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Chinese family business is experiencing a pivotal phase of succession. Although innovation can help family firms realise the goal of long-term development, it remains under-investigated whether and how the second generation influence family firms’ innovation. Based on the controversy on the successors’ behaviour, we explore the effect of the second generation on family firms’ innovation, both input and output included. We find that the engagement of the second generation can foster firm innovation, encompassing both the willingness and the high-quality outcomes of innovation. Also, this effect is more pronounced when family firms own greater competitiveness over their peers and exhibit higher level of financialisation. Path analysis indicates that the second generation may lead to reduced agency costs, minimised appropriation of receivables by large shareholders, and increased risk tolerance regarding innovation, thereby fostering a greater willingness to innovate and yield superior innovation outputs. We thus add to the literature on the succession in family firms and derive practical implications for family firms aiming to bring together family succession and innovative practices.

This study explores the efficiencies of firm’s R&D investment depending on the degree of reliance on government funding relative to firms’ private funding. Stochastic frontier analysis is applied on a sample of 30 provinces with data on R&D inputs and innovation outputs by all large- and medium-sized industrial firms in these provinces from 2000 to 2013. It is found that R&D investment financed by firms’ private funding is more efficient than that by government funding in generating new products, whereas R&D investment financed by government funding is more efficient than that by firms’ private funding in producing new patents.

While humour is present in everyday business in practice, its strategic meaning and effectiveness are rarely investigated in relation to innovation processes or their management. In this study, we suggest that different types of humour can have both positive and negative effects on innovative work behaviour and the innovation output of individuals, and that the nature of the effects depends to an extent on whether these types of humour are present in interaction within or across organisational boundaries. Theoretical discussion and empirical evidence derived from a quantitative analysis illustrate the diversity of relationships. The results indicate that while humour is, in general, more relevant for innovation within organizations, it also bears importance with regard to external relationships, especially considering innovative work behaviour. Likewise, generally speaking, aggressive humour has negative connotations while, affiliative, coping, and reframing types of humour are associated with positive undertones. However, these connections are not self-evident. Acknowledging differences helps managers to monitor and encourage the use of humour in varying forms of interaction within and beyond their organisations for creating supportive conditions for innovation.

Innovation is an ever-increasing focus for modern organizations; yet research studies on organizational culture have tended to neglect this aspect. This paper specifies the key factors characterising a company's innovation culture and examines the top managers' executed impact as organizational leaders from the individual perspective on implementing and fostering it in their respective organizations. Based on a conceptual framework, the empirically identified key factors of the (1) formal embedment, (2) climate, (3) incentives and reward allocation, (4) integration into decision process, (5) cross-hierarchical communication and (6) communication style are presented. Within the empirical study, 37 top managers of 21 leading companies in the industries of “fashion and accessories” and “watch and jewelry” were interviewed. The results indicate that the impact of top managers lag behind their potential to advance innovativeness through innovation culture, and the detected deficit represents scope for improvement. The paper concludes by highlighting the implications of the study and its limitations.