Frugal innovation and operational performance: the role of organizational learning capability

Abstract

Purpose – This study aims to analyze the organizational learning capability relationship with operational performance and frugal innovation across Brazilian companies. Design/methodology/approach – Quantitative research was performed using collected data from 154 firms, which were analyzed using structural equation modeling. Findings – The results showed that organizational learning capability is an antecedent of frugal innovation. The results also predict a better operational performance for companies that actively innovate cost-effectively. Another result was the positive relationship between the organizational learning capability and the operational performance. The authors found that the indirect and positive relationship between organizational learning capability, frugal innovation and operational performance was confirmed, reinforcing the literature. Research limitations/implications – A theoretical implication of this study can be seen in the establishment of the relationship between organizational learning capability, frugal innovation and operational performance since no studies linking these variables together were found. Therefore, the organizational learning capability and the frugal innovation can be considered facilitators of the operational performance. Practical implications – Managers should consider organizational learning and frugal innovation when thinking about firms’ operational performance. In this way, to facilitate and achieve higher performance, it was found that organizational learning capability and frugal innovation have a great deal of impact on operational performance. Social implications – At frugal innovation, the needs of citizens are prioritized. It is a great instrument to face crises since it consists of developing simpler and cheaper products and services quickly, making them accessible to a larger group of consumers. Originality/value – This study seeks to understand whether Brazilian companies are moving toward a more frugal innovation strategy. The study opens the possibility of showing whether the organizational learning capability has also impacted this change.

Keywords

• Frugal innovation
• Organizational learning capability
• Operational performance