Strategy shift: Integrating strategy and the firm’s capability to innovate

Innovation is a key source of organizational growth and profitability. Many organizations at the front end of innovation struggle to engender an innovation approach that is effective and lasting. This article presents a framework that defines the interdependency of innovation and strategy, and then outlines the role of top management to continuously renew the positioning of the firm. Based on a synthesis of prior research—including the Dynamic Capabilities View, Innovation Orientation, and Disruptive Innovation Theory—and our own experience working with organizations, we present an operational strategy shift framework, which allows practitioners to increase, refine, and transform their firm’s capability to innovate (CTI) toward achieving their strategic objectives. This framework provides guidance that leaders can use to integrate innovation into their strategic process.