**1. Introduction**

In recent years, the transformation of the organizational culture has become a disruptive way for companies to grow and innovate. Business practitioners, researchers and leaders are paying attention to innovation in the workplace to improve the organizational performance. Additionally, the COVID-19 crisis has highlighted the importance of digitalization and the need to fast-track the progress in technological innovations developed up to date. Consequently, the industry, no matters from which sector, needs to engage in the process of continuous improvement for being prepared to the new revolution in order to maintain their competitive advantage. In this situation, the role of Workplace Innovation (WI) is considered as an engine to improve organizations' ability to continuously generate innovations.

Rail is synonymous of technology, efficiency and sustainability. The railway industry is an important sector for Europe, with a turnover of 492 billion of euros. Since 2017, the industry's annual growth has been 3,6 and is expected to grow further at a rate of 2,3% until 2025 [1]. However, due to COVID-19 crisis the transport demand has been reduced by approximately 90% affecting the railway sector. The decrease of passenger and freight volumes results in postponements and cancelations of orders, as well as a lower services volume [1]. Although the railway sector has been affected by the consequences of the pandemic, there is a need to highlight rail transport plays a vital role in preserving the environment due to the low CO2 emissions, as well as supporting European society and its economy [2]. In this sense, the competitiveness and productivity growth of the railway industry depends, among other factors, on the company's ability to innovate, and rail research is a key driving force for Europe to maintain its competitiveness in technological development.

Social, economic and technological changes have driven the railway's sector migration towards the Open Innovation model. In spite of the great pressure from the business environment trends, stakeholders from the rail industry are still reluctant to open up their innovation strategy. WI has not been the sector's priority up to date, as it has been focused primarily on technological innovation to adapt to market demands. Therefore, the biggest challenge has been focused on providing innovative products offering quickness and flexibility to respond the changing customer's demands.

Technological innovation needs to be implemented together with nontechnological innovation and WI presents an opportunity for this. This chapter develops and tests a research model based on WI concept on railway's companies by considering the literature and research related to the employees' personal innovation behavior, organizational practices, process practices as well as the impact on company performance. WI scheme developed for rail sector, is an overview of the results obtained by RailActivation project, which has received funding from the European Union's Horizon 2020 research and innovation program under grant agreement No 861887. The chapter analyses the key competences and skills that presently characterize the rail industry, and to draw a general picture of how these are developed, in which context, and through which particular mentoring process. Then, data analysis and results are examined to develop the WI scheme and a guide to implement it is defined. Finally, the research findings are discussed, including the limitations and concluding remarks.

## **2. Theoretical background**

Workplace Innovation (WI) is a relatively new concept [3], being a combination of structural and cultural practices that enable employees to participate in the organizational change and renewal. Hence, improving the quality of working life and organizational performance [3]. According to the European Commission (EC) to stay at the competitive edge, companies need to invest not only in technological innovation but also in non-technological practices. Workplace Innovation can mean many things such as a change in business structure, human resources management, relationships with clients and suppliers, or in the work environment itself. It improves motivation and working conditions for employees, which leads to increased labor productivity, innovation capability, market resilience and overall business competitiveness. All enterprises, no matter their size, can benefit from WI*.*

The EC, by means of the European Workplace Innovation Network-EUWIN, launched in 2013, has also published a guide-to-guide companies on the implementation of WI. The network is quite active and connects nowadays more than 10,000 companies and other stakeholders. The guide refers to high performance jobs when:


WI focuses on work organization as a means of innovation and employee involvement, which aims to improve work quality and organizational performance. These techniques are designed to encourage employees to deliberately develop, implement and apply new ideas, process and products [4]. WI lies at the intersection of skills, technology and human resources management [5]. According to the literature, we can see the European workers percentage involved in improving work organization or processes is not really high (47%) [6].

The drivers for WI implementation are divided into two main groups [7]. On the one hand, the improvement of the organization economic goals and performance quality (e.g., increase of productivity, manufacturing quality, customer service, financial performance and profitability etc.). On the other hand, the quality of working life and employee engagement (e.g., increases employee motivation and well-being, playing a particularly important role in reducing stress, enhancing job satisfaction and mental health, and improving retention etc.).

The Employee Participation and Organizational Change (EPOC) analysis evidenced direct employee participation impacts on productivity, innovation and quality. The EPOC analyzed 6000 workplaces in Europe, and confirmed organizations with semi-autonomous groups had 68% reductions in costs, 87% of these entities reduced production times, 98% improved their products/services, and 85% increased their sales [8]. Furthermore, Swedish study evidences flexible organizations were more productive (+20–60%), had a lower rate of staff turnover (−21%) and had a lower rate of absence due to illness (−24%) [9]. The benefits of WI and the effect on entity efficiency and performance is as well evidenced by a review of sixte American articles, with improvements of between 15% and 30% in the performance of those companies [8].

Therefore, WI not only aims at promoting innovation capacities but also allows the companies to remain innovative and adapt to changes quickly and smoothly. WI strengthens an organizations' capacity to innovate by fostering both high-quality employment and good organizational performance [10]. Only the 25% of innovation is related to technological research, while the remaining 75% is related to management organization and work practices at the business level [8, 11, 12]. According to the literature, leaders are those in charge of building an innovative climate and

#### *Advances in Decision Making*

motivate the team towards innovation [13]. This means, the innovative behaviors and attitudes that are conducive to innovative projects are boosted by leaders [14].

According to the research conducted among companies about WI, it can be seen there a positive relation between non-technological innovation and organizational performance, all resulting in more dynamism, innovation capacity and competitiveness. However, the influence of combined organizational factors and individual employee behavior adoption has not been thoroughly analyzed in the railway sector.
