In many organizations innovation is a key mechanism to develop new capabilities for competing in the market place. To truly foster innovation in an organization, companies must create an atmosphere that is conducive to the creation of new ideas. Hiring creative employees and confining them into a rigid, policy driven system will lower their ability to be creative. However, it should be noted that changing an established organizational culture is not easy and presents challenges of its own. .
There are three components to autonomy in R&D: strategic, administrative and operational. Strategic autonomy entails freedom to select goals and policies for the corporation. The second component; administrative autonomy is an area overlapping strategic and operational autonomy while operational autonomy involves the freedom to approach a goal or a problem by means determined by oneself, but within administrative and strategic constraints. (Pinnington, A. and Haslop, D., 1995). .
Most firms involved in R&D projects have special teams, that are entrusted the task of developing new products or process, and autonomy is an important variable in these self managed teams (Bowen, H.K. et al.,1994). A study conducted on research and development scientists, for differences in output levels, working under high and low autonomy conditions indicated that high autonomy development scientists were found to have higher levels of work gratification and interpersonal compatibility than their low level counterparts (Souder, W. E., 1974). Development projects were found to have higher levels of output that research projects, where outputs were measured in terms of the percent technical problems solved and the project degree of achievement (Souder, W. E., 1974). However, according to Fieldman, (1989) " Not only are autonomy and control needed in an organizational innovation, but they cannot be understood separately, because autonomy is dependent both structurally and managerially on a context of control.