The purpose of this paper is to examine how and why outsiders, rather than incumbents, are able to take advantage of technological discontinuities.
The paper employs a case study of a single innovation that transformed the technology of Formula 1 motor racing.
The findings show how social capital made up of “weak ties” in the form of informal personal networks, enabled an outsider to successfully make the leap to a new technological regime.
The findings show that where new product development involves a shift to new technologies, social capital can have an important part to play.
It is widely accepted that radical innovations are often competence destroying, making it difficult for incumbents to make the transition to a new technology. The paper's findings show how the social capital of outsiders can place them at a particular advantage in utilizing new technologies.
