Proceedings of the 50th Hawaii International Conference on System Sciences | 2017

Blockchain as Radical Innovation:

A Framework for Engaging with Distributed Ledgers
Roman Beck Christoph Müller-Bloch
IT University of Copenhagen IT University of Copenhagen
[email protected] [email protected]

Abstract society [2,20,21]. To emphasize this, blockchain is

compared by some to the invention of the Internet
Blockchain is an emerging technology that is and its comprehensive impact on almost every
perceived as groundbreaking. However, blockchain industry [5,6,14,16]. Indeed, blockchain has made
presents incumbent organizations with significant inroads into many industries since it first materialized
challenges. How should they respond to the advent of in early 2009 as underlying technology of the
this innovative technology, and how can they build cryptocurrency Bitcoin, with high expectations for its
the capabilities that are necessary to successfully future. Blockchain can be defined in brief as a
distributed ledger or list of data records of
engage with blockchain? In this case study, we
transactions that may involve any kind of value,
analyze how an incumbent bank deals with the
money, goods, property, or votes. The blockchain is
radical innovation of blockchain. We find that
shared in a decentralized network of computers and
blockchain as an innovation is unique, because its
based on mathematics and advanced cryptography,
transaction cost-lowering nature requires
where each transaction can be verified by the entire
cooperation not only on an intra-organizational, but
network that can be either public or private. In this
also on an inter-organizational level to fully leverage
way, blockchain technology challenges any business
the technology. We develop a framework illustrating
model that relies on third parties for trust and
how the process of discovering, incubating, and
verification such as insurance companies or banks.
accelerating with blockchain can look like. Our
Evidently, this puts a remarkable pressure on
research is one of the first case studies in the area;
incumbent organizations, whose operations are built
shedding light on the organizational challenges of
upon trust-securing models such as in the case of
incumbents as they engage with blockchain. The
banks which act as trusted third-parties and those
paper provides a blueprint for business executives in
have a central role in the economy as we know it.
their endeavor of embracing blockchain technology.
Clearly, with blockchain and distributed ledgers,
the rules of the game are changing, adding pressure
1. Introduction on financial institutions to be more innovative to
reinvent their existing business models. Incumbent
Blockchain technology receives a lot of attention banks have to rethink what their value propositions in
in the information technology (IT) and financial the future might be.
industry these days, being referred to as being In the literature on innovation management, this
potentially the most promising technology in phenomenon of ascribing a very large promise to a
financial services ever [5,6,16,23]. Every major bank technological opportunity is often referred to as
and financial institution is looking into the potential “radical innovation” and is a widely addressed and a
of applying this technology in different areas of their persistent theme in innovation studies [1,3,8,9,18,25].
business, such as payment, stock trading, or similar In particular, radical innovation is often perceived to
transaction-based processes [2]. The expected gains be a managerial challenge in established
are improvements in speed, security, and organizations, because it involves high uncertainty
transparency along with a general reduction of and unpredictability. Thus, established organizations
transaction costs - just to name a few. have to build the necessary capabilities to manage,
In addition, the long-term predictions suggest a absorb, and adapt new technologies such as
remarkable, even revolutionary potential to redefine blockchain [19]. In this process, established
our entire financial system and to change some of the organizations increasingly team up with external
most fundamental structures of our economy and parties to stay in touch with the latest trends and

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CC-BY-NC-ND 5390
avoid falling behind in the innovation race [26]. This infrastructure for all kinds of blockchain secured
way of working calls for these actors to lower their applications [20]. In other words, blockchain 2.0
organizational boundaries to allow knowledge to offers a digital, open source peer-to-peer transaction
freely flow within and between organizations. system where ledgers, or more precisely databases,
In this paper, we explore the impact blockchain are decentralized and distributed across a network of
has as radical innovation on incumbent industries. users [15,20]. The database consists of chains of
The financial services industry is taking blockchain blocks, each containing a list of transactions. To
very seriously now and is developing know-how and validate the transactions within the block, the block
capabilities in that area. However, it is unclear how operates as advanced cryptographic puzzle that has to
banks and incumbent organizations in general will be solved. This approach is called proof of work and
deal with such a radical technological innovation that relies on so-called miners to solve these puzzles, for
has the potential to disrupt large parts of their instance, for the Bitcoin blockchain [20,28]. When
traditional business models. How do incumbent the puzzle for a block of transactions is solved, a new
organizations respond to blockchain as radical block for new transactions is generated and added to
innovation? How can they build the needed the chain. Each block is placed in a chronological
competencies to rethink their current business models order on the blockchain; thus, the blockchain
in the light of radical innovation? contains the complete history of all transactions.
In order to answer our research questions, we The highly cryptographic design of the
conducted a case study within a large international blockchain technology makes it practically
bank that is engaged with blockchain along the lines impossible to reverse or tamper with transactions
of discovery, incubation, as well as acceleration. We [15,20,22]. Moreover, all participants within the
will illuminate how they can build the competences system have a personal key or signature that is used
that are necessary to rethink existing business models when creating a transaction. This key makes it
in the light of blockchain. possible to account for which user created a given
The paper is structured as follows. Section 2 transaction and to whom that specific transaction was
explores the foundational literature on both sent to [15,20]. Also, the combination of the ledger
blockchain technology and radical innovation. being distributed and validated across the network
Section 3 describes the case as well as the makes it possible to assign any asset to any user, and
methodology. Section 4 presents the findings of the that a single asset cannot be sent more than one time.
case study. Section 5 discusses the insights gained In other words, this prevents double-spending assets
and concludes. which in effect makes it possible to track ownership
for a certain asset at any point.
2. Literature Background: Blockchain as Furthermore, because blockchain technology is a
peer-to-peer technology, it operates on a network of
Radical Innovation users, who are also called nodes. The technology is
reliant on the network of nodes to work together to
2.1. Blockchain and its Components validate transactions [15,20]. In principle, all who
engage in the blockchain can see all transactions
Blockchain is regarded as a technology that has happening on the blockchain as well as review past
(and will have even more in the future) a radical transactions. The blockchain technology can be
impact on the financial services sector. In the utilized in two different ways; public blockchains and
following, we will briefly discuss what blockchain private blockchains, also called unpermissioned and
actually is: Blockchain was first introduced in the permissioned [4,13]. In public or unpermissioned
source code of Bitcoin. It is argued that Bitcoin used blockchains, everyone who wishes to engage in the
blockchain of the first generation, called blockchain network can openly see all transactions. The
1.0, which was only designed to support crypto technology is transparent and all who wish to engage
currencies. The blockchain of the second generation in making transactions on the blockchain can do so.
moved away from Bitcoin and its single focus on In contrast, private or permissioned blockchains are
cryptocurrency and allows all kinds of transactions to closed and only accessible for a selected few who
be coded into a freely programmable blockchain, have permission to engage in the blockchain. The
such as the Ethereum blockchain, where one can transparency is therefore only given for permissioned
implement business logics in so-called smart participants, which is making it challenging to handle
contracts [2]. Thus, blockchain 2.0 has an extended data that requires a certain privacy, as it is the case
functionality compared to its predecessor, making it a with, for instance, customer data in the finance
generically programmable platform that can serve as sector. Like traditional legal documents, smart

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contracts in unpermissioned or permissioned development. Therefore, organizations need three
blockchains comprise rules, rights, and sets of competencies to manage the particular fields
consequences. However, unlike a traditional contract, of radical innovation [19], namely discover, incubate,
a smart contract can be supplied with information, and accelerate capabilities. As organizations decide
which can automatically be processed through the to develop radical technical innovations, they are
predefined rules, and take action upon in regards to bound to stretch the boundaries of what they already
the defined consequences [2]. Moreover, as smart know, and in doing so, accessing market partners and
contracts operate on a blockchain, they submit to all expertise in different environments enables the
the specifications of the blockchain technology. This company in developing their capabilities for radical
means that not only does the contract operate innovation.
automatically, it is also distributed across the network The first set of competencies is discovery. This
and operates on the premise of the aforementioned refers to capabilities involving activities that create,
structure of the blockchain technology. recognize, elaborate, and articulate radical innovation
The advent of blockchain has been compared with opportunities [19]. In relation to the activities, certain
the invention of the Internet, having a huge potential skills are required to carry these out. These skills are
for creating groundbreaking transformations within a exploratory and conceptualization skills, such as
number of industries [16,23]. In innovation conducting basic research and internal and external
management literature, such a phenomenon of hunting for opportunities. Because the discovery
groundbreaking change is often referred to as radical competencies include both invention and discovery
innovation [18], that will be discussed next. of radical innovations, it means that discovery
involves creating or discovering something different
2.2. Blockchain as Radical Innovation and previously unknown to the inventors. In other
words, discovery is about being or becoming aware
of innovations that were previously unknown to the
Radical innovations are discontinuous events that
company. Therefore, a mature set of discovery
are often direct results of research and development
competencies not only involves internal research and
[9], having a disruptive impact on existing business
development, but also activities focusing on
models [3,9]. Radical innovations often represent
acquiring external knowledge [19].
revolutionary changes in technology [8]. In other
The incubation competencies include activities
words, a radical innovation outdates existing
for maturing radical opportunities into business
technologies and practices within a given field [25].
proposals. Whereas discovery competencies create or
What distinctively differentiates radical innovation
recognize opportunities, incubation competencies
from incremental innovation is that incremental
create hypotheses of what a given opportunity could
innovations are typically adding new functionalities
become within the market [19]. These hypotheses
to existing technologies, while radical innovations are
include a potential business model, a hypothesis of
new technologies with new functionalities [3].
what the market could look like and what the
Radical innovations are not only promising potential
technological platform could enable in the market.
rewards for organizations, but are also risky since
Furthermore, incubation is for testing out these
such fundamental technological changes require to
hypotheses in the market with prototypes. The skills
adapt old or develop new organizational
needed are experimentation and interaction skills.
competencies to perform differently [1,8]. It can be
The acceleration competencies involve activities
assumed that the radical innovation of blockchain
for developing the business proposal to stand on its
will trigger significant organizational changes
own in relation to other business platforms in the
through the introduction of new business models and
ultimate receiving unit [19]. This means focusing on
organizational practices. As such, radical
building the proposed business to a level of
technological innovation are particularly difficult for
predictability so that sales and operations can be
established organizations to manage [7,11,12,19].
somewhat calculated. The main skill needed for this
Radical innovations come with methods and
is exploitation, including activities such as
materials that are new to the incumbent organization,
investment in building up the business and its
requiring knowledge that typically has to be absorbed
underlying infrastructure while keeping focus on
from external sources and combined with established
responding to market demands. Furthermore, focus is
organizational knowledge [11].
also upon creating processes for manufacturing,
Radical innovation involves a high level of
customer contact, support, and more. In other words,
market, technical, resource, and organizational
the focus here is to establish the full functioning
uncertainty, which can potentially be converted into
business, and once the radical innovation generates
long project maturity durations and unpredictable

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returns, it will be submitted to existing businesses or development unit, which lasted longer than 2.5 hours
create ground for its own business unit [19]. (see Table 1). Interviews were conducted in an open-
ended and semi-structured manner. Our data
3. Case Description and Methodology sampling was closely aligned with our pre-conceived
understanding about radical innovation, but otherwise
open to allow for the analysis and emergence of new
Our case company is one of the leading theoretical insights [24]. Our primary data collection
investment banks in the world, with more than was complemented by observations and informal
100,000 employees. In early 2014, some of its senior face-to-face discussions during our field research at
executives became aware of blockchain technology. the bank’s venues.
While they agreed early on that the impact of
blockchain on the banking sector might be
Table 1. Interviews for case study
significant, they needed to promote the technology
within the firm and to build the capabilities to engage Interviewee Duration of
with blockchain. In addition, they needed to assess if Interview
the bank would be able to capture value from using Head of Technology Strategy 01:02
blockchain technology. The bank managers in charge Head of Innovation Lab 01:05
of the blockchain initiative were well aware of the Head of Debt Capital Markets 01:13
criticality and the uncertainty that the advent of Head of Blockchain 01:05
blockchain technology poses for their business, and Head of Digitization 02:40
thus developed a rich understanding of the
technology and its business implications. Hence, the In total, more than 90 pages of transcriptions and
case company offers a unique opportunity to elicit notes were created during the analysis process in
interesting insights to deepen our understanding how May and June of 2016. In addition, for triangulation
incumbents cope with blockchain as a radical purposes, secondary data was collected and analyzed,
innovation. Moreover, the same circle of senior such as presentation slides and a brief blockchain use
executives was driving the blockchain initiative case description. This information helped us to
within the firm over the whole period and were thus construct the evolution of events and activities in the
able to paint a comprehensive picture of the entire blockchain development unit in 2014 and 2015, as
array of blockchain-related activities since 2014, well as the decision logic and development of
allowing us to gain a historical overview of the whole blockchain-related competencies. Our methodology
process of managing the radical innovation that for investigating the case was ‘pluralist,’ meaning
blockchain represents. that we engaged in different research activities [17].
We conducted a single-case study to analyze how Our approach was also consistent with Mingers
incumbent organizations in the financial sector (2004) who advocates for a pragmatic approach in
manage radical innovation such as blockchain within which researchers embrace different research
their organizations. Given the scarcity of research on perspectives with the aim of generating “a useful
the blockchain and management of radical innovation model of reality” [27]. We also followed the principle
in large organizations, our goal was to build a process of ‘emergence’ from grounded theory: grounded
model, using grounded theory techniques in case theory must ‘fit’ the data under study, and it must
study research [24]. The case research we conducted meaningfully explain the behavior under study [10].
took place within one of the largest investment banks In addition, techniques were selected and used that
in the world, making the organization particularly helped us increase the theory’s scope and the degree
suitable for investigating blockchain and the of conceptualization, for instance, by treating
phenomenon of interest, namely how to manage literature about radical innovation as additional data
radical technological innovation. points that we used for the data analysis [24].
Our primary data collection consisted of 5 Our research process started with formulating the
interviews conducted in April 2016 at two different problem [27], designing the case study [30], and
international sites of the investment bank. The engaging in intertwined data collection and analysis
interviews were conducted in English, digitally to theories from our data. However, we did not
recorded, and subsequently transcribed and follow all grounded theory method recommendations,
complemented by the extensive notes we took during for example, we did not apply different coding
each interview session [29]. Each interview lasted on approaches, in part because we only conducted five
average 1 hour, although we also had a ‘long interviews with a rather narrow scope on radical
interview’ with the head of the blockchain innovation management in the case of blockchain.

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4. Empirical Data and Analysis executive and] I cohosted a distributed ledger
internal working group mainly from people from
global markets, from the innovation lab, and from the
4.1. Discovery
transaction bank, and that became our internal
community of enthusiasts, and it was enthusiasts,
The discovery process is initiated by the because it was nobody’s job at this point, and it went
recognition of the radical innovation. The bank’s from there. [Head of Debt Capital Markets]
interest in blockchain was triggered by the rise of
Bitcoin, which the firm’s senior executives sensed Building a community of volunteers allowed
required further scrutiny: engaging with blockchain without having to acquire
financial resources. Employees from different
And the reason I got interested in it [blockchain], business units got together in their spare time. They
was I was in charge of product management for were only involved because they were intrinsically
payments, and I go back to the beginning of 2014, motivated by the complexity and novelty of
and […] people were talking about Bitcoin all of the blockchain technology:
time, and there was a curiosity about whether Bitcoin
is going to be the currency of the future. And so, The most important thing that we’ve used as an
somebody had to take a look at it from our enabler to try and cover that has been identifying the
management team, and since I was […] the person people in the organization who—and I wish I could
most associated with the technical part of it, I got put this more elegantly, but I promise you it’s true—
that job basically. So I looked into […] Bitcoin […], who will work on this in their spare time. They will
and basically came to the conclusion that it was not do this, because it’s intellectually interesting,
very interesting as a currency, but actually [it was because they like to know what’s happening on the
the] underlying technology [that was] quite cutting edge, and it is genuinely surprising the level
interesting.” [Head of Blockchain] of commitments that people will demonstrate and
how passionately they feel about it as a topic when
Following an external regulatory event, the same they are allowed to innovate in this way. [Head of
executive became aware of the potential concrete Debt Capital Markets]
applicability of blockchain technology for the
financial sector shortly thereafter. This illustrates the
importance of not only being aware of a radical 4.2. Transition from Discovery to Incubation
innovation, but also of sensing its relevance for the
own business: Evolving the opportunity the blockchain posed for
the bank further into a business proposition was
A few months later I became much more contingent upon acquiring funding to allow for
interested in it [blockchain] because of something experimentation. The firm could hence move on to
that happened from a regulatory perspective. And I the incubation phase:
was thinking, […] how do you figure out who the
client of a client is? And at that point I realized […]. So we basically got the COO to kind of write us a
Blockchain […] could actually work for that, because very small check to perform a small experiment
then I would have a ledger with […] complete inside the Innovation Labs, and we then had the
transparency. [Head of Blockchain] problem of who is going to work in it, because all of
us had fulltime jobs. [Head of Blockchain]
Later in 2014, the future Head of Blockchain met
a fellow executive interested in blockchain. They After securing the funding, the executives decided
jointly decided to further pursue blockchain. To to bring in the right experts to embark on
stimulate interest within the bank, they reached out experimentation. Bringing in the future users of the
both to senior executives of the firm, as well as to its radical innovation was thought be helpful to manage
other employees: resistance later on, in the transition from incubation
to acceleration:
And so we then immediately had this connection,
and I wrote a white paper in May of 2014 to try and As far as adoption by the organization, the earlier
get [bank name] management, particularly on the you bring in more of the business, the easier the
investment banking side, educated on what these journey in, because you're not having to now sell
things meant. By the end of that summer [the other your more formed solution to other parts of the bank

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and they don't feel as connected with it as you may clearinghouses, exchanges, trade reporting, and so
feel [Head of Technology Strategy] forth. [Head of Debt Capital Markets]

Even though the incubation phase would rely on The goal of mitigating potential resistance was
volunteers, akin to the discovery phase, the funding likewise behind the decision the select corporate
also allowed for acquiring additional external bonds as a use case:
capabilities. The bank decided to collaborate with
startups, not with established vendors, to achieve The other element was we needed to pick a use
significant cost savings: case […] our internal stakeholders […] considered
to be nonthreatening, right? That’s actually quite
But so, we looked for external vendors to support. important when we’re trying to do something
We have a lot of knowledge in-house. We had a lot of disruptive, right? [Head of Debt Capital Markets]
business and technology knowledge, and architecture
knowledge. What we didn't necessarily have anyone After the use case had been selected, the bank
who could, you know, code the theory in. […] we had implemented a blockchain-based representation of
all of the usual suspects on a big scale come in and corporate bonds:
then we got some startups. And it was intriguing, the
stark difference between the money that the startups Then we started to document the trade work flows
were looking for, which is effectively cover costs. The that made up the life cycle of those products and then
systematically larger company it was make a, you see how close we could get to replicating them, using
know, 60% margin. So we opted to go with the distributed ledgers. [Head of Debt Capital Markets]
startups. [Head of Innovation Lab]
Going forward, the managers assessed the
After acquiring the funding, as well as bringing viability of the use case using hypothesis-driven
both internal and external expertise together, having experimentation:
the right environment for innovation in place was the
last step before incubation began: And then, we executed the proof of concept with a
very clear hypothesis […] [we assessed] business
So we got the funding, got a whole bunch of outcomes and benefits within three months, which,
different experts together. The [innovation lab] had again, is quite a record. [Head of Innovation Lab]
the space to do it [to conduct experimentation], and
they had just been set up. So they had a whole 4.4. Transition from Incubation to
process, which helped us identify the right people to Acceleration
work with and how we should work with them. [Head
of Blockchain]
The bank was still in the incubation phase, as the
following quote illustrates, and was not moving
4.3. Incubation toward acceleration yet:

To allow for experimentation, the blockchain [...] We’re not yet at a point where it is [...] a
team designed use cases. Executives argued that the commercial model. [Head of Debt Capital Markets]
use cases allowed for running simulations and to
assess how a blockchain-based solution would However, executives already had a vision on how
perform compared to a legacy solution. In addition, to make the shift from the incubation to the
they tried to avoid overtly complex use cases, to acceleration phase. They argue that the radical
focus on blockchain itself: innovation will only be adopted if resistance can be
overcome and if the adoption proves valuable for the
What we needed was a simulation to be able to firm:
test our existing environment against a prospective
environment using a new technology, and we looked And so our, the lab engagement gets smaller and
to use cases where the complexity and the level of smaller and smaller, as we go through. And the
digitization in the existing environment was business […] [becomes more] involved in this to a
reasonably low, transaction volumes were point where they are doing the final adoption.
reasonably low, and that we didn’t need to worry They're deploying it. They're managing the
about externalities, and by that I mean environment. The technology is alive. It's providing

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the value to the organization. […] So this bit, the and to respond agile to [this] kind of issues. Now we
adoption, is the hardest part of it. […] You can do have technologies, which are kind of accelerating
lots of experimentation, but [the radical innovation this trend, like social media, or Blockchain, where
will not be adopted] unless there's a part of the the decentralization is kind of given more emphasis,
organization that wants to take this in, and unless it rather than the centralization right. [Head of
shows real value. [Head of Technology Strategy] Blockchain]

4.5. Acceleration 5. Discussion

As argued above, the bank had not entered the Our findings illustrate that firms engage with
acceleration phase yet. The bank was still at the blockchain along the lines of discovery, incubation,
incubation stage, conducting experiments and trying and acceleration. While blockchain is a rather new
to foster organizational learning. The phenomenon, our case shows that there are firms that
commercialization of blockchain and thus in their blockchain initiatives already moved beyond
acceleration was expected to happen in the next few discovery, are fully immersed in incubation, and are
years. beginning to consider acceleration. In line with the
theory we also find that the transitions between these
4.6. Fading Boundaries and Decentralization three phases need to be considered to successfully
engage with blockchain. Both the transition from
From an overall perspective, the efforts to engage discovery to incubation and from incubation to
with blockchain as a radical innovation led to fading acceleration are key to initiate the respective next
boundaries both intra- and inter-organizational. innovation phase. As our case illustrates, there are
Blockchain triggered cross-functional collaboration several key activities that are key to comprehensively
between different business units, such as technology, engage with blockchain from discovery to
legal, and sales units. In addition, vendors were also acceleration (see Figure 1).
heavily involved in the process. Hence, boundaries The discovery phase is initiated by the recognition
between organizations were also starting to of blockchain. However, recognizing the existence of
disappear: blockchain is not sufficient. It is also necessary to
realize that blockchain might be of relevance for the
So [there are] fading business boundaries. You business. Subsequently, this finding needs to be
are heavily [involved] with your partners and with communicated to stimulate interest within the firm.
your vendors, it’s not exactly clear anymore where This may result in a community that is intrinsically
you company ends, and where the […] vendor motivated to engage with blockchain. The members
company starts.” [Head of Blockchain] of this community can foster organizational learning
by educating themselves.
Moreover, this trend toward fading boundaries is The new insights gained in this process can be
even welcomed by the employees: used to initiate the transition from discovery to
incubation, which is marked by the acquisition of
Now people [from different business units] are financial resources. The incubation phase is reliant
coming together on a frequent basis, and nobody upon funding, since experimentation is usually
needs to be forced to go to any of those meetings. associated by significant financial cost. There are
Everyone goes, because they want to go. [Head of also organizational enablers for the incubation phase:
Debt Capital Markets] an innovation laboratory can offer the right
environment for experimentation. It can also serve as
In addition, the blockchain initiative was also an environment for collaboration of different
characterized by a high degree of decentralization: business units as well as external vendors, which is
crucial since diverse knowledge needs to be merged
Everybody is sort of informed, […] has an to successfully engage with blockchain. Bringing in
opinion. And then this [can be seen] in the light of the owners of business process early in the process
kind of knowledge work, as […] everybody is sort of can also be a tool to mitigate early on potential
an expert in his, or her own field, makes it more and resistance to blockchain.
more complicated to respond to run the company,

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 Figure 1. Blockchain Innovation Process (derived from [19])

The incubation phase is contingent upon having Blockchain initiatives are characterized by fading
use cases that can be subject to experimentation. The boundaries between the different actors that are
use cases should allow for running simulations so involved. Both on an intra-organizational as well as
that the effectiveness of blockchain-based solutions inter-organizational level, blockchain initiatives
can be compared to legacy solutions. Moreover, use require close collaboration since the necessary
cases should be simple enough to enable rapid competences are scarce and widely dispersed.
prototyping iterations, as well as focusing the impact Moreover, inter-organizational cooperation is key to
of blockchain technology itself. They should also be fully leverage the transaction-cost lowering potential
chosen in a fashion that minimizes potential of blockchain. Blockchain initiatives also exhibit a
resistance. After the use cases have been designed, high degree of decentralization, because they require
they can be implemented as a blockchain-based collaboration among a wide array of experts, from
solution. Subsequently, the solutions can be subject areas such as information technology and law.
to hypothesis-driven experimentation and can be
assessed against predefined performance indicators. 6. Implications and Limitations
To successfully facilitate the transition from
incubation to acceleration, the involvement of the Our paper has implications for both practitioners
innovation laboratory needs to be reduced, while the and researchers. For practitioners, we illustrate how
business process owners need to take over the banks can engage with blockchain in a timely and
blockchain-based solution. However, a blockchain- sustainable fashion. We illuminate how they can
based solution will only be adopted if resistance can build the competences that are necessary to rethink
be overcome and if it proves valuable for the firm. existing business models in the light of blockchain,
Most firms engaging with blockchain have not by embracing fading boundaries between different
entered the acceleration phase yet. However, the business units as well as different organizations. For
success of the commercialization of blockchain-based researchers, we analyze how incumbents can pursue
solutions is also contingent on the discovery and blockchain as a radical innovation, by addressing the
incubation phases, because these phases play an three phases of discovery, incubation, and
important role in blockchain-related organizational acceleration.
learning. Moreover, potential resistance to blockchain A limitation of our research is the rather limited
can be mitigated early on. number of interviews we conducted. Although we
had access to key decision makers and archival data,

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