Innovation and pay incentives drive growth, but not for all firms.
The study looked at how innovation and management practices affect firm growth. They found that investing in technology and using performance-based pay can help firms grow in turnover, employment, and productivity. However, combining these strategies doesn't always lead to more growth. Performance-based pay boosts growth for firms not focused on innovation or using simple innovation strategies. But for firms heavily relying on research and development, this type of pay may not have a positive effect.