The art of orienteering small firms' innovation: Illuminating the link between innovation and strategy making

Purposes. This paper aims at investigating the link between inter-organizational relationships and innovation, discussing whether the probability to detect a greater innovation propensity of organizations increases with or without collaborative partnerships. Design/methodology/approach. Drawing on secondary data provided by the Italian Institute of Statistics (ISTAT) about a representative sample of 8,967 Italian firms, three multinomial logit models and four logit models have been estimated, in an attempt to examine the effects of inter-organizational relationships on different types of organizational innovation. Findings. A positive and statistically significant relationship between inter-organizational relationships and organizational innovation emerged from all the models which were arranged for the purpose of this study. Several categories of partners, including suppliers, universities and firms belonging to the same holding group, were found to be more effective in fostering the probability of organizational innovation. Interestingly, geographical proximity did not seem to influence the organizational propensity to innovate. Practice implications. Even though further developments are needed to disentangle the complex link between inter-organizational relationships and organizational innovation, the former are likely to positively affect the innovation ability of or ganizations. From this point of view, it could be argued that partners perform as catalysts, which boost the knowledge creation process underlying the emergence of organizational innovation. Originality/value. This is one of the first attempts to exploit the potential of multinomial logit models and logit models to investigate the effects of inter-organizational relationships on the propensity of organizations to innovate