Process innovativeness in technology services organizations: Roles of differentiation strategy, operational autonomy and risk-taking propensity

This paper examines the effect of differentiation strategy on process innovativeness in technology services organization (TSOs). In addition it examines the direct and moderating effects of two organizational constructs— operational autonomy and risk-taking propensity. Analysis of data from 102 firms in the mid-Atlantic region of the USA indicates that both differentiation strategy and operational autonomy are positively related with process innovativeness, while an organization's risk-taking propensity has no such relationship. In addition, operational autonomy moderates the relationship between differentiation strategy and process innovativeness, while no evidence was found for the moderating effect of risk-taking propensity on this relationship. Further sub-group analysis shows that in TSOs with high levels of operational autonomy, risk-taking propensity has a positive moderating effect on the above relationship. Post hoc analysis also establishes positive links among process innovativeness and firm performance.