The Case of Organizational Innovation Capability and Health Information Technology Implementation Success: As You Sow, So You Reap?

The Case of Organizational Innovation Capability and Health Information Technology Implementation Success: As You Sow, So You Reap?

Rangarajan Parthasarathy, Monica Garfield, Anuradha Rangarajan, Justin L. Kern
DOI: 10.4018/IJHISI.20211001.oa21
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Abstract

Organizational innovation capability is defined as the ability to continuously transform knowledge and ideas into new products, processes and systems for the benefit of an organization and its stakeholders. This study examines the relationship between the innovation capability of healthcare organizations and their ability to successfully implement electronic medical records (EMR), a health information technology (HIT) innovation. Data was collected using a cross-sectional survey and structural equation modeling (SEM) method was used to analyze the data. Results demonstrate that organizational product innovation capability positively affects EMR implementation success. A positive relationship also exists between organizational process innovation capability and EMR implementation success. This study is one of the first to empirically validate the relationship between healthcare organization’s innovation capability and HIT innovation implementation success, in the context of EMRs. Implications of the study for the academic and industry practitioner are discussed.
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Introduction

Organizational innovation capability has been considered an important ingredient for success. This is more relevant today than ever before, due to the intense competition in the healthcare and non-healthcare industry (Calantone, Cavusgil & Zhao, 2002; Damanpour, 1996, 1991, 1987; Damanpour & Evan, 1984; Gonzalez-Zapatero et al., 2016; Mu et al., 2017; Najafi-Tavani et al., 2016). Innovation can be defined as the intentional introduction and application within a role, group, or organization, of ideas, processes, products, or procedures new to the relevant unit of adoption and designed to significantly benefit the individual the group or the wider society (West, 1990). Technological innovation refers to “the implementation of an idea for a new product, or a new service, or the introduction of new elements in an organization’s production process or service operation” (Damanpour and Evan, 1984, p. 394). Innovation capability is “the ability to continuously transform knowledge and ideas into new products, processes and systems for the benefit of the firm and its stakeholders” with this higher order capability enabling the molding and management of multiple capabilities to successfully stimulate innovation (Lawson and Samson 2001, pp. 380, 384). Organizational innovation capability essentially involves the bringing to the market and/or successful implementation of a new product or service (Adler & Shenbar, 1990). Scholars have described it as the ability to mobilize the knowledge of the employees and the organization from past innovation implementation experiences to create new knowledge, and use such new knowledge to implement a new product or service (Çakar & Ertürk, 2010; Kogut & Zander, 1992; Ranganathan & Afnan, 2012). A firm with the capability to enhance its organization’s learning and assimilate existing and new knowledge would also have the capability to successfully create and implement product and process innovations (Therin, 2003).

Research literature informs us about the important role of health information technology (HIT) innovations in improving healthcare quality and the cost of care (Bezboruah et al., 2014; Chaudhry et al., 2006; Cresswell & Sheikh, 2013; Gewald & Gewald, 2020; Gagnon et al., 2012; Li et al., 2013; Narattharaksa et al., 2016). In the realm of healthcare, electronic medical records (EMR) fit the profile of technology innovations (Crane & Crane, 2006; Dansky et al., 2006; Dansky & Dirani, 1998; Dansky et al., 1998; Holt et al., 2019; Krist, 2015; Lee et al., 2016; Lee, 2000; Pellizzoni et al., 2020; Perez et al., 2017). EMR implementation is an important aspect of HIT, perhaps the most important aspect, since it has the potential to directly impact cost reduction and quality improvement in healthcare delivery through: (i) lowering the processing times associated with enormous amounts of patient information within and between hospitals, (ii) enhancing the speed and quality of communications between patients and the healthcare providers, and between healthcare providers and other healthcare providers or specialists that need to be involved in patient care, and (iii) delivering evidence-based high-quality healthcare through collection and mining of patient information using computers (Hillestad et al., 2005; Jardim & Martins, 2016; Sharma et al., 2016). HIT and EMR are eventually expected to contribute to the delivery of high-quality healthcare to all sections of society at a reasonable cost (Byrd & Clayton, 2001; Ferlie & Shortell, 2001; Jardim & Martins, 2016; Sharma et al., 2016; Thakur et al., 2012; Trzeciak & Rivers, 2003).

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