Managing Innovation for Sustainable Growth in Competitive Markets

Abstract

Innovation has created a sustainable competitive advantage in today's market, which is characterized by disruption, rapid technology changes and changes in stakeholder expectations. The objective of this paper is to analyze the multi-dimensional connection among innovation management and long-term business growth in a competitive environment. Using concepts from the dynamic capabilities perspective, the resource-based view (RBV), and the concept of Open Innovation, management of innovation for sustainable growth is conceptualized through the development of a framework called the Managing Innovation for Sustainable Growth Index (MISGI) that includes six core dimensions: (1) level of innovation intensity; (2) level of market competitiveness; (3) level of investment in R&D; (4) digital capability; (5) organizational agility; and (6) firm collaborative relationships. In the research method section, data were gathered through a mixed methods approach from 320 organizations operating in manufacturing, service, and technology industries located in five emerging and advanced economies. The construct relationships and hypotheses were analyzed using SEM and multiple regression analysis. The empirical results show that innovation intensity (β = 0.52, p < .001) had the greatest impact on sustainable growth performance, followed by market competitiveness (β = 0.31, p < .001) and R&D investments (β = 0.28, p < .001). Organizational agility was identified as a moderator on the innovation intensity-growth relationship. As can be observed from, the MISGI model fit results into an R² of 0.743, indicating that 74.3% of the variance in the outcomes of sustainable growth has been explained by the model. The findings have certain practical recommendations for the practitioners and researchers of innovation management.