The Impact of Organizational Culture on Service Innovation: An Empirical Study of Sri Lankan Business Service Organizations

Abstract

The purpose of this research article is to examine the impact of organisational culture on service innovation. A conceptual framework was proposed from the related literature and empirically tested using primary data collected from managers of service centric business organisations in Sri Lanka. The study employs a cross-sectional, survey-based methodology. Data was analysed via Smart PLS program. The result reveals that adhocracy culture is positively related to service innovations. Further, it provides evidence that, first, in order to increase service innovations companies should foster cultures with external and flexibility orientations. Moreover, the paper suggests that values, beliefs and assumptions that are coherent with adhocracy culture are key drivers for developing new services. Hence, the result provides evidence regarding the implications of organisational culture as well as enabling factors behind innovations of service firms.