The economic performance of innovations in a collaborative setting: the case of KIBS firms

Collaborative innovation literature shows that collaborating with clients enhances the innovation performance of firms particularly as regard the development of highly new products. In this setting, are highly new products the innovation category that drives the most firmÕs performance? This is a relevant research question in the innovation literature since it warns about the risks and limits of highly new products but has not considered the firmÕs performance implications of different categories of innovations developed by collaborating with clients. In this paper we consider different categories of innovation, product and process innovations new to the industry and new to the firm respectively, and develop original hypotheses about their implications over firmÕs performance. We develop and test our hypotheses on a sample of 99 Italian KIBS firms. We focus on KIBS firms since they are used to customize their services and collaborate with clients during the development of new services. Results support the idea that highly innovative product innovations are more strongly associated with a KIBS firmÕs growth, while weakly innovative process innovations are more strongly associated with a KIBS firmÕs productivity, but only in small firms. Theoretical and managerial implications for collaborative innovations settings are drawn.