ORGANIZATIONAL AND PSYCHOLOGICAL INFLUENCES ON ORGANIZATIONAL INNOVATIVENESS

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ORGANIZATIONAL AND PSYCHOLOGICAL INFLUENCES ON
ORGANIZATIONAL INNOVATIVENESS

• Salvatore ZAPPALÀ Fabio MASSEI University of
  Bologna Italy

XXXIII Joint IAREP/SABE colloquium Rome. 3-6
September 2008
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OUTLINE OF PRESENTATION

1. Introduction
2. A Definition of Organizational Innovation
3. Antecedents of Innovation
4. The research
5. Main measures
6. Results
7. Comments and conclusions

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1) INTRODUCTION

• ... In the current wave standards of costs,
  reliability, functionality, quality of goods and
  services can, at best, ensure survival they are
  no longer able to differentiate companies.
• As a result, innovation... has become one of the
  key avenues to achieve differentiation.

Rajan. A. (2001) Centre for Research in
Employment and Technology in Europe.
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2) A DEFINITION OF ORGANIZATIONAL INNOVATION

• Innovation is the intentional introduction and
  application within a role, group or organization
  of ideas, processes, products or procedures, new
  to the relevant unit of adoption, designed to
  significantly benefit the individual, the group,
  organization or wider society (West Farr,
  1990).
• Innovations include such different manifestations
  as technological, administrative, new products,
  processes, services, or systems (West, 2002
  Kanter, 1988)
• Criteria according to West (2002)
• - Intentional rather than accidental
• - Designed to benefit someone
• - New to the setting of adaptation

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MAIN RESEARCH APPROACHES
1) Organizational design approach link between
organizational structure, size, sector (and so
on) (macro-level) and characteristics and
organizational innovation (Lam. A. Working
papers. 2004).
2) Organizational cognition and learning
approach link between individual and
group-social processes (cognition, creativity or
social support) (micro-level) and organizational
capabilities to develop new ideas and innovation
(Lam. A. Working papers. 2004).
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3) ANTECEDENTS of INNOVATION

• The major components of work context facilitating
  development and implementation of innovations
• Individual level factors
• Job level factors
• Group/team level factors
• Organizational level factors
• (Woodman et al., 1993 Amabile, 1996
• Anderson at al., 2004 Shalley Gilson, 2004)

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4) THE RESEARCH AIM and HYPOTHESIS
Exploratory Research Aim to examine if
antecedents at different levels (organizational,
team, job and individual) are related to
different measures of organizational innovation
H1. Companies that adopt more innovations have
different organizational, team and job
characteristics compared to companies that adopt
less innovation (Number of Innovations related
to organizational psycho-social variables) H2.
Companies perceived as more innovative by the
employees present more effective and innovation
oriented organizational, team, job and individual
characteristics (Perception of innovativeness
related to organizational psycho-social variables
)
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THE RESEARCH METHOD and SAMPLE

• We developed two questionnaires
• for the employer/s, to collect information about
  the company and data about the number of
  innovation adopted in the last two years
• for the employees, to collect data about
  organizational, team, job and individual
  characteristics.

• Sample
• 10 owners company (one owner for each company)
  located in Bologna and Forlì, in different
  sectors. Size from 6 to 100 employees.
• 158 employees (on average 15 respondents for
  company range 5 41).
• Age 36 (20-30 y. o.), 44 (31-40), 11 (41-50),
  9 (51-70)
• Sex Men 59, Female 39, Missing 2
• Seniority mean 82 (months almost 7 years), s.d.
  77. (range 1-336)
• Education Secondary sc. 16, High sc. 54,
  College 30

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5) MAIN MEASURES PREDICTORS

• Individual level
• Intrinsic motivation the motivation to do an
  activity for its own sake. because it is
  intrinsically interesting. enjoyable. or
  satisfying (Tierney Farmer. 2002).
• Creative self-efficacy the belief that one has
  the ability to produce creative outcomes
  (Tierney Farmer. 2002).
• Job level
• Job demands time pressure and challenges (The
  Copenhagen Psychosocial Questionnaire COPSOQ.
  National Institute of Occupational Health.
  Denmark).
• Autonomy job discretion and influence on
  decision related to the work (COPSOQ).
• Skill variety activities that challenge skills
  and abilities (COPSOQ).
• Creativity goals relevance of creativity to
  achieve the job objectives (items based on Lokes
  Goal theory. developed by Gro Ellen Mathisen).

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MAIN MEASURES PREDICTORS

• - Team level
• Leader support Supportive Supervision (Oldham
  Cummings. 1996).
• Leader-member exchange (LMX) quality of the
  relationship between supervisor and employees
  (Tierney Farmer. 1999).
• Coherence coherence between the inputs that the
  supervisor sends and his/hers actual actions
  (developed by GEM ).
• Supervisor developmental feedback leaders
  feedback which is oriented towards development
  (Zhou. 2003).
• Organizational level
• Openness to change organizational readiness to
  changes (adapted from Siegel Kammerer. 1978).
• Resource availability access to resources.
  material. time expertise (developed by GEM).
• Handling risk 1) Risk encouragement of risk
  taking for developing new ideas) 2) Error
  mistakes tolerance (adapted from Caldwell
  OReilly. 2003).
• Systems for receiving and supporting ideas and
  suggestions availability of procedure to present
  and develop new ideas (developed by GEM).
• Size/Dimension number of employees.

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MAIN MEASURES INNOVATION

• OBJECTIVE MEASURES QUESTIONNAIRE FOR THE OWNER
• - Adoption rate/number of innovations (Mohamed,
  2002)
• Service inn. introduction of new types of
  services to respond to the demands of customers
  or clients
• Process inn. adjustments of work allocations
  and changes in work processes
• Administrative inn. novel ways of managing the
  work processes (ex. New management tools, new
  evaluation systems.)
• Operational inn. new equipments and tools
• Product inn. new products or significant
  improvements of existing ones. Marketing inn.
  new ways of marketing products or services.
• - Patent disclosures (Oldham Cummings, 1996.
  Jung et al., 2003)
• - RD intensity (Jung et al., 2003)

SELF-REPORTED MEASURE (rated by employees and
companies owners) - Innovative behaviour measure
to evaluate organizational innovative behaviours
(based on Scott Bruce, 1994).
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6) RESULTS OBJECTIVE MEASURES of INNOVATION
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RESULTS TYPES of INNOVATIONS
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RESULTS ORGANIZATIONAL LEVEL
Averages (scale 1-7).
Mean S.D. Alpha
Innovation adopted (number) 16.7 15
RD expenditure (percentage of the total incomes) 12.14 10.62
Innovation behaviour, owner evaluation 5.90 .66 .76
Innovation behaviour, employees evaluation 5.55 .42 .87
Job demands 5.18 .41 .65
Autonomy 4.63 .55 .77
Skill variety 5.62 .69 .88
Creativity goals 5.20 .75 .93
Leader support 5.02 .54 .86
Leader-member exchange (LMX) 5.13 .53 .88
Coherence 4.74 .30 .44
Supervisor developmental feedback 4.95 .44 .67
Openness to change 5.11 .31 .79
Resources availability 5.21 .39 .83
Risk 3.71 .49 .50
Error 5.30 .46 .45
Systems for receiving supporting ideas 4.59 .64 .85
Size of the company (Employees number) 40.70 36.17
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RESULTS ORGANIZATIONAL LEVEL
T-test showed no difference between companies
reporting more and less innovations on all
variables. H1 not confirmed.
Objective Measures of Innovation, Correlations.
Innovation Adopted RD expenditure Innovative beh., owner evaluation
Innovation Adopted
RD expenditure .388
Innovative behaviour, owner evaluation .711 .096
Innovative behaviour, employees evaluation .574 .025 .714
p lt .05 N 10
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RESULTS ORGANIZATIONAL LEVEL
Predictors and Innovation Measures, Correlations.
Innovation adopted RD expenditure Innovative beh. owner evaluation Innovative beh. employees evaluation
Job demands .63 .59 .57 .79
Autonomy .39 .51 .41 .46
Skills variety .28 .30 .71 .67
Creativity goal .23 .08 .59 .70
Leader support -.31 .01 .07 .49
LMX .01 .30 .24 .50
Coherence .40 -.04 .33 .61
Super. feedback .13 .39 .46 .56
Openness to change .26 .16 .55 .50
Resources .31 .14 .78 .74
Risk -.10 .50 .07 -.07
Error .67 .51 .29 .50
Support Ideas .36 .19 .75 .80
Size/ N Employees -.17 .92 -.21 -.45
p lt .05 p lt .01
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RESULTS INDIVIDUAL LEVEL. Correlations between
Employees Evaluation of I.B. and Predictors
I.B. I.M. C.S. J.D. Aut. S.V C.G L.S. LMX Co. S.F O.C Re. Ris. Err.
Innovative b., emp. Ev.
Int. motivation .40
Creative self-effic. .35 .63
Job demands .20 .42 .30
Autonomy .35 .33 .18 .17
Skills variety .49 .37 .27 .43 .43
Creativity goals .58 .32 .22 .28 .43 .62
Leader support .40 .17 .01 .11 .28 .35 .45
LMX .38 .31 .13 .11 .34 .36 .45 .67
Coherence .40 .18 .03 .12 .26 .41 .48 .49 .50
Super. Feedback .36 .25 .13 .15 .34 .38 .46 .77 .65 .49
Op. to change .51 .52 .20 .23 .35 .39 .49 .33 .38 .29 .35
Resources .43 .25 .28 .02 .47 .41 .46 .39 .33 .35 .43 .36
Risk .29 .40 .15 .29 .33 .40 .36 .25 .25 .29 .26 .36 .61
Error .34 .24 .15 .15 .22 .32 .27 .15 .30 .26 .18 .24 .25 .36
Support Ideas .52 .39 .28 .27 .43 .58 .68 .55 .49 .52 .57 .51 .23 .26 .25
p lt .05 p lt .01 N 158
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RESULTS INDIVIDUAL LEVEL
Hierarchical Regression Employees Evaluation of
Organizational Innovativeness regressed on
Organizational, Team, Job and Individual,
Characteristics
Step Predictor R2 ?R
1 Control variables (firm, education, age, seniority, sex). .12 .12
2 Individual characteristics (intrinsic motivation, creative self-efficacy). .31 .19
3 Job Characteristics (job demands, autonomy, skill variety, creativity goals). .49 .18
4 Team Characteristics (leader support. LMX, coherence, supervisor developmental feedback). .53 .04
5 Organizational characteristics (openness to change, risk. error, support ideas). .57 .03
p lt .01
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RESULTS INDIVIDUAL LEVEL
Stepwise Regression Analysis Employees
Evaluation of Organizational Innovativeness
regressed on Organizational, Team, Job and
Individual, Characteristics
Step1 Step2
Predictor ß ß
Control variables Firm Age Seniority Sex Education -.33 .17 .09 .09 .22 -.10 -.05 -.04 -.00 -.11
Creativity goals Leader support Creative self-efficacy Openness to change .29 .21 .28 .29
R2 F .12 3.84 .53 17.60 p lt .001
H2 partially confirmed.
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7) COMMENTS and CONCLUSION

• The different measures of (Organizational)
  Innovativeness are partially related among them,
  and differentially related to structural and
  organizational variables - this could have
  implications for the surveys conducted at
  inter/national level on innovativeness.
• As reported in other Italian studies, Italian
  SMEs innovativeness is mainly related to new
  products (but some companies are customers
  oriented and work on prototypes) and improving
  processes (methods and equipments) to facilitate
  employees work and efficiency.
• 3) Splitting the sample between companies
  reporting more and less innovations does not show
  any differences in the predictors thus Number
  of Innovations (Inn. Adoption and Implementation)
  is not related to intra-organizational processes,
  but probably to the maturity of the sector, to
  owner characteristics, financial availability or
  support, or something else.

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COMMENTS and CONCLUSION
4) In general, employees perceive a positive
psycho-social climate (related to the small
company size?) 5) The companies that adopt more
innovations are also more error tolerant. 6)
The limited number of companies induced us to an
individual level analysis this showed Supervisor
support, creativity goals and openness to change
as the team, job and organizational most
important variables to predict employees
evaluation of organizational innovativeness.
In other words 1) different measures of
innovativeness seem to be related to different
aspects of organizational functioning, 2) at the
psycho-social level, the employees perception of
company innovativeness is related to (at least
one aspect of) all the antecedent levels.
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Thank you for your attention.