Innovation Management and Its Impact on Firm Competitiveness

Abstract

This study investigates the impact of innovation management on firm competitiveness using a mixed-methods experimental design. Quantitative analysis was conducted on a panel dataset of 500 firms, examining the role of innovation scores, R&D intensity, absorptive capacity, and organizational agility in shaping competitiveness outcomes. Complementary qualitative evidence was gathered through in-depth interviews with 40 executives and innovation managers, providing insights into cultural, leadership, and strategic enablers of innovation. Results demonstrate that firms with higher levels of innovation activity achieve superior competitiveness indices, greater market share, and more sustainable long-term growth. Importantly, the findings show that innovation effectiveness is mediated by absorptive capacity and organizational culture, suggesting that financial investments in R&D are most effective when supported by leadership and cross-functional collaboration. Sectoral and international comparisons further reveal that contextual conditions shape the innovation–competitiveness relationship, with firms in technology-intensive sectors and emerging markets adopting distinct strategies to maintain competitiveness. The integration of sustainability-oriented innovation underscores that eco-innovation enhances not only firm reputation but also long-term strategic advantage. Collectively, the study advances theoretical debates on dynamic capabilities and resource-based views of innovation, while offering actionable implications for managers and policymakers seeking to foster competitiveness through innovation management.