Reconceptualizing professional service firm innovation capability: Scale development

Building on capability theory, this paper presents a reconceptualization of the innovation capability construct within a knowledge-intensive service context, specifically, professional service firms (PSFs). Employing a rigorous multi-stage scale development process we interviewed 37 participants and surveyed 463 respondents across a wide range of PSFs including lawyers, accountants, consulting engineers and management consultants. The results of exploratory and confirmatory factor analyses highlight the multi-dimensional nature of innovation capability within this context. Three dimensions were identified: client-focused, marketing-focused, and technology-focused innovation capability. We provide evidence of face validity, content validity, convergent and discriminant validity, nomological validity and reliability of our scale. Our scale offers a new way to measure innovation capability within PSFs and highlights the need to move beyond the narrow manufacturing mind-set focus of prior innovation research. Implications for theory and practice are discussed.

► We reconceptualize the innovation capability construct within a knowledge-intensive service context.
► A rigorous multi-stage scale development process is employed across two separate samples.
► The results highlight the multi-dimensional nature of innovation capability within professional service firms.
► Three dimensions are identified: client, marketing and technology-focused innovation capability.
► We present an empirically validated, psychometrically sound and parsimonious innovation capability scale.