Firm Strategy for Innovation and Creativity

Innovation is inextricably tied to firm strategy because of the dynamic competitive environment firms face that requirew constant changes to products and services. Despite the interdependency between market needs and the need to innovate, firms traditionally experience difficulties executing the capabilities for effectively pursing an innovation strategy and successfully innovating. This chapter posits that the fundamental reason for these difficulties is the misalignment between firm innovation and the firm's strategy, structure, and culture. In doing so, we examine three core innovation activities (searching, connecting, and adapting) and outline the structural and cultural elements that are critical to the success and integration of these innovation activities. Implications for research and practice are discussed in efforts to promote greater alignment between a firm's innovation strategy, the firm's overall strategy, structure, and culture, in efforts to increase the success of innovation and ultimately firm performance.