Available data suggests that managerial leadership style and work environment significantly influence innovative performance, especially in the case of self-directed work teams (DiBella 1995; Shim and Lee 2001). Thamhain and Wilemon (1999) found that innovative performance in technical project teams is not only strongly associated with project success, but also favourably influenced by leadership and employee professionalism. Thamhain (2003) investigated the effectiveness, innovative characteristics and overall performance in technology-oriented environments of R&D teams. The aim of the research was to determine the principal factors that influence innovation-based performance of R&D teams.
The study revealed certain metrics commonly used by team leaders and managers as indicators of innovative performance included (1) the number of new products/services introduced to market, (2) time-to-market, (3) cost and performance improvements, and (4) generated patents. For teams and individuals, meaningful performance measures were more difficult to define. The most common metrics of team performance cited were (1) judgement of innovative performance, (2) number of innovative ideas, (3) patent disclosures and papers, and (4) effort and commitment to established objectives.
Thamhain opined that one of the major challenges in innovation management is to achieve the involvement of the entire workforce. This is important because in today’s high-tech companies, innovation is rarely the result of individual genius. Instead innovation is a multidisciplinary effort, involving teams of people and support organisations interacting in a highly complex, intricate and sometimes even chaotic way. The process requires experiential learning, trial and error, risk-taking, cross-functional co-ordination, and the integration of technical knowledge and information. Thamhain concluded that professional esteem among team members seems to have a particularly strong influence on innovative performance. The three most significant associations identified were (1) professionally stimulating and challenging work environments, (2) opportunity for accomplishments and recognition, and (3) the ability to resolve conflict and problems. Factors of influence on achieving convergence between individual and overall organisational goals include effective communication, information sharing and integration of the activities of various project teams with a common focus on desired outcomes. Factors which were conducive to innovative performance by teams also led to (1) high predictability of changes in markets and technology, (2) high market focus, responsiveness and favourable time-to-market performance, (3) effective cross-functional communications and networking, and (4) effective resource utilisation.