Achieving competitiveness through innovation capability: developing what public sector customers really need

Abstract

Purpose Firms need competitiveness in terms of quality, price, and delivery to satisfy public sector customers. The purpose of this study is to investigate the effect of innovation capability on this competitiveness in a market-oriented firm and to determine the role of supply chain integration and marketing-technical integration in enhancing innovation capability. Design/methodology/approach A theoretical model was developed to test hypotheses. Data was collected from 199 top-level managers serving pharmaceutical companies. Partial least squares-structural equation modelling was used for datas analysis. Findings The results highlight the vital role of innovation capability in the development of firm competitiveness. Significant results for all relationships were obtained. The effect of market orientation on supply-chain integration was stronger than its effect on marketing-technical integration. Partial multi-mediation of supply chain integration and marketing-technical integration was found in the relation between market orientation and innovation capability. Practical implications The study helps managers develop an efficient strategy by using firms’ innovation capability to supply products according to public sector customer needs. Originality/value The study is based on a real-time practical problem faced by firms, as the majority of them fail to sell their products to public sector customers. To the best of the authors’ knowledge, the current study is one of the first studies that discusses the role of innovation capability at the marketing-supply chain management interface to help a firm become an attractive supplier for public sector customers.