A theory of innovation in small knowledge-intensive professional service firms

Lu, SL

Abstract

Performance improvement in the construction industry is significantly influenced by
the innovation performance of small construction knowledge-intensive professional
service firms (SCKIPSFs). There is thus an urgent need to better understand the
nature and process of innovation in such firms. The prevailing innovation literature
is generally not appropriate for SCKIPSFs, as it tends to focus on large,
manufacturing-based firms operating in 'non-project based' environments; rather
than small, service-based firms operating in multiple, fluid 'project based'
environments. A knowledge-based innovation model was developed from a review
and synthesis of the relevant literature. This model is presented as a holistic,
system-orientated framework to better investigate how SCKIPSFs create, manage
and exploit innovation. The five variables in the conceptual model are: interaction
environment; relationship capital; structure capital; human capital; and, knowledge
capital.
The conceptual model formed a gap analysis framework to interrogate the meta
hypothesis and six sub-hypotheses. The model was investigated and developed
through a longitudinal twenty-two month case study which consisted of an
exploratory phase and an action research phase. Semi-structured interviews,
company documentation and company workshop data collection techniques, and
content analysis and cognitive mapping data analysis techniques, were used.
The unit of analysis for this research was taken as the 'innovation activity.' In the
exploratory phase of the case study, seven innovations were investigated, and key
variables for successful and unsuccessful innovation identified. In the action
research phase of the case study, an interim project review process innovation was
developed and, in so doing, the interactions between the key variables identified in
the exploratory phase were investigated.
The empirical testing of hypotheses revealed two principal factors that stimulate successful knowledge-based innovation in SCKIPSFs: client requirements
(synonymous with the market-based view of innovation) and the competences of
knowledge workers (synonymous with the resource-based view of innovation). In
developing and testing the conceptual model, the research contributed to innovation
theory by: affirming that the prevailing innovation theory is not appropriate for
SCKIPSFs; and, conceptualising and empirically validating two forms of
knowledge-based innovation: exploitative innovation and explorative innovation,
along with their generic variables and their distinctive variables to success and
failure, within a SCKTPSF context.
The results emphasised the need, in practice, for appropriate: senior management
education and training in innovation management; and, mechanisms for knowledge
sharing between staff which are not solely driven by immediate project needs.

Citation

Lu, S. A theory of innovation in small knowledge-intensive professional service firms. (Thesis). University of Salford

• Thesis Type: Thesis
• Deposit Date: Jul 26, 2011
• Publicly Available Date: Jul 26, 2011
• Award Date: Jan 1, 2005