And in the service sector, innovation consists almost entirely on non-R&D related practices (Baldwin & Gellatly, 2003). Innovation and development in both these types of companies must be done by creative employees coming up with ideas and participating in development work simultaneously. Obviously, in these circumstances human resources become a resource of crucial importance (Sundbo, 1999). However, in contrast to the ample attention this topic has received on a more macro-economic level (nationally, globally, and so forth) by for instance the development economics literature, little is known of the relationship between workforce characteristics (employees) and innovation on the firm level. Management researchers have tended to focus more on the effects of workforce management practices and work organization on various measures of company performance, including innovation (Michie & Sheehan, 1999; Shaw, 2004).