Technological Innovation Capability and Firm’s Performance in New Product Development

Technological innovation is one of the driving and fundamental instruments of growth strategies. The main objective of this study is to provide the understanding the way in which technological innovation capabilities affect the efficiency and potential of firm performance. The study attempted to draw on the theoretical literature and empirical studies on innovation, management and capabilities of technology in an effort to explore the role of technological innovation on new product development. The study posits the importance of technological innovation as an essential ingredient of competitive advantage for new product development. The study is different from previous research and focuses on an integrated framework of potential influence on innovation incorporating other variables. Adopting the Principal Component Analysis (PCA) approach, we were able to reduce the larger set of variables into a more manageable set of scales. A PCA with varimax rotation was conducted to find out the underlying dimensions of innovations and firm performance. We used the SPSS for window 12.0 software pack as our statistical analysis tool for all the data, and Pearson's analysis to verify the relationship between technological innovation and new product development, and t-test to verify the hypotheses. In this study, the researcher constructed research variables for measurement (α) was used to measure the internal consistent of the study. For Cooper and Emory (1995) if Cronbach’s alpha (α) is between 0.70-0.98, then the reliability is higher but if it is lower than 0.35, then the results are not reliable and should be refused. For this study, Cronbach’s α was above 0.80, indicating that the results of the survey were all well within the parameters of reliability. The survey findings verify the existence of correlation between technological innovation and firm performance on new product development. Based on the findings, recommendations were proffered which have crucial role for innovative capabilities.