Size of an Enterprise and Organizational Innovations

Abstract

In the literature two opposite theoretical concepts on the innovation of enterprises can be found. The assets concept, known as the “Schumpeterian hypothesis”, assumes that large enterprises have more assets and greater ability to introduce innovations, not only in the technological but also in the organizational sphere. The other concept is the “Inertia theory”, which shows that the growth of the firm’s size causes the increase of standardization and formalization of its procedures and relations inside the organization. Structures seem to be stable, non-flexible and they resist organizational changes. Empirical examinations based on EUROSTAT statistics, as well as other, independent research confirm the assets concept. Author’s own research on the innovation of Polish enterprises has been conducted in the context of the development of the knowledge-based economy. The survey was conducted in 2012 on the group of 150 companies. Results of this study have also confirmed the assets concept. Large enterprises are more active in the area of innovation than medium or small firms. Presented dependency has been confirmed both in organizational and structural innovations.