PROFILES OF PRODUCT INNOVATORS AMONG LARGE UNITED-STATES MANUFACTURERS

This paper identifies four groups among 113 Fortune 500 manufacturers that approach innovation quite differently. The groups are based on 27 measured elements of corporate environment, corporate strategy, and f ormal and informal organization. Both product innovation and financial performance differ significantly over the groups, and a group of 42 f irms that invest heavily in innovation perform best financially. A sma ller group of firms that are not innovative but which follow a strateg y of acquisition perform nearly as well financially. Firms focusing re search resources on process innovation perform poorly, although proces s research complements product research among the effective innovators . Particularly important for explaining both product innovation and fi nancial performance of these firms are salient combinations of classic elements of good environment, good strategy and good organization-str ong positions in growing markets, investment in research and developme nt, open and creative organizational structures and supportive organiz ational climates.