The Relationship Between an Innovation Orientation and Competitive Strategy

The strategy chosen in organizations is related to several factors including the organization's mission, objectives, resources, and its innovation orientation. Using a sample of Canadian organizations, this study examines the relationships between an organization's innovation orientation and the types of competitive strategies they pursue. An innovation orientation describes how innovative an organization is and the results suggest that such an orientation provides a context for the implementation of proactive growth-based strategies. Organizations that possess high innovation orientations engage in value creation strategies such as market segmentation, developing new products/services for new markets, and product or service customisation. Those organizations possessing low innovation orientations generally practice less aggressive and internally focused strategies, de-emphasising such things as customer service, brand reputation, and co-operation based strategies such as joint ventures and alliances.