Template-type: ReDIF-Paper 1.0 Author-Name: Hervas-Oliver, Jose-Luis Author-Email: jose.hervas@omp.upv.es Author-Workplace-Name: Universidad Politécnica de Valencia,and Florida State University Author-Name: Sempere-Ripoll, Francisca Author-Workplace-Name: Universidad Politécnica de Valencia Author-Name: Boronat-Moll, Carles Author-Workplace-Name: Universidad Politécnica de Valencia Title: Process innovation objectives and management complementarities: patterns, drivers, co-adoption and performance effects Abstract: The excessive concentration of the innovation literature on product development, its drivers and effects, has almost neglected an important strategy which develops and sustains a firm's competitive advantage: process development or innovation. This is an examination of process innovation as more than a mere dependent variable for predicting innovators. It provides insights into the poor attention that process innovation variable has received as an indicator of a firm's performance. In addition, the paper relates this process with the management innovation phenomenon. Using 8,977 firms from Spain through CIS data, findings suggest: (1) most process innovation performance is explained without R&D variables; (2) process innovation process innovation was observed to have a strong dependence on external sources of knowledge, mainly via the acquisition of embodied knowledge; (3) an important "implementation" effect or "learning by trying" effect is observed in which the acquisition of embodied knowledge requires the organization to couple the new technology with existing processes; (4) the simultaneous co-adoption of management innovation positively moderates and improves process performance (5) product innovation is not related to process innovation performance. The latter result is unrelated to consideration of co-adoption of product and process innovation. Two-step Heckman procedures control for the selection process. The paper presents important implications for policymakers and scholars. Classification-JEL: Q31, L25 Keywords: process innovation, process innovation performance, management innovation, embodied knowledge acquisition, product innovation Series: UNU-MERIT Working Papers Creation-Date: 2012 Number: 051 File-URL: http://www.merit.unu.edu/publications/wppdf/2012/wp2012-051.pdf File-Format: application/pdf File-Size: 275 Kb Handle: RePEc:unm:unumer:2012051