Organizational support for intrapreneurship and its interaction with human capital to enhance innovative performance

The main purpose of this paper is to investigate the direct and interactive effects of organizational support and human capital on the innovative performance of companies. Individual effects of the organizational support dimensions, namely: management support for generating and developing new business ideas, allocation of free time, convenient organizational structures concerning, in particular, decentralization level or decision‐making autonomy, appropriate use of incentives and rewards, and tolerance for trial‐and‐errors or failures in cases of creative undertakings or risky project implementations, are also to be investigated.

The study develops and tests a theoretical research model where the organizational support dimensions are the independent variables, innovative performance is the dependent variable, and the human capital has a moderating role in this relationship, via a questionnaire study covering 184 manufacturing firms in Turkey.

Among the individual direct effects of the dimensions of organizational support, management support for idea development and tolerance for risk taking are found to exert positive effects on innovative performance. Availability of a performance based reward system and free time have no impact on innovativeness, while work discretion has a negative one. As for the role of human capital (HC), it is found to be an important driver of innovative performance especially when the OS is limited. However, when the levels of both HC and OS are high, innovative performance does not increase any further.

Two distinct research streams, namely organizational support literature and human capital literature, have already focused on their individual impacts on the innovative performance. However, a combination of these separate streams was not tried before. The paper discusses and investigates what will happen when both positive drivers interact with each other. Moreover, it also investigates how organizational support and human capital are complementary.