The Role of Management Innovation in Enabling Technological Process Innovation: An Inter‐Organizational Perspective

For sustained competitive advantage of established process manufacturing firms, technological process innovation to improve resource productivity and environmental performance has become of pivotal importance. These firms, however, often face intra‐organizational tensions to reconcile pressures for exploration and exploitation across subsequent phases of technological process innovation. Firms may, therefore, need to perform the development phase – being the most sensitive to these tensions – in the inter‐organizational context of an external dedicated development facility. This requires new‐to‐the‐firm management activities, i.e., management innovation. However, the role of management innovation in enabling technological process innovation in an inter‐organizational context remains largely unexplored. To address this gap, in developing propositions we use illustrative examples from the research context of an external development facility for sustainable process technology. The paper has two contributions. First, by adopting a process perspective we are able to clarify how both types of innovation are combined over time in an intertwined way. Second, we extend management innovation theory by conceptualizing management innovation in an inter‐organizational context. We conclude with implications for theory, practice and future research.