A causal model of the linkages between innovative ecological responsiveness and performance

The purpose of this study was to examine the question "What are the organizational "antecedents" and "downstream" effects of innovative ecological responsiveness in the electric service industry?" Data were collected primarily from the chief operating, financial, and environmental/regulatory officers from 101 investor owned electric power producers across the United States.

Theory from the organizational innovation literature was integrated with the organizational adaptation literature to identify the relationship between the organizational determinants of innovative adaptive responses, as well as to project the financial implications of these responses. Since innovations are a means of introducing change into organizations in order to facilitate the adaptation process, these two theoretical frameworks were found to be quite complementary.

Statistical results suggest that "culture and context" matter. Managerial ideology was found to be significantly related to innovative ecological responsiveness. Regulatory uncertainty was significantly and positively related to the range of innovative responses implemented by a company. The range of innovative activities implemented by a company had a significant positive effect on financial performance. This finding suggests that firms that adopt a broad range of activities tend to perform better, indicating a possible synergistic effect in this adaptive pattern.