Innovation and Business Performance: a Literature Review
INNOVATION AND BUSINESS PERFORMANCE: A LITERATURE REVIEW
Commissioned by GO-ER
Andy Neely Jasper Hii The Judge Institute of Management Studies University of Cambridge 15 th Jan 1998
CONTENTS
EXECUTIVE SUMMARY 1 INTRODUCTION 2 INNOVATION 2.1 Why innovate? 2.2 Innovation and competitiveness 2.3 Barriers to innovation 2.4 Summary 3 INNOVATION MANAGEMENT 3.1 What is innovation? 3.1.1 Diffusion of innovation 3.2 Models of innovation 3.2.1 First generation: technology-push 3.2.2 Second generation: market-pull 3.2.3 Third generation: coupling model 3.2.4 Fourth generation: integrated model 3.2.5 Fifth generation: systems integration and networking 3.3 Levels of analysis 3.3.1 Firm-level 3.3.2 Regional-level 3.3.3 National-level 3.4 The constructs ‘innovativeness’ and ‘innovative capacity’ 3.4.1 What is innovativeness? 3.4.1.1 Individual-level innovativeness 3.4.1.2 Firm-level innovativeness 3.4.2 What is innovative capacity? 3.5 Summary
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CONTENTS
4 INNOVATION AND PERFORMANCE 4.1 The link between innovation and business performance 4.1.1 Innovation transforms internal capabilities of firm 4.1.2 Innovation is necessary but not sufficient for business performance 4.2 Empirical evidence showing the link 4.2.1 Firm-level 4.2.2 Regional-level 4.3 Measurement of innovative activities 4.3.1 Common measures 4.3.2 Difficulty of measuring innovative activities 4.3.3 Innovation performance measurement framework 4.3.4 Importance of measuring innovative activities 4.4 Means of mapping innovation 4.4.1 Patent analysis 4.4.2 Innovation surveys 4.4.2.1 Object approach 4.4.2.2 Subject approach 4.4.2.3 Recent developments 4.5 Summary 5 CONCLUSIONS 5.1 Summary of review 5.2 Potential research avenues REFERENCES
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EXECUTIVE SUMMARY
Innovation has been cited as one of the key factors that affects competitiveness.
Commissioned by GO-ER
Andy Neely Jasper Hii The Judge Institute of Management Studies University of Cambridge 15 th Jan 1998
CONTENTS
EXECUTIVE SUMMARY 1 INTRODUCTION 2 INNOVATION 2.1 Why innovate? 2.2 Innovation and competitiveness 2.3 Barriers to innovation 2.4 Summary 3 INNOVATION MANAGEMENT 3.1 What is innovation? 3.1.1 Diffusion of innovation 3.2 Models of innovation 3.2.1 First generation: technology-push 3.2.2 Second generation: market-pull 3.2.3 Third generation: coupling model 3.2.4 Fourth generation: integrated model 3.2.5 Fifth generation: systems integration and networking 3.3 Levels of analysis 3.3.1 Firm-level 3.3.2 Regional-level 3.3.3 National-level 3.4 The constructs ‘innovativeness’ and ‘innovative capacity’ 3.4.1 What is innovativeness? 3.4.1.1 Individual-level innovativeness 3.4.1.2 Firm-level innovativeness 3.4.2 What is innovative capacity? 3.5 Summary
iii 1 3 3 4 5 6 7 8 10 11 11 12 13 13 14 15 15 17 18 20 20 20 21 21 25
i
CONTENTS
4 INNOVATION AND PERFORMANCE 4.1 The link between innovation and business performance 4.1.1 Innovation transforms internal capabilities of firm 4.1.2 Innovation is necessary but not sufficient for business performance 4.2 Empirical evidence showing the link 4.2.1 Firm-level 4.2.2 Regional-level 4.3 Measurement of innovative activities 4.3.1 Common measures 4.3.2 Difficulty of measuring innovative activities 4.3.3 Innovation performance measurement framework 4.3.4 Importance of measuring innovative activities 4.4 Means of mapping innovation 4.4.1 Patent analysis 4.4.2 Innovation surveys 4.4.2.1 Object approach 4.4.2.2 Subject approach 4.4.2.3 Recent developments 4.5 Summary 5 CONCLUSIONS 5.1 Summary of review 5.2 Potential research avenues REFERENCES
28 28 28 29 29 29 31 34 34 35 36 38 39 39 40 40 41 42 43 45 45 45 49
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EXECUTIVE SUMMARY
Innovation has been cited as one of the key factors that affects competitiveness.
References: Cooke and Morgan (1994) Wiig and Wood (1997) Camagni (1991) Innovation networks.