The impact of product innovation and process innovation strategies on business performance; Investigating the role of environmental dynamics and environmental competitiveness

recently, more notable performance is expected from knowledge-based companies. Some intra-organizational factors (such as innovation strategies) and also a number of extra-organizational factors (such as competitiveness and environmental dynamics) can play significant roles in their performance.

The purpose of this study is to evaluate the connection of dynamics variables and environmental competitiveness with the variables of product innovation strategy and process innovation. Another objective of this article is to investigate the impact of these factors on business performance.

This research is an applied and descriptive correlational study. The statistical population includes 170 managers of knowledge-based companies of Khorasan Razavi province out of which 115 were randomly selected. The data collection tool was a questionnaire which its validity and reliability was confirmed. Causal relationships between variables were measured using PLS software.

The results indicate that environmental competitiveness affects both process and product innovation. It also affects business performance through innovation. Also, the Environmental dynamics affect product and process innovation and through them affect business performance.

Knowledge-based companies should investigate the environmental conditions and formulate innovative strategies based on its competitiveness and dynamics to achieve optimal performance.