Understanding Innovative Potential (IP) in an ICT Context: Insights from the ICT industry in India

In this paper I discuss innovative potential at a firm level using information system literature and broadening my review to R&D literature as well. This review enables me to develop a theoretical frame of what researchers have indicated to be innovative potential or capacity at the firm level. While the information system literature does refer to a firms innovative potential as a dynamic phenomena, thus the inception of this phenomena is rooted through the R&D literature, which is helpful but in itself has a weakness. In relying on the R&D perspective to explain innovative potential of a firm information system researchers have stuck to the static notion of innovation while talking about innovative potential (IP) as a dynamic process. This paper redresses that imbalance as it tries to formulate a theory of IP that in my opinion better explains IT innovation at the firm level from a dynamic perspective in its conception, operation and instantiation. I conclude this paper with insights on what I call the dynamic IP threshold arguing that being dynamic cannot be seen as a point in time but a threshold existing over time. I then discuss some implications. I suggest that firms need to consider IP as a long term investment not only in human capital but in the way the human capital is allowed to engage with new ideas. I suggest IP can be build using institutional logics that enable openness and collegiality.