Innovation Management Practices in Production-Intensive Service Firms

Abstract

This paper posits that innovation management practices are contingent upon the type of industry, and examines the innovation management practices in a distinctive set of service firms: production-intensive service firms. Production-intensive services are standardised services produced at a large scale. These services have received little attention from prior comprehensive qualitative innovation management practices research. The examination in this paper is based on in-depth interviews with 21 key-employees in five large Scandinavian production-intensive service firms. The results revealed a number of innovation management practices specific to production-intensive service firms in the four dimensions of strategy and culture, front end of innovation and portfolio management, development process, as well as intellectual and organisational resources. The findings expose that production-intensive service firms are less likely to have an explicit innovation strategy and they are unlikely to measure the strategic impact of innovation activities. Furthermore, the innovation processes in production-intensive service firms tend to be flexible, although formal descriptions exist. The findings extend knowledge on innovation management practices research and provide useful lessons and implications for managers who seek to develop new production-intensive services. The findings also demonstrate that there is a need to acknowledge a contingent view of innovation management practices that are receptive to the type of context the innovation occur in.