The effects of innovation-oriented mission statements on innovation performance and non-financial business performance

Abstract

The innovation literature has given a great deal of attention to the antecedents of innovation performance within the firm. Although many multinational companies include innovation-related words in their mission statements, little effort has been devoted to the relationship between a mission statement and innovation performance. This study investigates how mission statements influence innovation performance and then tests the relationship between innovation performance and non-financial business performance. An empirical analysis was conducted on a sample of the Chinese high-tech industry. Those companies with innovation-orientated mission have better innovation performance than companies without. The results also show strong evidence that mission statements have a positive influence on innovation performance, especially when innovation-related words are present in the statements. The results also indicate that both the newness of a technology and its newness to market can significantly enhance corporate image and customer satisfaction and that is critical for firms to understand the appropriate time to launch new products. This study discusses the practical implications of this work for managers.