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Relationships between Innovation Capabilities, Business Performance, Marketing Performance and Financial Performance: Classification

Relationships between Innovation Capabilities, Business Performance, Marketing Performance and Financial Performance: ClassificationA Classification of Relationship between Innovation Capabilities and Business, Financial and Marketing Performances

A total of 28 empirical studies are analyzed in this study. Of these 19 of them used survey methods. Other research uses questionnaire to address the aspect of innovation capabilities. Our goal is to develop a classification representation factors/elements related to innovation capabilities that has been covered in the existing empirical studies. After examining the 28 empirical studies, we found a total of 15 interconnected factors for which the empirical evidences show significant relationship. These 15 factors that were being identified is product and service innovation, process and marketing innovation, strategic innovation, resources allocation and organizing capabilities, marketing capabilities, financial performances, marketing performances, business performances, sales value, sales growth, gross profit, cost reduction, revenues, market share and finally the fifteen customer retention. All the fifth teen is found to be ordinarily independent and in addition that financial performances are also dependent to marketing performances.

Out of the 28 studies examined not all factors being covered and there is inconsistence in the empirical study results of those that included similar factors. Nonetheless, for the sake of discussion, we integrate these fifth teen factors in a model (Figure 1) in which the expected connection among them are depicted. financial performance

Product & Service Innovation

There are 21 journals out of 28 studies evidence which has shows a strong relationship between product innovation and market performance (Narver, 1990). Kotler (1991) mentioned that corporate revenue’s return hit more than 50% on innovation account. The development of technology has contributes to the product and process innovations (OECD, 2005).

Figure 1

Figure 1. Model of relationship between innovation capability, business, marketing and
financial performance

This post was written by , posted on November 5, 2013 Tuesday at 11:44 am