Adopting a specific innovation type versus composition of different innovation types

Abstract

PurposeAlthough several types of innovation are identified in the extant literature, researchers have not resolved conflicting theoretical predictions about the implication of adopting innovation types. Following the conceptualization of Damanpouret al., this paper aims to distinguish between three innovation types (i.e. services, technological process, and administrative process) and make suggestions for banks on whether to focus their innovation efforts on a specific type or composition of different types in order to optimize the returns to innovation.Design/methodology/approachBased on an empirical case study of a large multinational bank in Ghana (name withheld for anonymity), data were collected with questionnaire instruments from 51 bank managers. Two regression equations were estimated and analyzed using the Statistical Package for the Social Sciences (SPSS).FindingsThe paper finds evidence that focus on adopting a specific innovation type seems to contribute more to performance than adopting bundles of different types of innovation. As the bank focuses on adopting only administrative process innovation it enjoys higher growth in market share than when it adopts services innovation and technological process innovation in conjunction with administrative process innovation.Practical implicationsIt seems that even when resources are in abundance, and complementary changes or innovations are found to be necessary, there is less need to introduce different types of innovation with a more balanced rate simultaneously.Originality/valueThe study proposes to resolve conflicting theoretical predictions and ongoing policy disputes about the effects on business performance (i.e. market share) of the adoption of a specific innovation type versus composition of different innovation types.