Abstract
The perspective of innovation as the strategic lever of organizational performance has been widespread in the hospital sector. While public value of innovation can be significant, it is not evident that innovation always ends up in higher levels of performance. Within this context, the purpose of the article was to critically analyze the relationship between innovation and performance, taking into account the specificities of the hospital sector. This article pulls together primary data on organizational flexibility, innovation, and performance from 95 hospitals in Portugal, collected through a survey, data from interviews to hospital administration boards, and a panel of 15 experts. The diversity of data sources allowed for triangulation. The article uses mixed methods to explore the relationship between innovation and performance in the hospital sector in Portugal. The relationship between innovation and performance is analyzed through cluster analysis, supplemented with content analysis of interviews and the technical nominal group. The main findings reveal that the cluster of efficient innovators has twice the level of performance than other clusters. Organizational flexibility and external cooperation are the 2 major factors explaining these differences. The article identifies various organizational strategies to use innovation in order to enhance hospital performance. Overall, it proposes the alignment of perspectives of different stakeholders on the value proposition of hospital services, the embeddedness of information loops, and continuous adjustments toward high-value services.