more sensitive towards market evolutionary changes and their searchprocess is led by a team or an entire function/department. In this case, people in charge of searchinteract on a continuous basis to generate a collective sense of the outside market. In our researchwe have also discovered that the two models affect the scope of the search process. While companiesdriven by a lead designer tend to search more locally, and specifically in the neighbourhood of thedesigner’s expertise, the second type of company tends to look beyond its current horizons whilesearching. This tendency to search more distantly has strong implications in terms of outcomes be-cause it enables those companies to potentially produce more radical changes, although in the longrun it may cause a loss of stylistic identity. Firms with a tendency to search locally strengthen theirstylistic identity, at the expense of their ability to match the dominant trends in the market. Theseopposing forces (the tendency to engage a distant search in order to differentiate and the tendency

2 Search Styles in Style Searching



ARTICLE IN PRESS

to search locally to preserve stylistic identity) generate the need for combining exploration with ex-ploitation with specific organisational mechanisms.

In the paper, we discuss the mechanisms behind these two search styles, the opportunities andlimitations they present, and the periodical attempts of firms to balance local and distant searchin order to fit changing market trends. We conclude by drawing academic and managerial impli-cations for companies that want to pursue a process of change driven by style.

Conceptual perspectives on the process of changeIn recent years there has been an increasing interest in the study of a firm’s process of change. Thisinterest goes beyond the object of investigation of this article (the style-driven change) and refersmore broadly to the increasing complexity that firms have to face in global markets often charac-terised by technology dynamics full of uncertainty. While a number of studies on change have in-vestigated the continuous or punctuated timeline with which firms change, and the organisationalsolutions in order to seed exploration within the more exploitative nature that characterises orga-nisations, the actual triggers of search and the way they are integrated in the process of change seemto have received scant attention.6 Nevertheless, we believe that existing contributions in the field ofstrategy can inform our understanding of the initiation of the process of change. Triggers of changemay in fact be rooted in the traditional competitive strategy literature which has been broadly in-formed by either a structural or a resource-based view.7

According to the structural view (also called positioning view), firms should strategise by mainlypaying attention to their external environment in order to search for possible solutions to gaincompetitive advantage. While this tradition dates back to the classic work by Michael Porter,according to which the choices a company makes are primarily driven by the structural character-istic of the industry and of competition, works in both strategy and marketing literature have pro-vided detailed evidence on the nature and impact on the strategy process of market forces.8 Moreparticularly, studies on competitive strategy have shown how competitors and competitive inter-actions are at the basis of decision-making aimed at gaining and sustaining competitive advantage.9

Similarly, marketing strategy contributions have shown that a competitor orientation and, moreimportantly, a customer orientation (namely, the ability to collect information regardingcustomers and disseminate it within the organisation) shed fundamental light on how to searchoutside a company’s environment and are positively related to short and long-term performance.10

Overall, these studies show that the external environment can be an influential trigger in theprocess of change.

Unlike the structural approach, the resource-based view of the firm has provided conceptual andempirical evidence regarding the fact that resources (namely, a firm’s skills, assets, routines, capa-bilities and competences) should be at the basis of the strategy-making process and the process ofchange.11 Recent works on dynamic capabilities have reinforced this strategic idea by showing howinternal competences support and stimulate organisational change and strategic renewal, thanks totheir capacity to purposely create, extend or modify a firm’s resource base. In particular, humancapital is considered to be a key antecedent in the formation of dynamic capabilities and in the con-tribution of a firm’s adaptation to a changing environment.12 According to this second view, inter-nal resources trigger a firm’s process of change and adaptation to a changing market.

By building on the above-mentioned streams that have partly shed light on the triggers of search,we aim to focus on the following questions: how do companies search for new styles? More pre-cisely: what triggers the search process in the case of style? What are the mechanisms that compa-nies use in the process of search and what are their expected outcomes? How do firms stray fromtheir legacy of stylistic identity while searching for new styles? Research has highlighted how thelocus of search itself might pose complex and subtle organisational challenges.13 In this respect,the presence of different triggers may impact on the way firms integrate and manage knowledgewithin their boundaries and avoid the natural tendency of premature lock-in between strategisingand organising.14

Long Range Planning, vol -- 2008 3



ARTICLE IN PRESS

Research methodsWe decided to focus on a single style-related industry. In our view, there is no better place to ex-plore the issue of search styles than a style-making context like the fashion industry. Fashion com-panies compete through style and the symbolic value conveyed by their style and brands. Therefore,fashion firms can provide managerial and conceptual insights for many different sectors where theaesthetic and symbolic value of products is becoming increasingly relevant. We built our explor-atory investigation on a semi-grounded basis, based on a study of comparative cases.15 This methodhas been successfully applied to study the process of change in different contexts, especially in thecase of the highly complex phenomenon under investigation.16 Our study initially investigated twocase studies in the fashion industry: Escada and Diesel.17 Escada is a German company that operatesin the pret-a-porter segment. Diesel is an Italian company that focuses on casual and activewear,with a global image created over the years through distinctive, innovative advertising and a selectivedistribution policy. The companies differ in the dimensions of their activities, turnover and size.Both cases have been included in the analysis as the study aims to explore companies characterisedby different dimensions and targeting different segments within the same industry in order to high-light the mechanisms implemented to sustain market innovations. In order to strengthen the inter-nal and external validity of the emerging model of style search after this first phase and enrich itwith details and anecdotes of other firms in the industry, we also collected primary and secondarydata on a wider sample of fashion firms including the following four leading operators of ready-to-wear and diffusion segments: Giorgio Armani, Gianfranco Ferre, Gucci and Versace. The Appendixprovides details of the methodology we followed to collect and interpret data, as well as a stylisedrepresentation of the strategies in the fashion industry.

Search styles in fashion firmsWe have identified two approaches that mirror the resource-based and the structural angles respec-tively with which firms can interpret their search process and which influence the way the process ismanaged. These two approaches first emerged while exploring the cases of Diesel and Escada.Further evidence was added to corroborate the two cases, citing companies from our extendedsample e see Table 1. The two models provide mirroring answers to our research questions. Tobetter understand how search in style is pursued, we have organised our findings around foursubsections related to:

� The triggers of change;� The locus of search;� The role of individuals versus team in search;� Expected outcomes of the process.

Triggers of change in style searchingOur main results regarding triggers of change in the two emergent approaches are presented inTable 2. As shown, there are firms that tend to centralise the style-making process around a char-ismatic figure, the company’s designer. As an internal resource, namely, the designer is the maintrigger of the search process, this type of search reflects the resource-based view of the firm andwe have labelled it designer-driven search. This kind of search emphasises the capacity of the design-er’s mindset to interpret market changes. The search strategy behind this approach depends on theknowledge and history of the firm, more than on inputs from the external environment. This doesnot mean that the external environment is not influential since a finetune with the changingdominant style in the market is critical to succeed. What is more important is the way the designerinterprets the outside world, since he/she is the primary actor in the search process and is also thefilter through which a company makes sense of the market. The designer makes sense of the externalworld like an artist does e that is, by imposing his/her lens and replicating his/her viewpoint.




Table 1. The Two Approaches to Style Search

Style Search Designer-Driven Search Market-Driven Search

Cases Escada Diesel

Armani D&G

Ferre Prada

Versace Gucci

Key Subjects Designer Unit (Design Function)

Metaphor Art Science

Key Competence Designer Customer and competitor

orientation

Process Individual sensemaking Collective sensemaking

Locus of search Local Distant

Incentives Designer is the owner of the

company or gets royalties

Members of the unit are

regular employees with a traditional

division of labour and an incentive

to innovate

Legacy Past Collections Market dynamics

Innovation Outcomes Evolutionary change Radical change

Trade-off Balancing distant with local search Balancing local with distant search

Long-run Limitations Adaptation with the market at risk Stylistic identity at risk

ARTICLE IN PRESS

Escada is a good example of this designer-driven search. At Escada, the process of creation anddevelopment of a new collection always starts from the designer. In an interview, the chief designerof Escada remarked:

I start to imagine every single collection from the fabrics, and most of these fabrics come from Italyand Russia. First of all I search for new fabrics, colours and by looking and touching the fabrics,ideas emerge. Every season I try to focus on different colours (.).

In this approach designers are responsible for most of the changes occurring within the company.As one of the designers from Escada pointed out:

It really comes from our designer e that is, Brian. He travels to New York and to Pitti Filati (.).He basically goes to New York to spot the trends, to go shopping. When he comes back he startsworking on that with the senior designers. The concept comes from Brian.

Gianfranco Ferre is another case in point. Mr Ferre starts to develop a new collection by imag-ining a path that is meant to be coherent with the brand stylistic identity. To guarantee this strongcoherence of the brand identity over time and across different collections and product categories,Mr Ferre directly controls every item of the collection presented in the fashion shows, every com-bination of the pieces of the collection and those used for communication activities. This approachmakes the product recognisable on the market and ensures that the stylistic identity is not diluted.The unique artistic touch of the designers belonging to designer-driven search is well represented bysome of the artefacts produced in their collections over the years. Armani’s jacket, Gianfranco Fer-re’s white blouse, Valentino’s red dress are remarkable examples of this artistic idea of the artifact.18

The designer is the primary actor in the search process and is also the

filter through which a company makes sense of the market




Table 2. Triggers of Change in Style Searching


Trigger of

Change

Designer Unit (Design Function)

Selected

Evidence

The development of every new collection starts

from themes and sketches defined by the lead

designer (Escada, Ferre, Armani)

Design of a single collection is triggered

by the trips of designers around

the world (D&G, Diesel)

In the Gianfranco Ferre company, Ferre himself

directly controlled every item of the collection

presented in the fashion shows and in the

communication and advertising campaigns (Ferre)

Every season, Diesel changes

the composition of the group

of designers who travel to look

for emerging trends in order to

have greater variation in the search

process at the beginning of every new

collection development process (Diesel)

It is the designer who travels to different places

in the world to get ideas and sense emerging

trends (Escada)

Artifacts are related to a broad concept

(e.g., the Mediterranean style introduced

by Dolce and Gabbana, the Minimalism

introduced by Prada), a general fabric

(such as the Diesel jeans) or a trademark

(such as the Burberry check)

Artefacts are mainly artistic workpieces, present

in every single collection developed by the company:

Armani’s jacket, Gianfranco Ferre’s white blouse,

Valentino’s red dress

The designer is strongly involved in company

ownership or has a strong participation

in company results

Outcomes Changes within existent brand identity Changes anticipating emerging

market trends

ARTICLE IN PRESS

The designer’s responsibility does not only include the core creative activity that is related to de-fining a new collection, but also regards many other company choices that affect its core stylisticidentity. In most of the cases observed, the striking influence of the designer in the designer-drivensearch case is associated with a formal role in the company ownership, or in any case, with a strongparticipation in the company’s results e if he/she does not own a specific stake, he/she obtainsroyalties on the revenues.

The market-driven search is instead triggered by a continuous process of market sensing and under-standing, reminiscent of the competitor and market orientation view of strategy studies. This approachis based on the attempt to respond to the market evolution by leveraging the organisation’s greater ca-pacity to adapt. Market-driven search is characterised by a strong external focus, rather than an internalone. Competitors, customers and any other actor that can influence the evolution of market trends area potentially useful source of information for people involved in search strategy. In our study, we ob-served that companies that adopt a market-driven search use the capacity to anticipate emerging mar-ket trends as a major selection criterion in developing new collections or any other innovation activity.

In this respect, Diesel provides a benchmark case. In this company, the process of search is trig-gered by a careful study of the emerging trends. These trends are observed by travelling and cap-turing street styles and selecting creative ideas that fit with these emerging trends.19 In fact,before defining the themes of a new collection, designers usually travel in small groups and interactwith many people that can provide a differentiated set of information that can influence the collec-tion. As mentioned by one of our informants at Diesel:




ARTICLE IN PRESS

Inputs are first gathered during trips to the hottest and trendiest places and then transformed intoproducts and styles. How can a company decide whether short, long, yellow, red or a brand newfabric will be in fashion unless it is familiar with the street trends?

The substantive emphasis on the external environment and the reduced emphasis on a solo/stardesigner is also confirmed by the absence of a single authority in the design process and in the man-agement of the stylistic identity of the firm and the production of artefacts which are more gener-alist compared with those produced by the star designers. Indeed, in the case of firms embracinga market-driven approach, artefacts are related to broader concepts (e.g., the Mediterranean styleintroduced by Dolce and Gabbana), to fabrics (such as the Diesel jeans) or to trademarks (as inthe case of Burberry’s signature check), more than an artistic workpiece.

The locus of searchThe two approaches also differ with respect to the locus of search e see Table 3. The legacy with thepast is the main driver of designer-led search and the search process usually starts from inside thecompany. As we noted in the development process of new collections at Ferre, innovation alwaysstarts from the archives of past collections. If one looks at the company’s collections, he/she willalways discover references to materials, decoration or graphics from existent concepts and ideas.Gianfranco Ferre himself used to consult the company’s huge archives to find inspiration for thethemes, graphics and materials to use in new products. In this approach, what we found is that de-signers tend to search in the neighbourhood of their expertise and, more specifically, of their iden-tity e i.e., they search locally. This aspect can be easily detected by the fact that their search processrelies mainly on existent strong relationships with intermediate consumers (i.e. department storebuyers and small boutique owners) and with the end consumers of fine fashion that spend hoursin shops. An Escada informant confirmed:

Marketing in fashion companies has scant influence on the creative process (.) We [marketingdepartment] can give recommendations, report what we find and then hope they will be

Table 3. Locus of Search


Locus of

Search

In the neighbourhood of the

designer’s expertise and identity

Distant search

Selected

Evidence

Archives represent the first search

spot where designers look for new

ideas when developing a new

collection (Ferre)

The panels used to develop a new

collection are not kept in archives

to avoid repetition of existent ideas (Diesel)

The marketing department has scant

influence on the style and new collection

development process. Usually, most of the

marketing activity is related to competitors’

and pricing analyses (Escada)

Observing people in the street and

emergent habits are a main source

of insights when creating a new

collection (D&G)

At Escada, the new collection development

process is influenced by the interactions

with lead customers and retailers that

contribute to selecting the main themes

and pieces of the collection (Escada)

At Diesel, a key activity to initiate

the process of innovation is interacting

with trendsetters, namely, people that

are not Diesel consumers but are considered

capable of anticipating and sensing emergent

trends in the market (Diesel)

Outcomes Incremental changes within the path

of existent brand identity

Radical changes anticipating market

evolutionary trends




ARTICLE IN PRESS

considered by the design department. What we are most actively involved in is to launch newproducts.

The creative process and the relative outcomes of market-driven search are developed witha different approach with respect to designer-driven search. Firms adopting a market-drivensearch tend to forget past knowledge in order to expand their innovation potential and to beopen to capturing market changes. Therefore, these companies tend to focus more on distantrather than local knowledge in their search. Indeed, the search activity occurs through a directinteraction with consumers, opinion leaders and retailers that are not necessarily connected tothe company and with the support of extensive market research done by the marketingdepartment.

Diesel, for instance, leverages the peculiar ability of its designers to interact with non-mainstreamusers, namely, trendsetters. More precisely, managers tend to view the target market as a pyramidwith the trendsetters at the top because they are considered to set the trends that others subse-quently follow. The second layer is made up of opinion leaders, responsible for spreading the trend.They play a key role once Diesel incorporates the ideas of the trendsetters in the new products. Thethird layer is made up of the bulk of the market: consumers who want to follow the trend or func-tional-orientated consumers who simply buy a product because it is useful and/or comfortable.Trendsetters are considered to be one of the most reliable sources of insights into market trendsbecause they are not influenced by what others are wearing and tend to abandon a trend assoon as it becomes popular. As Renzo Rosso, founder and CEO of Diesel, said:

They are the people who have to look inside the jacket to see the brand they are wearing, and thatusually buy in secondhand shops so they can mix and match different pieces they like.

The market orientation of the market-driven search is exemplified by the turnround of Gucci inthe early 1990s. To put it in the words of CEO Domenico De Sole: ‘‘Historically, fashion was viewedlike movies. We made it a business.’’20 Among the other market-driven strategic initiatives, theboard of directors appointed Tom Ford e a model e as the director of its Creative Department.The CFO was explaining the plan of Mr De Sole: ‘‘Domenico and Tom sat down and said ‘Howare we going to turn Gucci around?’ And they said: ‘We’ll make Tom a Star.’ And his beinga star is part of Gucci’s success. Because it created a lot of excitement in the press (.) Tom hasgot a great physical presence; he’s a very handsome man. He developed this ethos of the Gucci life-style which is sort of on the cutting edge; he gave it this sexy edge. And he made clothing that ex-actly cohered with that. So that became the platform for selling incredible quantities ofhandbags.’’21 Although De Sole and Ford left the company three years ago, Gucci continues tobe successful under a new CEO, Robert Polet, who has matured his previous experience in headingcompanies in the fast-moving consumer goods industry, and a new creative director, Frida Gian-nini, who decided to radically change the organisation of the design department by relocating thedesign unit headquarters in Italy (it was moved to London by Tom Ford) and introducing radicallynew messages such as the following one:

If a girl wants to come to our store and just buy, for example, only a shirt or a jacket and wear thiswith a pair of jeans in order to buy the Gucci dream, I will be more than happy. This was myintention, my real intention.22

This new idea breaks with the past when Gucci wanted to dictate the dress code of its customers.Instead, now people will be able to buy just one item to feel Gucci. This new approach fits wellwith the changing landscape brought about by the introduction of fast fashion retailers such asZara and H&M, turning key customers into smart shoppers who like to mix and match differentbrands.




ARTICLE IN PRESS

The role of individuals versus teams in the process of searchWhat we found to be even more interesting is that not only are the triggers and the loci of change dif-ferent in the two approaches, but also the mechanisms underlying the search process itself e see Table 4.Designer-driven search is supported by the cult of the single personality embodied by the designer. He/she is usually an artist, not necessarily trained in fashion design. For example, Gianfranco Ferre was anarchitect before joining the fashion world, while Giorgio Armani was a visual merchandiser for the big-gest Italian retailing chain and is a classic example of the ‘‘self-made’’ designer. Similarly, Gianni Versaceinherited his passion for tailor-made clothes from his mother, a sarta (seamstress). Escada founder andoriginal designer, Margarethe Ley, had experience in the fashion industry but as a supermodel and not asa designer. When she and her second husband founded the company, she was the designer, while he wasresponsible for the administration. This does not mean that firms that follow a designer-driven strategydo not have a design unit, but that the design unit is hierarchically managed by the star designer.

In the market-driven search, the capacity to adapt does not depend on a single designer, but ona team that works within the design unit: no single person is responsible for the whole process,which is instead usually taken on by a team or a creative/design function. Regarding this distin-guishing characteristic, the Diesel creative director said:

The choice of Renzo Rosso was not to have one famous designer, but a team. First, being in a team isvery different from having two prima donnas both aiming to affirm their personality and will.

Table 4. Individual versus Teams in Style Searching


Main Actor Designer acting as an artist Unit (Design Function) Unit (Design Function)

sponsored by a champion and following a more

‘‘scientific’’ approach to new product development

Selection Selection occurs at later stages

in the process

Panel boards e first selection done by group

of designers after travelling

Selected

Evidence

Individual definition from the

designer of the themes and critical

ideas for new collections

(Giorgio Armani, Escada, Ferre)

Designers’ team based on a mix of people similar

to the target market (Diesel)

The role of the designer’s team is to

create the new collection according

to the guidelines set by the designer

(Escada, Ferre)

The team of designers that travels

to find inspiration outside the company

uses panel boards to share their ideas with

the rest of the teams. This activity usually

takes place in a mansion in the countryside

a week after they return from their trips (Diesel)

The selection activity is done by the

sales department and usually only

a select number of pieces is sent

to production (Ferre)

The definition of the concept of a

new collection is not defined a priori

but changes thanks to the contribution

of the different designers (Diesel; D&G)

The selection of pieces for the new

collection is made by the designers through

a process of continuous interaction

and consultation (Diesel)

The process of selecting new designers

is highly formalised and designers are

taken from the best design schools (Gucci, Diesel)

Outcomes Individual interpretation of

market evolution and trends

Collective and iterative process of sensemaking




ARTICLE IN PRESS

Second, our team is based on a mix of people reflecting our target market with respect to age, sexand open-mindedness. For these reasons, we can affirm that we are aware of market developmentsand change because our team of designers precisely represents our target market.

In this approach, search represents a collective process of sensemaking.23 Designers are often hiredfrom design schools and specifically trained for the job. The internal division of labour they are usedto represents a quasi-scientific, rational approach to the creation of a new collection e now taught inmost schools. Diesel, for instance, relies on a number of designers coming from all over the world. Asthe creative director pointed out:

Our designers come from the best design schools. We hire them when they are very young and manyof them do not have relevant job experience. Yet, the hardest test they have to pass is the one ofliving here in Molvena, especially when they are used to big cities like New York, London orAmsterdam.

Designer-driven search is supported by the cult of the single personality

embodied by the designer

Similarly, other informants highlighted that in the case of Gucci, designers come from differentcorners of the world in order to get a broader perspective. They also find it hard to live in a smalltown such as Florence e where the historic headquarters was located.

The team is sponsored by a champion who is himself very sensitive to market changes andemerging trends:

[Renzo Rosso] is very intuitive, but also has very strong competences within the industry. He paysgreat attention to research, he reviews around 60 magazines every week, and going out with him isa nightmare because he wants to enter every single shop, because he analytically collects and reviewsall the information in order to disentangle market trends. What is more important, he has built upa company where people adopt an approach very similar to his own and has created a set ofprocedures that replicate his approach.

The different roles played respectively by the designer and by the team in the two approachesimpact on the selection activity within the change process. We noted that in companies wherethe designer plays the main role in the search process, once the new ideas are implemented andthe fashion shows are over, it is the sales department that manages the selection process. On thispoint, Ferre’s Commercial vice-president said:

Fine fashion firms with icon designers put into production a small portion of what is shown infashion shows. (.) In our case, I would say it is about 30 per cent, but digits can be evensmaller in case of some niche players. (.) For us, fashion shows are fundamental to sharingour ideas with key customers and we want to make sure we understand what they actually likebefore entering the market phase.

Similarly, the average number of pieces in a collection at Escada is significantly higher than a reg-ular fashion company’s collection. As reported by one of our informants at Escada:

An Escada main collection consists of more than 1,300 pieces. It is not the traditional collection thatusually consists of 250e350 pieces because we try to satisfy all the different needs by significantlyincreasing the number of pieces and themes in the same collection.




ARTICLE IN PRESS

Therefore, in the case of the designer-driven search, it is the sales department that plays a centralrole in bridging the gap with the market, providing constant feedbacks on the latest market trends.In the case of Escada, for instance, intermediate customers (i.e. both key client retailers and man-agers of different subsidiaries) are directly involved in selecting the pieces to include in the collec-tion. As a vice-president of the Italian branch of Escada observed:

All the commercial branches are involved in the different phases of the new collection development processand provide inputs to the design office. During the prototyping phase we are asked to go to Germany toevaluate and discuss colours, graphics and discuss the possibility of integrating the collection with newpieces (.) there is also a very important briefing before the collection is presented to the buyers.

In the case of market-driven search, selection is centralised in the design unit. Overall, we noticedthat the selection activity is less relevant than in the designer-driven search case. Indeed, the creativeeffort of these firms is characterised by a market sensitiveness ab origine, which does not produce newproduct concept redundancy that is common in the designer-driven search approach. As a direct con-sequence of their general strategic orientation, even retention is not considered relevant. In fact, firmsadopting market-driven search tend not to memorise solutions but to forget them. For instance, atDiesel, the communication manager made the following remark regarding the panels built to developa new collection:

We usually cut the panels at the end of each collection to avoid remaining tied to specific conceptsand duplicating them over and over.

Generally speaking, the fact that it is not a single person but an entire unit with people that ‘‘comeand go’’ makes the process of retention more problematic and the process of market orientation morenatural. For example, at Gucci the recent resignation of Tom Ford and his replacement by Frida Gian-nini as head of the creative department caused a substantive change in the firm’s human capital.

Expected outcomesWhat are the key constraints and opportunities firms have to cope with when searching for newstyles following either the market-driven search or the designer-driven search approach? Theyare reflected in the expected outcomes that the two models generate. In fact, by favouring localsearch, designer-driven search will award the affirmation of a firm’s stylistic identity; on the con-trary, the market-driven search will primarily award the ability to adapt to market changes. As a cor-ollary, this would mean that, in periods of incremental change, designer-driven search couldprovide a better performance than market-driven search, while the opposite would occur in periodsof radical change.

Let’s first take the case of designer-driven search and the example offered by Giorgio Armani. Hisstyle, characterised by simple lines, soft colours and the strong presence of jackets and suits, is al-ways recognisable in the collections under his name, even when the dominant style does not reflectthese features. By investing in the neighbourhood of their expertise, designer-driven firms reinforcetheir stylistic identity and stimulate a process of differentiation with respect to their competitors.However, in the long run, this type of behaviour comes with risk. Style evolves in the marketand firms also need to keep in touch with this to sustain their success. For instance, the successof Armani’s grey and light colours is threatened during periods where, for instance, kitsch and ba-roque references are dominant. Similarly, the colourful and artistic creation of the early Versace didnot fit the minimalism of the late 1990s. Therefore, if they want to survive in the long run, firmsneed to search far from their expertise. This implies that while individuals and organisations can gobeyond their current technical domain, the more distant the search process goes, the more compli-cated it is for the firm to use its existing knowledge base.24 However, the tendency to search farfrom the current expertise is considered especially vital in order to adapt in situations of marketand technological uncertainty. For this reason, the evolution of firms as learning systems requires




ARTICLE IN PRESS

being constantly aware of both local and distant search opportunities and trying to manage thetrade-off between exploration and exploitation.

We noted that in the case of designer-driven search, the distant search process starts with the helpof the sales department and the support of the top management. However, when the results are notin line with expectations and the needs of the end market seem to diverge from the proposed col-lection, the company provides an input to undertake an exploratory activity. In any case, explora-tion (namely, distant search) in those companies is always managed by the designer, who receivesinputs from the sales department and the merchandising functions. For this reason, the process ofdistant search is neither easy to implement nor very common in companies strongly driven by a sin-gle designer. When it does occur, it is sometimes associated with a change in the lead designer. Thisis exemplified by the case of Escada when it appointed a new designer in 1994, after the death of thedesigner who had succeeded Mrs Ley. The new designer e Brian Rennie e was chosen to renew thebrand’s image and stylistic identity and thus attract new, younger customers and no longer be iden-tified with its traditional customers. Indeed, the new designer ‘‘brought with him a youthful andmore modern perspective for the Escada lines, while continuing Mrs Ley’s vision on what Escadahad to represent on the market’’.25 In those cases where exploration takes place in the continuity ofthe same designer, it is because the designer himself seems to be particularly sensitive to long-runmarket changes. This is the case of Giorgio Armani. The name and evolution of the company hasalways depended on the charismatic leadership of Mr Armani who is the main actor in the changesthe company has undertaken. As one of our informants pointed out:

He has this idea of creating an Armani lifestyle with Armani points of sale reflecting this style, whereconsumers can find many different products converging on the idea he has of the Armani brand.(.) He personally decides which categories fit into this lifestyle and whether to include newextensions and changes in the company.

The risks run by firms following a market-driven approach is exactly the opposite to the one pre-sented before. Their tendency to keep searching distantly endangers their stylistic identity. The needto balance local and distance search is therefore also vital for firms that present a market-driven ap-proach. For example, the Diesel brand has always been associated with the use of denim in high-endcasual products. However, like most fabrics, denim is subject to a life cycle of falling in and out of fash-ion. For a brand such as Diesel, abandoning denim would mean rejecting one part of its stylistic identityand heritage. To avoid losing control of the end market, in 1998 the company started working on en-larging its identity by creating a new line, called DieselStyleLab. It is an experimental sector where dif-ferent materials e other than denim e new cuts, colours and combinations are allowed. This processwas deliberately undertaken in order to face the expected decline of denim and to try to extend the Dieselstyle to combine new materials with the historical denim, and to avoid completely abandoning denim.The creation of an ad hoc unit to develop this new line, independent from the design unit responsible forthe traditional Diesel line, was sponsored by the top management. It is the top management team to-gether with the newly-created design unit that is in charge of the selection activity. This example high-lights the characteristics of the process of exploration in the case of market-driven search. Firms seem toidentify alternative paths to their creativity by empowering new teams or organisational units. We findconceptual support for this behaviour in the literature of ambidexterity which refers to the need to createan ambidextrous organisation in order to keep up with waves of technological change. Ambidexteritycan refer to the value and skills of people involved in the creative process, but more often it has an impacton the structure being implemented by separating those who ‘‘exploit’’ and those who ‘‘explore’’.26

Gucci provides another case of structural ambidexterity. The company’s reorganisation, led byDe Sole and Ford, was the result of poor management of its stylistic identity that had seen the Guccibrand become a mass brand spread over many unrelated categories. Even in this case, too muchcontrol of the market and consumer needs and expectations had diluted the brand’s stylistic iden-tity and led to poor performance. One of the first choices made by Tom Ford was to create a newStyle Office in London. Even though Italy is considered the cradle of fashion and elegance, Ford




ARTICLE IN PRESS

thought it was much better to stay in touch with the underground environment of a global city,without being too far from the Italian headquarters.27

In summary, not only does the style search differ in the case of firms embracing a designer-drivenor a market-driven search but the two approaches have important implications on expected out-comes (more evolutionary vs. radical innovation) and the need to balance local with distant searchin order to, respectively, avoid losing a grip with the market (in the case of designer-driven) andlosing the stylistic identity (in the case of market-driven search).

Conceptual discussionIn this paper, we have identified two styles of search that seem to characterise firms in the fashionindustry and that might shed light on how the style-driven process of change can be undertaken.We are obviously aware of the limitations of our study: it is industry-specific and provides dataonly on a small sample. However, we think that the explorative purpose of the work mitigates theselimitations.

At a more conceptual level, we believe our work contributes to literature on processes of change.First, our study highlights the importance of triggers enacting change. As shown in the results’ sec-tion, the presence of either a single personality or a team unit has an impact on the type of search thatis enacted e local or distant e and thus on the results in terms of change. Second, our results showthat the focus on triggers of change is also critical because triggers influence not only the process ofsearch per se but also the mechanisms behind exploration and exploitation ignited by the search pro-cess. This relationship has so far been overlooked by studies focused either on search or on exploi-tation of information derived from search, while we found critical interactions between triggers ofchange and mechanisms of exploration and exploitation of the outcomes of search. In this respectwe think that our study provides insightful results and opens avenues for future research.

Third, our results highlight how a complete understanding of the process of search relies on theidentification of the unit of analysis, and more precisely of the interaction between individuals andorganisational units. As noted by Gupta and colleagues, so far studies on exploration have over-looked the implications behind the different layers within which search occurs e be it individuals,teams, organisations or inter-organisational units.28 Our research has highlighted that search strat-egies can strongly emphasise either the process of individual search required by the company de-signer or the organisational and more collective sensemaking activity within the design unit and/or creative function. These differences have considerable implications on the strategic and organisa-tional mechanisms used by firms to stimulate the process of exploitation of current knowhow andexpertise. Most notably, they present important differences in the case one wants to search toa more distant locus e i.e. in the case of exploration. In such cases, the interplay between the in-dividual and the organisational level influences the overall learning process. In the case of designer-driven search, organisational search tends to match with the individual (that is, the designer’s)search. However, individuals are controlled by the organisation and forced to change: in fact,the organisational unit turns into a selector and a controller in case results fail to meet expectationand the firm decides to stray away from its current stylistic path. In the case of market-driven searchwhere the search process is nested in a unit, a form of organisational ambidexterity seems to berequired in order to change. In short, we believe that a better understanding of search strategy re-quires a more thorough understanding of the interplay between the different layers through whichsearch and, consequently, learning takes place. Different layers imply different responsibilities, andtherefore different roles with which the overall learning is governed.

Finally, our results offer a perspective on search in a low-tech context usually overlooked in pre-vious research. Indeed, most of the studies on search have been primarily focused on high technologyor science-based settings. While these contexts represent a fundamental laboratory to understandlearning processes behind search, they present industry-specificities. As noted by Dosi, Nelson,and Winter, among others: ‘‘In areas of ‘hard technology’ the dynamic capabilities of the firm dependheavily on its R&D resources; in other areas, that label may not be applied but analogous investmentsare made’’.29 We think that the fact that this analogous investment is primarily made in style instead




ARTICLE IN PRESS

of technology, and that knowledge related to style presents different specificities with respect to tech-nology, has important implications for what firms should do. For instance, due to proprietary char-acteristics of knowledge in the case of hard technology, an R&D race usually occurs: firms want to befirst- mover in order to impose their own design in the industry so it will become the dominantone.29,30 On the contrary, the less proprietary nature of knowledge and the willingness to be distinc-tive and similar to competitors while at the same time generating market trends in the target com-munity, leads to a continuous interplay between differentiation and homologation with respect tothe end market. Moreover, we also noticed that style search presents a high degree of intangibilityand is therefore characterised by a higher degree of flexibility than technological search. Consumerslike to change and experiment and such behaviour makes change less constrained than in the case oftechnology. Yet, although stylistic knowledge makes the process of distant search easier to pursue, wealso noted that companies that depend on a cult figure can find the process of distant search just ashard to embrace as high-tech companies.

Lessons for managers and conclusionsOur research has important practical implications especially for companies in other industries thatare facing a critical trade-off between product differentiation and market innovation.31 In particu-lar, our evidence on fashion provides insights on how to shape the search process whenever firmsaim not to use innovation to isolate themselves from the others, but to maintain a balance betweendifferentiation and homologation. Our cases show the importance of a strong interaction betweenthe designer or the design unit and the rest of the company. This interaction is fundamental forcompanies that want to maintain their stylistic identity, while adhering to market trends in style.What we think emerges as critical from our study is the ability of the company to design mecha-nisms enabling integration between the designer or the design unit responsible for the search pro-cess and those responsible for the production and commercialisation of products. If the designersdevelop strong interactions with sales and operations managers early in the process of search trig-gering change, there will be major opportunities to broaden the process of search and to producea change that is more coherent with market evolutionary trends, without threatening the companyidentity. For these reasons, what could be helpful in companies where the process is mainly pushedby a designer’s individual search is to define specific meetings and checkpoints with other roles in-volved in the change process at the very early stages of the process.

Practical implications of our study also involve the role of managers in providing signals to directthe search process when company performance is lower than expected. While recognising the pri-macy of the designer or the design unit in the new collection development process, when a distantsearch is necessary, the management team assumes a critical role in orientating the designer or de-sign function activity and ensuring that the company is in line with market evolution. If the man-agement fails to provide this support, there is a strong risk of either under-exploiting the creativepotential of the designers or overexploiting it and thus losing grip with the market.

Finally, while our analysis can more easily be linked to the dynamics of cultural industries, we thinkit might also provide powerful implications for companies that want to leverage the symbolic value oftheir product. The aesthetic and symbolic dimensions of a product can profoundly impact its percep-tion and adoption by consumers irrespective of the actual degree of product novelty. Apple’s personalcomputer iMac as a case of successful incremental innovation and Sony’s entertainment robot AIBOas an unsuccessful case of radical innovation are both examples of the influential relationship betweenaesthetics and adoption.32 An important implication of this emergent phenomenon is that modelsthat attribute the success of an innovation solely to technological and organisational reasons mightnot tell the whole story. It is especially the way symbols are created and the way they both interactwith the product and generate supply-side and demand-side externalities once introduced into themarket that provide substantial insights into competitive dynamics that can help managers better un-derstand how to creatively generate value. In this respect, we believe the designer-driven and market-driven search models can be particularly useful for firms competing with symbols. These contexts arethose that attribute great relevance to the non-technical part of their product e namely, its stylistic




ARTICLE IN PRESS

content that also carries out meanings that are then used in the contexts where the products are dif-fused. As recent works on design have shown, in those contexts personal relationships and exchangeamong people within the firm are still the most relevant source of ideas for innovation.33 Our studycontributes to the understanding of how this exchange occurs either in the presence of a single dom-inant personality e the designer e or in the presence of a design unit. As style is becoming a relevantvariable in the process of differentiation and value creation in several consumer industries (e.g., car,consumer electronics, telecoms) and has generally become an important support for firms that wantto change the rules within the boundaries of their own industries (e.g., MCC Smart in Automotive;Apple with Mac, i-Mac, i-Pod; Starbucks in coffee shops), we think that our results can provide animportant basis for managers who want to leverage an alternative path to value creation and scholarswho want to capture new venues for differentiation strategies. This path is particularly relevant forproducts approaching maturity, where style-based differentiation represents an important optionto rejuvenate the product and extend its lifespan.34

Table 5. Searching Styles: Key Questions and Major Lessons

Key Questions Lessons for Managers

What are the advantages and risks of an internal

search process driven by a single designer?

� It ensures a strong coherence in the

innovation outcomes of the firm

� It is also efficient, because the selection

of critical environmental changes and

challenges is done directly by the designer

� The major risks companies should be aware

of are of losing the pace with market

evolutionary trends, and the risk of continuing

replicating existent identity without embracing

any required change

What is the role of managers in the search

process driven by a single designer?

� Managers play a critical role in selecting

the outcomes of designer’s ideation process

� Managers also have to interact directly with

the designer when he limits the process

of change of the whole company

What are the advantages and risks

of a search process driven by a team?

� The search process is developed through

a continuous interaction among the

people of the team

� The selection is realised along the process

and not at the end and this makes

the process more effective

� The process of search might result

as less efficient because of the interactions

occurring within the team

What is the role of managers in the

search process driven by a team?

� They act as champions of the search

process and this is critical to make the

process more efficient and more effective

How to overcome the risks associated

to the different types of search?

� Reinforce the managerial staff supporting

the lead designer to stimulate a real debate

and to promote change whenever necessary

� Define clear milestones to anticipate critical

interactions between the different groups

involved in the process of change

� Develop internal units led by internal

champions to promote change within the company




ARTICLE IN PRESS

In Table 5 we have summarised the key managerial implications of our study and we have high-lighted some caveats managers need to consider when adopting one of the two models of search.First, we believe that our results show that managers, when choosing the model that best fits theirorganisation, should be aware of the opportunities and limitations that each of the two identifiedapproaches presents. The advantages of a designer-driven search approach are in its efficiency andin the coherence that is granted by the presence of a single individual driving the whole process.Yet, such a presence of a single personality can threaten the ability of the company to be finetunedwith market evolutionary trends. Therefore, the role of managers becomes crucial when it comesto select the outcomes of the designer’s creation process and to interact. Similarly, when thesearch process is led by a team, the role of managers is to set timing and goals of the team activityin order to speed up the process and to make sure the outcome is in line with the firm’s historyand activity. Independently from the search style adopted, companies need to invest in designingorganisational mechanisms and roles to avoid the risks associated with the adoption of oneapproach.

In conclusion, our contribution helps untangle important mechanisms in the style search pro-cess, and we hope that future empirical research will further explore the complexity of search strat-egies in style-making contexts.

AcknowledgementsThe paper was partly funded by the Claudio Dematte Research Division of SDA Bocconi School ofManagement of Bocconi University and was presented at the 2007 Academy of Management Con-ference, Philadelphia. We are particularly indebted to the comments of Editor Charles Baden Fullerand three LRP anonymous reviewers. We are grateful to the managers of the companies involved inthe study for the information and time they have shared with us and in particular we want to thankMr Alessandro Varisco, currently Managing Director of Roberta di Camerino, for his support alongthe whole process of data collection and interpretation. Usual disclaimers apply.

Appendix

Research settingThe research setting for this study is the fashion business. The fashion industry has a very complexstructure. A pyramid, going from a high-end/high-margin/low-volume tip to a low-end/low-mar-gin/high-volume base, is the most commonly used metaphorical representation of strategic segmen-tation in fashion (see the Figure below).35

There is a clear pecking order within the fashion industry that goes from haute couture productsto mass market products. More precisely, the industry can be divided into five segments:

The Fashion Pyramid

HAUTE

COUTURE

READY-TO-WEAR

DESIGNER

DIFFUSION

BRIDGE

MASS MARKET




ARTICLE IN PRESS

� Haute couture (literally: high fashion) refers to one-off designs, tailor-made according to cus-tomer specifications, like the hand-made clothes worn by Hollywood stars at the Oscar Awards.The rules governing the creative process in haute couture are no different from those in other art

forms. As noted by Davis: ‘‘there is and probably always has been significant formalistic elementin couture that, beholden to principles of ‘‘pure design’’, unabashedly, and often defiantly, pays

scant attention to questions of comfort, fit, and convenience, much less to those of price andsocial suitability. For designers of this tendency, clothing values (i.e. fabric texture, weave, vol-

ume, light reflection, colour, pattern, etc.,) are thought to constitute an aesthetic of their own,one to which the human form must submit, rather than the reverse’’.36

� Pret-a-porter (ready-to-wear) represents what is commonly referred to as ‘‘fashion’’. It is the ex-pression of the process of democratisation of haute couture and its extension to a larger public.

From the manufacturer’s point of view, it is the result of the effort each company makes at leasttwice a year (one for each season and for each portfolio line) to transform the creativity of their

designers into wearable clothes. This is exemplified by the first lines of Escada, Giorgio Armani,Gucci, Gianfranco Ferre and Prada.

� Diffusion/Better includes high-end companies producing the so-called second lines, more afford-

able and targeting a wider market. This is exemplified by Armani Collezioni, the second line de-signed and produced by Giorgio Armani, Miu Miu, Prada’s second line, and DieselStyleLab,Diesel’s experimental line.

� Bridge includes creations that are more affordable and functional (such as Diesel, MaxMara and

Calvin Klein) compared with the previous segments. By developing brands and styles that pro-vide substantial differences in the perceived value of the market, these companies target different

segments whose average purchasing volume increases according to the layers of the pyramid.� Mass market companies are those specialised in making fashion attainable for a larger public, as

in the case of The Gap, Benetton, Zara and H&M. These companies are typically retailers eventhough some of them are vertically integrated upward.

Sample selectionCompanies in our sample cover all the layers of the pyramid with the exclusion of the mass mar-

ket e mass market companies in fact are followers in the process of style creation and did not rep-resent an interesting focus for our analysis. More precisely, in a first exploratory stage we analyzedtwo highly-visible firms belonging to different segments in order to increase the heterogeneity ofour findings. These firms are Escada (a key player in haute couture, ready to wear and diffusion)and Diesel (a leading player in bridge and diffusion). In a second stage, we included other four lead-ing firms of the industry which are also highly visible with respect to our object of investigation:Giorgio Armani, Ferre, Gucci and Versace. The four firms compete in the first three segments ofthe industry (haute couture, ready to wear, diffusion).

Data collectionWe relied on three main sources to collect data. First, we ran in-depth, semi-structured inter-

views with representatives of fashion companies, as well as with additional external informants. In-terviewing informants at multiple levels in each firm and unit allowed to mitigate potential subjectbiases and obtain more elaborated theory.37 All the managers in the different firms held comparablepositions. Their industry experience ranged from 6 to 35 years. Follow-up interviews often occurredin order to clarify the evidence from data coding and analysis. Interviews lasted 60 to 90 minutes.Each interview was tape-recorded and transcribed verbatim within 24e48 hours. The interviewguide was structured as follows. We first asked generic questions about the interviewee’s back-ground and experience within the firm and the industry. Interviewees were also asked to describethe nature of their job and role within their particular unit. Then, we asked specific questions aboutthe innovation process and the management of style. Interviewees provided data related to theirpersonal experience and the experience of the unit they belonged to. In the Table below is the in-formation regarding the informants we have interviewed.




ARTICLE IN PRESS

Second, we employed direct observation at company meetings to collect field notes and observereal-time interactions and decisions. One of the authors, known as a researcher, participated atcompany meetings and activities in an unobtrusive way, to obtain first-hand exposure to organisa-tional processes.38

Third, an investigation of internal documents (company reports, websites, etc.) and externalsources provided a sound opportunity for method triangulation and comparison. With regard toexternal sources, the researchers relied on industry-specific publications (Vogue US, Vogue Italia,WWD), business magazines (Business Week, The Economist among the others) and financial news-papers (The Wall Street Journal, Financial Times) and websites (PambiancoNews, Modaonline,among the others). Triangulation of data from multiple and diverse sources increased our confi-dence in the robustness of the findings.39 Data collection stopped when we reached the theoreticalsaturation point, or when additional data resulted in minimal marginal understanding.40

Data measuresWe relied on the following elements for the measures we used for our main variables. For the

triggers of change, we asked the people we interviewed to backward identify the structure of themost recent collection development processes and to focus in particular on the events and peopleigniting the process. For the locus of search we explicitly directed our attention in the interviews onquestions related to the areas e geographical and thematic e from where people get inspirations inthe new collection development process. For a deeper understanding of the role of individuals andteams, we asked questions on the mechanisms, formal and informal, used for sharing ideas in theinitial phase of the new collection development process, for interacting during the implementationphase and for making information spread within the company.

Details on Key Informants and Time Frame of Data Collection

Company Key Informants Time Frame

18

Please cite this article in pres

Firms, Long Range Planning

s as: P. Cillo, G. Verona, Search Styles in S

(2008), doi:10.1016/j.lrp.2008.08.001

Diesel
� Founder September 2000eMarch 2004
� Creative Director

� Marketing VP

� Commercial VP

� Communication VP

� 4 Designers

Escada
� Commercial VP September 2000eMarch 2004
� HR VP

� Marketing VP

� CEO Italian Branch

� 2 Designers

Giorgio Armani
� Global Commercial VP JuneeOctober 2006
� Marketing VP

Gianfranco Ferre
� Mr Gianfranco Ferre JuneeOctober 2006 Follow-up e JuneeJuly 2007)
� CEO

� Commercial VP

� Communication VP

Gucci
� Global Commercial VP JuneeOctober 2006
Versace
� Commercial VP June 2006eJune 2007
� Collection Merchandiser

)We ran a follow-up interview with Ferre Commercial Vice-President after Mr Ferre’s death on June 17th 2007.

Search Styles in Style Searching

tyle Searching: Exploring Innovation Strategies in Fashion

ARTICLE IN PRESS

References
1. In addition, for all see: R. Cappetta, P. Cillo and A. Ponti, Convergent designs in fine fashion. An evolu-
tionary model for stylistic innovation, Research Policy 35(9), 1273e1290 (2006); R. Barthes, The FashionSystem, Hill and Wang, New York (1983); U. Eco, A Theory of Semiotics, University of Indiana Press, Bloo-mington, IN (1976); F. Simon Miller, Commentary: signs and cycles in the fashion system, in R. Solo-mon(ed), The Psychology of fashion, Lexington Books, Lexington, MA (1985).

2. M. Trueman and D. Jobber, Competing through design, Long Range Planning 31, 594e605 (1998); V.Postrel, The Substance of Style, Harper Collins, New York (2003); M. J. Silverstein and N. Fiske, TradingUp: The New American Luxury, Portfolio, New York (2003); M. Eisenman, Mature industries as fashionsystems, Working paper, Columbia Business School (2004); M. J. Silverstein and N. Fiske, Why ConsumersWant Luxury Goods e And How Companies Create Them, Penguin, New York (2005); D. Ravasi and G.Lojacono, Managing design and designers for strategic renewal, Long Range Planning 38, 51e77 (2005);V. P. Rindova and A. P. Petkova, When is a new thing a good thing? Technological change, product formdesign, and perceptions of value for product innovations, Organization Science 18(2), 217e232 (2007).

3. F. Davis, Fashion, culture and identity, University of Chicago Press, Chicago (1992).4. Fashion has been the subject of longstanding research in sociology that mainly aims to understand the

process of collective fashion selection and diffusion over time. See, e.g. T. Veblen, The Theory of theLeisure Class, Transaction Publishers, London (1899); G. Simmel, Fashion, The American Journal ofSociology 62, 541e544 (1957); Eco, op. cit. M. A. Descamps, Psychosociologie de la mode, PUF, Paris(1979); Barthes, op. cit. More recently, style in fashion has become an interesting context of investi-gation for different fields such as economics, consumer behavior, organization behavior, and the man-agement of innovation. See, e.g. C. Lorenz, Harnessing design as a strategic resource, Long RangePlanning 27(5), ;73e84 (1994); W. Pesendorfer, Design innovation and fashion cycles, The AmericanEconomic Review 85, 771e792 (1995); J. Richardson, Vertical integration and rapid response in fashionapparel, Organization Science 7(4), 400e412 (1996); C. G. Thompson and D. L. Haytko, Speaking offashion: consumers’ uses of fashion discourses and the appropriation of countervailing meanings, Jour-nal of Consumer Research 24(1), 15e42 (1997); M. L. Djelic and A. Ainamo, The coevolution of neworganization forms in the fashion industry: a historical and comparative study of France, Italy and theUnited States, Organization Science 10, 622e637 (1999); D. Cox and A. Cox, Beyond first impressions:the effects of repeated exposure on consumer liking of visually complex and simple product designs,Journal of the Academy of Marketing Science 30(2), 119e130 (2002); R. Cappetta and D. Gioia, Finefashion: symbolic artifacts, sensegiving, and sensemaking in the construction of organizational identityand image, in A. Rafaeli and M. Pratt(eds), Artifacts and organizations, Lawrence Erlbaum Publishers(2005); R. Cappetta et al., op. cit.

5. See, among the others D. Miller and P. Friesen, Momentum and revolution in organizational adap-tation, Academy of Management Journal 23, 591e614 (1980); E. Romanelli and M. L. Tushman,Organizational transformation as punctuated equilibrium: An empirical test, Academy of ManagementJournal 37, 1141e1166 (1994); C. Baden Fuller and H. Volberda, Strategic renewal. How large com-plex organizations prepare for the future, International Studies of Management and Organizations 27,95e120 (1997); D. J. Teece, G. Pisano and A. Shuen, Dynamic capabilities and strategic management,Strategic Management Journal 18(7), 509e533 (1997); S. W. Floyd and P. J. Lane, Strategizingthroughout the organization: managing role conflict in strategic renewal, Academy of ManagementReview 25(1), 154e177 (2000).

6. Please refer to S. L. Brown and K. M. Eisenhardt, The art of continuous change: Linking complexity theoryand time-paced evolution in relentlessly shifting organizations, Administrative Science Quarterly 42, 1e34(1997); Miller and Friesen, op. cit; Romanelli and Tushman, op. cit; Baden Fueller and Volberda, op. cit;Ravasi and Lojacono, op. cit.

7. J. G. March, Exploration and exploitation in organizational learning, Organization Science 2(1), 71e87(1991); M. L. Tushman and C. A. O’Really III, Winning Through Innovation: A Practical Guide to LeadingOrganizational Change and Renewal, Harvard Business School Press, Boston MA (1997); J. Birkinshaw andC. Gibson, Building Ambidexterity into an Organization, MIT Sloan Management Review 45(4), 47e55(2004); A. K. Gupta, K. G. Smith and C. E. Shalley, The Interplay between Exploration and Exploitation,Academy of Management Review 49(4), 693e706 (2006).

8. M. E. Porter, Competitive Advantage, Free Press, New York (1980); M. E. Porter, Competitive Strategy, FreePress, New York (1985).




ARTICLE IN PRESS

9. See for instance M. D. Chen, Competitor analysis and interfirm rivalry: toward a theoretical integration,Academy of Management Review 21(1), 100e134 (1996); D. Miller and M. Chen, Sources and conse-quences of competitive inertia: a study of the US airline industry, Administrative Science Quarterly 39,(1994); K. G. Smith, C. M. Grimm, M. J. Gannon and M. J. Chen, Organizational information processing,competitive responses, and performance in the US domestic airline industry, Academy of ManagementJournal 34(1), 60e85 (1991).

10. On the market orientation construct see for all the seminal works by A. Kohli and B. Jaworski, Marketorientation: the construct, research propositions and managerial application, Journal of Marketing 54,1e18 (1990); J. C. Narver and S. F. Slater, The effect of a market orientation on business profitability,Journal of Marketing 54(4), 20e35 (1990).

11. See for all: J. Barney, Firm resources and sustained competitive advantage, Journal of Management 17(1)(1991); R. Grant, The resource-based theory of competitive advantage: implications for strategy, Califor-nia Management Review 33, 114e135 (1991); M. Peteraf, The cornerstones of competitive advantage: a re-source based view, Strategic Management Journal 14, 179e191 (1993); Since the issue is not central to ourargument, for sake of simplicity in this paper we adopt a definition of resources which is synonym in gen-eral of competences and internal factors. One should however be aware of the different schools of thoughtwithin the so-called resource-based studies which for instance associate to the label ‘‘resource-based view’’a neoclassical accent and to the ‘‘competence-based’’ or ‘‘knowledge-based view’’ a more managerial andorganisational flavour.

12. Teece, Pisano Shuen, op. cit; K. M. Eisenhardt and J. A. Martin, Dynamic capabilities: what are they?,Strategic Management Journal 21, 1105e1121 (2000); Helfat, et al., Dynamic Capabilities, Blackwell,Malden, MA (2007).

13. D. Levinthal and J. March, The myopia of learning, Strategic Management Journal 14(8), 95e112 (1993).14. J. W. Rivkin and N. Siggelkow, Organizing to strategize in the face of interactions: preventing premature

lock-in, Long Range Planning 39, 591e614 (2006).15. See L. A. Isabella, Evolving interpretations as a change unfolds: how managers construe key organizational

events, Academy of Management Journal 33(1), 7e41 (1990).16. See R. I. Sutton, The process of organizational death: disbanding and reconnecting, Administrative Science

Quarterly 32, 542e569 (1987); Isabella op. cit; K. Eisenhardt, Building theories from case study research,Academy of Management Review 14(4), 532e550 (1989); R. K. Yin, Case study research, design and methods(2nd ed), Sage, Thousand Oaks, CA (1994); N. K. Denzin and Y. S. Lincoln, Collecting and InterpretingQualitative Materials, Sage Publications, London (1998); K. Locke, Grounded Theory in ManagementResearch, Sage, London (2001).

17. By highly-visible we mean that the sampling reflected the idea of the visibility criterion e and that is theclear presence of the phenomenon under investigation; A. Pettigrew, Longitudinal field research onchange: theory and practice, Organization Science 3, 267e292 (1990).

18. As reported in one of our recent interviews with the commercial VP of Ferre, the untimely death of MrFerre in June 2007 caused a worldwide sell-out of his classic white blouse in Ferre stores; For references onthe role of artefacts in organization, see B. Ewenstein and J. Whyte, beyond words: aesthetic knowledgeand knowing in organizations, Organization Studies 28(5), 8, 689e708 (2008).

19. In that respect they are more proactive than reactive. See: S. Slater and J. C. Narver, Customer-led andmarket-oriented: let’s not confuse the two, Strategic Management Journal 19, 1001e1006 (1998); S. Slater,J. C. Narver and D. MacLachlan, Responsive and proactive market orientation and new product success,Journal of Product Innovation Management 21(5), 334e347 (2004).

20. Quoted in M. Kwak and D. B. Yoffie, Gucci Group, HBS case # 9-701-037 by (2001).21. op. cit.22. See the entire interview and fashion show on www.style.com, Gucci/February/2008/Milan Fashion Show.23. E.g. K. Weick, The collapse of sensemaking in organizations: the Mann Gulch disaster, Administrative

Science Quarterly 38, 628e652 (1993); K. Weick, Sensemaking in organizations, Sage, Thousand Oaks,CA (1995); B. Vogel, Linking for change: network action as collective, focused and energetic behaviour,Long Range Planning 38, 531e553 (2005).

24. In fact, studies based on technological contexts have highlighted an inverted U-shape relationship betweenthe breadth of learning and its innovative performance; See L. Rosenkopf and A. Nerkar, Beyond local search:boundary spanning, exploration, and impact in the optical disk drive, Strategic Management Journal 22,287e306 (2001); R. Katila and G. Ahuja, Something old, something new: a longitudinal study of search be-havior and new product introduction, Academy of Management Journal 45(6), 1183e1194 (2002).




ARTICLE IN PRESS

25. G. Vergani(ed), Fashion Dictionary, Baldini, Castoldi, Dalai, Milan (2006).26. M. L. Tushman and C. A. O’Really III op. cit; Birkinshaw and Gibson, op. cit.27. We found other examples of this experimentation activity in all the companies of the extended sample

that are characterised by a market-driven search approach. For example, Prada has started a process ofexperimentation by launching its sport and casual line named Prada Sport. This line was created by takingthe technical materials and fabrics used to make sailboats and creatively and experimentally adapting themto create a sporty and casual product. Another example is the new D&G brand of Dolce&Gabbanalaunched in 1994 and defined as ‘‘A fashion label inspired by the street, contemporary music and every-thing that is now, for a personal style free from the constraints of pre-conceived notions and formats.D&G Dolce&Gabbana fashion signifies freedom, as the ultimate mirror of a wholly metropolitan culturein an unconventional, informal re-working. D&G Dolce&Gabbana is particularly popular among innova-tors and trendsetters, and everyone who enjoys freedom, irony and irreverence in fashion’’ seewww.dolcegabbana.it.

28. See Gupta, et al. op. cit; C. Lechner and S. W. Floyd, Searching, processing, codifying and practising e keylearning activities in exploratory initiatives, Long Range Planning 40(1), 9e29 (2007).

29. G. Dosi, R. R. Nelson and S. J. Winter, Introduction: Nature and Dynamics of Organizational Capabilities,Oxford University Press, Oxford (2000).

30. E.g. C. Christensen and J. Bower, Customer power, strategic investment, and the failure of leading firms,Strategic Management Journal 17, 197e219 (1996).

31. Fashion is sometimes considered a cultural industry consisting of ‘‘those organisations that design, pro-duce and distribute products that appeal to aesthetic and expressive tastes more than to the utilitarianaspects of customer needs such as films, books, building designs, fashion and music’’ C. Jones and P.Thornton, Introduction to transformations in cultural industries, Research in the sociology of organizations23, ixexix, (2005) p. xi. In cultural industries, the search process is central to innovation for two mainreasons. First, one of the most relevant debates in cultural industries is whether product performancedepends on the ability of companies to thoroughly understand and exploit consumer needs and desiresor to shape their tastes through their imagination and creativity, thus defining the standard by which theirproducts are evaluated. Second, another issue these companies have to face is how to be innovative with-out losing their fit with the market e that is the trade-off between product differentiation and marketinnovation. ‘‘Competition in cultural industries is driven by a search for novelty. However, whileconsumers expect novelty in their cultural goods, they also want novelty to be accessible and familiar.Onthe one hand, producers are pushed to seek novelty that differentiates products without making them fun-damentally different from others in the same category. This novelty represents a recombination of existingelements and styles that differentiates, but does not break existing artistic and aesthetic conventions. Onthe other hand, there is the push to pursue innovation beyond existing limits. This type of novelty breaksnew ground, often results in new types of cultural products, and may expand or fundamentally change themarket.’’; J. Lampel, T. Lant and J. Shamsie, Balancing act: learning from organizing practices in culturalindustries, Organization Science 11(3), 263e269, (2000) p. 266. Both these issues interpret the differentpositions fashion companies adopt with respect to their search activity directed to innovation.

32. Rindova and Petkova, op. cit.33. See A. Salter and D. Gann, Sources of ideas for innovation in engineering design, Research Policy 32,

1309e1316 (2003).34. See M. Eisenman, Dynamics of symbol imitation in the personal computer industry, in C. Combes, D.

Grant, T. Keenoy, C. Oswick, I. Sabelis, M. Veenswijk and S. Ybema(eds), Organizational Discourse:Artefacts, Archetypes and Architexts, Proceedings of the 6 th Biennial Conference (2004).

35. It is also noteworthy to point out that despite the fact that over the years the pyramid has been consol-idated, the context has changed so much that the boundaries between the different layers are no longer asrigid as they were 30 or 40 years ago. For instance, in recent years, we have seen the emergence of the so-called ‘‘demi-couture’’ which represents the interplay between haute couture and pret-a-porter.

36. Davis, op. cit., pp. 124.37. C. R. Schwenk, The use of participant recollection in the modelling of organizational decision of pro-

cesses, Academy of Management Review 10, 496e503 (1985); C. C. Miller, L. B. Cardinal and W. H. Glick,Retrospective reports in organizational research: a re-examination of recent evidence, Academy of Man-agement Journal 40, 189e204 (1997).

38. E. Danneels, The dynamics of product innovation and firm competences, Strategic Management Journal23, 1095e1121 (2002).




ARTICLE IN PRESS

39. See for instance T. D. Jick, Mixing qualitative and quantitative methods: triangulation in action,Administrative Science Quarterly 24, 602e611 (1979); R. E. Stake, The Art of Case Study Research, Sage,Thousands Oaks (CA) (1995).

40. A. L. Strauss, Qualitative Analysis for Social Scientists, Cambridge University Press, Cambridge (1987).

BiographiesPaola Cillo is an Assistant Professor of Management at Bocconi University, where she teaches courses on inno-

vation and new product development. She is also lecturer at the SDA Bocconi School of Management where she has

been in charge of the Marketing Group in the Master of Fashion and Design at SDA Bocconi School of Man-

agement. She holds a PhD in Management and was Visiting Scholar at Wharton School (2000e2001) and Visiting

Assistant Professor at the Carlson School of Management at the University of Minnesota. Her research interests

focus on market orientation and innovation in symbol intensive industries. Her articles have been published in

Italian and international journals, including Research Policy, European Management Journal and International

Journal of Human Resource Management. [email protected]

Gianmario Verona is Professor of Management at Bocconi University and is currently Visiting Professor at the

Tuck School of Business at Dartmouth College. He is Associate Director of the PhD in Business Administration

& Management. He holds a PhD in Management and was a Research Assistant at the Massachusetts Institute of

Technology (1997e1998). His research interests regard knowledge and innovation, with particular focus on ex-

ploration strategies and open innovation. His articles have been published in leading journals, including The

Academy of Management Review, Organization Studies, Journal of Product Innovation Management, Industrial and

Corporate Change, MIT Sloan Management Review and California Management Review.

[email protected]




mailto:[email protected]

mailto:[email protected]

Documents

Search Styles in Style Searching: Exploring Innovation