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Innovation strategies and firm performance: Simple or complex strategies?


  • Sam Tavassoli
  • Charlie Karlsson


This paper analyzes the effect of various innovation strategies (ISs) of firms on their future performance, captured by labor productivity. Using five waves of the Community Innovation Survey in Sweden, we have traced the innovative behavior of firms over a decade, that is, from 2002 to 2012. We defined ISs to be either simple or complex (in various degrees). We call an IS a simple IS when firms engage in only one of the four types of Schumpeterian innovations, that is, product, process, marketing, or organizational, while a complex IS is when firms simultaneously engage in more than one type. The main findings indicate that those firms that choose and afford to have complex ISs are better off in terms of their future productivity in comparison with those firms that choose not to innovative (base group) and also in comparison with those firms that choose simple ISs. The results are mostly robust for those complex innovators that have a higher degree of complexity and also keep the balance between technological (product and process) and non-technological (organizational and marketing) innovations.

Suggested Citation

  • Sam Tavassoli & Charlie Karlsson, 2016. "Innovation strategies and firm performance: Simple or complex strategies?," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 25(7), pages 631-650, October.
  • Handle: RePEc:taf:ecinnt:v:25:y:2016:i:7:p:631-650
    DOI: 10.1080/10438599.2015.1108109

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    References listed on IDEAS

    1. Sofia Wixe, 2015. "The Impact of Spatial Externalities: Skills, Education and Plant Productivity," Regional Studies, Taylor & Francis Journals, vol. 49(12), pages 2053-2069, December.
    2. Jeroen de Jong & Ron Kemp & Mickey Folkeringa & Wubben, 2003. "Innovation and firm performance," Scales Research Reports H200207, EIM Business and Policy Research.
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    1. repec:wsi:ijimxx:v:22:y:2018:i:07:n:s1363919618500615 is not listed on IDEAS
    2. repec:sae:ausman:v:43:y:2018:i:4:p:632-652 is not listed on IDEAS
    3. Markus Grillitsch & Sam Tavassoli, 2018. "Cultural diversity and employment growth: Moderating effect of the recent global financial crisis," Australian Journal of Management, Australian School of Business, vol. 43(4), pages 632-652, November.
    4. Sam Tavassoli & Lars Bengtsson, 2018. "The Role Of Business Model Innovation For Product Innovation Performance," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 22(07), pages 1-28, October.

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