Determinants of Successful Organisational Innovation: a Review of Current Research

The purpose of this report is to examine the topic of organisational innovation. This is a vast multi-disciplinary area of research and is a relatively new area of inquiry. The literature reviewed is empirical, management-oriented research from an organisationa l perspective and is sourced from peer-reviewed journals. The objectives of the review are: 1) to understand the current state of research through analysis and synthesis of academic research papers; 2) to determine what the current research identifies as the main determinants of successful innovation; and 3) to determine what research evidence there is for positive effects on competitiveness and profitability from the development of innovation. The study utilised the method of a research review. Research articles (20) were collected from relevant academic journals and are quantitatively and qualitatively analysed. It was found that research in this area is in its infancy. Most researchers agree on a definition of innovation and, though research is fragmented from different perspectives, efforts are being made towards a cumulative body of research and a general theory. Systems theory provides a convenient and popular theoretical framework, however, new approaches to theory such as chaos theory and the fractal paradigm are providing new insights. Of the twenty research articles reviewed, most focussed on organisational innovation and the manufacturing sector and used the method of surveys and interviews. In addition, only two of the studies focussed on Australian firms. A number of common innovation determinants were identified from the research at a macro organisational level. The three main ones were management support for an innovative culture, a customer/market focus, and a high level of internal and external communication/networking. The identified determinants are important factors that all managers need to address, but the importance of each factor will be weighted according to the context of the organisation and its unique contingency variables. Innovation is a management process and its development must come from the top down. It was surprising to find little research on the effect of innovation interventions on Determinants of Successful Organisational Innovation Read 96 organisational performance, however, this is probably due to innovation being a new research area and the difficulties associated with measuring innovation. It has been found though, in the few identified studies, that there is a positive relationship between an organisation’s innovativeness and its performance. Recommendations include working towards a cumulative body of research by defining innovation, stating the dimensions studied, and considering an holistic view. Managers need to be aware that innovation is a managementinduced process, realise the determinants identified are dependent on the firm’s context, and give more attention to performance measurement to gauge the contribution of the innovation interventions.