Essays on Firm Innovation and Operational Performance

Download or read book Essays on Firm Innovation and Operational Performance written by Senali Amarasuriya and published by . This book was released on 2023 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Author's abstract: The majority of the OSCM literature suggests that firm innovation is positively associated with firm performance. However, as evidenced by some of the innovation failures in the real world, this seemingly intuitive relationship between innovation and firm performance has the potential to be quite nuanced and counterintuitive. Hence in this dissertation, I seek further understanding related to (1) extant OSCM research regarding the innovation-performance relationship and (2) types of firm innovation strategies- being a leader or a laggard- which will financially benefit a firm according to the market they operate in, essentially informing the management how the industry will determine whether they need to innovate or not. Essay 1 systematically reviews the extant OSCM literature on innovation focusing on research utilizing Patent and R&D data. Based on a total population of 176 Patent and R&D data-based empirical papers, I develop a novel framework based on patent measurement class data and R&D operationalization method, to guide the consistent application of patent and R&D data in future OSCM research. I also identify fifteen measurement issues falling under three classes categorized by the magnitude of their impact (high/medium or low impact) on data analysis that can impair the inferences drawn from interpreting the results. In Essay 2 I explore the conditions under which firm innovation could benefit (impede) firm performance. This specifically involves investigating the financial and operational implications of a firm’s choosing to be leading (lagging) innovators within the context of innovative (non-innovative) industries. Using generalized structural equation modeling on a sample of 18,870 firm-quarter observations belonging to the manufacturing organizations of the United States for the period from 2000 to 2020 obtained from Compustat, I find out that a firm playing in a highly innovative market will be financially better off by opting to be a laggard instead of a leader, and that being a leader or a laggard doesn’t essentially make a difference for a firm operating in a non-innovative market. Accordingly, contrary to the conventional belief that being innovative is always associated with superior firm performance, management should choose their innovation strategy based on how innovative the industry is.