Small firm innovation performance and employee involvement

Small firm innovation performance and employee involvement 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. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Small Business Economics Springer Journals

Small firm innovation performance and employee involvement

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Publisher
Springer US
Copyright
Copyright © 2014 by Springer Science+Business Media New York
Subject
Economics / Management Science; Management/Business for Professionals; Microeconomics; Entrepreneurship; Industrial Organization
ISSN
0921-898X
eISSN
1573-0913
D.O.I.
10.1007/s11187-014-9577-1
Publisher site
See Article on Publisher Site

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.

Journal

Small Business EconomicsSpringer Journals

Published: Mar 30, 2014

References

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