Complementarities between organisational strategies and innovation
The purpose of this paper is to determine whether organizational strategies in various manufacturing industries are complementary with innovation. In particular, our interest is to discover which organizational strategies are complementary with major innovations (world-first and Canada-first). Knowledge of complementarity should pave the way for creating sustainable competitive advantage because the use of a complex strategy may be difficult to imitate. In other words, competitive advantage increases as the complexity of the strategy increases (i.e. because the number of strategy combinations follows a power law), which acts as a barrier to potential imitators (Rivkin, J.W. (2000) Imitation of Complex Strategies. Management Science, 46(6), 824-844.). Because of the static nature of our results (productivity and profit are for 1997), their interpretation can only be tentative. Thus, our research is really a first step along the road to understanding the (potential) importance of complementarities among firm strategies. Caveats aside, managers may want to compare their own firm's emphasis on particular strategies against what is empirically determined to be complementary with innovation and high-performance within their industry. The frequency of complementary pairs that involve innovation range from 40 to 50% depending on whether we are talking about profit, productivity, or strategies. This result is important—as it means that innovation outcomes are statistically significant for both increased productivity and increased profit. Furthermore, innovation was found to be complementary with many organizational strategies. The complementary strategies across industries were quite different, but this was expected to occur.
Volume (Year): 15 (2006)
Issue (Month): 3 ()
|Contact details of provider:|| Web page: http://www.tandfonline.com/GEIN20|
|Order Information:||Web: http://www.tandfonline.com/pricing/journal/GEIN20|
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.:
- Argyres, Nicholas S., 1995. "Technology strategy, governance structure and interdivisional coordination," Journal of Economic Behavior & Organization, Elsevier, vol. 28(3), pages 337-358, December.
- Brian Cozzarin, 2004. "Innovation quality and manufacturing firms' performance in Canada," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 13(3), pages 199-216.
- Rinaldo Evangelista, 2000. "Sectoral Patterns Of Technological Change In Services," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 9(3), pages 183-222.
- Chenhall, R. H. & Langfield-Smith, K., 1998. "The relationship between strategic priorities, management techniques and management accounting: an empirical investigation using a systems approach," Accounting, Organizations and Society, Elsevier, vol. 23(3), pages 243-264, April.
- 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.
- Bruno Crepon & Emmanuel Duguet & Jacques Mairesse, 1998.
"Research, Innovation, and Productivity: An Econometric Analysis at the Firm Level,"
NBER Working Papers
6696, National Bureau of Economic Research, Inc.
- Bruno Crepon & Emmanuel Duguet & Jacques Mairesse, 1998. "Research, Innovation And Productivity: An Econometric Analysis At The Firm Level," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 7(2), pages 115-158.
- Bruno Crépon & Emmanuel Duguet & Jacques Mairesse, 1998. "Research, Innovation and Productivity : An Econometric Analysis at the Firm Level," Working Papers 98-33, Centre de Recherche en Economie et Statistique.
- Evangelista, Rinaldo & Perani, Giulio & Rapiti, Fabio & Archibugi, Daniele, 1997. "Nature and impact of innovation in manufacturing industry: some evidence from the Italian innovation survey," Research Policy, Elsevier, vol. 26(4-5), pages 521-536, December.
- Milgrom, Paul & Roberts, John, 1995. "Complementarities and fit strategy, structure, and organizational change in manufacturing," Journal of Accounting and Economics, Elsevier, vol. 19(2-3), pages 179-208, April.
- Jacques Mairesse & Pierre Mohnen, 2002. "Accounting for Innovation and Measuring Innovativeness: An Illustrative Framework and an Application," American Economic Review, American Economic Association, vol. 92(2), pages 226-230, May.
- Milgrom, Paul & Roberts, John, 1995. "The Economics of Modern Manufacturing: Reply," American Economic Review, American Economic Association, vol. 85(4), pages 997-99, September.
- Karel O. Cool & Dan Schendel, 1987. "Strategic Group Formation and Performance: The Case of the U.S. Pharmaceutical Industry, 1963--1982," Management Science, INFORMS, vol. 33(9), pages 1102-1124, September.
When requesting a correction, please mention this item's handle: RePEc:taf:ecinnt:v:15:y:2006:i:3:p:195-217. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Michael McNulty)
If references are entirely missing, you can add them using this form.