Abstract
Innovation has been recognized as a central source of business growth and a key determinant of competitive advantage for many organizations. This paper seeks to address two main objectives. The first objective is to examine the direct effect of organizational structure (i.e. centralization and formalization), transformational leadership, organizational learning and customer orientation on innovation capabilities. The second objective is to examine the effect of innovation capability and organizational performance. Findings show that customer orientation, organizational learning, and transformation leadership had significant positive effects on innovation capability. The results further show that innovation capability had a significant impact on organizational performance.
Highlights
Studies on the current business landscape indicate that services are becoming a major focus
Similar trends are developing in other countries as well; for instance, in Malaysia the service sector plays a primary role in economic growth
Referring to the above-mentioned gaps, based on the contingency theory (Drejer, 2002; Tidd, 2001) and the resource-based view (RBV) (Barney, 1991) this study aims to examine the influence of organization structure, organization learning, transformational leadership and customer centered on service innovation capabilities
Summary
Studies on the current business landscape indicate that services are becoming a major focus. Most developing countries, which historically have concentrated on manufacturing, are experiencing fast service growth (Boswijk et al, 2007). Similar trends are developing in other countries as well; for instance, in Malaysia the service sector plays a primary role in economic growth. This sector is estimated to expand at 6.3% per annum, contributing 53% to GDP. During the Tenth Malaysia Plan (RMKe-10), the service sector growth was supported largely by the wholesale and retail trade, finance and insurance, and communications sectors. The service sector has played an important role in economic growth in Asia in recent years and has been identified as the engine to trigger an economic rebound (Wilson, 2014)
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