The Effects Of Innovation On Business Performance In The Construction Industry : An Empirical Study In Pakistan

Abstract

Purpose- Based on the research of 94 Pakistani construction enterprises, this work aims to objectively verify the relationship between a organization’s level of innovation and its performance. According to research findings, management, process, and product innovation benefit a organization’s performance. Innovation is proven to be a way to get an advantage in this aspect, competitive and long-lasting. Entrepreneurs may find this study interesting because innovation is required to promote growth in this industry. For public governments to effectively fulfil their mandate of fostering economic activity and development, and by initiatives to encourage innovation, the Pakistani economy can become more competitive.

Materials and Methods - The industry wide survey had a sample size of 376 (44 public clients, 22 engineering and design consultants, 54 construction management consultants and 123 contractors). Data analysis was done by SPSS 20 and SPSS AMOS 20, through structural equation modelling of 32 construction organizations of Islamabad,

Findings - The results were significant and all the hypotheses were accepted. Moreover, they showed that inter-organizational learning drives innovation that ultimately increases the performance of the organization.

Research Limitations – The study was limited to three cities of Pakistan including Lahore, Karachi and Islamabad.

Practical Implications –A significant implication for business practitioners and researchers is the knowledge regarding the significance of inter-organizational learning for the improvement of construction industry of Pakistan. It was also specific to construction industry.