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The Effect of Organizational Innovation and Information and Communications Technology on Firm Performance

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Author Info
Surendra Gera ()
Wulong Gu ()

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Abstract

A key lesson from the U.S. literature on the impact of ICT on productivity is that ICT can only be effective if appropriate organizational structures are in place. This article by Surendra Gera of Industry Canada and Wulong Gu of Statistics Canada provides Canadian evidence to support this view. Using the Workplace and Employee Survey, the authors find evidence that firms that implement organizational changes and introduce ICT have a higher incidence of productivity improvement, increased sales and profits, and product and process innovation than firms that do not follow this path. Their findings suggest that to be successful firms typically need to adopt ICT as part of a system or cluster of mutualy reinforcing organizational approaches.

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Publisher Info
Article provided by Centre for the Study of Living Standards in its journal International Productivity Monitor.

Volume (Year): 9 (2004)
Issue (Month): (Fall)
Pages: 37-51
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Handle: RePEc:sls:ipmsls:v:9:y:2004:4

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Related research
Keywords: Productivity Growth; Productivity; Information and Communication Technologies; Information Technology; Firm-level; Firm Performance; Human Capital; Training; Management Practices; Organization; Organizational Change; Organizational Innovation; Process Innovation; Innovation;

Find related papers by JEL classification:
O32 - Economic Development, Technological Change, and Growth - - Technological Change - - - Management of Technological Innovation and R&D
J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
D24 - Microeconomics - - Production and Organizations - - - Production; Capital and Total Factor Productivity; Capacity
L80 - Industrial Organization - - Industry Studies: Services - - - General
M53 - Business Administration and Business Economics; Marketing; Accounting - - Personnel Economics - - - Training
M12 - Business Administration and Business Economics; Marketing; Accounting - - Business Administration - - - Personnel Management; Executive Compensation
O51 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - U.S.; Canada

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

  1. Sandra E. Black & Lisa M. Lynch, 2000. "What's Driving the New Economy: The Benefits of Workplace Innovation," NBER Working Papers 7479, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  2. Sabourin, David & Baldwin, John R. & Smith, David, 2003. "Impact of Advanced Technology Use on Firm Performance in the Canadian Food Processing Sector," Economic Analysis (EA) Research Paper Series 2003012e, Statistics Canada, Analytical Studies Branch. [Downloadable!]
  3. Ichniowski, Casey & Shaw, Kathryn & Prennushi, Giovanna, 1997. "The Effects of Human Resource Management Practices on Productivity: A Study of Steel Finishing Lines," American Economic Review, American Economic Association, vol. 87(3), pages 291-313, June. [Downloadable!] (restricted)
  4. Brynjolfsson, Erik. & Hitt, Lorin M., 1995. "Paradox lost? : firm-level evidence on the returns to information systems spending," Working papers 3786-95., Massachusetts Institute of Technology (MIT), Sloan School of Management. [Downloadable!]
  5. Easton, George S & Jarrell, Sherry L, 1998. "The Effects of Total Quality Management on Corporate Performance: An Empirical Investigation," Journal of Business, University of Chicago Press, vol. 71(2), pages 253-307, April. [Downloadable!] (restricted)
  6. Timothy F. Bresnahan & Erik Brynjolfsson & Lorin M. Hitt, 2002. "Information Technology, Workplace Organization, And The Demand For Skilled Labor: Firm-Level Evidence," The Quarterly Journal of Economics, MIT Press, vol. 117(1), pages 339-376, February. [Downloadable!] (restricted)
    Other versions:
  7. Surendra Gera & Wulong Gu & Zhengxi Lin, 2001. "Technology and the demand for skills in Canada: an industry-level analysis," Canadian Journal of Economics, Canadian Economics Association, vol. 34(1), pages 132-148, February. [Downloadable!] (restricted)
  8. Sandra E. Black & Lisa M. Lynch, 2001. "How To Compete: The Impact Of Workplace Practices And Information Technology On Productivity," The Review of Economics and Statistics, MIT Press, vol. 83(3), pages 434-445, August. [Downloadable!] (restricted)
    Other versions:
  9. Milgrom, Paul & Roberts, John, 1990. "The Economics of Modern Manufacturing: Technology, Strategy, and Organization," American Economic Review, American Economic Association, vol. 80(3), pages 511-28, June. [Downloadable!] (restricted)
  10. Frank R. Lichtenberg, 1996. "The Output Contributions of Computer Equipment and Personnel: A Firm- Level Analysis," NBER Working Papers 4540, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  11. Peter Cappelli & David Neumark, 2001. "Do "high-performance" work practices improve establishment-level outcomes?," Industrial and Labor Relations Review, ILR Review, ILR School, Cornell University, vol. 54(4), pages 737-775, July.
    Other versions:
  12. Erik Brynjolfsson & Lorin M. Hitt, 2000. "Beyond Computation: Information Technology, Organizational Transformation and Business Performance," Journal of Economic Perspectives, American Economic Association, vol. 14(4), pages 23-48, Fall. [Downloadable!] (restricted)
  13. Erik Brynjolfsson & Lorin Hitt, 1997. "Information Technology as a Factor of Production: The Role of Differences Among Firms," Working Paper Series 201, MIT Center for Coordination Science. [Downloadable!]
    Other versions:
  14. Morris M. Kleiner & Marvin L. Bouillon, 1988. "Providing business information to production workers: Correlates of compensation and profitability," Industrial and Labor Relations Review, ILR Review, ILR School, Cornell University, vol. 41(4), pages 605-617, July.
  15. Lavoie, Marie & Roy, Richard & Therrien, Pierre, 2003. "A growing trend toward knowledge work in Canada," Research Policy, Elsevier, vol. 32(5), pages 827-844, May. [Downloadable!] (restricted)
  16. Lisa M. Lynch & Sandra E. Black, 1995. "Beyond the Incidence of Training: Evidence from a National Employers Survey," NBER Working Papers 5231, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Jean-Francois Arsenault & Andrew Sharpe, 2008. "An Analysis of the Causes of Weak Labour Productivity Growth in Canada since 2000," International Productivity Monitor, Centre for the Study of Living Standards, vol. 16, pages 14-39, Spring. [Downloadable!]
  2. Someshwar Rao & Andrew Sharpe & Jeremy Smith, 2005. "An Analysis of the Labour Productivity Growth Slowdown in Canada since 2000," International Productivity Monitor, Centre for the Study of Living Standards, vol. 10, pages 3-23, Spring. [Downloadable!]
  3. Petr Hanel, 2007. "Productivity and innovation: an overview of the issues," Cahiers de recherche 07-22, Departement d'Economique de la Faculte d'administration à l'Universite de Sherbrooke. [Downloadable!]
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