|
Abstract:
|
Innovation is a strategic necessity for the survival of today’s
organizations. The wide recognition of innovation as a competitive necessity,
particularly in dynamic market environments, makes it an evergreen domain
for research. This dissertation deals with innovation in small Information
Technology (IT) firms in India. The IT industry in India has been a
phenomenal success story of the last three decades, and is today facing a
crucial phase in its history characterized by the need for fundamental changes
in strategies, driven by innovation. This study, while motivated by the
dynamics of changing times, importantly addresses the research gap on
small firm innovation in Indian IT.This study addresses three main objectives: (a) drivers of innovation
in small IT firms in India (b) impact of innovation on firm performance (c)
variation in the extent of innovation adoption in small firms. Product and
process innovation were identified as the two most contextually relevant
types of innovation for small IT firms. The antecedents of innovation were
identified as Intellectual Capital, Creative Capability, Top Management
Support, Organization Learning Capability, Customer Involvement,
External Networking and Employee Involvement.Survey method was adopted for data collection and the study unit was
the firm. Surveys were conducted in 2014 across five South Indian cities.
Small firm was defined as one with 10-499 employees. Responses from 205
firms were chosen for analysis. Rigorous statistical analysis was done to
generate meaningful insights. The set of drivers of product innovation
(Intellectual Capital, Creative Capability, Top Management Support,
Customer Involvement, External Networking, and Employee Involvement)were different from that of process innovation (Creative Capability,
Organization Learning Capability, External Networking, and Employee
Involvement). Both product and process innovation had strong impact on
firm performance. It was found that firms that adopted a combination of
product innovation and process innovation had the highest levels of firm
performance. Product innovation and process innovation fully mediated the
relationship between all the seven antecedents and firm performance The results of this study have several important theoretical and
practical implications. To the best of the researcher’s knowledge, this is the
first time that an empirical study of firm level innovation of this kind has
been undertaken in India. A measurement model for product and process
innovation was developed, and the drivers of innovation were established
statistically. Customer Involvement, External Networking and Employee
Involvement are elements of Open Innovation, and all three had strong
association with product innovation, and the latter twohad strong association
with process innovation. The results showed that proclivity for Open
Innovation is healthy in the Indian context. Practical implications have been
outlined along how firms can organize themselves for innovation, the
human talent for innovation, the right culture for innovation and for open
innovation.
While some specific examples of possible future studies have been
recommended, the researcher believes that the study provides numerous
opportunities to further this line of enquiry. |