The impact of strategic quality orientation on innovation capabilities and sustainable business growth

Abstract

PurposeThe purpose of this paper is to present a new conceptual framework for service organizations to achieve sustainable business performance through strategic quality orientation and innovation capabilities on the basis of relevant literature review and integration of various innovation and business sustainability theories and models. The study tests if the strategic quality orientation enhances innovation capabilities in terms of exploitation and explorative innovation, which, in turn, can lead to sustainable business growth. Mediating impact of innovation capabilities between strategic quality orientation and sustainable business growth relationship is also examined.Design/methodology/approachA conceptual framework was developed to test and establish these relationships. Results were analyzed based on 442 questionnaires collected from five different service industries of Pakistan, and the structural equation modeling technique was used to empirically test the conceptual framework.FindingsThe results indicate that strategic quality orientation directly affects innovation capabilities and sustainable business growth and also indirectly impacts sustainable business growth through its effect on innovation capabilities.Practical implicationsThe study suggests service organizations can jointly implement quality and innovation using a structured approach, with strategic quality orientation as the foundation. In this way, they can leverage from their strategic quality management, supplier relationship, corporate quality culture, continual improvement and people management in order to ensure innovation and sustainability in their business growth.Originality/valueThe study integrates strategic quality orientation and innovation capabilities, and validates a new organizational framework through empirical examination which can be used by service organizations to ensure their sustainable business growth.