Innovation culture and the performance of new product launches: A global study

We examine how innovation culture affects new product launch performance in a sample of entrepreneurial ventures (N = 334). In order to examine the relation between innovation culture and new product launch performance, we embarked on a two-step process. First, we examined the factor structure of innovation culture—results confirmed nine-dimensions. Here, a grouped confirmatory factor analysis (CFA) examined cross-cultural differences between eastern and western cultures. Second, the dimensions of innovation culture were used to determine culture profiles across these 334 entrepreneurial ventures. We found two clear subpopulations of innovation culture and we link these two clusters to new product development (NPD) performance (i.e., new product sales and profits averaged over 5 years). In particular, a Latent Profile Analysis (LPA) suggested two profiles existed with respect to innovation culture—that is, ventures that ranked ‘high’ across all innovation culture dimensions versus ventures that ranked ‘low’ across all nine dimensions. Ventures scoring higher across all innovation culture dimensions had significantly higher new product profits and sales. In a series of robustness checks, a path model revealed no significant moderation by region (i.e., eastern vs. western countries) in the innovation culture to performance relationship. Implications as well as directions for future research are discussed.