Service innovation management in a modern economy: Insights on the interplay between firms’ innovative culture and project-level success factors

Abstract

Despite the growing importance of the service industry in modern economies, research on service innovation success has been far less prolific than has work on product innovation, and there is still a relative paucity of knowledge about the key factors to achieve new service success. The study of the relationships among these factors has also received very little attention and provides a significant opportunity for theoretical developments and managerial insights in service innovation. In this study, data drawn from a sample of 502 hotels and knowledge-intensive business service firms located in Spain allows testing the relationships among organizational and project-level success factors in new service development. Empirical evidence reveals several routes of effects useful to trigger external new service performance or market success, and internal new service performance, or the satisfaction, motivation, and commitment of front-line employees. Some relevant insights for managers include illustrating the crucial role of service firms’ innovative culture to configure project-level success factors; highlighting the social aspects of top management's support to the new service project; underlying the importance of human resource management practices during new service development for new service success, and the motivating effects that new service advantage has among front-line employees.