The mediating role of personnel training between innovation and performance: Evidence from the German pharmaceutical industry

Abstract

Purpose – The need for companies to become more innovative has never been greater, because innovation helps them deal with a turbulent environment by providing them a sustainable competitive advantage. In this sense, it has been generally accepted that a successful innovative environment requires a welltrained work force. Nevertheless, the literature showing how personnel training drives the innovationperformance relationship in industries where innovation is a key factor is scarce, especially in high-tech industries such as the pharmaceutical industry. Thus, we build upon existing studies to contribute to the innovation and training-related literature by considering the latter as a mediating variable between innovation and business performance. Hence, we aim to assess the impact of innovation on performance, and bring new insights into the innovation-performance link by including training as a variable that drives the aforementioned relationship. Design/methodology – We apply the partial least squares structural equation modeling technique to a sample of German pharmaceutical firms. The data were collected in mid-2014 by means of a computerassisted telephone interviewing (CATI) procedure. As a result, 200 valid responses were obtained from CEOs. Findings – First, this study demonstrates that both innovation and personnel training have a significant, positive impact on performance. Second, the results suggest that training personnel does indeed positively mediate the innovation-performance link. Hence, our study helps explain how innovation effectively translates into greater levels of performance. Originality / value – We answer calls to clarify about the innovation-personnel training relationship to generate greater levels of performance in turbulent environments. Furthermore, we assess this fact in the pharmaceutical industry, where paradoxically there is a lack of studies within the aforementioned framework.