The Role of Firm Innovation in the Workforce

Employees are important stakeholders to firm innovation strategy because they tend to be more satisfied and committed when their employer is seen as innovative and their knowledge and skills contribute to firm innovation success. The chapter presents findings from the National Technology Readiness Survey™ by Radius Global Market Research and the Responsible Business Center that shows that employee perceptions of firm’s innovation spiked during the COVID-19 pandemic, dropped for a while, and is now rising again, probably a result of new technologies like AI influencing the workplace. Employees in more innovative firms are more likely to be satisfied with their jobs and more likely to recommend the firm. The impact on churn intentions is more nuanced because workers in the most innovative firms are more likely to consider leaving in the future. The authors hypothesize that a segment of the workforce deliberately changes positions periodically to develop their skills, and innovate firms are in a better position to accept this behavior. The chapter takes a deeper look at what drives employee perceptions and finds that five career features are important to innovation, job satisfaction, and career satisfaction: having a career sponsor inside the organization, being able to attend industry events, having a wide variety of job assignments to broaden skills, having specific career goals with a plan to achieve them, and maintaining a professional network. The authors conclude that firms that want to succeed through innovation should place a priority on proactively helping their workforce develop knowledge and skills and maintain an outward focus.