BREATHING SHOES AND COMPLEMENTARITIES: STRATEGIC INNOVATION IN A MATURE INDUSTRY

Abstract

This paper tells the story of Geox, an Italian footwear manufacturer that, in less than a decade, has become one of the world's largest shoe manufacturers. Applying the related notions of complementarity and performance landscape to study strategic positioning in the footwear industry, we show that, though grounded on product innovation (the original Geox breathes® patented system which allows ventilation in waterproof rubber sole), Geox's competitive advantage has not grown out of operational excellence in single activities in the business, but, rather, derives from a unique and consistent configuration of complementary activities. Such configuration represents an innovative strategic position and corresponds to a peak in the footwear industry performance landscape. The case study offers anecdotal evidence in support of complementarity based economic theory. It confirms that, in the presence of complementarities, rivals find strategy imitation and reverse engineering difficult due to the unique nature of the relationships among complementary variables.