The interplay of decentralization, employee involvement and absorptive capacity on firms' innovation and business performance

Kaja Rangus and Alenka Slavec

Technological Forecasting and Social Change, 2017, vol. 120, issue C, 195-203

Abstract: This paper investigates the relationship between organizational characteristics and firm's innovation and business performance. Specifically, we examine how decentralization, absorptive capacity, and employee involvement (in light of the open innovation literature) impact firm's innovation, which in turn affects business performance. We test the proposed model on a large sample of 421 manufacturing and service firms and find decentralization being positively connected to employee involvement, absorptive capacity, and firm's innovation performance. Moreover, the results show that employee involvement and absorptive capacity mediate the relationship between decentralization and firm's innovation performance. The results also suggest that firm's innovation performance positively influence firm's business performance. Implications for managers and future research are discussed.

Keywords: Innovation; Decentralization; Employee involvement; Absorptive capacity (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (21)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0040162517300069
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:tefoso:v:120:y:2017:i:c:p:195-203

DOI: 10.1016/j.techfore.2016.12.017

Access Statistics for this article

Technological Forecasting and Social Change is currently edited by Fred Phillips

More articles in Technological Forecasting and Social Change from Elsevier
Bibliographic data for series maintained by Catherine Liu ().