Complementarity in product, process, and organizational innovation decisions: evidence from European firms

Abstract

This work uses a sample of firm‐level data from seven EU countries to explore the possible roles of simultaneity and heterogeneity in determining firms' decisions to engage in three types of innovation. Process, product, and organizational innovations are considered jointly, by applying a multivariate probit specification. The results support the hypothesis that the three innovation decisions are interdependent. This has straightforward implications for the practice of R&D managers. In order to gain advantages from an innovation, innovation managers need to jointly exploit these different types of innovation activities and their potential synergies. Given that the innovative firms in the sample, desire additional credit which actually they do not obtain, R&D managers should also be concerned with the financing sources firms have access to. Finally, from the analysis it also emerges that public support boost all the three forms of innovation.

Is the corporate social responsibility–innovation link homogeneous?: Looking for sustainable innovation in the Spanish context

“…Product innovation consists of the introduction into the market of new or significantly improved goods or services with respect to basic features, technical specifications, embedded software or intangible other components, desired purposes, or benefits (OECD, 2005). They are "the result of searching for technological competitiveness and are market-oriented innovations" (Carboni & Russu, 2018;p. 202).…”

“…202). Process innovations are the implementation of new or significantly improved production processes and marketing efficiency, distribution methods, or support activities for goods and services (Carboni & Russu, 2018;OECD, 2005). Finally, an organizational innovation is the implementation of new organizational methods in the internal operation of a company (including knowledge management), new workplace organization or external relations that have not been previously used by the firm (OECD, 2005) and that are normally linked to new managerial and working practices (Damanpour, 1987).…”

How to leverage the impact of R&D on product innovation? The moderating effect of management innovation

“…Product innovations are new products or services introduced to the market to serve market needs or developed to meet the needs of external customers (Jansen et al, ; Carboni and Russu, ). These innovations, which are aimed at new markets and customers, typically incorporate new knowledge that is very different in nature from most of its knowledge base (Benner and Tushman, ; Danneels, ).…”

“…Building on literature relating to the socio‐technical system theory (Trist, ), we would expect changes in a firm’s technological system (technological innovation) to be accompanied by changes in its social system (social innovation) designed to improve firm outcomes (e.g., Damanpour and Aravind, ; Carboni and Russu, ). Both contribute to the innovation process in different ways (Daft, ; Kimberly and Evanisko, ).…”

“…In addition, the precise nature of the combined effect of technological innovation and management innovation is still rather under‐researched empirically (Azar and Ciabuschi, ; Magnier‐Watanabe and Benton, ; Khosravi et al, ), especially with regard to nonlinear effects. The few scholars (e.g., Krzeminska and Eckert, ; Carboni and Russu, ; Hervas‐Oliver et al, ) who have assessed empirically the combined effect of these two types of innovation have typically looked at the impact on firm performance and used dichotomous scales to measure both types. Using such binary adopt/do‐not‐adopt measures provides rather limited information on the differing degrees of intensity with which R&D and management innovation are introduced over a certain timespan.…”