Marketing and Organisational Innovations in Entrepreneurial Innovation Processes and their Relation to Market Structure and Firm Characteristics

This paper analyses the influence of marketing and organisational changes on the innovation process. Using data from the German Community Innovation Survey (CIS) 2007, two questions are investigated. Firstly, do certain firm and market characteristics trigger certain innovation strategies? This allows the examination of whether product/ process (PP) and marketing/ organisational (MO) innovations are more likely to occur in monopolistic or competitive markets, whether there is an “innovationmaximising” degree of competition, but also how important human capital is for the implementation of specific innovation strategies. Secondly, are MO innovations complementary to PP innovations or do they substitute them? Our results suggest that firms choose broad innovation strategies, if they have high internal resources and if they have intermediate market power. We also find that marketing innovations make product and process innovations more successful on the market (product innovations) and in terms cost reductions (process innovations), while there is no positive apparent effect of organisational innovations and product and process innovations. 1 Fraunhofer Institute for Systems and Innovation Research, Breslauer Straße 48, 76139 Karlsruhe, Germany, email: [email protected], telephone: +49-721-6809-357, fax: +49-7216809-260 2 Also: Berlin University of Technology, Chair of Innovation Economics