Does EFQM enhance learning and innovation?

Abstract

Prior research has suggested that learning capabilities of exploitation and exploration may affect incremental and radical innovations in firms. Nevertheless, there has been a lack of empirical studies that have examined these relationships in quality-oriented organisations, especially in European Foundation for Quality Management (EFQM) organisations. This research empirically examines whether EFQM improves learning ambidexterity as well as promotes incremental and radical innovations. Concretely, this research explores these relationships, using Partial least squares (PLS) with data from 200 Spanish industrial companies. The results of this study show first that the EFQM framework enhances exploitation and exploration (ambidexterity), incremental and radical innovations. Secondly, these results demonstrate the power of exploitation and exploration over incremental and radical innovations. Thirdly, they display that learning capabilities may play a mediating role in the relationship between EFQM and both types of innovation. Moreover, the results of this study cover an existing gap in literature, since there is no literature that has tried to link as a whole quality management models, exploitation, exploration, incremental and radical innovations. The proposed framework is therefore helpful for managers, by providing a deeper understanding of how organisations may improve the results of their innovations by enhancing exploration and exploitation and by following the EFQM model.