Innovation Culture in Small

and Medium Enterprises

A comparative case study of decisive organizational
factors for practising a successful innovation culture
in Small and Medium Enterprises in Denmark

Author:
Andreas Ackermann

Student number:
116005

Supervisor:
Suzanne Lauritsen

Hand-in date:
16.09.2019

Master’s Thesis
Copenhagen Business School
MSc in Social Science - Organizational Innovation and
Entrepreneurship

Number of pages: 72,2

Number of characters (incl. spaces): 164.302

Abstract
This master’s thesis examines the decisive organizational factors for practising
a successful innovation culture in Danish Small and Medium Enterprises
(SMEs). An extensive amount of literature on the field of innovation,
organizational culture and innovation culture have been reviewed, and the
relevant literature has by a deductive approach been used as a framework. A
comparative case study has been chosen as a strategy to research the field of
innovation culture, and here, mixed methods have been used to collect
empirical data for the research. Quantitative data have been collected by the
use of surveys, and qualitative data have conducted via semi-structured
interviews with respondents from six different SMEs in the comparative case
study. SMEs have been chosen as cases due to the importance of SMEs in
the Danish business industry, and the cases were chosen from Børsen’s
gazelle list in 2018. The collected quantitative and qualitative data have been
analysed by the use of the framework from the reviewed literature of
innovation, organizational culture and innovation culture. Moreover, three
business cases from major global companies have been used in the analysis
as a framework of how to practise a successful innovation culture. The
findings from the analysis have been discussed, and from here it can be
concluded that shared basic values are an important decisive factor and the
means to create shared basic values are done by the use of arteacts and
norms. Furthermore, it can be concluded that the culture in SMEs needs to
be built and it needs to be valuable. Risk-taking, encouragement and reward
of new ideas in the organization can also be concluded to be decisive
organizational factors. Furthermore, a people-centric approach is, in general,
a very important approach for SMEs and finally, to hire diverse and creative
people, be customer-driven and create a foundation for open innovation can
also be concluded to be important for a successful innovation culture in
SMEs. However, these principles and approaches can be practised in
numerous ways depending on the individual SME.
Acknowledgements
A lot of people deserve my gratitude for their contribution to the process of
writing this master’s thesis.

First, I would like to thank all of the involved respondents, employees and the
companies they represent for the time they devoted to interviews,
showcasing the company’s premises, sharing and answering surveys.

Thank you to Mads Hofman Hansen from Abtion, Alex Ramskov Johannsen
from Biometric Solutions, Simon Espelund Hansen from Festina Finance,
Thomas Ove Rasmussen from Invokers, Jacob Hesselballe from Move
Innovation, Christian Hübbe from Shape, Michael Bruun Ellegaard from
Trustworks and Dorte Kulle from SMV Danmark.

I would furthermore like to thank my supervisor Suzanne Lauritzen for

guidance and help in the process of writing this master’s thesis.

Finally, I would like to thank Sanne and Anna for the fantastic support and
understanding for the time I have spent on writing this master’s thesis.

Thank you very much.

Andreas Ackermann
Table of Contents
Chapter 1 – Introduction ........................................................................... 1
1.1 Research Question ..................................................................................... 2

1.2 Structure of the Thesis ............................................................................... 2

Chapter 2 – Literature Review .................................................................. 4

2.1 Defining Innovation .................................................................................... 4

2.2 Framework for innovation .......................................................................... 6

2.3 Organizational Culture ............................................................................... 8

2.4 Innovation Culture .................................................................................... 11

2.5 Business Cases ......................................................................................... 17

2.5.1 Apple ........................................................................................................18

2.5.2 Google ......................................................................................................19

2.5.3 LEGO ........................................................................................................22

Chapter 2 – Subset ......................................................................................... 24

Chapter 3 – Methodology ....................................................................... 25

3.1 Structure of the Research ......................................................................... 25

3.2 Deductive versus Inductive Approach ...................................................... 25

3.3 Qualitative Methods................................................................................. 27

3.3.1 Semi-structured Interviews ........................................................................28

3.4 Quantitative Methods .............................................................................. 29

3.5 Mixed Methods ........................................................................................ 29

3.6 Hermeneutic Methodology ...................................................................... 31

3.7 Social Constructionism ............................................................................. 32

Chapter 3 – Subset ......................................................................................... 34

Chapter 4 – Case Studies ........................................................................ 35

4.1 SMEs as Cases .......................................................................................... 35

4.2 Case Studies ............................................................................................. 36

 4.2.1 Case Study Strategy ..................................................................................36

4.2.2 Selecting Cases .........................................................................................37

4.3 Innovation Indicators ................................................................................ 39

4.3.1 Object versus Subject Method..................................................................40

Chapter 4 – Subset ......................................................................................... 41

Chapter 5 – Analysis ............................................................................... 42

5.1 Analysis of Quantitative Empirical Data ................................................... 42

5.2 Analysis of Qualitative Empirical Data...................................................... 47

5.2.1 Organizational Culture ..............................................................................49

5.2.2 Innovation Culture.....................................................................................55

5.2.3 Business Cases ..........................................................................................59

Apple .................................................................................................................60

Google ...............................................................................................................61

LEGO .................................................................................................................63

Chapter 5 – Subset ......................................................................................... 65

Chapter 6 – Discussion and Conclusion ................................................... 66

6.1 Discussion of Quantitative Empirical Data ............................................... 66

6.2 Discussion of Qualitative Empirical Data .................................................. 69

6.3 Conclusion ................................................................................................ 73

6.4 Further Research ...................................................................................... 75

Bibliography............................................................................................ 77

Appendices ............................................................................................. 90
Chapter 1 – Introduction
As a master student on the Organizational Innovation and Entrepreneurship
programme at CBS, the interest and passion for innovation have been central
for choosing the research field. The passion for innovation is combined with
the interest for people in organizations and innovation culture therefore
naturally became the focal research point in this master’s thesis. The desire
for conducting fieldwork for the research has been a major motivation
throughout the whole process, and therefore a comparative case study was
chosen as a research strategy. Not only do comparative case studies enable
the possibility of fieldwork and meeting people who practices and daily work
in an innovation culture, it moreover enables the possibility to examine
successful innovation culture in a practical way as well as in a theoretical way
and thereby, by the comparison of the two areas, be able to contribute with
new knowledge to the existing literature on the field of innovation culture.

With the perspective of social constructionism, knowledge is not something a

person has or does not have, but rather something that is created together
by people (Burr, 2015, p. 12). Therefore, with comparative case studies as a
research strategy, new knowledge on the field of innovation culture can only
be created together with the people who experience and practice an
innovation culture on a daily basis. For the selection of cases where a
successful innovation culture thrives, Small and Medium Enterprises (SMEs)
serves as perfect cases, as these type of companies neither are too small to
have a culture nor too big to be able to examine the culture.

With the desire of examining practical innovation culture in SMEs and

combine this with the existing literature, in order to contribute with new
knowledge to improve the innovation culture in Danish SMEs, the next
section will present the research question for the research in this master’s
thesis.

1
1.1 Research Question
With the introduction presented above, a research question will here be
presented. The research question will not only function as guidance for the
thesis but also as a structured way to obtain more knowledge and hereby
contribute to the already existing knowledge of the field of study.

The following research question is formulated as:

What organizational factors are decisive for innovation culture in Small or

Medium Enterprises in Denmark, and how can they be practised in order to
create a successful innovation culture in Small or Medium Enterprises in
Denmark?

1.2 Structure of the Thesis

For an overview of the thesis, Figure 1 illustrates the structure of the thesis.

Figure 1: Structure of the Thesis

(own creation)

2
Chapter 1 - Introduction provides an introduction to the thesis. Moreover, the
general interest in conducting the research is presented and the research
question is stated in order to provide the overall ambition for the thesis.
Hereafter, in Chapter 2 - Literature Review, the relevant literature on the field
of innovation, organizational culture and finally innovation culture are
examined in order to provide a framework for the following analysis of the
empirical data collected. In the literature review, a presentation of the
literature of three different business cases is also presented. Further, a
framework for innovation is presented in order to provide a tool for framing
the implications of the analysis in an organizational context. Hereafter, in
Chapter 3 - Methodology, the used methodologies for the research are
presented. In here, the research design is defined, and methodologies and
approaches are discussed and applied to the research. In Chapter 4 – Case
Studies, the reasoning for choosing SMEs as cases in the comparative case
study are explained. Moreover, the case study strategy and the selection of
cases are explained. Finally, in Chapter 4, innovation indicators are defined
and discussed in the research context. In Chapter 5 - Analysis, first the
quantitative data will be analysed, and hereafter the qualitative data will be
analysed by the use of the framework presented in the literature review and
in the three examined business cases. Based on the analysis, the implications
will in Chapter 6 - Discussion and Conclusion, be summarized, and the
research question will be answered. Moreover, a suggestion for further
research on the field of study will be presented.

3
Chapter 2 – Literature Review
This chapter provides an examination and elaboration of the existing
literature on the field of innovation, organizational culture and innovation
culture. The different literature will be examined in order to compare and
distinguish the literature from another, and most importantly, to justify the
need for examination of innovation culture in SMEs. Furthermore, three
different business cases concerning innovation culture will be examined in
order to identify the practice of innovation culture in organizations.

2.1 Defining Innovation

The term innovation is used heavily and to exemplify the heavy usage of the
word, Google identifies 1.270.000.000 hits when searching on the word
‘innovation’1. However, the term is often misunderstood (Goffin & Mitchell,
2017, p. 3). Different scholars have since the early introduction of the term
tried to define it. The examination of the different definitions of the term
innovation is done in order to be able to understand the term and
phenomenon ‘innovation’ and moreover, be able to analyse the collected
empirical data, which hereafter will provide implications for the following
conclusion.

Starting with one of the elder definitions of innovation, is the definition

presented by the Austrian economist, Joseph Schumpeter. he considered
different aspects of innovation (Schumpeter, 1934)2 as:

1. The introduction of a good (product), which is new to consumers, or

one of increased quality than was available in the past.
2. Methods of production, which are new to a particular branch of
industry. These are not necessarily based on new scientific discoveries
and may have, for example, already been used in other industrial
sectors.
3. The opening of new markets.

1
When searching on the word ‘innovation’ on Google, July 16, 2019
2
As presented by Goffin & Mitchell, 2017, p. 4
4
 4. The use of new sources of supply.
5. New forms of competition, which lead to the restructuring of an
industry

The Oslo Manual – which is a manual for collecting and interpreting data on
innovation for an international comparison of innovation in companies –
provides another definition,. The definition is formulated as: “An innovation
is a new or improved product or process (or combination thereof) that differs
significantly from the unit’s previous products or processes and that has been
made available to potential users (product) or brought into use by the unit
(process)” (OECD, 2018, p. 20). This definition supports the one presented
by Schumpeter, as it focuses on new products or processes.

To further examine the definition of innovation to be able to analyse the

empirical data, the scholars Hauschildt and Salamo agree with Schumpeter
regarding the introduction of something new, as innovation are “qualitatively
new products or processes which, markedly differ … from the preceding
status” (Hauschildt & Salomo, 2007). Their perception is, however,
centralized about the commercial exploitation of an invention in order for it
to qualify for the term innovation, as they argue that an invention needs to
be commercially exploited in order to qualify for the term innovation (Herzog,
2011, p. 9).

Another definition provided by another well-known economist is Michael

Porter, who defines innovation as including “both improvements in
technology and better methods or ways of doing things. It can be manifested
in product changes, new approaches to marketing, new forms of distribution
and new concepts of scope…[innovation] results as much from organizational
learning as from formal R&D” (Porter, 1990).

In his definition, Porter agrees with Schumpeter on emphasizing on the

creation of something new. What though distinguishes Porter’s definition
from the one presented by Schumpeter is the focus of organizational
learning. The focus is of high interest for this research due to the field of
study. In continuous search of defining innovation to use in the context of
innovation culture, Matthews and Brueggemann (2015) provide an interesting

5
proposition, as they “define innovation as the successful implementation of
creative ideas within an organization. In this view, creativity by individuals and
teams is a starting point for innovation; the first is necessary but not a
sufficient condition for the second” (Matthews & Brueggemann, 2015, p.
30).

2.2 Framework for innovation

After examining the definition of innovation, the need for understanding
innovation in an organizational context is of importance, as the research
question is concerned with innovation culture in organizations. To exemplify
how complex innovation can be in an organizational context, an innovation
framework is presented. The Pentathlon Framework emerged back in 1998 as
a survey was conducted with 16 senior managers, whereas one of these
managers said that he needed “a systematic way to encourage and manage
innovation” (Goffin & Mitchell, 2017, p. 28). From this, and similar views the
Pentathlon emerged.

Figure 2: The Innovation Pentathlon Framework (Goffin and Mitchell, 2017, p. 29)
Source: Originally developed from research supported by the Anglo-German Foundation

6
The framework started out by having the development funnel for innovation
in an organization, but the development shows no link to the company’s
strategic intent or the company culture. Therefore two extra elements
needed to be added; Innovation Strategy and People, Culture and
Organization (Goffin & Mitchell, 2017, p. 28), as seen in Figure 1.

The Pentathlon Framework deals with the complex art of innovation and the
different aspects of managing innovation within organizations. In order to
break down this complex area into more manageable parts, the Pentathlon
Framework consists of five different elements of which all of them, to some
extent, impact the others. When dealing with innovation culture, as in the
Pentathlon Framework are represented by the element called People, Culture
and Organization (Figure 3), it is here seen that innovation culture can impact
the other parts of the Pentathlon Framework.

Figure 3: Links from People, Culture and Organization to other Elements of the Pentathlon
Framework. (Goffin and Mitchell, 2017, p. 296)

With Figure 3, the links and impact from People, Culture and Organization to
the other parts of the framework can be illustrated and by that the
importance of innovation culture becomes visible, as “it is the people, teams
and organizational culture that make it [innovation] happen” (Goffin &
Mitchell, 2017, p. 296). Moreover; “The culture of innovation in organizations
is becoming a popular research topic. Senior managers need to accurately
‘diagnose’ their organizational culture, encourage the right employee

7
behaviour, and give employees the means to drive innovation (PWC, 2013).
Furthermore, does “many senior managers have a more positive view of
organizational culture and its impact on innovation than employees” (Rao &
Weintraub, 2013). In relation to the Pentathlon Framework, which includes
the innovation strategy as an important element when dealing with
innovation in organizations, innovation strategy is “embedded in the overall
strategy of the firm” as “the innovation strategy is driven by the mission and
vision as well as by the long-term objectives of the firm” (Stuckenschneider &
Schwair, 2005, p. 767).

2.3 Organizational Culture

As stated by Rao and Weintraub (2013), many managers have a positive view
of organizational culture and its impact on innovation. Therefore, research on
the literature on organizational culture is of importance to examine the link
between organizational culture and innovation culture. Of the reviewed
literature, Herzog (2011) defines the existing empirical evidence as scarce.
Moreover, he argues that a literature review of organizational culture
indicates that “corporate culture is a complex and multi-faceted element of
an organization” (Herzog, 2011, p. 58). Herzog does not elaborate on the
perceived distinction between corporate culture and organizational culture.
For the future distinction between corporate culture and organizational
culture, the terms will be used to identify culture in an organization, and the
used term will be based on the literature reviewed. On the research area of
organizational culture, literature still lacks empirical studies (Ernst, 2003, p.
23) and empirical studies concerning organizational culture must therefore be
seen as important. What must be noted when conducting empirical studies
on organizational culture, is that culture cannot be acquired, it has to be built
(Teece, Pisano, & Shuen, 1997, p. 528).

Further when conducting empirical studies, to apply qualitative or

quantitative methods, Schein (1997) argues that this depends on the cultural
level to be analysed (Herzog, 2011, p. 64) and as an example here, it is
argued by Schein that analysing shared basic values requires qualitative
analysis, such as in-depth interviews, case studies and observations, “as these
are more likely to yield meaningful results. In this regard, cultural data is
discovered rather than measured” (Schein, 1997, p. 145; Sparrow, 2001, p.
8
88). Schein defines organizational culture as a “pattern of shared basic
assumptions that the group learned as it solved its problems of external
adaptation and internal integration, that has worked well enough to be
considered valid and, therefore, to be taught to new members as the correct
way to perceive, think, and feel in relation to those problems” (Schein 1997,
p. 12). Adding to this definition, it is argued that: “shared values and beliefs
...help individuals understand organizational functioning and thus provide
them norms for behaviour in the organization” (Deshpandé & Webster, 1989,
p. 4).

According to these definitions of organizational culture, it can be argued that

three levels of organizational culture can be distinguished (Herzog, 2011, p.
59).
• Artefacts, which include rituals and ceremonies, stories, arrangements,
and language created by an organization Together with corporate
behaviour patterns, they build the surface level, i.e. the most visible
level of organizational culture
• Behavioural norms, which are “expectations about behaviour or its
results that are at least partially shared by a social group” (Homburg &
Pflesser, 2000, p. 450).
• Values, which are the deepest manifestation of culture and can be
defined as “a conception, explicit or implicit, distinctive of an
individual or characteristic of a group, of the desirable which
influences the selection from available modes, means, and ends of
action” (Homburg & Pflesser, 2000, p. 450)3.

To provide another perspective of organizational culture, Barney (1986)

identifies corporate culture as a company resource and a resource of great
strategic importance. In order to sustain a company’s competitive advantage,
a company’s culture needs to be (1) valuable (2) rare and (3) imperfectly
imitable (Barney, 1986, p. 658). Barney argues that a valuable culture
provides several advantages. Barney furthermore exceeds Schein regarding
the perspective of innovation culture when dealing with organizational
culture, as Barney also argues that an innovative culture must be valuable in

3
Originally from Kluckhohn, 1951, p. 395, but cited in Homburg and Pflesser, 2000, p. 450.
9
order to provide sustained innovative performance. In correlation to this,
Herzog (2011, p. 92) argues that a culture is only valuable when it fits in a
strategically and competitive context.

Both Barney and Schein defines organizational culture, but do not pay much
attention to the characteristics of the organization and the generalization of
organizations seem to be troubling in order to answer the research question
of how innovation culture can be practised in SMEs as it is presumed that not
all organizations are alike.

To identify individuality among organizations, Herzog (2011) refers to Burns

and Stalker (1961, p. 119), who uses a typology, which is often referred to in
the literature of corporate culture. Burns and Stalker distinguish between
mechanistic and organic organizations, where both terms describe
organizational structures as well as organizational culture (Herzog, 2011, p.
65). For further reference of the two terms, culture will be used to cover both
of these, as this research is concerned with the culture in organizations. The
two cultures are distinguished based on five different areas within the
organization, as presented in Appendix 1.

In organic cultures, communication can be categorized as lateral, whereas

communication in mechanistic cultures is rather vertical. To the distinction,
Burns and Stalker (1961) argue that organic cultures are more likely to the
potential of (radical) innovation. Furthermore, in order to determine the
appropriate type of culture, different factors play a role in the categorization.
Where the mechanistic type is best suited for stable market and technology
conditions, the organic type is better suited for changing conditions. Another
character of the organic culture is decision making in the organization, as this
is driven and influenced by employees with knowledge within the field rather
than the hierarchical position as in mechanistic cultures. Moreover,
employees in organic cultures are more open to new ideas or technologies
than the ones in mechanistic cultures. Further, organic cultures foster the
exchange of ideas and information rather than from a central authority
(Afuah, 2003, p. 102; Burns & Stalker, 1961, p. 120; Hauschildt & Salomo,
2007, p. 110). Lastly, organic cultures are considered to be more flexible in
processing information and exchanging ideas and thereby it is argued that

10
they are more likely to recognize the potential of (radical) innovation (Herzog,
2011, p. 65).

Scholars have adopted the general view of mechanistic organizations as

being ones that hinder innovation (Hauschildt & Salomo 2007, p. 111), but a
critique of such a view is also presented by Hauschildt and Salamo (2007, p.
114), who argues that the different phases of the innovation process require a
move from organic to mechanistic structure in accordance with the different
phases of the innovation process. By this argument, one must, in
consideration of developing an innovative culture in an organization,
consider the type of culture, as argued by Hauschildt and Salamo (2007),
organic cultures are more prone to foster innovation, but at the same time,
acknowledge that a move from an organic culture to a mechanistic one in the
innovation process, could potentially be beneficial for the innovation process.
A need for further investigation of how the two cultures co-exists in
organizations is needed as there is no further mentioning of this by either
Burns and Stalker (1961) or Hauschildt and Salamo (2007).

2.4 Innovation Culture

From the discussion of mechanistic cultures versus organic cultures, an
implication is innovation culture, which is defined as an important subculture
(Herzog, 2011, p. 68). However, it is argued, “a clear definition of the term
‘innovation culture’ has not emerged in the literature on technology and
innovation management” (Ernst, 2001). Based on the former discussion of
corporate culture and the three levels consisting of shared basic values,
norms and practices, innovation culture can be defined as (Herzog 2011, p.
69):
• Organization-wide shared basic values that support innovation,
• Organization-wide norms for innovation, and
• Perceptible innovation-oriented practices (artefacts and behaviours)

With this definition, Herzog partly agrees with Schein in his definition of
organizational culture when presenting artefacts, behaviour and value as
factors defining a culture.

11
As argued by Ernst (2001), a clear definition of the term innovation culture is
lacking, and therefore further research is needed in order to define the term
and hereby answering the research question of how innovation culture can
be created in Danish SMEs.

According to the empirical studies conducted on the field of innovation

management, numerous of them have argued that openness to new ideas is
an important parameter for innovativeness. Hurley and Hult, who are
supporting the theory of openness to new ideas, directly argues that it is
possible to measure a company’s orientation towards innovation on behalf of
openness to new ideas (Hurley & Hult, 1998, p. 44). Ideas are something
created by individuals, but innovation is typically a result of the joint effort
between several individuals (Van De Ven, 1986, p. 591). With the
argumentation about the importance of new ideas, in order to create an
innovative culture in an organization, the reaction to these new ideas is just
as important. Therefore, in order to create a positive innovation culture,
creativity is an important element (Amabile, 1997, p. 52, Amabile et al. 1996,
p. 1155; Ernst 2003, p. 31; de Brentani 2001, p. 179) and new ideas must be
encouraged and rewarded (Amabile et al., 1996; Worren, Moore & Cardona,
2002, p. 1128).

Another factor for creating an innovation culture in organizations is risk-taking

behaviour, and hereby the acceptance of failure. Here it is argued that
emerging technologies requires continuous development and therefore it is
necessary to learn from a trial-and-error practice (Day & Schoemaker, 2002,
p. 44). At the same time, it is important that employees are not punished if
the projects they are working on not are delivering the expected results.
Therefore “an innovation culture thus encourages experimentation, tolerates
creative mistakes and fosters learning from failure” (Atuahene-Gima & Ko,
2001, p. 61; Botcheva, White, & Huffman, 2002, p. 421; Cooper &
Kleinschmidt, 1995, p. 377; Cummings & Teng, 2003, p. 49; Day &
Schoemaker, 2002, p. 44; de Brentani & Kleinschmidt, 2004, p. 312; Huber,
1996, p. 88; Sundgren et al., 2005, p. 362).

Furthermore, in the search for decisive organizational factors for innovation

culture, some authors have stressed the importance of a general openness

12
about communication and discussion among employees (Herzog, 2011, p.
80). If there exists a culture of freedom and the possibility to speak freely
then it is possible to promote innovation (Capon et al., 1992, p. 161; Gupta
and Wilemon, 1990, p. 277). However, it is argued that effective innovation
processes involve disagreement among team members (Dornblaser, Lin, and
van de Ven, 1989, p. 210; Ring & van de Ven, 1989).

As a definition of the term ‘innovation culture’ is lacking (Ernst, 2001), it can

be argued that more studies are needed in order to contribute to the
definition of the term as well as to answer the research question. Such studies
are compiled and presented by Herzog (2011, p. 74-78), and of these,
several major findings have been presented (Appendix 2). However, the
majority of the research conducted only covers aspects of innovation culture
(Herzog, 2011, p. 73) and therefore a set of well-defined factors for practising
a successful innovation culture is difficult to produce on the background of
these studies. The studies, however, present interesting findings, which
contribute to the research of organizational factors for practising a successful
innovation culture. Selected interesting findings from the major results in the
study (Herzog, 2011, p. 74-78) will be presented here. These findings will by
a deductive approach be used in the analysis for assessing useful practices
for creating a successful innovation in Danish SMEs. For a full overview of the
selected studies, see Appendix 2.

In his study, Voss (1985) argues, with the research objective of factors that
can lead to innovation success, that good management practice is needed,
which is mainly determined by a risk-taking climate. Amabile et al. (1996) also
mention management in their findings, as they are important for workgroups
as well as individuals. de Brentani and Kleinschmidt (2004) mention
management as well, as solid top management involvement is needed to
achieve outstanding performance.

Another important factor listed as a major result in the presented studies is

employees. Cooper and Kleinschmidt (1995) mention free time for
employees as important. In the updated study with a slightly different focus,
Cooper and Kleinschmidt (2007) again mention free time for employees as of
importance for a positive climate and culture for innovation. Sundgren et al.

13
(2005) contributes to the importance of employees but focuses on learning
culture and intrinsic motivation as important factors to create a creative
climate.

Ideas are mentioned in several ways as a contributor to innovation too.

Capon et al. (1992) mention the importance of a climate where ideas can
flourish. Amabile et al. (1996) mention constructive judgment of ideas and
openness to new ideas as important, and that harsh criticism of new ideas
can impede creativity. Hurley and Hult (1998) support the studies by arguing
that the ability to successfully implement new ideas is important for a strong
innovation culture. Cooper and Kleinschmidt (2007) join the chorus by
arguing that positive cultures and climates for innovation are those in which
idea generation is fostered.

The findings presented above will be used in the analysis in order to see if a
consistency, between these and the findings in the empirical data collected,
can be identified. Not all the major findings are listed here as the full list of
studies and thereby major results are extensive and therefore only selected
relevant results are included as these are of importance in the later analysis.

The scholars and their presented findings regarding innovation culture have
no specific focus on SMEs, and many of the studies are concerned with the
related field of study, innovation management. This can, however, also be
used as a framework for innovation culture, as presented in the Pentathlon
Framework. In here innovation culture, or the element of People, Culture and
Organization, as it is defined in the Pentathlon Framework, relates to all the
other elements in the organization regarding innovation.

As the data from the findings in the studies are not directly focused on the
research topic for this research, being innovation culture in SMEs, one must
be careful in the direct translation of the presented successful factors for
innovation culture, as successful innovation factors in large enterprises might
not be transferable to SMEs.

14
Therefore literature and empirical studies on the subject of innovation culture
in SMEs are closely studied in order to provide a more direct perspective on
creating a successful innovation culture in SMEs.

An empirical study, which addresses the question of innovation culture in

SMEs, is conducted by Wolf, Kaudela-Baum and Meissner (2012). In the study
85 interviews with managers, with particular responsibility for innovation
management in Switzerland, were conducted. These were conducted in
order to examine where innovation and creativity come from, as these
attributes, according to the study, are central in order to develop new
products and new processes. All of these managers were employed in SMEs,
which in this study is defined as a workplace with less than 500 employees. In
the study, SMEs are acknowledged as drivers for the development and
renewal of national economies (Acs and Audretsch, 1990; Birch, 1989; Wolff
& Pett, 2006). Moreover, supporting the rationale of the study, innovation
capability is identified as critical for SMEs in order to survive (Hitt et al., 2001;
Lee, Lee & Pennings, 2001). Further, adding to the rationale, it is argued that
organizational culture is highlighted as a powerful determinant for innovation
potential (Pohlmann, Gebhardt, & Etzkowitz, 2005). Finally, it is concluded,
“that our current knowledge about innovation culture in SMEs remains some
limited” and that “studies investigating the role of culture in SME innovation
therefore, are relatively rare” (Wolf, Kaudela-Baum and Meissner, 2012, p.
245). All of the implications above are supporting the importance of the
research on innovation culture in SMEs as the focal research area for this
thesis. Furthermore, it is in the study argued that, as the data is gathered
from SMEs in Switzerland, it might not be valid for other regions. This aspect
further supports the need for more research on innovation culture in SMEs in
other regions as this master thesis also examines. Moreover, the study
applied the US definition of SMEs, being companies with fewer than 500
employees, whereas the research in this thesis is concerned with the Danish
and European definition of SMEs being fewer than 250 employees (Jensen,
Moltrup-Nielsen & Nielsen, 2016; Liikanen, 2003) and therefore it can be
argued that a research on innovation culture in SMEs with the European
definition is needed.

15
Several other studies who have examined innovation culture in SMEs are
mentioned in the study by Wolf, Kaudela-Baum and Meissner, but it is
argued that these only provide a fragmented picture of innovation culture in
SMEs, as “each study only covers a fraction of the variables considered
important in other studies” (Wiklund, Patzelt and Shepherd, 2009, p. 351)
and therefore a study is needed in order to generate a holistic picture of
innovation culture in SMEs (Wolf, Kaudela-Baum and Meissner, 2012).

Other studies that are examining other aspects of innovation culture in SMEs
are mentioned in order to provide useful insight in order to create a holistic
picture of innovation culture in SMEs. Here studies on entrepreneurship, SME
innovation management research and studies on organizational culture are
mentioned. In the latter, several studies on the subject are mentioned.
Schein’s study, as already mentioned in section 2.3, is referred to, regarding
artefacts, norms and beliefs. A study conducted by Kenny and Reedy (2006)
investigated cultural factors and their impacts on innovation in SMEs. The
important findings in this study are that the most influential factors “are the
availability of adequate resources and funding, management support, the
technical competence of innovation team members, good strategic direction
and a non-constraining environment” (Wolf, Kaudela-Baum and Meissner,
2012, p. 245). The literature in the study presented by Kenny and Reedy is,
however, based on innovation in large companies. It is therefore argued that
the approach is inadequate as large companies and SMEs differ as the
innovation processes in SMEs lack limited access to finance and scarce
resources (Freel, 2000; Rothwell, 1989; Welsh & White, 1981), as well as
managerial skills and marketing knowledge (Adams, 1982). Moreover, SMEs
usually face high market uncertainty (Westhead & Storey, 1996). What can be
added as advantageous factors for innovation in SMEs are flexibility,
adaptability to changing market conditions and rapid internal communication
and decision-making processes (Adams, 1982; Cannon, 1985). In the study, a
social constructivist perspective and thereby the use of a qualitative rather
than quantitative social research is proposed “as a joint conversational event
where new configurations of meaning are constructed” (Steyaert, Bouwen &
van Looy, 1996, p. 67).

16
The framework of the study is based on studies by Sackmann (1991; 1992),
where culture in organizations stands as the research objective. The
conceptual framework presented by Sackmann is based on the assumption
that “the essence of culture can be conceptualized as the collective
construction of social reality” (Sackmann, 1991, p. 33)
The study resulted in the definition of four different types of SME innovation
profiles, which represent ideal types of innovating cultures in SMEs (Wolf,
Kaudela-Baum & Meissner, 2012); Holistic Innovation, Network-based
Innovation, Do It Yourself Innovation and Innovation Resistance. The
innovation profiles however seldom appear in their absolute form (Weber,
1980). A description of the different SME innovation profiles can be found in
Appendix 3.

Of interesting findings, it is suggested, “successful innovation processes are

facilitated by both excellent knowledge of employees and financial back-up”
(Wolf, Kaudela-Baum & Meissner, 2012, p. 266). Furthermore, it is concluded
that the relationship between manager and employee are very direct and
close in SMEs compared to large companies (Wolf, Kaudela-Baum &
Meissner, 2012).

As a conclusion, it is in the study argued that SMEs do not need to strive for
any particular innovation profile. Rather they should strive for the one suiting
the company profile (Wolf, Kaudela-Baum & Meissner, 2012, p. 265).

2.5 Business Cases

To further examine innovation culture and especially the creation of
successful innovation culture in organizations, three different business cases
on innovation in major companies will be examined in order to dissect the
successful organizational factors for innovation in order to practise innovation
culture in organizations and more specifically SMEs. As argued in section 2.4,
studies on innovation in large companies might be inadequate, as large
companies and SMEs differ. However, the three case studies are included as
relevant literature on the study of innovation culture due to the potential of
relevant aspects and factors for the practise of successful innovation culture
in organizations. Moreover, the three companies are globally identified as
companies who create continuous innovations. If the examination of these
17
three business cases therefore leads to ways of practising a successful
innovation culture in SMEs, these will be taken into consideration. The
potential proposal of ways to practise a successful innovation culture, based
on the three business cases, will later be analysed and discussed before
proposing these as being successful for SMEs. A discussion of both literature
on the field of organizational culture, innovation culture and the literature
from the three cases will hereafter be conducted in order to provide
conclusions to the research question.

2.5.1 Apple
Apple has for years been one of the most influential companies in the world
regarding technological products and the highly innovative force behind
Apple was, until his death, Steve Jobs, the founder and charismatic CEO of
Apple. The use of Apple in the context of innovative culture is truly
interesting as Apple, and especially Steve Jobs often does not follow the
scholars’ rules of innovation in organizations. The literature, of which this
business case is based on, is the book “Inside Apple” by Adam Lashinsky
and thereby also the empirical studies conducted by Lashinsky in his work
writing this book. This book will be categorized as literature, who are to
provide inspirational principles for innovation and thereby, innovation culture
in SMEs.

Leadership at Apple, in terms of creating innovation, can be described as

centralized, and the organizational structure is strict top-down management
(Lashinsky, 2013, p. 71). This structure affects almost everything in the
organization, as communication at Apple always began at the top (Lashinsky,
2013, p. 118). Moreover, secrecy is a very important business strategy for
Apple and can be seen in all the ways employees work at Apple. From idea
generation, production to marketing, secrecy is the main key in order to keep
innovation within the walls of the organization. This can also be seen in the
culture, as the employees are not recognized for their success, as this in
Apple is exemplified by how Apple employees do not know which projects
their colleagues are working on (Lashinsky, 2013, p. 46). Moreover, to the
culture, focus is a very important part, if not the most important part of the
culture at Apple. Apple has, from the very beginning, focused on the design
of the products. But what is just as important is the narrow focus on the
18
design of their products and the attention they get from the whole
organization. As one employee at Apple formulated it: "at most it's three
projects that can get a ton of attention at the executive level. It is about
editing down…” (Lashinsky, 2013, p. 62.) In order to make new product
development consistent and structured, Apple has created a clear structure
called the ANPP (the Apple New Product Process) (Lashinsky, 2013, p. 56).
The management at Apple is also very clear, and the use of DRI (Directly
Responsible Individual) is an important management tool in order to know
who to go to if things do not go as planned (Lashinsky, 2013, p. 68). Apple’s
attributes: clear direction, individual accountability, a sense of urgency,
constant feedback and clarity of mission is described as Apple’s values.
Another thing to add regarding management is that managers rarely press
the employees at Apple for any financial analysis or are expected to deliver
any potential return on investment (Lashinsky, 2013, p. 69).

As seen from the points above, conducted by studying the way Apple
manages - and thereby creates - innovation within the organization, it is not
given that the Apple way is necessarily the correct way to do so. Lashinsky
himself is also agreeing upon this as; “Not every company and not even
every executive will be able to copy Apple” (Lashinsky, 2013, p. 187). But at
the same time, in his conclusive words, Lashinsky writes: “I've come to realize
that corporate culture is critical to Apple's success. That means culture is
critical to any organization's success, and I still believe that though not
everyone can or even should want to be like Steve Jobs, every company,
organization, and individual can learn lessons from Apple's
accomplishments” (Lashinsky, 2013, p. 22).

2.5.2 Google
Just as Apple, one of the key players regarding innovative products and
solutions the later years has, and still is, Google. The business case on
Google in this section is based on the book, The Google Model - Managing
Continuous Innovation in a Rapidly Changing World by Annika Steiber (2014).
The Google case is used to explore the innovative culture in one of the
biggest and most innovative companies in the world, as Google has become
(Ringel & Zablit, 2018) and from this provide useful ways of practising
innovation culture in SMEs.
19
Steiber starts by arguing that it is the employees’ knowledge and creativity
that is Google’s most important strategic resource (Steiber, 2014, p. 6). This
means an emphasis from setting specific goals, accurately measuring
performance to set the overall orientation and motivating employees by
offering challenges and more stimulating task as examples (Steiber, 2014, p.
6).

Google’s innovation model is explained by the use of six management

principles, who, according to Steiber, have been identified by clusters of
researchers to be crucial for explaining the ability of successful companies to
engage in continuous innovation (Steiber, 2014, p. 16). These six principles
are: 1) Dynamic capabilities 2) a continuously changing organization 3) a
people-centric approach 4) an ambidextrous organization 5) an open
organization that networks with its surroundings and 6) a systems approach.
These six principles will in the following sections be further elaborated.

First, an important asset in the eyes of Steiber is dynamic capabilities, which

she defines as the capacity to constantly review external factors and quickly
adapt the company to meet new challenges (Steiber, 2014, p. 18). To further
dissect dynamic capabilities, these are based on three skills (Teece, 2007, pp.
1319–1350):
• Sensing and shaping opportunities and threats
• Seizing opportunities
• Maintaining competitiveness by combining, protecting, and where
necessary, reallocating company resources

Next principle focuses on the continuously changing organization. Here the

focus is simple; the company must always be ready for change. In terms of
that, leadership is an important factor to be able to guide the organization in
a competitive landscape where challenges arise fast. Therefore, as Steiber
puts it, it is truly important to make every person in the organization
understand that various parts of the common picture (vision, mission and
strategies) support each other (Steiber, 2014, p. 21). And these objectives
should be communicated to the employees, so they can use them as a basis
for their independent decisions (Steiber, 2014, p. 21). What is therefore

20
needed is a culture where people are always prepared for changes and to
create a semi-structured organization, which can function on the border
between order and chaos (Steiber, 2014, p. 22).

A people-centric approach is another important part of the six principles, as

people are the most important asset in the current economy (Steiber, 2014,
p. 23). Here again, management plays a crucial role in the people-centric
approach, as “the management team communicates visions and explains
prioritizations but leaves the choice of how to perform the work to the
employees themselves” (Steiber, 2014, p. 23). Finally, on the topic of a
people-centric approach, companies with innovation cultures spread trust
and openness in the organization, and they actively try to involve and
activate their employees. But at the same time, they allow conflict and
debate, accept risk-taking and allow employees to freely choose how to
perform their work (Isaksen & Tidd, 2006).

The next principle, concerning an ambidextrous organization, is how the

organization is able to improve its daily operations while engaging in
continuous innovation (Steiber, 2014, p. 24). The company’s ability to create
favourable long-term business success is based on being good at both
production and innovation (Steiber, 2014, p. 24).

To survive in the long term, it is important for a company to create an open

system, and thereby to search beyond itself for innovations that are likely to
increase revenue (Steiber, 2014, p. 27). This is the principle as Steiber defines
as an open organization that networks with its surroundings. Networks and
alliances outside of the company can even show to be crucial for a company’s
innovations (Steiber, 2014, p. 27).

It can be argued that a system approach can be used to understand what is

needed to enhance innovation capabilities (Steiber, 2014, p. 27). A system
approach includes two different features of operations: productivity and
innovation and therefore, companies can roughly be divided into one or
another. The difference between the two types of companies is where the
focus lies (Steiber, 2014, p. 29). The board and the management in the
innovation company has a long-term vision for the company, whereas the

21
board and management in the production company are focused on the
current business and about meeting the financial goals of the company
(Steiber, 2014, p. 29). Moreover, the knowledge about how to create an
organizational culture is low in the production company, whereas culture is
embedded in everything the innovation company does and the management
have a high influence on creating and affecting the culture (Steiber, 2014, p.
30).

The two most driving forces for continuous innovation at Google is the
company culture and the people involved (Steiber & Alänge, 2013). The
culture at Google is extremely important as it pervades everything, from
leadership to recruiting, building the brand and even the compensation
system (Steiber, 2014, p. 42). The company culture consists of building blocks
such as norms and values, which can be seen in the actual behaviour and the
artefacts - just as literature presented by Schein - in the company, such as
Google’s colourful and playful offices (Steiber, 2014, p. 46).

In terms of duplicating Google’s management model, Steiber stresses that: “I

do not believe that other companies should try to duplicate Google’s
management model in its entirety, as each company faces its own unique
circumstances. I do believe, however, that Google can play a role as an
inspiration for companies and organizations in the innovation economy…”
(Steiber, 2014, p. 77).

2.5.3 LEGO
LEGO has and still is a strong player in the toy industry (Haigh, 2019) because
of the innovative approach, not only to products in the form of toys, but also
to create a playful universe and by being innovative in doing so. The business
case of LEGO is used to exemplify innovation in a Danish organization. With
the book Brick by Brick: How LEGO Rewrote the Rules of Innovation and
Conquered the Global Toy Industry 4, David Robertson and Bill Breen go

4
Original title. The reference used here is based on the Danish translation of the book

(LEGO: Sådan omskrev LEGO reglerne for innovation og erobrede legetøjsindustrien).

22
through the history of LEGO, how they almost vanished and how they rose
again, by the use of innovation.

In the case, Robertson presents seven so-called truths about innovation and
how LEGO first went about them (Robertson & Breen, 2013, p. 61):

1. Hire diverse and creative people

Diverse and creative people are the ones who are the primary source for
competitive advantages (Robertson and Green, 2013, p. 306)

2. Set the course towards “blue ocean” markets

A new untouched market is not free for competitors for very long. The faster
a breakthrough product is created, the faster it meets the potential in the
original business model and loses its news value (Robertson and Green,
2013, p. 301)

3. Be customer-driven
Due to LEGO Mindstorms, LEGO began to see the advantages to encourage
customers to come up with supplementary innovations to its toys (Robertson
and Green, 2013, p. 216)

4. Practise breakthrough innovation

Big companies who are trying to launch breakthrough innovation will do
better if they establish a separate department where the employees can do
what is best for the product (Robertson and Green, 2013, p. 262)

5. Create a foundation for open innovation - listen to the majority’s opinion

When LEGO changed their innovation processes, to more open innovation,
they learned a set of valuable lessons about open innovation. Firstly, to set a
direction but to be flexible in the execution of it. Secondly, both insiders and
outsiders have a common responsibility for the final result. Thirdly, open
innovation activities demand new roles (Robertson and Green, 2013, p. 247).

6. Make sure to use the whole innovation spectrum

A total use of the whole innovation spectrum does not only create value by
new products and services to the customers but also via changes in the

23
company’s business model, internal processes and even culture (Robertson
and Green, 2013, p. 194).

7. Build an innovation culture

A company should be concerned about a relative few products for a clearly
defined customer segment (Robertson and Green, 2013, p. 118).

Chapter 2 – Subset
In Chapter 2, the literature on organizational culture has been reviewed, and
implications from the examination of the literature show that shared values
are of importance in the organization and an organization can be divided into
three different levels of culture. Differentiation of organizations is lacking, but
a distinction of mechanistic and organic cultures is presented. Furthermore,
innovation culture is defined as an important subculture, but a definition of
the term is lacking. Innovation culture can moreover be defined as
organization-wide values, norms and practices. Several factors are argued to
be important in the creation of innovation culture, where openness to new
ideas, risk-taking behaviour and toleration of mistakes can be mentioned as a
few. The examined literature also emphasizes that existing studies are based
on innovation in large companies, and this approach is inadequate as large
companies and SMEs differs. A study of innovation culture in SMEs is
therefore examined, and four different SME innovation profiles are
presented. However, research of SMEs in other regions is needed. Finally,
three business cases have been examined regarding innovation culture,
which shows that many different factors are important for innovation culture
in major companies.

24
Chapter 3 – Methodology
In Chapter 3, the methodological framework for the research will be
explained in order to fully understand the research design of the thesis and
how the following implications of the research have been processes. Firstly,
the structure of the research is presented with the different methodologies or
approaches applied. The structure will hereafter be broken down into the
individual parts of the process, and the chosen methodology or approach will
be examined and described. Hereafter, it will be explained how these are
used in the context of this research in order to answer the research question.
Each part of the process is chosen in consideration of the field of research.
This will define the whole process and structure of the research and will result
in a conclusion of the thesis and provide a basis for answering the research
question.

3.1 Structure of the Research

As presented in the introduction of the thesis in Chapter 1, the research
started out with extensive research for relevant literature in the literature
review. Hereafter a deductive approach (section 3.2) was chosen, as the
examined literature was included in the case studies conducted. In order to
collect relevant empirical data from the case studies, both a qualitative
method (section 3.3) as well as a quantitative method (section 3.4) was
chosen, which is defined as mixed methods (section 3.4). With the empirical
data conducted from the chosen research methods, a hermeneutic
methodology (section 3.5) was used to categorize the empirical data and
hereby be able to analyse it according to the literature examined in the
literature review. In the analysis in Chapter 5, social constructionism (section
3.6) as a methodology is applied to discuss and interpret the implications
from the conducted analysis and, furthermore, to compile the implications
into a discussion and conclusion of the research in Chapter 6.

3.2 Deductive versus Inductive Approach

The research is examining the existing literature on the field of organizational
culture as well as innovation culture. These two fields are researched, not

25
only from an academic perspective but also from a practical perspective in
the form of three different business cases. The research is designed to
conduct a comprehensive study, resulting in valuable findings in order to
answer the research question.

By structuring the research in such a way, it can be argued that a deductive

method is used, as “deduction involves movement from the general to the
particular…” However, it is added that it “… is inseparable from inductive
reasoning “ (Gilgun, 2016, p. 9). In addition to this, it is argued that the basis
for knowledge development is the ongoing movement between concepts
and the empirical world (Thomas & Znaniecki, 1934). The difference between
deduction and induction is that deduction is the process of testing
hypotheses for the purpose of ‘confirming, refuting, and modifying’ them
(Dewey, 1933, p. 82) whereas induction is for the researcher to attempt to be
open-minded and set aside biases in order to see concrete instances in new
ways (Gilgun, 2019, p. 9). As Gilgun formulates it, “Dewey acknowledged the
impossibility of purging the self of presuppositions, but he recommended the
attempt” (Gilgun, 2019, p. 9).

Another way of describing induction is used by explaining the term

Generalization, provided by Maxwell and Chmiel (2014) and is explained by
taking “the characteristics of a small selection of elements of a specific group
to be representative of the characteristics of all elements of that group. The
implication inherent in this manner of reasoning is that all the elements of a
group have the same features” (Reichertz, 2014, p. 8).

Joining the aforementioned chorus of perceiving deduction and inductive

reasoning as inseparable as argued by Gilgun and the ongoing movement
between concepts and the empirical world, as argued by Znaniecki, is
Schleiermacher (1998), who encourages to see inductive and deductive
approaches as dependent and co-constitutive (Tomkins & Eatough, 2019).

As written at the start of this section, this research is concerned with the
existing literature on the field of organizational culture in order to examine
and research on the field of innovation culture. Moreover, existing
knowledge and data from the business cases, used in this context as relevant

26
literature, is used as a basis for the analysis of the collected empirical
qualitative and quantitative data. Therefore a deductive method can be
identified, as there is a movement from the general, in the form of existing
literature, to the particular, in the form of practised innovation culture in the
studied SMEs. However, for again to refer to the aforementioned Gilgun,
Znaniecki and Schleiermacher, deductive and inductive approaches are
inseparable, dependent and co-constitutive, which is applicable for this study
as well. The use of existing literature to analyse the empirical data must be
defined as a deductive approach, but hereafter the empirical findings
contribute to the creation of new knowledge on the field of study, based on
the studied cases. A movement from the particular to the general can hereby
be seen, and an inductive approach is therefore used in the study, as the
empirical findings will be used as particular cases for generally creating a
successful innovation culture in Danish SMEs.

3.3 Qualitative Methods

Qualitative methods are often used to get a deep insight into how
phenomena are experienced, appeared or developed (Brinkmann &
Tanggaard, 2015). The American scientists Denzin and Lincoln provide a
general definition of qualitative methods: “Qualitative research is a situated
activity that locates the observer in the world. It consists of a set of
interpretive‚ material practices that make the world visible. These practices
can transform the world. They turn the world into a series of representations,
including field notes, interviews, conversations, photographs, recordings, and
memos to the self. At this level, qualitative research involves an interpretive,
naturalistic approach to the world. This means that qualitative researchers
study things in their natural settings, attempting to make sense of, or
interpret phenomena in terms of the meaning people bring to them” (Denzin
& Lincoln, 2000, p. 3).
With the definition presented above, several aspects can be transferred to
the overall ambition of this research. Firstly, by the use of qualitative
research, it has been possible to conduct empirical data in the organizational
settings of which the respondent in the interviews worked - with the words of
Denzin and Lincoln - to study things in their natural settings. Secondly, as
presented in the definition, choosing a qualitative method as an approach to
collect data were done in order to interpret phenomena in terms of the
27
meaning people bring to them. Interpreting innovation and especially
innovation culture has mainly been done by interpreting the meaning the
respondents brought to them. Therefore the definition presented by Denzin
and Lincoln is highly applicable in the reasoning of choosing a qualitative
method as a research method.

3.3.1 Semi-structured Interviews

When choosing a qualitative research method for collecting empirical data,
several forms of interviews could have been chosen. However, the qualitative
research interview has been chosen for this research, as it gives the possibility
to learn something about the world around us (Gubrium et al., 2012, p. 5).
The reasoning of choosing interviews as an empirical data collection method
is that it allows one to complete a whole conversation with a specific
purpose. The purpose in this matter is to understand the respondent’s
understanding and perception of innovation culture with all implicit as well as
explicit factors affecting it. In choosing the qualitative research interview, one
must look at the strengths and weaknesses for conducting such interviews.
The strength of the qualitative research interview is that it provides access to
personal knowledge and experience (Kristensen & Hussain, 2019, p. 97).
Knowledge, which is not else accessible by any other type of sources (Elklit &
Jensen, 2012, p. 133). The reason for choosing the semi-structured interview
form for qualitative research interview is that it provides the possibility of
adapting questions and to ask new, not prepared questions, depending on
how the interview evolves (Berg, 2009, p. 105). As the main goal for
conducting interviews in this research is to gain knowledge of innovation
culture in SMEs, in order to compare with the existing literature on the field
of study, the possibility of asking these unprepared questions are much
welcomed as they might provide additional knowledge, which can be
defined as valuable in search of answering the research question. The
potential additional knowledge might not have been accessible if the
structured or unstructured interview had been chosen as a framework for the
interviews.

28
3.4 Quantitative Methods
Quantitative methods are in this research used for collecting primary data; as
such data are not available. The primary data are collected as it investigates
the research problem of how to create an innovation culture within SMEs.
The quantitative empirical data are in this research collected by the use of a
survey, and there are different advantages and disadvantages with the use of
a survey as a method for data collection.

An advantage of using a survey is the generally high level of

representativeness and thereby increased generalizability compared to the
use of the semi-structured interviews (Kristensen & Hussain, 2019, p. 212).
Moreover, does a high level of representativeness in the collected data make
it easier to document significant statistical results than compared to other
data collection methods (Kristensen & Hussain, 2019, p. 213). Having
presented some of the strengths of using a survey as a research method, the
weaknesses must be presented too, in order to provide an understanding of
the usage of both qualitative and quantitative methods. A survey represents
an inflexible research design, which cannot be changed during the data
collection. Moreover, standardized questions tend to be irrelevant for some
of the respondents (Kristensen & Hussain, 2019, p. 213).

In the construction of the survey, the use of a Likert-scale has been chosen,
as this is recommended, as “surveys can collect data on the relevance of
these capabilities for a firm's business operations, using a Likert scale…”
(OECD, 2018, p. 110). Moreover, does the Likert scale force the respondent
to make a directional choice (Heiberger & Holland, 2015, p. 592). The survey
in this research is, therefore constructed by the use of a Likert-scale and
thereby includes statements that the respondent must respond to the extent
to which they agree or disagree with the presented statement.

3.5 Mixed Methods

A combination of both qualitative and quantitative methods is a designation
of a research design called mixed methods (Tashakkori & Teddlie, 2010) and
can be defined “as a design for collecting, analysing and mixing both
quantitative and qualitative data in a study to understand a research
29
problem” (Denzin, 2012, p. 81). The purpose of using this form of research is
to create new knowledge that helps to create an understanding of the
concerned problem (Wheeldon, 2010).

The emergence of mixed methods is in the literature on methodology

referred to as a “third paradigm” (Giddings, 2006), where the two others
paradigms are the scientific theory, who primarily uses quantitative methods
and the paradigm that is based on constructivist ontology, which uses
qualitative methods (Morgan, 2007). The “third paradigm” builds a bridge
between the two formerly known paradigms (Giddings, 2006).

It is argued by Morgan that quantitative and qualitative methodologies

should not be perceived as incompatible paradigms that cannot be used in
the same research. Moreover, Morgan argues that it is not necessary to
choose between theoretical or empirical driven research. When choosing a
methodology for the research, it is argued that mixed methods are
characterized by a given research question, which defines the best
methodology to provide an answer to the research question (J. W. Creswell,
2008; Tashakkori & Teddlie, 2010, p. 8). This is called methodical eclecticism
and means that the choice of methods is not controlled by an ontological
starting point, but rather a valuation of suitability for the research (Kristensen
& Hussain, 2019, p. 331). Moreover, mixed methods are based on the
rejection of an either-or choice between qualitative and quantitative methods
(Kristensen and Hussein, 2019, p. 331).

As seen from the literature on mixed methods presented above, the use of
mixed methods allows the researcher to focus on answering the research
question by the use of the best-suited methodology. As argued by Morgan
(2007), quantitative and qualitative methodologies should not be perceived
as incompatible paradigms that cannot be used in the same research and
both methodologies are therefore used in this research.
The methodologies can be used in a parallel process, in a sequential process
or they can be embedded in each other (Creswell, 2014, p. 220; Creswell,
2008, p. 68). In this research, a parallel process is chosen as both a
quantitative as well as a quantitative sub-study is conducted and analysed
together.

30
3.6 Hermeneutic Methodology
Hermeneutic methodology is in this research used for the interpretation of
the empirical data collected and hereafter the production of knowledge.

When dealing with hermeneutics, two main fields can be distinguished. One
deals with the activities of interpretation and the other deals with the
philosophy of thinking (Palmer, 1969).

When dealing with understanding and interpretation from a hermeneutical

perspective, the hermeneutic circle can be applied as an idea of how to
approach exactly understanding and interpretation. With the hermeneutic
circle, the idea is to move away from linear thinking to a more iterative and
productive one (Tomkins & Eatough, 2019). This hermeneutic circle as an
idea of understanding and interpreting newly generated knowledge is highly
replicable to the way knowledge is constructed in this research. As such, new
knowledge is generated through the use of comparing existing literature on
the field of innovation culture with new insights gathered by the empirical
data collected. The process of doing so can be defined as an iterative one, as
new knowledge does not necessarily lead to the next step in a final
conclusion. Rather new knowledge must be compared with the existent and
by that, this new knowledge can be defined as valuable or not valuable for
generating a contribution to the existing knowledge on the field of study.

Several scholars have contributed to the development of hermeneutics and

how hermeneutics can be used for interpretation and understanding of
meaning. Schleiermacher, the so-called father of modern hermeneutics
(Palmer, 1969), uses the hermeneutic circle to connect whole and parts. As
explained with his own words: “the vocabulary and the history of the era of
an author relate as the whole from which his writings must be understood as
the part, and the whole must, in turn, be understood from the part. Complete
knowledge is always in this apparent circle, that each particular can only be
understood via the general, of which it is a part, and vice versa”
(Schleiermacher, 1998, p. 24). The use of this perception of generating
knowledge is used in order to understand the subject of innovation culture,
as innovation culture must be understood from organizational structure and

31
an innovation management perspective, as well as these two, must be
understood from an innovation culture perspective. An example of this can
be explained by the use of Figure 1 and Figure 2 in section 2.2, where Figure
1 exemplifies how innovation culture must be understood from organizational
structure and innovation management, and Figure 2 illustrates how
organizational structure and innovation management must be understood
from innovation culture.

The argumentation presented by Schleiermacher is not limited to

understanding the field of study in terms of understanding innovation culture
via organization culture and vice versa, but are also used as a method for
interpreting the qualitative empirical data. When analysing the qualitative
data in the form of semi-structured interviews with respondents from selected
SMEs and thereby spoken words, a hermeneutic method is used in the
interpretation and categorization of the exact wording, as “when we find
ourselves putting some sort of label on it, we should also reflect on how our
appreciation of that category is brought about by our exposure to specific
instances of it” (Tomkins & Eatough, 2019, p. 4).

The hermeneutic influence on organization and management studies is also

of importance, as it deals with the interpretation of a text. Text in this context
often refers to something linguistic. No matter if it is the written or the
spoken word. However, something linguistic can also be different than ‘text’
as it can refer to non-linguistic phenomena, such as organisational practices
(Tomkins and Eatough, 2019), as part of the empirical data in this research
concerns. The study and the following analysis are based on interpretation of
the linguistic character, but as the majority of the interviews were conducted
face-to-face at the company, the notion of social constructionism must be
taken into consideration, as the natural physical appearance in the
organizational frame of the company and the physical appearance of the
respondent have influence on the final results.

3.7 Social Constructionism

Social constructionism is chosen as a methodology for the analysis of the
research. In order to study and research the field ‘innovation culture’, one
must be able to understand the perception of the term and phenomenon as
32
culture is and how such a phenomenon can be constructed. In order to do
so, a social constructionism approach has been chosen.

Social constructionism as perception intends to be critical in our

understanding of the world and us. Moreover, does social constructionism
cautions us to be suspicious about our assumptions of how the world appears
to be (Burr, 2015). Such an approach, in the context of innovation culture,
thereby pushes the researcher to be suspicious about, not only how, but also
why culture has an effect on innovation in an organizational context. What
lies in the approach of social constructionism is that we construct our own
versions of reality between us (Burr, 2015, p. 9). As presented in the literature
review, “shared values and beliefs” among individuals are used as a
definition for organizational culture. Such values and beliefs only become a
reality if several individuals concur to such a shared perception, as
knowledge is not something a person has or does not have, but rather
something that is created together by people (Burr, 2015, p. 12).

For creating a culture where innovation thrives, the decisive factors for
creating such a culture is important. Whether it is the allowance of risk-taking,
freedom for employees, acceptance of failure or any other factor, social
learning theorists would argue that behaviour is acquired through the set of
reinforcers present in the situation and are specific for that particular situation
(Burr, 2015, p. 36). Adding to the behaviour of individuals in an organization,
with a focus on culture, it is with social constructionism perceived that
“human beings take action based upon their perceptions of events” (Burr,
2015, p. 155).

The conclusion of social science research is by social constructionism

challenged as it is argued that no researcher is able to step out of the
perspective they might have. Therefore “the task of the researcher therefore
becomes to acknowledge their own intrinsic involvement in the research
process, reflecting on the part that this plays in the findings” (Burr, 215, p.
172).

The findings of this research must be acknowledged to be affected by the

bias and existing perception of innovation culture obtained before the

33
collection of empirical data. With such a perception of social science
research, objective results will be hard to provide. Nevertheless, an
understanding of social science research in the light of social constructionism
will provide the enlightenment of the researcher’s role in the study and
therefore provide another and important perspective on the study.

Chapter 3 – Subset
In Chapter 3, the chosen methodologies and approaches for the research
have been identified, discussed and elaborated regarding the use of these in
the context of the research. Firstly, a deductive approach has been identified
as the approach in this research. However, by examining the literature on
deductive and inductive methodology, the two are by scholars argued to be
inseparable. Thereby, an inductive approach can be identified in the research
as well. In order to collect empirical data, both qualitative and quantitative
methods have been used. The use of both methods can be characterized as
mixed methods, and it is here argued that quantitative and qualitative
methodologies should not be perceived as incompatible paradigms that
cannot be used in the same research. For categorizing and interpreting the
collected data, a hermeneutic methodology is chosen, as the majority of the
collected empirical data can be categorized as linguistic and a hermeneutic
methodology is best suited for this form of interpretation. As culture is
defined in the reviewed literature as shared values and beliefs, it is here
implicitly argued that culture is created as shared values and beliefs between
more than one individual. The perception of culture can therefore be defined
as social constructionism, as it is with social constructionism argued that we
construct our own versions of reality between us.

34
Chapter 4 – Case Studies
In the following sections, the research strategy by the use of case studies will
be elaborated in order to explain the reasons for choosing a case study as a
strategy for this research. Moreover, the criteria for choosing the selected
cases will be explained, and the whole process of doing so will be dissected
to provide insights into the different parts of the process.

4.1 SMEs as Cases

In Denmark, SMEs make up 99% of the total amount of businesses, which is a
total of approximately 300,000 companies on a national scale. In an analysis
from Dansk Industri (DI), 94% of the Danish high growth companies 5 are
SMEs (Olsen, 2019). They accounted for almost half of the value creation
created by Danish high growth companies in 2013-2016. Furthermore, 37%
of the big high growth companies were a high growth SME three years earlier
(Olsen, 2019, p. 50).

By the above-mentioned data, it becomes clear that the Danish SMEs are
interesting as a research objective regarding innovation culture. Not only
from a social science point of view but just as well from the perspective of the
individual Danish SME as the possibility for identifying decisive factors for
successful innovation culture in Danish SMEs would be beneficial for these.
With the spectacular numbers presented from the DI analysis, possible new
research added to the field of study could potentially have a massive effect
on the produced outcome for Danish SMEs.

5
DI defines a high growth company, as a private-owned company, which has had an average

annual increase in value, added of at least 10 percent over the past three years (Olsen,

2019).

35
4.2 Case Studies
When selecting SMEs as case studies, different SMEs have been selected in
order to collect useful and relevant empirical data. The collected empirical
data are in the analysis compared with the existing literature on the field of
study. This, combined with the literature provided by the three business
cases, are used as a foundation for answering the research question on how
to create a successful innovation culture in SMEs.

Multiple SMEs have been chosen in order to create a comparative case

study. When choosing a comparative case study as a research design, several
strategies must be considered in order to provide the best possible outcome
from the case studies.

4.2.1 Case Study Strategy

With case studies, different ways of choosing the material needed can be
used, and different strategies can be selected. The chosen way and strategy
depends on what the researcher wants to investigate and here the following
three ways of selecting cases is (Kristensen & Hussain, 2019, p. 51):
• Cause-of-effects
• Effects-of-causes
• Mechanisms and capacities

In search of answering the research question, the case studies in this thesis
are selected in order to research on the cause-of-effects. The reason for
doing this is that the focus is on finding cases where there is a positive
outcome and hereafter search for the effect for that outcome. That positive
outcome - in the cases selected - is that the SMEs have been able to grow
their turnover continuously over a period of years and the effects are how the
SMEs have, by the use of innovation and thereby having a successful
innovation culture, been able to create that growth in turnover.

Once the rationale for choosing the cases has been identified, the cases
should be selected based on the possibility of giving the best value possible
for the research. When dealing with a comparative case study, as this study

36
can be categorized to be, the selection and analysis of cases can be divided
into three different categories of cases (Kristensen & Hussain, 2019, p. 52):
• Different cases
• Most similar cases, different outcome
• Most different cases, same outcome

The research design chosen in this thesis is the strategy of most different
cases, same outcome, as the research is concerned with the cause of the
same outcome in different cases. In this research, the same outcome is
represented in the form of continuous growth in the SMEs, and the
classification of the cases as different comes in the form of type of business,
number of employees and several other factors, which makes the cases
different from each other.

The analysis of the comparative case study, where cause-of-effects are

chosen as what to research upon and most different cases, same outcome is
chosen as the general category of cases for research, will be based on the
empirical data collected by the use of qualitative and quantitative methods.

4.2.2 Selecting Cases

The newspaper Børsen is every year presenting so-called gazelle companies.
A gazelle is a company who, in the period of four fiscal years, have had
positive growth and as a whole at least has doubled the turnover over the
four years (Leisner, 2018). The list of gazelle companies from 2018 presented
by Børsen serves as a pool of potential companies for collection of empirical
data as these are meeting the criteria of the comparative case strategy being
most different cases, same outcome. The gazelle companies fit the
classification, as they are different cases, based on the number of employees,
structure and field, but they all have the same outcome in the form of growth
in turnover. As the method chosen for investigation of the cases is cause-of-
effects, the cases are to be analysed for how the effects have caused the
success for the companies in the form of growth in turnover and to see if the
companies possess an innovation culture, and if so, what the decisive factors
are for creating such a culture.

37
The selection of relevant business industry has been affected by the three
business cases in section 2.5. Both Google and Apple are in the technology
business, and with the move into the digital space, LEGO can partly be
argued to be in the technology industry as well. To narrow down the business
to select SMEs from, the pool of gazelle companies has been limited to the
business industry, which Børsen defines as IKTM – IKT (IT,
Telecommunication and Media).

As the research examines how innovation culture successfully can be created

in SMEs, the selected companies have further been limited to companies
with 10-249 employees as a company with this amount of employees is in
Denmark defined as an SME (Jensen et al., 2016). And for the sake of
conducting the empirical data, the geographical placement of the companies
has been limited to Greater Copenhagen. This geographical segmentation of
companies is due to the preferred way of conducting the semi-structured
interviews, which is face-to-face. Conducting the interviews face-to-face is
done with the hermeneutic methodology in mind, as it is important to
understand the particular from the general and vice versa. Transferred to the
setting of the conducted interviews, it is therefore important to understand
the respondent in regards to the company he or she represents and in the
same way, to understand the company culture from the interview with the
respondent.

After applying the criteria mentioned, the list was down to 66 companies.
Hereafter a closer review of the companies was conducted by visiting each of
the companies’ website. After the review, the list was further shortened down
to 22 companies as the excluded companies somehow did not meet the
aforementioned criteria, was filed for bankruptcy or contained any other
reason causing the company to be of no interest for the later conducted
comparative case study. Hereafter the process of contacting the companies
began. If possible, the relevant employee was identified from their website
and contacted by telephone. If this was not possible, the company was
contacted by telephone via their general telephone number. Either it was
possible to be provided with a telephone number or email address on a
relevant employee - here an employee somehow responsible or included in
the innovation process - or the company declined the query to line up for an

38
interview. Hereafter, the list was down to six companies which each had an
employee available for an interview. Five of the interviews were conducted
via a face-to-face interview, and the last was conducted via a telephone
interview. The position for each respondent is presented in Appendix 4. The
approximate interview time for each interview was one hour and took place
at the respective company with the exception of one of the interviews, which
were conducted via telephone. The interviews were conducted in Danish, as
this was preferred from all of the respondents.

4.3 Innovation Indicators

Further, in search of conducting useful empirical data for later analysis, a set
of indicators for innovation measurement in the chosen SMEs has been
identified. The following indicators are based on the guidelines provided by
the Oslo Manual (OECD, 2018), as these guidelines provide a possibility of
comparing international organizations. The rating and measurement of
innovation among the different SMEs are used, not only to distinguish
successful innovative factors from less successful ones, but also as a tool for
comparing successful innovative behaviour, structures, processes or
management leading to an innovative culture.

In order to collect relevant data for innovation surveys, key and

supplementary indicators are provided in order to provide the most useful
indicators of successful innovation. As the indicators are divided into key
indicators, which should be collected whenever possible and supplementary
indicators, which should only be collected if they are relevant (OECD, 2018,
p. 125), supplementary key indicators are not collected in this research as
they will make the data collection period unnecessarily complicated to which
the corresponding relevance of collected data will not increase the value of
the total outcome. The key indicators listed are as follows (OECD, 2018, pp.
123–124):
• Number of employed persons (full-time equivalents)
• Total turnover
• Firm age by year the firm began business activities
• Firm ownership status (stand-alone, part of a national group, part of a
multinational group)

39
 • Geographical distribution of sales (local, national, international
markets)
• The export share of sales
• Importance of cost versus quality for the firm’s competitive strategy
• Share of employed persons with a tertiary education
• Level of design capability

In order to measure the key indicators presented above, the selected

valuable indicators for the innovation surveys will be interleaved into the later
presented interview guide to conduct data for the key indicators. The
interview guide presented to the respondent in the respective SME can be
found in Appendix 5. Due to limited interview time with the respondent from
the company, the indicators included in the interview guide has been
reduced to the most central and valuable indicators in order to generate the
most valuable, relevant and needed data to produce a foundation for
comparison of the different cases.

4.3.1 Object versus Subject Method

When dealing with data collection for innovation measurement, two different
types of methods can be used. The object approach is based on a single
“focal” innovation, whereas the subject approach focuses on the company
and collects data on all its innovation activities (OECD, 2018, p. 208). The
object method has several advantages, as for one is that questions about the
innovation tend to be easier for the respondent to understand and therefore,
more useful empirical data can be conducted. In this instance of collecting
empirical data by the use of semi-structured interviews, the data collected
are limited to construct aggregate indicators, which are to be compared with
the existing literature on the field of study. In such a case, the use of an
object approach is not recommended (OECD, 2018, p. 213). The method
chosen for the innovation survey is therefore the subject approach, as the
empirical data conducted will be used to construct aggregate innovation
indicators.

40
Chapter 4 – Subset
In Chapter 4, the strategy for selecting cases, in order to collect empirical
data in this research, is presented. Firstly, SMEs in Denmark has been
identified as important businesses for the Danish business industry. In this
research, cause-of-effects have been as a strategy for selecting cases, due to
the focus on finding cases where there are a positive outcome and hereafter
search for the effect for that outcome. As the research contains a
comparative case study, most different cases, same outcome have been
chosen as a category for the cases. The reason for the chosen category is the
interest in examining the reason for the same outcome, continuous growth, in
the respective cases. To create a pool of potential cases a set of criteria was
identified; to be a part of Børsen’s gazelle list in 2018, be in the IT,
telecommunication and media business industry, employ 10-249 people and
geographical be placed in Greater Copenhagen. Excluding companies not of
interest the list was down to 22 companies, where an interview was
conducted with respondents from six companies. To measure the innovation
in the selected cases, a list of innovation indicators were defined and
hereafter interleaved in the interviews to be used for comparability in the
comparative case study. The subject method was the chosen method for
innovation measurement, as this method is used to construct aggregate
indicators of innovation.

41
Chapter 5 – Analysis
In the first part of this analysis, the quantitative empirical data will be
analysed. Analysing on the quantitative data will provide a possibility of
comparing the different SMEs in order to potentially differentiate factors that
are decisive for creating an innovation culture in SMEs. The accumulation of
the collected data is used to provide valuable insights of innovation culture
factors from the perspective of the employees in the organization.

Hereafter an analysis of the qualitative empirical data will be conducted by

applying the framework presented in the literature review. As the qualitative
empirical data comes in the form of audio files6 from the conducted semi-
structured interviews, a hermeneutic methodology will be used for
interpretation of the data to generate knowledge from the data, which are to
be analysed later. Moreover, social constructionism is used as a methodology
of how to make sense of the data and to make sense of this data in a social
context in the form of an organization. Finally, the qualitative empirical data
will be analysed by the use of the presented framework from the three
business cases in order to provide an answer to the research question of how
the decisive organizational factors can be practised to create a successful
innovation culture in SMEs.

5.1 Analysis of Quantitative Empirical Data

The analysis of the quantitative data will be based on each single question in
the semi-structured interviews and compared with the comparable statement
in the survey. Moreover, the individual case will be compared with the others
as it is projected in a comparative case study. Not all questions from the
Comparative Case Study Matrix (Appendix 4) will be included, as some of
these will be analysed in section 5.2.

When analysing quantitative data, different forms of analysis can be used.

However, as argued in section 3.5, by the use of mixed methods, methodical
eclecticism is used in the analysis as both quantitative and qualitative

6
Attached via USB-sticks.

42
research methods are being used for the collection of empirical data.
Therefore, in the analysis of quantitative data, some of the questions
analysed will include answers based on data conducted via semi-structured
interviews in order to compare the individual cases.

Number of employees
The question is based on innovation indicators from the Oslo Manual.
The maximum amount of employees is represented by Shape with 90
employees, and Move Innovation represents the minimum amount of
employees with 25 employees. This results in a variation width of 65, as
equals the biggest of the companies, measured on employees, being 260%
bigger than the smallest company, which can seem extreme. However, with
the definition of an SME, as being a maximum of 249 employees, the
variation width seems relatively small. The variation width of 65 employees
can therefore be approved for purposes of comparison.

Q1) When did the company start its business activities?

The question is based on innovation indicators from the Oslo Manual.
The oldest company started their business activities back in 2006, and the
youngest companies started their business activities in 2014. The companies
are therefore relatively new with an average start of business activities in
2010,3.

Q2) How is the ownership of the company?

The question is based on innovation indicators from the Oslo Manual.
All of the companies are self-owned companies.

Q3) Are the company selling on a local, national or international market?

The question is based on innovation indicators from the Oslo Manual.
Two of the six companies are selling their products or services on a national
market, which equals to 33,33%. The remaining four companies are selling
their products or services on an international market with Denmark as the
biggest market.

Q4) Are you trying to create a specific culture in the company?

The question is among others based on the literature presented by Teece,
Pisano and Shuen (1997), arguing that culture has to be built.

43
In the survey, the statement is presented, as “The company is innovative”.
The quantitative data in this question can therefore not be compared to the
question asked in the semi-structured interviews, but are included in the
survey in order to see if the employees in the respective companies identify
the company as innovative. The highest employee score to this statement is
4.88, and lowest is 4.14 with a variation width of 0.74 and an average
employee score of 4.28. On a weighing scale from 1 to 5, where 1 is
‘Strongly disagree’ and 5 is ‘Strongly agree’; it can be argued that the
employees perceive their workplace as innovative.

Q5) Do the company have an innovative culture?

The question is among others, based on the literature presented by Herzog
(2011), where innovation culture is defined as organization-wide shared basic
values.
The question, formulated as a statement in the conducted surveys, relates to
whether or not the culture in the respective companies can be categorized as
innovative. The relevance of this question relates to the stated research
question as if the employees did not see the culture in their company as
innovative, the foundation for using the cases, as examples of how innovation
culture successfully can be practised in Danish SMEs were not present. To the
statement presented, the highest employee score is 4.88, and the lowest is
3.95. A variation width of 0.93 creates a relative substantial difference in
perception of having an innovation culture in the companies. The average
employee score is 4.17. Both the lowest and the highest employee score are
though on the positive side of perceiving the culture as innovative, only
differentiated on how much of an innovation culture the two companies
possess. When comparing the average employee score here with the one
presented in Q4, a difference of 0.11 can be seen. With this result, the
employees in general identify, with a small margin, their company to be
innovative rather than having an innovative culture.

Q6) Who has the responsibility for the development and implementation
of innovative initiatives in the company?
The question is among others, based on the literature presented by Burns
and Stalker (1961) about mechanistic versus organic cultures.
In the survey, the statement focused on the managerial or employee
responsibility of both development and implementation, whereas the
44
questions in the semi-structured interviews focused on distinguishing
between development and implementation of innovative initiatives. A direct
comparison of the answers in the semi-structured interviews and the
employee score in the conducted surveys can therefore be difficult to draw.
Nevertheless, both of the results provide valuable insight into the structure of
the innovation processes in the respective SMEs. The lowest employee score
given to the statement “The management team is the most important factor
for development and implementation of innovative initiatives in the
company” is 2.00 and the highest is 3.09, providing a variation width of 1.09
and an average score of 2.71. Compared to the opposite statement “The
employees are the most important factor for development and
implementation of innovative initiatives in the company” an interesting result
emerges. Here the highest employee score is 4.40, and the lowest is 3.71
resulting in a variation width of 0.69 and an average employee score of 3.97.
The two average employee scores indicates that the employees in general
believe that they are an important factor in the SMEs regarding the
development and implementation of innovative initiatives.

Q8) Do the company has an overall strategy as you know of?

The question is based on the importance of strategy as presented in the
Pentathlon Framework by Goffin and Mitchell (2017) and Stuckenschneider
and Schwair (2005) regarding innovation strategy.
The statement in the survey is here again different from the one presented in
the interview. Where the question in the interview focuses on whether the
respondent knew the overall strategy for the company, the statement in the
survey was formulated as “I know the company's overall strategy and my
tasks are a part of that strategy”. The focus here was therefore more focused
on if the employee’s work tasks are a part of the overall strategy. The highest
employee score is split by two different SMEs and the score given is 4.00.
The lowest is 3.63 resulting in a variation width of 0.37, which must be
defined as a small variation and can therefore be interpreted as the
employees, to some degree, believes that they know the overall strategy and
that their work tasks are a part of the overall strategy.

45
Q9) How do the company adapt to changes in the market?
The question is based on the literature presented by Adams (1982) and
Cannon (1985) on how adaptability is an advantageous factor for innovation
in SMEs.
Again, the question in the interview and the statement presented in the
survey differ slightly. The question in the interview relates to how the
company adapt to changes in the market whereas the statement in the
survey is presented to the respondents to identify the perception of the
company regarding changes in the market, and the statement is stated as
“The company is adaptable (regarding implementation of new technologies
or threats from competitors)” The lowest employee score here is 4.27, and
the highest score is 4.40 resulting in a variation width of only 0.13 and an
average employee score of 4.33. The low variation width indicates a
consensus among the employees. And the average employee score indicates
that the employees in general believe that their company is adaptable to new
technologies or threats from competitors.

Q14) Does the employees choose their own work tasks?

The question is based on the literature presented by Isaksen and Tidd (2006)
and Steiber (2014) on whether the employees can choose how to perform
their work.
Both the question in the interview and the statement in the survey relates to
whether the employee chooses the work task him/herself. The reason for
using the question both in the interview as well in the survey is to see if the
management and the employees have different perceptions of this. When
analysing the answers from the employees in the survey, the lowest
employee score is 2.88, and the highest is 4.40 resulting in a relatively high
variation width of 1.52, indicating that it depends on the respective company
whether or not the employees choose their work task themselves or not. The
average employee score of 3.59 indicates that the employees, to some
degree, choose their work tasks themselves.

Q18) Does innovation happen internally or externally?

The question is based on the literature presented by Steiber (2014) on open
organizations and Robertson and Green (2013) on open innovation.

46
Both the question in the interview and the statement in the survey relates to
whether the innovation happens internally or externally. The same
argumentation can be applied here as in Q14, about using the same
question in the interview as a statement in the survey, as this illustrates a
potential different perception when asking the respondent via the interview
and the employees in the company via the survey. When the employees are
presented to the statement “Development of new ideas takes place internally
in the company'', the lowest employee score is 3.50, and the highest
employee score is 4.28 resulting in a variation width of 0.78. The average
employee score of 3.93 indicates that, even though the employees disagree
slightly in the different cases, they tend to believe that innovation happens
internally. The opposite statement was presented to the employees as:
“Development of new ideas in the company takes place externally”. Here the
lowest employee score is 1.96, and the highest employee score is 3.00,
resulting in a variation width of 1.04 being slightly higher compared to 0.78
in the other question. The average employee score of 2.43 here supports the
employees’ perception of that innovation happens internally as the average
employee score in the first statement was 3.93 and in the latter statement
2.43, resulting in a difference of 1.50.

Q19) Do you have a systematic approach for the development of new

ideas in the company?
The question is based on the literature presented by Hauschildt and Salamo
(2007) on the movement from an organic culture to a more mechanistic one.
To the statement presented to the employees in the survey: “There is a clear
systematic approach to the development of new ideas in the company”, the
lowest employee score is 2.60, and the highest is 3.36 resulting in a variation
of 0.76, which indicates that the employees slightly disagree about having a
systematic approach for development of new ideas. With the average
employee score of 2.93, it can be argued that the employees do not know
whether or not there is a systematic approach for developing new ideas in
the company.

5.2 Analysis of Qualitative Empirical Data

The next part of the analysis will be divided into two sections, which
hereafter, together with section 5.1, will be included in the later discussion of
47
the research. The first section (5.2.1) of the analysis will be based on the
collected qualitative empirical data and be analysed by the use of the
framework presented in the literature review. This analysis will be conducted
in order to mainly, but not only, provide an answer to the first part of the
research question on “what organizational factors are decisive for innovation
culture in Small or Medium Enterprises in Denmark?” The next section (5.2.2)
in the analysis will be based on the literature from the research on the three
business cases concerning innovation culture in major global companies. This
analysis will be conducted in order to mainly, but not only, provide an answer
to the second part of the research question on “how can they [organizational
factors] be practised in order to create a successful innovation culture in
Small or Medium Enterprises in Denmark?”

In both of the sections, as written in the start of Chapter 5, a hermeneutic

methodology will be used for interpretation of the data and to generate
knowledge from the data, which are to be included in the discussion of the
research. Concerning the analysis of the qualitative data, this is done both
before the interviews and during the interviews (Kristensen and Hussain,
2019, p. 111). The coding of the interviews is done with the interpretation
and categorization of the interviews, by the use of hermeneutic
methodology.
Moreover, as presented in section 3.7, the analysis will be conducted by the
perception of social constructionism, as the reality and the foundation for the
findings in the research are constructed by the versions of reality between the
respondent and the researcher.

When, in both section 5.2.1 and section 5.2.2, a reference is made to the
conducted interviews, the reference will include to which interview there is
referred to and the given point of time in the interview. The given reference
will be stated in brackets to separate the reference from the written text. The
given interview is numbered, and the numbering of the interviews can be
found in Appendix 4.

The analysis presented here will be divided into separate sections relating to
the field of study, which will be organizational culture (5.2.1) and innovation
culture (5.2.2).
48
5.2.1 Organizational Culture
In the definition of organizational culture, as presented in the literature
review, the emphasis is on the pattern of shared basic assumptions, and if
these assumptions are considered valid, they are thought to new employees
as the correct way to perceive, think and feel (Schein, 1997). Herzog (2011)
uses Schein’s definition of organizational culture to distinguish different levels
of organizational culture, which consists of practices, created by artefacts and
behaviours, norms and shared basic values that can be distinguished into
different levels of visibility in the organization. For a better overview, the
analysis will be divided into each of the three levels.

Artefacts
When analysing on artefacts an interesting one was mentioned in the
interview with the respondent from Festina Finance regarding the creation of
the culture. The company has a Ping-Pong table where the employees often
play. When asked about this artefact, it was explained as a conscious choice
with a touch of coincidence (Interview 2: 14:10). The respondent elaborated
by saying that they have it because they want to be a company where they
do not take things too serious and where it should be fun to be at work.
Concluding on this, he said that this is a part of their identity. Through
several of the other interviews conducted, it is clear that artefacts are
important for creating a culture in the SMEs. Trustworks have what they call
knowledge days six days a year, where they share information among the
employees and every Friday the employees meet to share knowledge about
new technology or new ways to approach projects (Interview 6: 13:32). In
Trustworks, time is also set-aside for what they call ‘speed dates’, which
enables the employees to know their colleagues' competencies and
personality (Interview 6: 35:26). In Shape, they have an artefact in the form of
regular status meetings (Interview 5, Part II: 20:50), where they get
information from the other projects in the company.

Norms
Behavioural norms seem to lie explicitly in the culture of the SMEs. In Festina
Finance, there is a norm for the employees not to speak out loud about
being good at something (Interview 2: 31:10). Instead, a culture of saying
49
“we did that” is wanted. In the same way, it is in Move Innovation expected
not to go around and complain about something if it is not true (Interview 4:
03:05) and if it is, then it is addressed.

Shared Basic Values

How the different SMEs are working with values seems to differ a lot. In
Abtion, values are something embedded in the way of living and working. It
is about the adaption of changes (Interview 1: 40:23), and that is something
that the management is aware of. In Shape, values are represented by the
importance of never compromising on the product delivered to the customer
(Interview 5, Part II: 24:19).
In Festina Finance, the culture is created by the use of values (Interview 2:
08:10). These values are not written down, but the core value in the company
is about creating great systems (Interview 2: 08:50). This is elaborated by a
second value, which is things that impede building great systems (Interview
2: 10:13). This can be rules for the sake of rules, bureaucracy, meetings and
processes for the sake of processes.
In the same way, values are not formalized in Move Innovation. Values are
more represented by the way they act in the company (Interview 4: 30:50),
but it is acknowledged that there is a need for more communication about
their values, internally as well as externally.
A completely different approach to values is represented in Invokers, who
believes that values are hollow and do not believe it is the right way to
approach it (Interview 3: 52:16). Getting the employees to know each other
and thereby generate a common language should rather constitute values.

Valuable, Rare and Imperfectly Imitable

As presented in the theory section, Barney (1986) argues that in order for a
company to have a competitive advantage, the culture needs to be 1)
valuable, 2) rare and 3) imperfectly imitable. In the conducted interviews,
different examples of a valuable culture can be identified. The culture in
Abtion was valuable, as working in here was compared to hanging out with
the boys (04:09), as formulated by the respondent and by that, the culture
can also be argued to be rare and imperfectly imitable.

50
In Festina Finance the culture can also be identified as valuable, rare and
imperfectly imitable as effectiveness permeates almost every aspect of the
company’s culture and they explicitly talk about effectiveness (Interview 2:
35:46).
What defines the culture in Invokers is the use of Design Thinking. It is not
only a method apparatus but also a toolbox for hiring new employees
(Interview 3: 09:35). The use of Design Thinking is by the respondent
explained as a method for solving wicked problems from a designer’s
mindset with a scientific approach. Design Thinking, as the fulcrum for the
culture in the company, can be argued to be valuable, but not necessarily
rare and imperfectly imitable as other companies can adapt the approach of
Design Thinking. The execution of Design Thinking can though be argued to
be both rare and imperfectly imitable.
The culture as a competitive advantage seems to be the case in Move
Innovation where the familiar atmosphere has a great impact on the culture.
When asked about the culture, the respondent links the DNA of the company
with the familiar tone and identify it as something they strive for (Interview 4:
03:04). The perception of the company as a big family is further mentioned in
the importance of the employees (Interview 4: 24:58) and in the company’s
strategy (Interview 4: 55:34). But the respondent is also aware of keeping this
family-like culture, as it can be difficult when the company grows in the
number of employees.
Culture as a competitive advantage seems to be the case in Trustworks,
where there is no measurement of KPIs, sales, or the number of invoices the
individual employee is sending out (Interview 6: 06:29). This can be
combined with the fact that they do not want anybody to be better than
others, and this creates a culture, which - according to the respondent – is
not are seen in many other consultancies. This statement is supported by
how the company through time has dismissed employees who were
extremely productive but did not fit the team (Interview 6: 30:07).
What provides the competitive advantage in Shape does not seem to lie
within the culture of the company but rather the structure of the company.
Being both a venture business and a consultant house - and thereby be a two
kind of businesses – is innovative in the eyes of the respondent (Interview 5,

51
Part I: 04:36). Here the culture can therefore, with the words of the
respondent, be argued not to be valuable, rare or imperfectly imitable.

Mechanistic and Organic Organizations

As presented in the literature review, Burns and Stalker (1961) distinguish
between two types of cultures, the mechanistic and organic. Mechanistic and
organic cultures are further distinguished on the basis of five different areas;
communication, locus of influence, job responsibility, information flow and
conduciveness to innovation (see Appendix 1 for a description of the five
areas).

In Festina Finance communication is being described as very important as

knowledge should be as accessible as possible by being open and
transparent (Interview 2: 35:27).
In Shape, communication in a non-hierarchical way is just as well identified as
being important (Interview 5, Part II: 05:32).
Communication also happens among employees in Trustworks, not only at
their weekly Friday meetings but also when they are not working on the
respective projects (Interview 6: 13:52).

Regarding the locus of influence, both mechanistic and organic cultures are
represented in the studied SMEs. In Abtion a mix of the two types of cultures
can be identified. In the company, a project leader mainly has the
responsibility for internal optimization (Interview 1: 14:52). He though needs,
and often has, the empowerment of the management. However, the
respondent says that management does not tell which new products that
need to be developed and therefore, an organic culture can be identified.
Having both a mechanistic and organic culture seems to be the case in
Invokers as well. Here the implementation of innovative ideas is by the
respondent described as something the whole company is responsible for
(Interview 3: 36:50).
The client approach seems to be the case in Move Innovation as well, as it is
the client who chooses the processes they would like (Interview 4: 06:50).
When further elaborating on the responsibility, the CTO of the company is
mentioned as responsible for developing new ideas (Interview 4: 09:36), but
the respondent mentions the employees - together with other members of
52
the management - as the ones being responsible for anchoring these
(Interview 4: 10:28).
The management seems to be responsible for developing innovative ideas in
Shape as well. When asked about this, the respondent mentions the four
partners (Interview 5, Part II, 03:13) as the ones having the responsibility.
When asked about implementation, two of the four partners are again
mentioned as the ones having the strategic considerations (Interview 5, Part
II, 06:12). But to design and build it, the employees have free rein of how to
do so (Interview 5, Part II, 06:50). Here a general mechanistic culture can
therefore be identified as the prominent one, but parts of an organic culture
can be identified as well.
The opposite can be identified in Trustworks, where the respondent
describes the responsibility of developing innovative products or services as
very bottom-up, adding that it should never be the management who
dictates the innovative part (Interview 6: 19:16). The same is the case
regarding the responsibility of implementation of new ideas, but it is by the
respondent mentioned that sometimes the employees seek the approval of
the management (Interview 6: 20:30).
In Festina Finance, a mechanistic culture is clearly the dominating one. When
addressing the responsibility of developing innovative ideas, the respondent
states that it is mainly a management responsibility (Interview 2: 19:50).
When asked how this is expressed in the daily operations, he mentions that
leading employees sit, very unstructured, together and discuss how things
can be done differently. He specifically mentions that it does not come from
the bottom to the top (Interview 2: 20:04). When asked about the
implementation of these ideas, the management is again mentioned as a key
factor (Interview 2: 20:12).

The next area distinguishing the two types of culture is job responsibility.
Here an example of organic culture is provided by the respondent from
Invokers, as the employees sometimes have time off from projects and an
example here, is a team who created a competency app (Interview 3: 58:30),
which was their own initiative.
An organic culture regarding job responsibility seems to be the case in
Festina Finance too. When asked if the employees choose their work tasks

53
themselves, the respondent answers that they choose a lot themselves
(Interview 2: 36:20).
In Move Innovation a more mechanistic culture on this area can be identified,
as the management distributes work tasks when a new project comes in and
it is very rare that it changes from this distribution (Interview 4: 34:12).
The same is the case in Shape, as the employees do not get to choose a lot
of work tasks (Interview 5, Part II: 21:46).
When asked about this, the respondent in Trustworks says that a lot of it is
driven by the employees (Interview 6: 34:56).

Regarding information flow, a general way of informing can be argued to be

dominating. In several of the interviews, a flat hierarchy is mentioned, and
this can be identified as an organic culture. An example of organic culture is
represented in Festina Finance, as they do not have a hierarchical
organization because it ties things up (Interview 2: 36:05).
In Move Innovation, a focus on a flat structure is mentioned too, as the
employees are defined as almost a family (Interview 4: 24:58).
In Trustworks, they have a flat structure too, because their employees mean
everything to them (Interview 6: 30:30).
The same is the case in Abtion, but it is not necessarily identified as the best
structure, as the employees must know there is a direction and that they are
in the pursuit of a common goal (Interview 1: 37:58).

Regarding the last area, conduciveness to innovation, a clear tendency

emerges. From the interviews conducted, all the SMEs seem to identity their
cultures as innovative except from one.
In Festina Finance, the respondent does not identify the culture as being
innovative but rather identifies the culture as a high-performance culture
(Interview 2: 17:00).

As discussed in the literature review, it is argued that the different phases of

the innovation process require a move from organic to mechanistic structure
in accordance with the different phases of the innovation process (Hauschildt
& Salomo, 2007, p. 114). A clear tendency of such a move cannot clearly be
identified. A move to a more mechanistic structure is in Trustworks, when
asked if there is a systematic approach to the development of innovative

54
ideas, not seen as advantageous, as the biggest fear for the company is to
become a corporate organization (Interview 6: 46:00). A complete opposite
approach to this is formulated by the respondent from Move Innovation, who
is of the belief that a systematic approach for the development of innovation
is needed in order to grow (Interview 4: 1:02:24).

5.2.2 Innovation Culture

In the analysis of the creation of an innovation culture, the argument in the
literature review, of how culture must be build as it cannot be acquired, is
important in order to analyse on the creation of such a culture. When
conducting the research interviews, a general perception of culture being
created was represented, as it can be seen from the conclusion on Q4 in
Appendix 4. To exemplify this, the respondent from Move Innovation, when
asked if they are trying to create a specific culture, answered that they most
definitely did that (Interview 4: 02:50) and that the culture is a part of their
DNA.
The focus on creating a specific culture can also be seen from the interview
with the respondent from Invokers, who believes they just as well try to
create a specific culture (Interview 3: 14:54).
In Trustworks, the focus on creating a culture relates to breaking with the
culture in the former company (Interview 6: 06:20). Moreover, it is in
Trustworks important to fit into the DNA of the company, explained as being
“culture fit” (Interview 6: 07:27).
What define the culture in Shape are the many nationalities (Interview 5, Part
II: 03:08) and this creates an international culture with free and autonomous
ways of working for the employees (Interview 5, Part I: 04:00). Moreover, it is
mentioned that there are several working cultures depending on the origin of
the individual employee (Interview 5, Part I: 03:40).

In search of successful ways of creating, not just a culture, but also an

innovative one, the respondents were asked if an innovation culture exists in
the respective SMEs. Innovation culture is in the literature review defined as a
culture that "cultivates engagement and enthusiasm, challenges people to
take risks in a safe environment, fosters learning and encourages
independent thinking" (Goffin & Mitchell, 2017, p. 297)

55
Engagement is an important part of the culture in Festina Finance, as a
common trait for the employees are that they think it is fun to do what they
do regarding work tasks (Interview 2: 14:03), but else engagement is not
mentioned by the respondents in the conducted interviews.

Risk-taking is a part of the culture in the majority of the SMEs. In Invokers

they have designed a whole floor with different materials and objects that
aim to make the employees experiment and try out new things (Interview 3:
18:03).
In Abtion, there is also culture of trying new things (Interview 3: 11:53), but
the innovation culture as a safe environment are being questioned as in they
in Abtion are challenging their employees who like stability and being in a
comfort zone (Interview 1: 12:10) and challenging them on this is a part of
their success (Interview 3: 12:33).
In contrast, Trustworks are actively focusing on creating a safe environment
by allocating a share of the sales amount to the employees in case of an
acquisition. Yet they are still aware of creating a culture where
experimentation is a part of the daily activities and are driven by employees
(Interview 6: 21:00).
The same environment can be seen in Move Innovation, as they want their
employees to feel safe, so they can be innovative and in the pursuit of being
innovative, it is acceptable to fail (Interview 6: 03:10).

For several of the SMEs, independent thinking is important as well in order to

create an innovation culture. In Trustworks, it is seen as an advantage if the
employees are able to do things on their own (Interview 6: 37:40).
In Festina Finance they are supporting independent thinking among
employees, as they are highly reliant on employees who are able to think out
of the box and thereby be innovative (Interview 2: 37:33).

Encouragement and reward of new ideas (Amabile, 1996; Worren, Moore &
Cardona, 2002,) and creativity (Amabile, 1996, 1997; de Brentani, 2001;
Ernst, 2003) must be analysed as well in order to define if these factors are
decisive factors for creating an innovation culture in Danish SMEs.

56
Firstly, the encouragement of new ideas is identified in several of the
conducted interviews. In Abtion, the respondent mentions that they have a
culture of and support to try different things (Interview 1: 11:40).
The same is the case in Abtion, where they directly encourages their
employees to experiment and try things out (Interview 3: 18:03) and this is
the same belief in Trustworks, where the respondent states that an
encouragement is needed or else an innovation culture can not be created,
and such encouragement can be found in Trustworks (Interview 6: 54:20).

A reward of new ideas is identified as well. A distinction between rewarding

on an individual level and team level though seems to be important in the
organizations. An example of such is provided by the respondent from
Festina Finance, where it is emphasized that the employees say “we” instead
of “I” when a new product is created (Interview 2: 31:02). When asked about
the motivation of employees in terms of bonuses, the answer provided was
that it is difficult to create a bonus program that does not distort something
(Interview 2: 34:20).

Adding to the factors of what in innovation culture encourages

experimentation is toleration of creative mistakes and fostering of learning
from failure (Atuahene-Gima & Ko, 2001; Botcheva et al., 2002; Cooper &
Kleinschmidt, 1995; Cummings & Teng, 2003; Day & Schoemaker, 2002;
Brentani & Kleinschmidt, 2004; Huber, 1996; Sundgren et al., 2005). In
Festina Finance, the respondent emphasizes that it is more than okay to fail
in the company and to be open about making mistakes. It is further argued
that if openness about failing is not accepted, the failures will accumulate,
and then things end up in an explosion (Interview 2: 32:40).

Disagreement among team members is important for innovation processes in

an organization (Dornblaser et al., 1989; Ring & van de Ven, 1989), but only
in one of the conducted interviews disagreement was mentioned. Here it was
not dissent among team members that were mentioned, but rather dissent
among management and team members regarding the hiring process in the
company (Interview 1: 21:50).

57
Regarding innovation culture, an analysis of the research of innovation culture
in SMEs, as presented by Wolf, Kaudela-Baum and Meissner (2012) is of
great importance due to the field of study of the research. For a description
of the four innovation profiles identified in the study, see Appendix 3.

When analysing the conducted interviews, the network-based innovation

(NBI) type is by far the most represented. But the identified innovation types
seldom appear in their absolute form in the studied SMEs. However, most of
the conducted interviews represent traits of the NBI type, as this type gather
innovation ideas from external sources rather than creating their own ideas
(Wolf, Kaudela-Baum & Meissner, 2012, p. 258). As an example, the
respondent from Abtion mentions that they innovate with their customers
(Interview 1: 09:15).
The respondent from Festina Finance provides another perspective on the
NBI form of innovation, as innovation here is formulated as an interplay
between the company and the client (Interview 2: 28:24) but adds that the
customers often are poor at being innovative and hereby implies that Festina
Finance are the innovative entity in that interplay. Furthermore, the
respondent states that the customer has the need, and the company creates
the product for that need and the innovation happens as a part of that
(Interview 2: 41:38).
Another perspective of NBI and how it does not appear in an absolute form
is by the respondent from Move Innovation. Here innovation is defined as
happening 80% externally and 20% internally (Interview 4: 49:45) and
innovation here does not fit the description of NBI in an absolute form.
The respondent from Trustworks tends to provide the same. First, he argues
that innovation happens pretty internally (Interview 6: 44:52), but hereafter
acknowledges that development happens with the business partners who
facilitate things for Trustworks.
Invokers, the one company who potentially could be defined as having a
holistic innovation profile (HI), also have characteristics of the NBI profile.
Regarding the responsibility of innovative ideas that are to be implemented
in the company, the respondent exemplifies this by how an employee has
been visiting the client and as a result of this visit; a reduction of applications
on their mobile device was made (Interview 3: 35:54). By this example, HI can
therefore not be defined as the best-suited innovation profile for the

58
company. Neither can NBI, and yet again, the conclusion of the different
innovation profiles appearing in an absolute form seems to be unobtainable.

Besides the four different innovation profiles, findings from the study are
being defined as “successful innovation processes are facilitated by both
excellent knowledge of employees and financial back-up” (Wolf, Kaudela-
Baum & Meissner, 2012, p. 266). In the conducted interviews, knowledge of
employees is mentioned in several of them. Especially in Trustworks, the
respondent identifies the knowledge of the employees as very important. It is
explicitly stated that knowledge fills in the culture (Interview 6: 07:11).

Financial back-up does not by the respondents seem to be the most essential
in their innovation processes. In Trustworks, the acquisition of the original
company is mentioned, but only to illustrate that the new management
created processes and structures that affected the culture in a negative way
(Interview 6: 05:54). The respondent mentions how the now present CIO
funded the company with the money from the sale of his former company
until Festina Finance had their first customer (Interview 2: 04:05).

5.2.3 Business Cases

The three business cases are included as a framework for the analysis. The
business cases are included because of the companies’ ability to create
continuous innovation. In order to define principles of successful innovation
in the three companies and to use these as a framework of how to practise
successful innovation culture in Danish SMEs, the cases are being used based
on the principles that can be related to the creation of a successful
innovation culture.

The analysis in this section will, together with the two sections above, be
included in the final discussion to answer the research question. The analysis
will be divided into sections for each of the business cases, where the
empirical data, both quantitative as well as qualitative, will be compared to
the literature.

59
Apple
Leadership in Apple is practised by creating a culture of fear and
intimidation. Examples of such leadership and culture are nowhere to be
found in the conducted interviews, rather the opposite seems to be the case
as exemplified by the interview with the respondent from Move Innovation,
who identifies a familiar tone as something they strive for (Interview 4: 03:04).

Organizational culture in Apple is defined as strict top-down management. In

general, as seen from the quantitative analysis and the Comparative Case
Study Matrix (Appendix 4) on the conclusion of Q6 and Q7, the employees
perceive them as the ones who are responsible for developing and
implementing innovative ideas, by an employee score of 2.71 for the
management and an employee score of 3.97 in favour of the employees. To
compare the quantitative and qualitative data, the respondents in the
interviews perceive it to be more of a managerial responsibility.
Nevertheless, in none of the SMEs, strict top-down organizational structure
can be identified. Rather, in the interviews, a flat hierarchical structure is
mentioned multiple times. In the interview with the respondent from Festina
Finance, it is mentioned that openness and transparency are important as
they have a flat organization (Interview 2: 35:31).
The same is the case in Move Innovation, where the respondent identifies the
structure as flat, and this means everything for them (Interview 4: 24:58).
In Trustworks, the respondent tells that the company wants to keep a flat
structure due to the importance of their employees (Interview 6: 30:37).
In Shape, both a flat and a top-down structure can be identified from the
interview. When asked about the responsibility for developing innovative
products or services, the respondent immediately mentions the four partners
(Interview 5, Part II: 3:13). However, the respondent says that there is space
for talking about ideas with the partners, and here he identifies the hierarchy
as flat (Interview 5, Part II: 5:18).
In Abtion, this mixed perception of organizational structure can be identified
as well as the respondent identifies the hierarchy as flat, but adds that this
form of hierarchy is not always good because the employees should know
that there are a direction and a common goal. If everybody should agree on
everything, things can easily turn into a roundtable talk (Interview 1: 37:50).

60
Secrecy is identified as extremely important for Apple. However, secrecy is
not mentioned once in the conducted interviews, and the respondents freely
talked about their business activities, organization and strategy without
mentioning any form of secrecy. In some of the interviews, when starting out,
the respondents mentioned confidentiality of the interview, but quickly
hereafter, when the purpose of the interview was explained, confidentiality
did not seem to be of great importance.

When further dissecting the organizational culture at Apple, focus is

mentioned as an important area. In the Apple case, focus relates to the
design of the products. Focus is not mentioned a lot of times in the
interviews as important. For Abtion it can be argued that focus is on the
preferred method of programming (Interview 1: 30:20) and in Invokers, there
is a big focus on using Design Thinking as a method to approach challenges
(Interview 3: 08:13). But a narrow focus, as explained in the Apple case does
however, not seem to be the case in any of the SMEs.

Apple has created a structured product development called the ANPP (Apple
New Product Process). A structured product development cannot be
identified in any of the SMEs, as the process generally is an unstructured one,
as seen in the conclusion of Q19 in the Comparative Case Study Matrix
(Appendix 4).

When dealing with management in Apple, a management tool called DRI

(Directly Responsible Individual) is used to know who is responsible for the
different work tasks in the organization. Different opinions regarding this
method can be identified from the conducted interviews. In Festina Finance,
when asked about the DRI method, the respondent says that they try to
avoid this form of management (Interview 2: 30:41) whereas in Abtion, the
respondent compared their use of the method RACI (Responsible,
Accountable, Consulted and Informed) with DRI (Interview 1: 20:14).

Google
The first principle for successful continuous innovation presented in the
Google case is dynamic capabilities. This principle relates to the company’s
ability to seize opportunities and identify threats. When analysing both the

61
qualitative and quantitative data, the next principle a continuously changing
organization can be included in this analysis as it covers the same area in this
research. In the interviews, the respondents were asked how the company
adapt to changes in the market. In Abtion, the approach depends on the
object. When dealing with new technologies, they attract people who like to
program in their spare time (Interview 1: 33:18), and their employees are
hereby naturally updated on new technologies. When dealing with threats
from competitors, they try to sell themselves to new clients by the process of
how they work, which is different from their competitors (Interview 1: 33:58).
In Festina Finance, threats from competitors are identified by the use of
benchmarking when this is possible, and then they benchmark on efficiency
(Interview 2: 25:08).
In Move Innovation, the customers are the main driver in terms of potential
opportunities (Interview 4: 15:26) and the same is the case in Trustworks, as
they here focus on what the customer’s wants and demands (Interview 6:
25:03).

The principle a people-centric approach focuses on trust and openness in the

organization, and most importantly on the importance of the employees in
the organization. Here all of the SMEs emphasize the importance of the
employees. In Abtion, 50 per cent of their strategy relates to their employees
(Interview 1: 36:36), which illustrates how important they are.
In Invokers, the respondent states that the employees are the company
(Interview 3: 49:02).
In Move Innovation the respondent agrees with the perception as he
describes the employees as the foundation for what they do (Interview 4:
24:32) and in Trustworks, they are by the respondent described as the DNA
of the company (Interview 6: 29:33).

The principle of an ambidextrous organization is how the organization is able

to improve its daily operations while engaging in continuous innovation. As
seen in the Comparative Case Study Matrix (Appendix 4), on the conclusion
of Q17, there is in general no strict balance between these two in the SMEs.

The principle, an open organization that networks with its surroundings, is

somewhat the case in all of the SMEs. However, it depends on who is asked

62
in the organization. In the conducted interviews, the respondents were asked
if innovation happens internally or externally in the organization. Here
dissimilarity can be seen, as some of the respondents believe it happens
internally whereas others believe it happens externally as also seen in the
conclusion on Q18 in Appendix 4. When including the quantitative data, a
pattern emerges as the average employee score on Q18 (Appendix 3)
illustrates that the employees believe that the innovation mainly happens
internally with an average employee score of 3.93 compared to 2.43 of those
who believe it happens externally. With this, based on both the conducted
interviews and the answers from the surveys, it can be argued that innovation
in the SMEs is created together with the SMEs’ clients, but that it is the SMEs
who are responsible for making innovation happen.

In the last principle, called a systems approach, focus is on the distinction

between a productivity company and an innovation company. When this
distinction is used, almost all of the SMEs can be identified as innovation
companies, as the culture is almost embedded in everything in the studied
SMEs. When looking at the vision, as a distinction for the two types of
companies, the situation seems to be different though. From the Google
case, innovation companies have a long-term vision for the company,
whereas the board and management in the production company are focused
on the current business and about meeting the financial goals of the
company. Neither of these is exactly the case in the studied SMEs. None of
the SMEs seems to pay much attention to meeting the financial goals of the
company. But long-term vision neither seems to be the case for the SMEs. It
is therefore difficult to identify the SMEs as either productive companies or
innovative companies when analysed on the definition of this distinction.

LEGO
The seven truths about innovation in the LEGO case will be listed as bullets,
and hereafter a short analysis will follow for each of them.

1. Hire diverse and creative people

In the conducted interviews, the respondents are asked whether it is a
priority to have innovative employees and here, as seen in the conclusion on

63
Q15 in the Comparative Case Study Matrix (Appendix 4), there is a general
agreement of how important innovative employees are for the SMEs.

2. Set the course towards “blue ocean” markets

A general consensus among the respondents about targeting “blue ocean”
markets can be identified. In Abtion, targeting “blue ocean” markets is even
a part of their strategy (Interview 1: 26:16). In Festina Finance, a “blue ocean”
market is also defined as something they want to be in (Interview 2: 26:36)
and in Invokers; a “blue ocean” is used as a mindset (Interview 3: 46:29).
However, several of the respondents also mention “red ocean” markets as
important.

3. Be customer-driven
When the respondents were asked about whether innovation happens
internally or externally, the majority of the respondents expressed that
innovation typically happens together with the client, just as the third truth
about innovation describes. The employees however hold another
perspective, as, from the Comparative Case Study Matrix in Q18 (Appendix
4), the average employee score for the innovation to happen internally is
3.93 compared to 2.43 of externally.

4. Practise breakthrough innovation

None of the respondents in the conducted interviews define the innovation
happening in their company as breakthrough innovation. Rather the opposite
seems to be the case, exemplified by the respondent from Trustworks who
does not think they are practising radical innovation (Interview 6: 18:15).

5. Create a foundation for open innovation - listen to the majority’s opinion

Truth number five can be compared with number three, as this relates to
whether the innovation happens internally or externally.

6. Make sure to use the whole innovation spectrum

The whole innovation spectrum relates to how innovation not only adds value
to new products but also to the company’s business model, internal
processes and culture. An example of how the studied SMEs use the whole
innovation spectrum is provided by Abtion, who are shortening the working

64
week from five to four days (Interview 1: 11:17) illustrating how an agile setup
allows them to use the whole innovation spectrum. An agile setup can be
identified in almost all of the studied SMEs.
7. Build an innovation culture
Building an innovation culture in LEGO is achieved by focusing on the core
business activities and by being very disciplined. In the SMEs studied,
resources are somewhat scarce; therefore, to focus on anything else than the
core business activities do not seem to be a priority. Concerning the strong
discipline, the SMEs cannot be identified to have a strong discipline.

Chapter 5 – Subset
In Chapter 5, an extensive analysis of the empirical quantitative and
qualitative data has been conducted. Firstly, the quantitative data have been
analysed. Here the answers in the conducted surveys have been analysed to
see if a general pattern among the employees in the studied SMEs,
regarding innovation culture, would emerge. Of interesting implications it
can be mentioned that the employees perceived them to be an important
factor for creating innovation. Moreover, they perceived the studied SMEs to
be innovative. However, they do not know whether or not the SMEs have a
clear systematic approach for developing new ideas.
In the second part of the analysis, when analysing the qualitative empirical
data, multiple implications can be drawn. Especially artefacts and shared
basic values are important factors for an innovation culture. A valuable
culture is also an important factor. Traits of mechanistic and organic cultures
can be identified in the studied SMEs and distinguishing the SMEs to have
one culture or another is therefore difficult. Risk-taking, a safe environment,
encouragement and rewarding new ideas are all important for the innovation
culture in the studied SMEs. However, disagreement among the employees
does not seem important for the innovation culture. The SMEs can mostly be
identified to be the NBI type, however the innovation type does not appear
in an absolute form. From the three business cases a people-centric
approach and an open organization that networks with its surroundings from
the Google case, together with diverse and creative people, “blue ocean”
markets and be customer-driven are the most important principles for
practising an innovation culture.

65
Chapter 6 – Discussion and Conclusion
In Chapter 6, the different parts of the analysis will first be discussed in order
to provide a conclusion in the form of an answer to the research question.
Hereafter the findings will be used to discuss the need for further research in
the field of study.

6.1 Discussion of Quantitative Empirical Data

Firstly, when discussing the analysis of the quantitative data, the reliability
and validity of the survey must be discussed. The reliability of the survey can
be questioned, as there has been no control over the distribution of the
survey to the employees in the respective SMEs. It would therefore be
possible for the respondent from the interview to intentionally select
preferred employees whom the respondent knows will provide positive
answers to the statements presented in the survey. However, when looking at
the percentage of the employees who are participating in the survey, the
average is almost a third of the total amount of employees. Therefore it can
be discussed whether it is possible for the respondent to find a third of the
employees whom the respondent knows will provide positive answers to the
statements listed in the survey. In the discussion of reliability from this
perspective, the answers from the surveys can therefore be argued to be
relatively reliable. When discussing the reliability in terms of measuring and
analysing the data, the tool for analysis, provided by SurveyMonkey
(Surveymonkey.com), can be argued to be quite reliable due to the
algorithms used for analysis on the website compared to personally analysing
the data. When analysing the quantitative data though, the reliability can be
discussed as the analysis is based on subjective interpretation of the data.
Here the notion of social constructionism must be taken into consideration.
As also mentioned in section 3.7 about social constructionism, the task of the
researcher is to acknowledge their own intrinsic involvement in the research
process and hereby reflect on how this might affect the findings in the
research. With this in mind, the quantitative data collected have been
interpreted based on the intrinsic involvement in the research. However, as
the data is of quantitative character, it is difficult to question the data
quantitative itself. Furthermore - regarding the reliability of the survey - the

66
very same survey has been distributed to all the respondents, and therefore
the survey here can be argued to be reliable.

The validity of the survey can be questioned too, as innovation culture as a

phenomenon is difficult to measure empirically. The valuation of whether an
empirically grounded indicator truly represents the non-observative
phenomenon, in this case innovation culture, implies the validation problem
in this context (Møller & Hvid, 2018). However, the comparative case study is
based on the research design called mixed methods, and both quantitative
and qualitative research methods are used to understand the problem, as
presented in the research question and thereby it can be discussed how big
the validation problem is in the research.

When further discussing the empirical findings. It can be discussed whether

the statements in the survey and the questions in the interviews really
addresses that or the characteristics of a phenomenon that one would like to
investigate (Kristensen & Hussain, 2019, p. 224). Here again, the use of mixed
methods can be argued to address this issue. With the use of both methods,
the research does not have to rely entirely on the data collected from one
method or another, as it is supported by the other method for collecting
empirical data.

The comparative case strategy must also be addressed in this discussion, as it

can be discussed whether or not the cases fit the category most different
cases, same outcome. When presented with the conclusion of the number of
employees and the conclusions on Q1, Q2 and Q3 in the Comparative Case
Study Matrix (Appendix 4), the cases can appear to be similar rather than
different. However, when including the employee score, the culture and core
competencies in the respective cases, these can be argued to be different,
and the cases can therefore be argued to be most different cases, same
outcome.

The amount of employees indicates that all of the companies can be defined
as SMEs. The conclusion on Q1 indicates that the SMEs started their business
activities relatively recently. The conclusion on Q2 indicates that all of the
SMEs in the cases are self-owned companies, and the conclusion on Q3

67
indicates that the SMEs are selling their products or services on mainly a
national market. All the questions and conclusions can be found in Appendix
4.

Based on the quantitative data, on whether a specific culture is tried to be

created in the respective SMEs can be discussed, as the statement in the
survey (“The company is innovative”) is not comparable with Q4 (“Are you
trying to create a specific culture in the company?”) in the interview.
Therefore, the quantitative data is not relevant regarding whether or not a
specific culture is created.

Regarding Q5 in the Comparative Case Study Matrix (Appendix 4), the

interpretation of the analysed data can be discussed. The average employee
score in Q5, on the statement “The company has an innovative culture”, is
4.17 and when analysing this, the culture in the SMEs must generally be
identified as innovative. However, it can here be discussed whether the
statement addresses the characteristics of innovation culture, meaning that
the employees might have different perceptions of an innovation culture and
therefore the validation of data presented from this statement implies a
validation problem.
In Q8, the statement presented (“I know the company's overall strategy and
my tasks are a part of that strategy”) concerns both the overall strategy of the
company and the employee’s work tasks. The question in the interview (“Do
the company has an overall strategy as you know of?”) however, is only
concerned with the overall strategy of the company and not the employee’s
work tasks. It can therefore be discussed how valid the quantitative data are
regarding the analysis of the knowledge of the overall strategy in the
company.
In Q9, the validity of the data can again be discussed when it is compared to
the question in the interview concerning the same issue of changes in the
market. The statement identifies whether or not the employees perceive the
company as adaptable to changes in the market, whereas the question in the
interview identifies how the company adapt to changes in the market and
therefore the statement in the survey and the question in the interview
investigates two different aspects regarding changes in the market.

68
In Q14 (“Does the employees choose their own work tasks?”) the case is the
same as in Q8. However, in Q14, the question in the interview only focuses
on the employee’s work tasks, whereas the statement in the survey focus
both on the employee’s work tasks as well as the company’s overall strategy.
In both Q18 and Q19, the statement in the survey and the question in the
interview are formulated, so a comparison is possible. Again the perception
of internally and externally innovation and the perception of a systematic
approach can be different depending on the respondent.

With the discussion of the quantitative data collected by the conducted

surveys, in order to compare with the qualitative data collected from the
conducted interviews and examine innovation culture in the studied SMEs, it
becomes clear that the validity of the surveys can be discussed. However, the
intention with the quantitative data has throughout the research been to use
it as a support to the qualitative data, and the quantitative data therefore can
be argued to provide useful support of the qualitative data.

6.2 Discussion of Qualitative Empirical Data

The discussion of the qualitative empirical data will follow the same structure
as presented in the analysis of the qualitative empirical data (section 5.2).
However, the used methodologies, approaches and strategy will first be used
to discuss the qualitative empirical data.

With the analysis of the qualitative empirical data, social constructionism has
been used as a methodology to understand innovation culture. As
mentioned in section 3.6 about social constructionism, the researcher must
acknowledge their own intrinsic involvement in the research process and how
this affects the findings. Therefore, when analysing the qualitative empirical
data, a version of reality is constructed between the respondent and the
researcher. To define the analysis of the data as objective can therefore be
difficult with the perception of social constructionism of how to understand
the world. However, with the involvement in the research process, a deep
knowledge of innovation culture is obtained and therefore, it can be argued
that exactly therefore an analysis of the data is possible.

69
With cause-of-effects as a strategy for selecting cases in this research, it can
be discussed how representative the cases are for generalizing on innovation
culture in SMEs. With the chosen strategy for selecting cases, the selection is
based on a positive outcome - in this research a continuous growth in
turnover for the SMEs - and that the effects for that positive outcome are
based on innovation and innovation culture. It could here be discussed
whether innovation culture is an effect for the positive outcome or if other
effects have caused the positive outcome. However, with the research,
examination and analysis of the cases, it becomes clear that innovation
culture plays a central role in the studied SMEs’ growth.

From the analysis of the qualitative empirical data, numerous implications

emerge. When using the literature as a framework for analysis, some of the
factors for successful innovation culture are only illustrated by a few examples
from the conducted interviews. In most instances, examples from the other
cases are not included, as the factors are not explicitly stated from the
respondents in the interviews but more implicitly stated. In order to provide
an answer to the research question and present the most decisive factors for
innovation culture, the conclusion of the research will however be based on
explicitly stated examples of decisive factors for innovation culture in the
conducted interviews, as this will minimize the personal interpretation of what
organizational factors are decisive for innovation culture in SMEs.

From the literature on organizational culture, the framework regarding

different levels of corporate culture can be identified in the studied SMEs.
The respondents in the interviews rather easily exemplified both examples of
artefacts and norms. Shared basic values, on the other hand, seemed more
difficult to exemplify for the respondents. Nevertheless, practical exemplified
or not, shared basic values were by the respondents expressed as important
in all the cases and as the least visible part of the culture.
Regarding factors for having the company’s culture as a competitive
advantage, it can be discussed how important rare and imperfectly imitable
culture needs to be. However, a valuable culture can from the analysis be
argued to be important as a competitive advantage.
Concerning the distinction between organic and mechanistic cultures (Burns
and Stalker, 1961) the analysis identifies the SMEs to have both mechanistic

70
as well as organic cultures. The movement from an organic culture to a
mechanistic one (Hauschildt & Salomo, 2007) does however not seem to be a
general tendency in the cases, and it can therefore be argued that the
different phases in the innovation process do not require a move from an
organic culture to a mechanistic one in SMEs.
Regarding the creation of culture, it is clear that the culture in the SMEs has
been built, as argued by Teece, Pisano and Shuen (1997) and that there is a
strong focus on this.
Engagement, enthusiasm, risk-taking in a safe environment, learning and
independent thinking are by Goffin and Mitchell (2017) defined as factors for
innovation culture. It can though be discussed if there is equal importance of
all of them, as risk-taking is mentioned several times compared to the other
factors. The definition of a safe environment as a factor for innovation culture
can be discussed as the environment in general are safe, but the employees
can, at the same time, be challenged in this safe environment. Encouraging
and rewarding new ideas as a decisive factor for innovation culture can be
discussed. Both factors can be seen as important for innovation culture, but
what seems to be the case is that rewarding of new ideas happens on team
level and that reward comes in the form of acknowledgement rather than in
the form of bonuses.

Concerning the framework of innovation cultures in SMEs, as presented by

Wolf, Kaudela-Baum and Meissner (2012), NBI is the most represented type
in the studied SMEs. However, as also argued in the case, the type does not
appear in an absolute form, and therefore the importance of distinguishing
between the different types of innovation in SMEs can be discussed. If an
SME cannot be identified as having a specific innovation profile, the very
purpose of distinguishing between different innovation profiles becomes
indifferent.

Business Cases
The business cases included in the literature review is used as a framework to
answer the second part of the research question of how the organizational
factors can be practised to create a successful innovation culture in SMEs.
However, as briefly discussed in section 2.5, the use of successful innovation
culture in major global companies as a framework might be problematic, as

71
organizational structures and processes in major global companies can be
different compared to the organizational structures in Danish SMEs.

In the Apple case, only pieces of the innovation framework presented can be
identified in the studied SMEs. Neither the form of leadership, organizational
structure, secrecy, a narrow focus, the structure for product development or
the management tool used in Apple can be directly identified in all of the
SMEs. Therefore it can be discussed how transferable the innovation
framework in Apple is for SMEs, as the culture in SMEs seems to be very
different from the one in Apple.

In the Google case, the use of innovation principles seems more usable as a
framework as some, but not all of these, can be identified in the SMEs. When
the qualitative empirical data were analysed by the use of principles of
dynamic capabilities and a continuously changing organization, a general
way of adapting to changes in the market could not be identified in the
studied SMEs. However, when including the quantitative empirical data on
the subject, it became clear that the employees perceive the SMEs as
adaptable to new changes in the market, and the two principles can here be
argued to assert themselves as a part of the innovation culture in SMEs. The
principle people-centric approach seems from the analysis as a fundamental
approach to be innovative, as all of the SMEs identify their employees to be
very important for them. The principle of an open organization that networks
with its surroundings seems from the analysis to be partly useful to practise
an innovation culture in SMEs. The extent of which the organization networks
with its surroundings can though be discussed, as there is no general answer
on how much the organization networks with its surroundings. Nevertheless,
from the analysis, the collaboration or networking with clients and the studied
SMEs is of importance for innovation.

In the LEGO case, the framework for innovation is presented as seven truths
about innovation. Here, as in the Google case discussed above, some of the
truths are usable for creating an innovation culture in SMEs, whereas others
are not. Of the usable ones, hire diverse and creative people, is the case in
all of the studied SMEs. However, the level of creativity - in the Comparative
Case Study Matrix (Appendix 4) presented as innovative people - is

72
important, as there is no need for entrepreneur-like employees in the SMEs.
Another relatively usable truth in the LEGO case is about setting the course
towards “blue ocean” markets. However, the studied SMEs do also
recognize the importance of “red ocean” markets. Be customer-driven and
create a foundation for open innovation can also be identified as usable
truths, as the studied SMEs innovate together with their customers. However,
it can be discussed whether the SMEs listen to the majority’s opinion as the
employees in the SMEs are the decisive part for creating innovation. The two
truths about using the whole innovation spectrum and building an innovation
culture and what these entail do however, not seem to have much of
importance for creating a successful innovation culture in the studied SMEs.

To sum up the discussion, of using the business cases as a framework for

creating a successful innovation culture in SMEs, a tendency of low usability
of the principles in the business cases for creating a successful innovation
culture in SMEs emerges.
When focusing on the usability of the individual business cases, only
principles from Google and LEGO can be argued to be used for creating a
successful innovation culture in SMEs.

6.3 Conclusion
The conclusion of the research is used to answer the research question,
formulated as:

What organizational factors are decisive for innovation culture in Small or

Medium Enterprises in Denmark, and how can they be practised in order to
create a successful innovation culture in Small or Medium Enterprises in
Denmark?

First definitions of innovation have been examined in order to create a

foundation for the research and the Master’s Thesis in general. The most
appealing definition of innovation for this research can be formulated as “the
successful implementation of creative ideas within an organization”
(Matthews & Brueggemann, 2012, p. 30).

73
Regarding the first part of the research question on what organizational
factors are decisive for innovation culture in SMEs, an extensive amount of
literature on the field of innovation, organizational culture and innovation
culture have in this research been examined and compared for the purpose
of answering the research question.

On the question of decisive organizational factors, it can be concluded that

shared basic values in an organization are important as a foundation for an
organization and the means to create such shared values are artefacts and
norms. Moreover, for a company to have a competitive advantage, the
culture needs to be valuable. In the literature on organizational culture,
companies can be divided into having a mechanistic or organic culture. From
the comparative case study conducted, the culture in the studied SMEs can
neither be defined as mechanistic or organic. However, the SMEs possess
traits of both cultures and a co-existence of both cultures can therefore be
argued to be present. The culture in the studied SMEs can be identified as
something that is built, and a focus on building a specific culture is therefore
important. Other decisive organizational factors for innovation are risk-taking,
encouragement and reward of new ideas in the organization. When
rewarding new ideas in the organization, it is - from the interviews conducted
- important to reward on a team level rather on an individual level and
moreover, to reward in the form of acknowledgement.

As argued from a social constructionist point of view, the decisive

organizational factors presented in the conclusion only becomes a reality if
several individuals concur to such a shared perception of the factors, which is
the case as the majority of the respondents expresses a consensus on the
decisive organizational factors. Furthermore, the notion of hermeneutic
methodology can be mentioned in terms of understanding innovation culture
in an organizational context. Figure 1 and Figure 2 perfectly illustrates how,
as argued by hermeneutic methodology, the particular must be understood
from the whole and vice versa. Therefore, the decisive factors must not just
be understood and practised from the perspective of innovation culture, but
as well from the other elements in the Pentathlon Framework.

74
Answering the second part of the research question, of how the decisive
organizational factors can be practised in order to create a successful
innovation culture in SMEs in Denmark, have in the research process shown
to be more challenging. The inclusion of the business cases was aimed to
provide a practical approach of how to practise the decisive organizational
factors in order to create an innovation culture.
However, after analysing and discussing the findings from the quantitative as
well as qualitative empirical data in relation to the framework presented from
the three business cases, these - with few exceptions - does not provide as
much valuable knowledge of how to practise the decisive factors in an
organization as hoped for. However, the most important findings from the
discussion of the business cases are that a people-centric approach, as
presented in the Google case, is a practised approach in all of the studied
SMEs. Such an approach can be practised in several ways, as exemplified in
the different cases. It can be to create an environment and culture where
failure is accepted; it can be practised by a flat hierarchy and to reward new
ideas created by innovative employees. And an innovation culture can be
practised by - together with clients – identifying innovation possibilities and
hereafter develop the innovative products or services internally in the
organization.
The truths about innovation from the LEGO case; Hire diverse and creative
people, be customer-driven and create a foundation for open innovation can
also be concluded to be important findings for creating a successful
innovation culture in SMEs. However, as in with the Google case, these truths
can be practised in numerous ways, depending on the individual SME.
Even though the examined business cases did not provide much knowledge
of how to practice organizational factors for innovation, the studied SMEs
provided several examples of how to do so. It has proven to be difficult to
provide exact ways of practice the organizational factors, but from the
research conducted in this master’s thesis, creating a culture where
employees are one of the main entities, is crucial for creating a successful
innovation culture in Danish SMEs.

6.4 Further Research

From the research conducted in this master’s thesis several decisive
organizational factors for innovation culture in Danish SMEs have been
75
identified. In the same way, it has been examined how these factors can be
practised in order to create a successful innovation culture in Danish SMEs.
However, as innovation culture is a complex field of study and consists many
elements, the research opens up for further research on the field of
innovation culture in SMEs.

First, the research in this master’s thesis, examines innovation culture in

Danish SMEs. Therefore, studies on innovation culture in other regions,
countries and cultures are needed in order to see a correlation with the
findings in this study. Moreover, case studies on less successful SMEs are
needed in order to see if there is a consistency of the decisive factors for
innovation culture in less or unsuccessful SMEs. Furthermore, the cases in this
research are examining SMEs in the technological industry. Therefore, studies
on other business industries could provide useful insights about the decisive
factors for innovation culture. Moreover, more studies on the correlation of
innovation culture in major global companies and SMEs could be interesting
in order to decide whether other principles for creating a successful
innovation culture in major global companies could be useful for SMEs.

76
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Appendices
Appendix 1 - Mechanistic vs. Organic cultures

(Source: Herzog, 2011, p. 66, orginally adapted from Afuah 2003, p. 103. )

90
Appendix 2 - Full list of innovations studies

(Source: Herzog, 2011, p. 74-78)

91
92
93
94
95
Appendix 3 - SME Innovation Profiles

(Source: Wolf, Kaudela-Baum & Meissner, 2012, p. 258)

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 Appendix 4 - The Comparative Case Study Matrix Interview 1: Abtion
Initials and position of the respondent from the MHH - Chief Commercial Officer
company (CCO) & Partner
Started working in the company November, 2016
Question/Focus Area
Number of employees 35
Q1) When did the company start its business 2009
activities?
Q2) How is the ownership of the company? Self-owned company
Q3) Selling on a local, national or international National
market?
Appendix 4 - Comparative Case Study Matrix
Q4) Are you trying to create a specific culture in the Yes. Old culture in the company.
company? Employees think it's fun to work in the
company. Focus on one type of
employees. Freedom for employees.
Worshipping developers.
Q5) Do the company has an innovative culture? Yes. Innovate together with
customers. Culture and support for
trying things out. Creating innovative
solutions for customers. If something
makes sense to do - then do it.
Becomes challenging when the
company grows.
Q6) Who has the responsibility for the development Managers. Not the Management, they Q9: Management: 3.00 Management is mostly responsible.
of innovative initiatives in the company? only kill decisions. Q10: Employees: 3.71 Very unstructured. Not bottom-up.
Employee score* Interview 2: Festina Finance
97
Number of SEH - Chief Operating Officer (COO)
respondents: 17
May, 2015
Percent of the 60
employees participating
in the survey: 48,6%
2014
Self-owned company
International with Denmark as the
biggest market.
Q1: 4.00 Yes. Created by not formalized
values. To think it is fun to work. High
Performance culture. Culture where it
is about getting the right result. Not
rules, structures and procedures. Not
taking things too serious.
Q2: 4.00 Maybe. Do not think so. Innovative
products. High Performance culture.
Employees have an innovative
mindset.
Appendix 4 - The Comparative Case Study Matrix
Q7) Who has the responsibility for implementation
of innovative initiatives in the company?
Q8) Do the company has an overall strategy as you
know of?
Q9) How do the company adapt to changes in the
market?
Q10) Blue and Red Ocean - Do you think the
company is competing in a blue ocean?
Q11) Do you have focus on your customers
regarding creation and development of your
products?
Q12) What does your employees mean to the
company?
Interview 1: Abtion Employee score* Interview 2: Festina Finance
98
RACI* approach. Iterate on new Q9: Management: 3.00 Management.
innovative initiatives. Responsible Q10: Employees: 3.71
individual as Apple. Top-down.
Limited box of what to work with. Can
only change things within own
domain.
Three year strategy. 3-60-20. Q4: 4.00 No, but ambitions and directions. Part
Chasing a Blue Ocean. Create value of the culture not to have a strategy.
for customer. Collaboration with More value based than strategy
customer. Extreme Programming based.
(XP). Want to be known for the way
they develop. PR and Branding is a
part of that.
Attract people who are up to date on Q3: 4.35 Interested in competitors on the
what happens on the market. Are market. Measuring on effectivity.
chosen by customers because of
network and recommendations.
Yes. Wants to move more into Blue Danish market is Red Ocean.
Ocean. England a bit more Blue Ocean.
Wants to be Blue Ocean.
Sees it as a collaboraiton. Software is Customers is a part of the
dynamic. Therefore longer development. It is an interplay.
collaborations.
Very important. Retain and attract. Important. A part of effectiveness.
Should be relevant and interesting to Everything is a group effort.
work at Abtion. XP is a way to attract.
Flat hierarchy. Free frame for
employees. Can work from home.
Appendix 4 - The Comparative Case Study Matrix
Q13) Any values that the company tries to
communicate to the employees?
Q14) Does the employees choose their own work
tasks?
Q15) Is it a priority for the company to have
innovative employees?
Q16) Amount of employees working on full time,
who have a Higher Education
Q17) How is the balance between creation and
implementation of innovative initiatives and
maintaining the daily sales operations?
Q18) Does innovation happen internally or
externally?
Interview 1: Abtion
RACI. Adapting change. Using
nudging to do so.
Not really. CTO chooses who should
be in on projects. Sometimes lead
developers are in on project from
start.
Yes. A desire to be better. Should not
have a desire to be an entrepreneur.
Below 50%. Not many of the
developers. Not something important
for developers. More important for
project managers.
Working on creating a more clear
structure. Something they are aware
of. The management should focus on
improve the company. Employees
focus on daily operations. Slow of
adapting to the process.
Mainly externally with customers.
When internally, not very radical.
Employee score* Interview 2: Festina Finance
99
Openness and transparency.
Effectivity. Self-determination.
Q6: 2.88 Choose a lot themselves. Customers
are choosing on bigger level.
Sometimes the employees choose
themselves. Other times not.
Important for the company. The
company is dependent on smart
employees who can think out of the
box and thereby by innovative.
80% percent. Not the most important.
More focused on how good they are.
Correlation between education and
skills.
Customer decides mostly. If they are
lucky, they can innovative together
with the customer.
Q7:Internally: 3.75 Depends on the project. Innovation
Q8: Externally: 2.53 mostly happens with the customer.
Appendix 4 - The Comparative Case Study Matrix
Q19) Do you have a systematic approach for
development of new ideas in the company?
Q20) How will you define innovation?
Q21) Does the respondent have anyting to add?
Interview 1: Abtion
Strategi: Offerings, Clients, Retain,
Recruit. Employees can do something
which is a part of the overall strategy.
Top-down. Employees know that their
work is a part of the strategy. Working
for the company to reach higher
goals.
Something where 2 + 2 = 5.
Innovation is something where you
build something on top of the existing.
Being open to the fact that nobody
knows best.
Important to know each others
reasons for doing as they do. Would
make things go faster.
*RACI stands for: Responsible,
Accountable, Consulted and Informed
Employee score* Interview 2: Festina Finance
100
Q5: 2.94 No. Management sits together once
in a while.
When you make new features that did
not exist before. When you do
something that was not possible
before. If difficult things can be done
in a simple way. Innovation is also
something inward.
Not many people are innovative.
Need to understand technology but
also have a business perspective.
Can get far on raw talent. Not big
enough to do as Google does
regarding innovation. Effectivity is the
most important parameter. As a small
company the employees are the most
important. When you become bigger
than 100 eomployees, culture and
processes are more important.
Appendix 4 - The Comparative Case Study Matrix Employee score* Interview 3: Invokers Employee
score*

101
Initials and position of the respondent from the Number of TOR - Partner, Solution Architect Number of
company respondents: 25 respondents:
Started working in the company Feb, 2013
Question/Focus Area
Number of employees Percent of the 44
employees participating
in the survey: 41,7%
Q1) When did the company start its business 2006
activities?
Q2) How is the ownership of the company? Self-owned company
Q3) Selling on a local, national or international International with Denmark as the
market? biggest market.
Q4) Are you trying to create a specific culture in the Q1: 4.20 Yes. Have designed their rooms for an N/A**
company? innovative approach. Have invested in
materials to build mockups and
thereby be innovative.
Q5) Do the company has an innovative culture? Q2: 4.04 Yes, but it can always improve. N/A
Nudging people to become even more
innovative.
Q6) Who has the responsibility for the development Q9: Management: 2.96 Every needed resource in the N/A
of innovative initiatives in the company? Q10: Employees: 3.92 company is allocated to the
development of new
products/services.
Appendix 4 - The Comparative Case Study Matrix Employee score* Interview 3: Invokers Employee
score*

102
Q7) Who has the responsibility for implementation Q9: Management: 2.96 Employees. Developing innovative N/A
of innovative initiatives in the company? Q10: Employees: 3.92 ideas with/for the customers.
Q8) Do the company has an overall strategy as you Q4: 3.88 Yes. More international customers. Do N/A
know of? not want to be corporate. Want to
keep the family feeling.
Q9) How do the company adapt to changes in the Q3: 4.24 Benchmarks. N/A
market?
Q10) Blue and Red Ocean - Do you think the Uses mindset from Blue Ocean. Have
company is competing in a blue ocean? activities in looking for things leading
to products/services in Blue Ocean.
Q11) Do you have focus on your customers Yes. Customers is a big part of the
regarding creation and development of your process.
products?
Q12) What does your employees mean to the They are the company. Employees
company? are everything.
Appendix 4 - The Comparative Case Study Matrix Employee score* Interview 3: Invokers Employee
score*

103
Q13) Any values that the company tries to Values are hollow. More activities than
communicate to the employees? values. By getting the employees to
know each other they create a
common language and thereby a set
of values.
Q14) Does the employees choose their own work Q6: 3.72 A mixture. Everybody have their role N/A
tasks? in a delivery.
Q15) Is it a priority for the company to have Yes. It is a prerequisite for their
innovative employees? survival.
Q16) Amount of employees working on full time, Everybody. But it is not a requirement.
who have a Higher Education
Q17) How is the balance between creation and Divided into different departments.
implementation of innovative initiatives and
maintaining the daily sales operations?
Q18) Does innovation happen internally or Q7:Internally: 4.28 A combination of both. N/A
externally? Q8: Externally: 1.96
Appendix 4 - The Comparative Case Study Matrix Employee score* Interview 3: Invokers Employee
score*

Q19) Do you have a systematic approach for
development of new ideas in the company?
Q20) How will you define innovation?
Q21) Does the respondent have anyting to add?
104
Q5: 2.64 More an approach. Designthinking N/A
and Stage-Gate approach.
The ability to solve complicated
problems across different domains
where the solution is something new,
which has not been seen before.
Appendix 4 - The Comparative Case Study Matrix Interview 4: Move Innovation Employee score* Interview 5: Shape

105
Initials and position of the respondent from the JH - Project Manager Number of CH - Business Developer
company respondents: 8
Started working in the company August, 2018 2017
Question/Focus Area
Number of employees 25 Percent of the 90
employees participating
in the survey: 32%
Q1) When did the company start its business 2009 2010
activities?
Q2) How is the ownership of the company? Self-owned company Self-owned company
Q3) Selling on a local, national or international International with Denmark as the International with Denmark as the
market? biggest market. biggest market.
Q4) Are you trying to create a specific culture in the Yes. Part of the DNA. Want to have a Q1: 4.88 Yes and no. The culture is defined by
company? familiar tone in the company. Allowed the many nationalities in the
to make mistakes. Want people to company. But there is a free and
feel safe. Have meetings where they autonomous way of working.
talk about things affecting the culture.
Q5) Do the company has an innovative culture? Yes. They need to have one. Part of Q2: 4.88 Yes it does. By the way it is
what they are selling to customers. structured. Consultant house and
Venture Capital company at the same
time.
Q6) Who has the responsibility for the development Separated. In the consultant business Q9: Management: 2.88 Management is responsible.
of innovative initiatives in the company? it is the employees. In production Q10: Employees: 4.00
business it is the management.
Appendix 4 - The Comparative Case Study Matrix
Q7) Who has the responsibility for implementation
of innovative initiatives in the company?
Q8) Do the company has an overall strategy as you
know of?
Q9) How do the company adapt to changes in the
market?
Q10) Blue and Red Ocean - Do you think the
company is competing in a blue ocean?
Q11) Do you have focus on your customers
regarding creation and development of your
products?
Q12) What does your employees mean to the
company?
Interview 4: Move Innovation
CEO and Management. Employees
anchor the initiatives.
No. Driven by possibilites. Need a
plan, which is being written down.
Need a plan in order to grow. The
company has always been driven by
possibilities.
Follow what the customers want.
Their duty to follow up on new
technologies. Everybody in the
company are interested in
technology.
No on consultant business. More Blue
Ocean in the production business.
Yes. But now more narrowed focus
on customers.
Means everything. Part of the
company's foundation. Important they
feel good at work and that it is fun.
Employee score* Interview 5: Shape
106
Q9: Management: 2.88 Implementation of big things is
Q10: Employees: 4.00 management. Project based is an
employee responsibility.
Q4: 3.63 Yes. Ownership of companies. To
move away from being a consultant
house. A transition going on right now
in Shape.
Q3: 4.38 Only iOS agency in Denmark. Gives
possibilities regarding app
development.
Competing on Red Ocean in the
consultant business but delivers a
better product than competitors.
Yes. Very included in the process.
Takes iterations to include the
customer in the process.
Part of the modern working culture.
Appendix 4 - The Comparative Case Study Matrix
Q13) Any values that the company tries to
communicate to the employees?
Q14) Does the employees choose their own work
tasks?
Q15) Is it a priority for the company to have
innovative employees?
Q16) Amount of employees working on full time,
who have a Higher Education
Q17) How is the balance between creation and
implementation of innovative initiatives and
maintaining the daily sales operations?
Q18) Does innovation happen internally or
externally?
Interview 4: Move Innovation Employee score* Interview 5: Shape
107
Not directly. Not formalized. Never compromise on the product.
Something they need. Values are Not even regarding deadlines. Deliver
being expressed in how they act in more value than what the customer
the company. Should be fun to work has paid for.
for Move Innovation.
Have influence on it. Not on projects if Q6: 3.50 No. Not very much. Get on projects
they do not want to. Fill out the frame where it is needed.
presented by the customer.
Big priority. Being able to work in an No. But people should solve the tasks
agile environment. Naturally attracting in an innovative way.
those type of employees.
20 out of 25. 80%. Bachelor's degree The majority of employees has a
or Gradute. Higher Education. Have very skilled
employees who are autodidact.
Big problem. Trying to create a plan More innovative in VC company.
for it. Need more focus on the More fixed frame in the consultant
problem. A challenge where daily company.
operations often wins. A management
problem, but should be spread out to
the employees. Employees should
have influence on the strategy.
80% externally, 20% internally. They Q7:Internally: 3.50 Mostly internally.
are being forced to be innovative. The Q8: Externally: 3.00
customer are prepared to be
innovative with the company.
Appendix 4 - The Comparative Case Study Matrix
Q19) Do you have a systematic approach for
development of new ideas in the company?
Q20) How will you define innovation?
Q21) Does the respondent have anyting to add?
Interview 4: Move Innovation
Yes, regarding projects for
customers. There is a model for that.
Not regarding innovation for the
company. Need a structured process
for development of innovation.
Should distinguish between
development and innovation.
Development is a iterative process.
Improve something already existing.
Innovation is of more radical
character. When you turn things
upside down. 20% innovation 80%
development in the company.
Employee score* Interview 5: Shape
108
Q5: 3.13 Not really. Very individually
dependent.
The courage to experiment with
things as other have not done before.
The courage to listen to employees.
Openness to fail. Ready to invest in
something unsafe.
Low average age in Shape.
Employees know what is going on in
the industry.
Appendix 4 - The Comparative Case Study Matrix Employee score* Interview 6: Trustworks Employee score*

109
Initials and position of the respondent from the Number of MBE - Chief Culture Officer Number of
company respondents: 22 respondents: 5
Started working in the company Jan 2017
Question/Focus Area
Number of employees Percent of the 32 Percent of the
employees participating employees participating
in the survey: 24,4% in the survey: 15,6%
Q1) When did the company start its business 2014
activities?
Q2) How is the ownership of the company? Self-owned company
Q3) Selling on a local, national or international National
market?
Q4) Are you trying to create a specific culture in the Q1: 4.14 Yes. No personal KPI's. Not measuring Q1: 4.20
company? on invoices or sales. Knowledge is
important in the culture. Team culture.
Flat hiearachy.
Q5) Do the company has an innovative culture? Q2: 3.95 Yes, but depends on the definition. Q2: 4.00
Agile approach with short sprints. Not
radical innovation. Sometimes radical
for them, though.
Q6) Who has the responsibility for the development Q9: Management: 3.09 Bottom-up Q9: Management: 2.00
of innovative initiatives in the company? Q10: Employees: 3.82 Q10: Employees: 4.40
Appendix 4 - The Comparative Case Study Matrix Employee score* Interview 6: Trustworks Employee score*

110
Q7) Who has the responsibility for implementation Q9: Management: 3.09 Employees. Sometimes employees are Q9: Management: 2.00
of innovative initiatives in the company? Q10: Employees: 3.82 asking for the management's Q10: Employees: 4.40
permission.
Q8) Do the company has an overall strategy as you Q4: 3.82 Core services should fill more in the Q4: 4.00
know of? strategy. Financial sector is important.
Focus areas: team, knowledge, growth
and value is the sum.
Q9) How do the company adapt to changes in the Q3: 4.27 Focus on what customers asks for. Q3: 4.40
market?
Q10) Blue and Red Ocean - Do you think the Mainly Red Ocean with a touch of Blue
company is competing in a blue ocean? Ocean.
Q11) Do you have focus on your customers Yes. Customers is a big part of the
regarding creation and development of your process.
products?
Q12) What does your employees mean to the They are the DNA of the company. The
company? employees means everything for the
company.
Appendix 4 - The Comparative Case Study Matrix Employee score* Interview 6: Trustworks Employee score*

Q13) Any values that the company tries to
communicate to the employees?
Q14) Does the employees choose their own work
tasks?
Q15) Is it a priority for the company to have
innovative employees?
Q16) Amount of employees working on full time,
who have a Higher Education
Q17) How is the balance between creation and
implementation of innovative initiatives and
maintaining the daily sales operations?
Q18) Does innovation happen internally or
externally?
111
Team, knowledge and growth. The
value is the sum of those.
Q6: 3.45 Yes and no. Employees have an Q6: 4.40
influence and buy in. Can bring a
collegue on to a project if there is a
need for it.
Yes. Great if employees are taking
initiative to do things themselves.
90% When looking for new candidates
the education is something they look at.
Grades does not matter.
Not strictly divided. There is a flexible
approach to the balance between those
two.
Q7:Internally: 3.91 Mostly internally. Q7:Internally: 4.20
Q8: Externally: 2.45 Q8: Externally: 2.20
Appendix 4 - The Comparative Case Study Matrix
Q19) Do you have a systematic approach for
development of new ideas in the company?
Q20) How will you define innovation?
Q21) Does the respondent have anyting to add?
Employee score* Interview 6: Trustworks Employee score*
112
Q5: 3.36 No. Mainly happens ad hoc. Biggest Q5: 2.60
fear is to be corporate.
Interest and dialogue. Be ready to move
away from operations. Passiondriven.
Feeling something about the products
and the people you are working with.
Do not believe in controlled innovation.
If you have a culture, which is steeped
in a togetherness then some form of
development together will happen. If
you feel you are in the right place on
the right shelf, then people are loyal.
Appendix 4 - The Comparative Case Study Matrix Conclusion Average score***
*Employee score:

113
Initials and position of the respondent from the To the statements the
company following possible answers
were provided:
Started working in the company Possible answersWeight
Question/Focus Area Strongly disagree 1
Number of employees Average: 47,7 Disagree 2
Average percentage of employees
participating in the survey: 32,5
Q1) When did the company start its business Average: 2010,3 Neither disagree
activities? or agree 3
Q2) How is the ownership of the company? Self-owned company Agree 4
Q3) Selling on a local, national or international National and international, but Denmark is Strongly agree 5
market? the biggest marked for all of them.
Q4) Are you trying to create a specific culture in the Yes. Important thing for all companies. Average score: 4.28
company? Informal ways of working, freedom, no
bureaucracy and flat hierarchy is commom
denominators for the culture the companies
want to create.
Q5) Do the company has an innovative culture? Generally there is a belief of having so. A Average score: 4.17
general uncertainty on how to define an
innovative culture. Within their own
perception of innovation, the conclusion is
yes.
Q6) Who has the responsibility for the development Diverse, but mostly management. Average score:
of innovative initiatives in the company? Employees believes it is them. Management: 2.71
Employees: 3.97
Appendix 4 - The Comparative Case Study Matrix
Q7) Who has the responsibility for implementation
of innovative initiatives in the company?
Q8) Do the company has an overall strategy as you
know of?
Q9) How do the company adapt to changes in the
market?
Q10) Blue and Red Ocean - Do you think the
company is competing in a blue ocean?
Q11) Do you have focus on your customers
regarding creation and development of your
products?
Q12) What does your employees mean to the
company?
Conclusion Average score***
*Employee score:
114
Management are in general responsible for Average score:
major decisions regarding implementation in Management: 2.71
the company. When it comes to products it Employees: 3.97
is more the employees.
Generally the companies have strategies. Average score: 3.87
But not many believes that having long
strategical plans are the best practice. In
general there is a common opinion that
market and opportunities changes fast and
therefore a long strategic plan is not the
answer. But having directions is a better
way of planning strategically. In the question
to the employees the focus were on them
knowing of the overall strategy and if their
work tasks were a part of that. Here the
majority answers that they do with an
average score of 3.88
A mixture on what their customers want and Average score: 4.33
of the employee's knowledge. The question
for the employees where if the company
were adaptable for changes in the market,
to which the employees highly believes with
an average score on 4.34.
Generally a mixture of both. Common for
the companies is that they all want to more
in a Blue Ocean and focus on creating
products/services in a Blue Ocean.
Customers are a big part of the
development for all of the companies.
Extremely important. Generally the most
valuable resource for the companies.
Appendix 4 - The Comparative Case Study Matrix
Q13) Any values that the company tries to
communicate to the employees?
Q14) Does the employees choose their own work
tasks?
Q15) Is it a priority for the company to have
innovative employees?
Q16) Amount of employees working on full time,
who have a Higher Education
Q17) How is the balance between creation and
implementation of innovative initiatives and
maintaining the daily sales operations?
Q18) Does innovation happen internally or
externally?
Conclusion Average score***
*Employee score:
115
Communication is an explicit part of the
value for the companies. Being able to
communicate together and that there is a
general good tone in the workplace. Other
individual values to be listed are: openness,
teamspirit, passion, loyalty, self-
determination, fun and quality. Values are
not so often formalized.
Not really. Have influence on which projects Average score: 3.59
they want to work on. Often depends on
what the customer needs. The answers
from the employees reflects the one from
the managers as the average score is 3.63
and they are more of the opinion that they
choose their work tasks themselves.
Generally yes. Should not be entreprenur-
like people, but important that the
employees can think out of the box.
The main majority of the employees have a
Higher Education. Approximately 80%
Not a strict balance between the two. Very
dependable of what is needed in the
company at the moment.
A mixture. For some it is externally, for other Average score:
internally. Innovation are often developed Internally: 3.93
together with the customers. Employees Externally: 2.43
thinks it mainly happens internally.
Employees thinks it mainly happens
internally.
Appendix 4 - The Comparative Case Study Matrix
Q19) Do you have a systematic approach for
development of new ideas in the company?
Q20) How will you define innovation?
Q21) Does the respondent have anyting to add?
Conclusion Average score***
*Employee score:
116
Not really. A general unsystematic approach Average score: 2.93
with few exeptions. Employees agrees with
management as the average score is 2.83
and thereby illustrates that there is a form of
a systematically approach, but leaning
towards not having one.
Build something that did not exist before or
build something new from the existing. Do
something in a new way. Very different
definitions, but the word 'new' are included
in most of the definitions.
Appendix 4 - The Comparative Case Study Matrix **It was not possible to conduct a survey with
employees of the company

117
Initials and position of the respondent from the ***The average score has been calculated by
company dividing the sum of the employee score by five, as
it is the total number of companies where surveys
has been conducted. The average score has been
indicated by rounding to two decimals.
Started working in the company
Question/Focus Area
Number of employees
Q1) When did the company start its business
activities?
Q2) How is the ownership of the company?
Q3) Selling on a local, national or international
market?
Q4) Are you trying to create a specific culture in the
company?
Q5) Do the company has an innovative culture?
Q6) Who has the responsibility for the development
of innovative initiatives in the company?
Appendix 5 - Interview guide for interviews with respondents ​ ​Dato:
Sted:

Note​: ​All of the interviews were conducted in Danish as all of the respondents preferred to
do the interview in Danish. To accommodate this preference, the interviews were conducted
in Danish and the interview guide is written in Danish as well.

INTERVIEWGUIDE
Respondent​:
Navn​:
Stilling​:
Antal år i virksomheden​:

- Må interviewet optages til dokumentation?

- Må jeg dele nogle spørgeskemaer ud til dine medarbejdere efter interviewet?

Først har jeg lige nogle introducerende spørgsmål, som skal bruges til at få noteret fakta om
virksomsomheden, da interviewet bruges skal bruges i et komparativt case studie.

1. Hvor mange medarbejdere er I?

2. Hvornår startede virksomheden sine forretningsaktiviteter?

3. Hvordan er ejerskabet af virksomheden?

○ Selvstændig virksomhed, en del af en national gruppe, en del af en
international gruppe?

4. Sælger I jeres produkter/services på et lokalt, nationalt og/eller internationalt

marked?

Kultur
1. Forsøger I at skabe en bestemt kultur i virksomheden?
a. Hvis ja, hvordan?

2. Mener du at virksomheden har en innovativ kultur?

a. Hvis ja, hvordan?
b. Hvis nej, hvorfor?

Ledelse
3. Hvem har ansvaret for at udvikle innovative produkter/services i virksomheden?
a. Hvordan kommer det til udtryk i virksomhedens dagligdag?

4. Hvem bestemmer hvilke innovative tiltage der skal implementeres i virksomheden?

a. Hvordan gøres det i praksis?

5. Har virksomheden en overordnet strategi som du er bekendt med?

118
Appendix 5 - Interview guide for interviews with respondents ​ ​Dato:
Sted:
a. Hvis ja, kan du i korte træk fortælle om den?

Markedet
6. Hvordan forholder virksomheden sig til ændringer på markedet?
a. (I form af nye teknologier eller trusler fra konkurrenter)
i. Benchmarking eller på anden måde sammenligning? Er det noget I er
opmærksomme på og handler efter, eller forsøger I at fokusere på
jeres egne forretningsaktiviteter?

7. Er du bekendt med “Blue og red ocean teorien”?

Synes du, at I arbejder på et blue ocean marked?
a. Hvis ja, hvorfor og hvordan?
b. Hvis nej, hvorfor og hvordan er I bedre en de eksisterende aktører?

8. Har I fokus på jeres kunder i forbindelse med udarbejdelse og udvikling af jeres

produkter?
a. Hvis ja, inddrager I dem i processen?
i. Hvis ja, hvordan gør I det?
ii. Hvis nej, hvorfor ikke?

Medarbejdere
9. Kan du sætte nogle ord på, hvad jeres medarbejdere betyder for jer?

10. Er der nogle grundlæggende værdier for virksomheden, som I forsøger at

kommunikere videre til jeres medarbejdere?
a. Hvis ja, hvilke?
b. Hvis ja, på hvilken måde?

11. Bestemmer medarbejderne selv hvilke arbejdsopgaver de påtager sig?

12. Er det en prioritet for virksomheden at have innovative medarbejdere?

a. Hvis ja, er der en måde hvorpå I motiverer jeres medarbejdere til at være
innovative?
b. Hvis nej, hvorfor ikke?

13. Ved du hvor mange medarbejdere, der er ansat på fuld tid i virksomheden, som har
en videregående uddannelse?

Virksomhedens struktur
14. Hvordan balanceres der i virksomheden mellem udarbejdelse og implementering af
innovative tiltage og det at opretholde den daglige drift?

15. Er innovation noget der sker internt og/eller eksternt i virksomheden?

16. Har I en systematisk tilgang til at udvikling af nye idéer i virksomheden?

119
Appendix 5 - Interview guide for interviews with respondents ​ ​Dato:
Sted:
a. Hvis ja, hvordan?

Definition af innovation
Nu da jeg har spurgt en masse ind til innovation, så vil jeg gerne høre dig, hvordan du
definerer begrebet innovation?

EKSTRA
17. Med tanke på, at dette interview omhandler innovation i (INDSÆT NAVN PÅ
VIRKSOMHEDEN) er der så noget som du mener, at du ikke har fået sagt?

120
Appendix 6 – Surveys for employees in the selected SMEs
Survey 1 - Abtion

121
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124
125
126
127
128
129
130
Appendix 6 – Surveys for employees in the selected SMEs
Survey 2 – Festina Finance

131
132
133
134
135
136
137
138
139
140
Appendix 6 – Surveys for employees in the selected SMEs
Survey 3 – Move Innovation

141
142
143
144
145
146
147
148
149
150
Appendix 6 – Surveys for employees in the selected SMEs
Survey 4 – Shape

151
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153
154
155
156
157
158
159
160
Appendix 6 – Surveys for employees in the selected SMEs
Survey 5 - Trustworks

161
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168
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