Impact of Innovation on Realizing Competitive Advantage in Banking Sector in Jordan*

Abstract

With the increasing competition in a dynamic environment, competitive advantage can be very important to achieve better performance and better results eventually. The traditional four dimensions of competitive advantage are: Cost, Time, Quality, and Flexibility. The main objective of this study is to investigate the impact of innovation on realizing the competitive advantage in the banking sector in Jordan. The impact of innovation on each of the competitive advantage’s dimensions is tested through the statistical package for social science (SPSS). Reliability analysis, descriptive statistics, and regression analyses were performed. The results illustrated that innovation has a direct positive impact on competitive advantage through its dimensions (time, quality, cost, and flexibility) and that banks should support innovation in all aspects of business and operations. Conclusion, recommendation, and future research avenues were provided.