Untangling the Relationship between Innovation and Agility

Many governments, global management consultancies, university researchers and top executives have strongly advocated that either Innovation or Agility is essential for twenty first century enterprises (both commercial and not-for-profit). However, the similarities and differences between Innovation and Agility, and how they interrelate, has been explored less frequently. In this chapter we explore Innovation and Agility by examining two cases where they were mission-critical during a period of extreme disruption due to VUCA (volatile + uncertain + complex + ambiguous) conditions. Using data from our case examples we suggest a specification of the contingency factors that determine where Innovation and/or Agility are likely to be beneficial. From a theoretical perspective we propose that Innovation and Agility are usefully viewed as instruments for deploying clusters of micro-foundations of Dynamic Capabilities, hence contributing to the development of middle-range theories of action. We conclude by reflecting on the implications of our study for researchers, teachers and managers and propose topics for further investigations.