Leading innovation: How top managers influence technological search and innovation performance of firms

Many top managers will agree that innovation is important to their company’s success. Still there is little understanding of how top managers influence their company’s innovation performance. This dissertation studies how top managers influence technological innovation at their firms. It consists of three empirical studies that provide valuable insights into the extent to which, in what specific ways, and under what conditions senior management influences firms’ technological search behavior and how this behavior translates into innovation performance. Using micro-data on pharmaceutical firms and their subsidiaries, executives, and inventors, I examine how executives’ knowledge, skills, abilities, and other characteristics affect firms’ R&D investments and patent output. The first study investigates what CEO characteristics positively impact firms’ innovation outcomes, and when and how they do so. The second study examines how managerial human capital that is available to the firm affects a firm’s propensity to experiment with emerging and unfamiliar technologies. The third study investigates how the formal structure of a firm influences senior management’s ability to coordinate among firms’ inventors for the purposes of innovation performance. Overall, this dissertation results in a deeper and more comprehensive understanding of how the characteristics, strategic decisions, and actions of senior management explain the differences between firms in innovation performance. This dissertation also provides valuable insights into what corporate leaders can do to increase the likelihood of success in innovation.