The objective of this study is to identify and understand the influences of the organizational environment on the process of product innovation as well as to propose a scheme to classify these different forms of influences. Product innovations are based on a firm's technological capabilities which, in turn, result from organizational learning processes. Contrasting approaches which study internal learning processes, this article focuses on external stimuli for innovation from the subsidiary's organizational environment - namely, the task, institutional and corporate environment. Combining these three organizational environments results in a typology of eight different categories which we illustrate using case examples of subsidiaries located in Brazil. In addition, we explore the hypothesis that the mutual reinforcement of stimuli from several environment categories contribute to the sustainability of a subsidiary's innovative activities. Thus, observing changes in these three environments may help to explain why the subsidiary's innovative activities are reduced, eliminated or enhanced.
product development; subsidiaries of multinational companies; typology; organizational environment
