IDEAS home Printed from https://ideas.repec.org/p/par/dipeco/2020-ep01.html
   My bibliography  Save this paper

Organizational Drivers of Innovation: The Role of Workforce Agility

Author

Listed:
  • F. Landini
  • C. Franco

Abstract

The interplay between organization practices and innovation is highly relevant in modern business. This paper analyzes whether a specific organizational dimension, namely workforce agility, affects innovative performance. We rationalize this effect within an organizational economics perspective that stresses the role of behavioral motives and skill variety in the innovation process. In particular, we distinguish the contribution of two components: time agility and task agility. Using a sample of nearly 20000 private-sector workplaces in 32 countries, we report conditional correlations between workforce agility and innovation that are consistent with our framework. Establishments with higher workforce agility are more likely to innovate. This relationship holds also when we consider different types of innovation and we distinguish between time and task agility. The analysis of managers’ perceptions about internal working climate and information exchange activities suggest that this effect is likely be driven by the fact that workforce agility improves work motivation and knowledge transmission at the workplace level, favouring innovation. Managerial and policy implications are discussed.

Suggested Citation

  • F. Landini & C. Franco, 2020. "Organizational Drivers of Innovation: The Role of Workforce Agility," Economics Department Working Papers 2020-EP01, Department of Economics, Parma University (Italy).
  • Handle: RePEc:par:dipeco:2020-ep01
    as

    Download full text from publisher

    File URL: http://www.swrwebeco.unipr.it/RePEc/pdf/I_2020-01.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Eric von Hippel, 1986. "Lead Users: A Source of Novel Product Concepts," Management Science, INFORMS, vol. 32(7), pages 791-805, July.
    2. John T. Addison & Paulino Teixeira & Katalin Evers & Lutz Bellmann, 2017. "Collective Bargaining and Innovation in Germany: A Case of Cooperative Industrial Relations?," Industrial Relations: A Journal of Economy and Society, Wiley Blackwell, vol. 56(1), pages 73-121, January.
    3. Nicholas Bloom & John Van Reenen, 2007. "Measuring and Explaining Management Practices Across Firms and Countries," The Quarterly Journal of Economics, Oxford University Press, vol. 122(4), pages 1351-1408.
    4. Nicholas Bloom & James Liang & John Roberts & Zhichun Jenny Ying, 2015. "Does Working from Home Work? Evidence from a Chinese Experiment," The Quarterly Journal of Economics, Oxford University Press, vol. 130(1), pages 165-218.
    5. Hoxha, Sergei & Kleinknecht, Alfred, 2020. "When labour market rigidities are useful for innovation. Evidence from German IAB firm-level data," Research Policy, Elsevier, vol. 49(7).
    6. G. M.P. Swann, 2009. "The Economics of Innovation," Books, Edward Elgar Publishing, number 13211.
    7. Pablo D'Este & Simona Iammarino, 2010. "The spatial profile of university‐business research partnerships," Papers in Regional Science, Wiley Blackwell, vol. 89(2), pages 335-350, June.
    8. Metin M. Cosgel & Thomas J. Miceli, 1999. "Job Rotation: Cost, Benefits, and Stylized Facts," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 155(2), pages 301-301, June.
    9. Christian Rammer & Dirk Czarnitzki & Alfred Spielkamp, 2009. "Innovation success of non-R&D-performers: substituting technology by management in SMEs," Small Business Economics, Springer, vol. 33(1), pages 35-58, June.
    10. Hagedoorn, John, 2002. "Inter-firm R&D partnerships: an overview of major trends and patterns since 1960," Research Policy, Elsevier, vol. 31(4), pages 477-492, May.
    11. Kornelius Kraft & Jörg Stank & Ralf Dewenter, 2011. "Co-determination and innovation," Cambridge Journal of Economics, Oxford University Press, vol. 35(1), pages 145-172.
    12. Rangus, Kaja & Slavec, Alenka, 2017. "The interplay of decentralization, employee involvement and absorptive capacity on firms' innovation and business performance," Technological Forecasting and Social Change, Elsevier, vol. 120(C), pages 195-203.
    13. Jaime Ortega, 2001. "Job Rotation as a Learning Mechanism," Management Science, INFORMS, vol. 47(10), pages 1361-1370, October.
    14. Sebastian Kube & Michel Andre Marechal & Clemens Puppe, 2012. "The Currency of Reciprocity: Gift Exchange in the Workplace," American Economic Review, American Economic Association, vol. 102(4), pages 1644-1662, June.
    15. Wachsen, Eva & Blind, Knut, 2016. "More labour market flexibility for more innovation? Evidence from employer–employee linked micro data," Research Policy, Elsevier, vol. 45(5), pages 941-950.
    16. D'Este, P. & Patel, P., 2007. "University-industry linkages in the UK: What are the factors underlying the variety of interactions with industry?," Research Policy, Elsevier, vol. 36(9), pages 1295-1313, November.
    17. Belloc, Filippo, 2019. "Institutional complementarities between labour laws and innovation," Journal of Institutional Economics, Cambridge University Press, vol. 15(2), pages 235-258, April.
    18. Erling Barth & Bernt Bratsberg & Torbjørn Hægeland & Oddbjørn Raaum, 2008. "Who pays for performance?," International Journal of Manpower, Emerald Group Publishing, vol. 29(1), pages 8-29, March.
    19. Holmstrom, Bengt & Milgrom, Paul, 1987. "Aggregation and Linearity in the Provision of Intertemporal Incentives," Econometrica, Econometric Society, vol. 55(2), pages 303-328, March.
    20. Nicholas Bloom & John Van Reenen, 2010. "Why Do Management Practices Differ across Firms and Countries?," Journal of Economic Perspectives, American Economic Association, vol. 24(1), pages 203-224, Winter.
    21. Michael Beckmann, 2016. "Working-time autonomy as a management practice," IZA World of Labor, Institute of Labor Economics (IZA), pages 230-230, January.
    22. Fehr, Ernst & Kirchler, Erich & Weichbold, Andreas & Gächter, Simon, 1998. "When Social Norms Overpower Competition: Gift Exchange in Experimental Labor Markets," Journal of Labor Economics, University of Chicago Press, vol. 16(2), pages 324-351, April.
    23. Santamara, Llus & Nieto, Mara Jess & Barge-Gil, Andrs, 2009. "Beyond formal R&D: Taking advantage of other sources of innovation in low- and medium-technology industries," Research Policy, Elsevier, vol. 38(3), pages 507-517, April.
    24. Nicolai J. Foss, 2003. "Bounded rationality and tacit knowledge in the organizational capabilities approach: an assessment and a re-evaluation," Industrial and Corporate Change, Oxford University Press, vol. 12(2), pages 185-201, April.
    25. Cegarra-Navarro, Juan-Gabriel & Soto-Acosta, Pedro & Wensley, Anthony K.P., 2016. "Structured knowledge processes and firm performance: The role of organizational agility," Journal of Business Research, Elsevier, vol. 69(5), pages 1544-1549.
    26. Guy Michaels & Ashwini Natraj & John Van Reenen, 2010. "Has ICT Polarized Skill Demand? Evidence from Eleven Countries over 25 years," NBER Working Papers 16138, National Bureau of Economic Research, Inc.
    27. Keld Laursen & Nicolai J. Foss, 2003. "New human resource management practices, complementarities and the impact on innovation performance," Cambridge Journal of Economics, Oxford University Press, vol. 27(2), pages 243-263, March.
    28. Jonathon N. Cummings, 2004. "Work Groups, Structural Diversity, and Knowledge Sharing in a Global Organization," Management Science, INFORMS, vol. 50(3), pages 352-364, March.
    29. Nicolai J. Foss & Keld Laursen & Torben Pedersen, 2011. "Linking Customer Interaction and Innovation: The Mediating Role of New Organizational Practices," Organization Science, INFORMS, vol. 22(4), pages 980-999, August.
    30. Haneda, Shoko & Ito, Keiko, 2018. "Organizational and human resource management and innovation: Which management practices are linked to product and/or process innovation?," Research Policy, Elsevier, vol. 47(1), pages 194-208.
    31. Hsiu-Fen Lin, 2007. "Knowledge sharing and firm innovation capability: an empirical study," International Journal of Manpower, Emerald Group Publishing, vol. 28(1), pages 315 - 332, April.
    32. Samina Karim & Aseem Kaul, 2015. "Structural Recombination and Innovation: Unlocking Intraorganizational Knowledge Synergy Through Structural Change," Organization Science, INFORMS, vol. 26(2), pages 439-455, April.
    33. David J. Teece & Gary Pisano & Amy Shuen, 1997. "Dynamic capabilities and strategic management," Strategic Management Journal, Wiley Blackwell, vol. 18(7), pages 509-533, August.
    34. Michael C. Jensen & William H. Heckling, 1995. "Specific And General Knowledge, And Organizational Structure," Journal of Applied Corporate Finance, Morgan Stanley, vol. 8(2), pages 4-18, June.
    35. Richardson, G B, 1972. "The Organisation of Industry," Economic Journal, Royal Economic Society, vol. 82(327), pages 883-896, September.
    36. Guy Michaels & Ashwini Natraj & John Van Reenen, 2014. "Has ICT Polarized Skill Demand? Evidence from Eleven Countries over Twenty-Five Years," The Review of Economics and Statistics, MIT Press, vol. 96(1), pages 60-77, March.
    37. Carmeli, Abraham & Dothan, Ari, 2017. "Generative work relationships as a source of direct and indirect learning from experiences of failure: Implications for innovation agility and product innovation," Technological Forecasting and Social Change, Elsevier, vol. 119(C), pages 27-38.
    38. Hsiu-Fen Lin, 2007. "Knowledge sharing and firm innovation capability: an empirical study," International Journal of Manpower, Emerald Group Publishing, vol. 28(3/4), pages 315-332, June.
    39. Grazia D. Santangelo & Paolo Pini, 2011. "New HRM Practices and Exploitative Innovation: A Shopfloor Level Analysis," Industry and Innovation, Taylor & Francis Journals, vol. 18(6), pages 611-630, August.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Franco, Chiara & Landini, Fabio, 2022. "Organizational drivers of innovation: The role of workforce agility," Research Policy, Elsevier, vol. 51(2).
    2. Belloc, Filippo & Burdin, Gabriel & Landini, Fabio, 2020. "Corporate Hierarchies under Employee Representation," IZA Discussion Papers 13717, Institute of Labor Economics (IZA).
    3. Sun, Xiuli & Li, Haizheng & Ghosal, Vivek, 2020. "Firm-level human capital and innovation: Evidence from China," China Economic Review, Elsevier, vol. 59(C).
    4. Hervas-Oliver, Jose-Luis & Sempere-Ripoll, Francisca & Boronat-Moll, Carles, 2012. "Process innovation objectives and management complementarities: patterns, drivers, co-adoption and performance effects," MERIT Working Papers 2012-051, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    5. Spyros Arvanitis & Florian Seliger & Tobias Stucki, 2013. "The Relative Importance of Human Resource Management Practices for a Firm's Innovation Performance," KOF Working papers 13-341, KOF Swiss Economic Institute, ETH Zurich.
    6. Wadho, Waqar & Chaudhry, Azam, 2020. "Innovation Strategies and Productivity Growth in Developing Countries: Evidence from Pakistan," GLO Discussion Paper Series 466, Global Labor Organization (GLO).
    7. Vivarelli, Marco, 2018. "Globalisation, structural change and innovation in emerging economies: The impact on employment and skills," MERIT Working Papers 2018-037, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    8. Bhattacharya, Sourav & Chakraborty, Pavel & Chatterjee, Chirantan, 2022. "Intellectual property regimes and wage inequality," Journal of Development Economics, Elsevier, vol. 154(C).
    9. Aistleitner, Matthias & Gräbner, Claudius & Hornykewycz, Anna, 2021. "Theory and empirics of capability accumulation: Implications for macroeconomic modeling," Research Policy, Elsevier, vol. 50(6).
    10. Krammer, Sorin M.S., 2022. "Navigating the New Normal: Which firms have adapted better to the COVID-19 disruption?," Technovation, Elsevier, vol. 110(C).
    11. Burdin, Gabriel & Pérotin, Virginie, 2019. "Employee representation and flexible working time," Labour Economics, Elsevier, vol. 61(C).
    12. Behrens, Vanessa & Berger, Marius & Hud, Martin & Hünermund, Paul & Iferd, Younes & Peters, Bettina & Rammer, Christian & Schubert, Torben, 2017. "Innovation activities of firms in Germany - Results of the German CIS 2012 and 2014: Background report on the surveys of the Mannheim Innovation Panel Conducted in the Years 2013 to 2016," ZEW Dokumentationen 17-04, ZEW - Leibniz Centre for European Economic Research.
    13. Ganter, Alois & Hecker, Achim, 2014. "Configurational paths to organizational innovation: qualitative comparative analyses of antecedents and contingencies," Journal of Business Research, Elsevier, vol. 67(6), pages 1285-1292.
    14. Singh, Sanjay Kumar & Gupta, Shivam & Busso, Donatella & Kamboj, Shampy, 2021. "Top management knowledge value, knowledge sharing practices, open innovation and organizational performance," Journal of Business Research, Elsevier, vol. 128(C), pages 788-798.
    15. Owusu Sarpong & Peter Teirlinck, 2018. "The influence of functional and geographical diversity in collaboration on product innovation performance in SMEs," The Journal of Technology Transfer, Springer, vol. 43(6), pages 1667-1695, December.
    16. Chakraborty, Pavel & Raveh, Ohad, 2018. "Input-trade liberalization and the demand for managers: Evidence from India," Journal of International Economics, Elsevier, vol. 111(C), pages 159-176.
    17. Jose-Luis Hervas-Oliver & Francisca Ripoll-Sempere & Carles Boronat Moll, 2016. "Does management innovation pay-off in SMEs? Empirical evidence for Spanish SMEs," Small Business Economics, Springer, vol. 47(2), pages 507-533, August.
    18. Oleg Sidorkin, 2015. "The Impact of Management Quality on Innovation Performance of Firms in Emerging Countries," CERGE-EI Working Papers wp555, The Center for Economic Research and Graduate Education - Economics Institute, Prague.
    19. Damiani, Mirella & Pompei, Fabrizio & Kleinknecht, Alfred, 2020. "When robots do (not) enhance job quality: The role of innovation regimes," MPRA Paper 103059, University Library of Munich, Germany.
    20. Krammer, Sorin, 2021. "Navigating The New Normal: Which Firms Have Adapted Better To The Covid-19 Disruption?," MPRA Paper 109485, University Library of Munich, Germany.

    More about this item

    Keywords

    workforce agility; task agility; time agility; innovation;
    All these keywords.

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:par:dipeco:2020-ep01. 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: . General contact details of provider: https://edirc.repec.org/data/feparit.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Andrea Lasagni (email available below). General contact details of provider: https://edirc.repec.org/data/feparit.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.