Small firm innovation performance and employee involvement

Petra Andries and Dirk Czarnitzki

No 12-013, ZEW Discussion Papers from ZEW - Leibniz Centre for European Economic Research

Abstract: It is known that small firms rely mainly on the CEO's individual knowledge for developing innovations. Recent work suggests that this approach is inefficient since it underutilizes other employees' knowledge. We study to which extent using CEOs, managers and non-managerial employees' ideas enhances small firms' innovation performance. A Heckman selection model on 305 small firms shows that not only CEO's and managers', but also non-managerial employees' ideas contribute to innovation performance. However, contributions depend heavily on the individuals' area of expertise and on whether product or process innovation is desired. Our findings enrich the current view on the entrepreneurial team, but also warn against the implementation of one-size-fits-all employee involvement programs in small firms.

Keywords: Employee involvement; upper echelon; non-managerial employees; innovation performance; small firms (search for similar items in EconPapers)
JEL-codes: M12 O31 O32 (search for similar items in EconPapers)
Date: 2012
New Economics Papers: this item is included in nep-bec, nep-cse, nep-ent, nep-hrm, nep-ino and nep-sbm
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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Journal Article: Small firm innovation performance and employee involvement (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:zewdip:12013

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