ABSTRACT
Healthcare organizations and their managers operate in highly complex environments. Whereas they are subject to a wide variety of constraining contextual characteristics, they are also highly in need of innovation to be able to deliver high-quality care and compete in a highly dynamic environment. In this chapter, we utilize a dynamic capabilities perspective to describe how four important contextual characteristics—financial constraints, monitoring needs, bureaucracy and pluralism—may affect the innovation process of healthcare organizations. We zoom into how these contextual characteristics may impact three key activities of organizations that seek to innovate: sensing, seizing, and reconfiguring activities. In addition, we magnify the impact of these contextual characteristics on three key underlying components of the ability of managers to innovate: managerial social capital, managerial human capital, and managerial cognition. As we practically identify and address both threats and opportunities of healthcare sector’s contextual characteristics, comprehension of this chapter is vital for those pursuing successful healthcare innovation.
