The task of each firm’s strategic management is to identify those sustainable sources of competitive advantage that represent a way to achieve business goals and competitive advantage. Business management should be able to define determinants that fundamentally influence the innovation activity of business. Innovation leaders are influenced by the same set of determinants that allow them to maintain their position in the market. Identifying these determinants is a key source of knowledge for defining or adjusting corporate strategies, enabling sustainable benefits and for efficient building and functioning of countries’ innovation ecosystems based on cross-agents’ interactions leading to sustainable development. The goal of this paper is to identify the combination of innovation determinants in Dynamic Innovation Strategic Model (DISM) driving creation and sustaining innovation leaders’ competitive advantage in selected European countries belonging to the group of moderate innovators. Likewise, authors define a unique set or combinations of factors that will (fundamentally embedded in a company strategy) have a significant impact on the innovative production of the business, which are one of the key elements of innovative ecosystems. With the use of CIS data (from Eurostat) on the innovators and followers of nine EU countries and own regression models, the key determinants of the success of the innovation leaders and followers were found. These determinants are (also in appropriate combination) mainly: in-house R&D activities, co-operation with various partners, and marketing and design. The results clearly show that for innovative leaders, key determinants have a positive impact on produced innovations; for the followers, the same group has a negative influence.

Research background: The business climate development and the stage of innovation systems? transformation are very similar in many Central and Eastern European countries, making it necessary to study these specific economies. These economies are at a different level of transformation, and their governments are trying to support the development of a knowledge-based economy, the creation of innovation systems, and collaboration among different types of entities. These governments need feedback in the form of research into the impacts of public funding on innovation activities through the influence of basic research and cooperation-based resources in individual countries. Purpose of the article: This paper focuses on the examination of (i) the influence of national and European subsidies on innovation performance in manufacturing firms in the Czech Republic and (ii) impacts of knowledge- and cooperation-based resources on innovation activities in Czech manufacturing. Methods: The latest available data from the Community Innovation Survey was used for analyses realized by different regression models. The proposed research models were gradually created to verify the influence of pro-innovation factors (expenditures on in-house and external R&D and on the acquisition of external tangible and intangible sources, cooperation with different partners and innovation) and public (national and/or European) funding of firms? innovation performance within the Czech manufacturing industry. Findings and value added: The results have showed that there is a need to focus on direct and indirect effects of selected innovation determinants; we have also identified the crucial role of cooperation (specifically with government, public, or private research institutes) as a mediating variable within innovation processes. The results have also evidenced that public funding affects the efficiency of knowledge- and cooperation-based resources and amplifies the impact on firms? innovation performance differently. Whereas subsidies from national budgets do not significantly influence the innovation performance of Czech manufacturing firms, European subsidies, on the other hand, significantly increase firms? innovation performance. A long-term contribution of this paper is the significant completion of the theory of policy implications that may be applicable in a broad international context beyond the borders of the Czech Republic. This study significantly contributes to the ongoing discussion about (i) the significance of public financial subsidies from both national and European funds and (ii) the effects of cooperation and R&D on firms? innovation performance within ?catching-up? in Central and Eastern Europe.

Public sector organizations face a lack of efficiency and ineffectiveness in providing their mandates due to fear of change among the public service workers. Public sector managers can instill a high performance-driven culture in employees of the public sector. For this reason, the study aims to define a set of key characteristics of organizational culture that contribute to effective performance measurement and management of public sector organizations. The qualitative research method is employed in this paper using case study comparative analysis. To get the objectives of the study, selected local governments from three different Nordic countries are analyzed. As discovered from the case study analysis, these local governments have successfully constructed and implemented performance measurement and management systems. Concurrently, they practice performance-driven culture key characteristics to achieve their organizational targets without any significant difficulties. Three key characteristics (strong performance-driven leadership, report and communicate performance, review and discuss performance) are used in all selected local governments, and one (the reward system) is missing. All four key characteristics are employed only in Helsinki, which is a benchmark for other local governments. This study’s results can thus serve as an example of best practice for other public sector organizations within Europe.

Recently, there has been increasing pressure to change current performance measurement and management systems from control systems to those that support learning and continuous improvement. This change requires a specific corporate culture that supports the effective operation of performance measurement and management. This paper aims to clarify the relationship between corporate culture and performance measurement and management systems. Questionnaire survey data from Czech medium and large companies were collected and analyzed by Pearson’s chi-squared test to validate the proposed hypothesis. The research findings confirmed that performance measurement and management systems of companies that devoted sufficient energy and attention to performance-driven culture are more effectively developed. Analysis of different performance-driven culture attributes revealed which are the most important ones.

The performance measurement system as a tool for knowledge sharing and continuous improvement plays a key role in the knowledge management development. Previous research indicates that performance measurement and management systems are not always successfully implemented to improve decision-making or knowledge management. Many failures relate to the behavioural aspects of performance management, but a systematic review of this topic is lacking. Therefore, the main aim of the paper is to explore the shortcomings of current performance measurement and management systems. The study conducted a systematic review of the literature of peer-reviewed articles over the past 20 years. The main shortcomings are analysed within the individual categories of technical and social control, especially in terms of design, implementation, and behavioural aspects. The findings revealed that the most common causes of shortcomings of measurement and management performance systems include technical problems, insufficient or late knowledge sharing, or the inability to effectively implement the entire system. An ineffective performance measurement and management system encourages bad decisions and wastes resources by misallocating them. Subsequently, this results in dysfunctional employee behaviour and deterioration in overall performance, which often even increases fear, reduces employee trust, and engagement. Based on the synthesis of the results, the paper suggests how to prevent the identified shortcomings to cause a rapid change in the behaviour of employees. From a theoretical contribution point of view, the research provides a comprehensive and clear view of the currently available theory of performance measurement and management systems. In terms of managerial implications, point out the shortcomings of current performance measurement and management systems and outline how to overcome them.

Performance management systems (PMS) are an essential tool in shaping employee behaviour in organizations. PMSs are also an important part of today's organizations and provide a framework for improving employee performance, productivity and leadership. Previous studies have not examined how PMSs influence employee behaviour, i.e. what are the mediating and moderating roles in this relationship. This article reviews and synthesizes current scientific knowledge on the influence of performance management systems on employee behaviour and examines the role of mediating and moderating mechanisms in this relationship. A systematic review of 83 research articles published in English up to 2022 was conducted. The review investigated various mechanisms through which PMS influences employee behaviour (specifically employee commitment, motivation and satisfaction). Promising trends and research trajectories were identified through content analysis with a mediating and moderating role. The PMS influences employee behaviour primarily through three constructs - clearly set goals, properly set rewards, and effective feedback delivery. A consistent (effective) PMS subsequently contributes to employee engagement and empowerment, which mediate the relationship. Organizational culture is a moderator because it can deepen the relationship between PMS and employee behaviour. The performance-oriented organizational culture in a company helps to create an effective PMS that positively influences employee behaviour. From a theoretical perspective, this paper synthesizes the results of each research, assesses the knowledge base in our selected research area, and clarifies potential avenues for future research and trends. This research contributes valuable insights for organizations seeking to improve their PMS for sustained employee success and satisfaction, as the literature search described the impact of PMS on employee behaviour through the identification and examination of individual mediating and moderating roles. Managers who pay attention to employee engagement and empowerment can then set up activities to have a good and necessary impact on employee commitment, motivation and satisfaction.