Influence of business strategy on firm's capability to innovate
: investigation into employee perception of business strategy, market orientation, learning orientation and the favourability of the innovation implementation context on multiple hierarchical levels in a single multi-national organization in the FMCG industry

  • Christopher Sand

    Student thesis: Doctoral Thesis


    This research is informed by the implications of Disruptive Innovation Theory, which posits that incumbent firms tend to fail in the face of disruptive threats. A framework is developed based on the aim to identify controllable parameters of firm’s innovation capability to ultimately contribute to the longevity of incumbent organizations. It integrates the conceptualization of Innovation Orientation with a processual perspective on innovation and the Dynamic Capabilities View to gain a holistic perspective on a firm’s innovation. Furthermore, it emphasizes the role of managers and strategy makers to determine the level and composition of an organization’s overall Capability to Innovate. Research constructs for Business Strategy, Market Orientation (with separate measures to assess the firm’s distinct focus on Current Customers and/or Future Markets), as well as Learning Orientation were supplemented with a measure to assess the favourability of the Innovation Implementation Context of the firm. In their combination, these constructs are posited to provide a holistic account of the firm’s overall Capablility to Innovate. The research setting provides a framework to determine the influence of Business Strategy on the configuration of these constructs and to illustrate the interplay among them. A survey of 182 respondents based in a single organization in the Fast Moving Consumer Goods Industry was taken to validate the framework. Its objective was to investigate into the individual linkages between Business Strategy and Market Orientation, Learning Orientation and the favourability of the Innovation Implementation Context. Moreover, the perceptions of employees on 4 different hierarchical levels are assessed. Ultimately this setting allows to determine the degree of strategic alignment throughout the organization, which was shown to result in higher performance in prior research. The findings of this research contribute to extend existing knowledge in an evolutionary manner. It contributes to the integration of prior research in the field of Innovation Orientation, innovation and the Dynamic Capabilities View towards a holistic understanding of a firm’s Capablitiy to Innovate. Moreover, the findings provide insights into the interrelationship between Business Strategy and the organization’s propensity for Market Orientation in the Current Customer domain and into the Future Market domain, its Learning Orientation and the arrangement of its Innovation Implementation Context. It revealed a synergistic interplay between these constructs. The research provides directions for practitioners in outlining the importance of a holistic appreciation of innovation and by illustrating specific mechanisms how Business Strategy may influence a firm’s overall Capablity to Innovate.
    Date of Award2015
    Original languageEnglish


    • Business enterprises
    • Technological innovations
    • Organizational change

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