Complexities in innovation management in companies from the European industry

Purpose - – The purpose of this paper is to provide an integrated framework of complex relations among innovation characteristics, organizational capabilities, innovation potential and innovation performance. Design/methodology/approach - – The model is tested using partial least squares (PLS) modeling and 22 high- (96 respondents) and 16 (93 respondents) low-performing innovation projects from nine companies from the European industry. Findings - – The results show that the level of innovativeness of the project is an important determinant of product potential, whereas the complexity entailed in innovativeness entices integrative communication among innovation project team members. As expected, projects which are new to the company are related negatively to adequateness of the existing functional capabilities of the firm. The negative effects can be mitigated through integrative communication capabilities. Management can foster communication and knowledge integration through adequate databases and communication structures as well as social relations. Also, higher project potential and successful project performance can be attained through focus on product superiority and quality but also on speed of product introduction into the market. Originality/value - – An integrated framework which includes innovation characteristics, organizational capabilities which bring together project execution proficiency and synergy of firm capabilities with the innovation project, as well as innovation potential and performance is absent in the existing literature. The absence of an integrated framework may be the reason why still a large number of innovation projects result in failure. The emphasis on management of complexities in innovation in the paper requires the focus on the under-explored effect of innovativeness and newness of innovation projects on the functional and integrative communication capabilities of firms. While studies which focus on the synergy between firm capabilities and the innovation project regard mainly the functional capabilities, the inclusion of also the integrative communication capabilities allows the present paper to integrate the synergy view with the view that proficiency of project execution is decisive for innovation project performance (Harmanciogluet al., 2009).