According to a study titled “Complementarity Between Investment in Information Technology (IT) and IT Human Resources: Implications for Different Types of Firm Innovation,” investing in both IT systems and human resources is critical to achieving maximum innovation across multiple domains and allowing businesses to maintain their competitive advantage.
Adi Masli, a management professor and Koch Foundation Fellow at the University of Kansas, co-wrote the paper with Feng Guo of Iowa State University, Yijun Li of Erasmus University Rotterdam, and Likoebe Maruping of Georgia State University.
The research, published in Information Systems Research, looked at four categories of innovation: incremental, radical, non-IT related, and IT related. Companies that spend extensively in IT systems are more likely to develop valuable patents and prioritize new information, according to the study.
The survey also looked at many elements that contribute to a pleasant work environment, such as work/life balance, advancement possibilities, and diversity. The study team found that investing in IT had a favorable impact on both IT and non-IT innovation output.
Masli and his colleagues examined 36,812 firm-year data to track innovation by looking at the number of patents issued. They didn’t only look at the number of patents issued; they also looked at the quality of those patents. The team calculated the “market value” of these inventions by tracking the change in total stock market capitalization in the three days after the issuing of a new patent.
The sources for this piece include an article in KansasUniversityNews.