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Purpose ‐ The paper is an extension to a previous empirical study that models the process of innovation diffusion in Australian architectural and engineering design (AED) firms. This paper aims to utilise explanatory case studies to assist in the verification of this empirical model that depicts pathways that explain the role of enabling "climate for innovation" constructs in determining the level of innovation diffusion outcomes (IDO), and subsequent business performance (BPM) in Australian AED firms. Design/methodology/approach ‐ This paper presents the latter of a two-stage sequential mixed method research design: quantitative empirical study; and qualitative explanatory case studies. Specifically, this stage extracts findings from five explanatory case studies using a qualitative pattern matching analysis technique. Interview-based data collected from the case studies are analysed to formulate the relationship patterns between constructs, which are then compared with those predicted by the empirical model. This approach affords a determination on the extent to which the case-based findings (i.e. work-setting phenomena) explains (i.e. validated) the empirical model. Findings ‐ The results of the case studies on five Australian AED firms indicate that the model can be adequately explained by the actual phenomena. This is evident in four of the cases providing a good to perfect match, and one showing a partial match to the predicted patterns of relationships between the model constructs. Thus, the paper presents verified empirical pathways for AED firms, which suggest that, by increasing the level of leadership for innovation, the level of team climate and organisational culture for innovation can be improved. The improved culture for innovation will then heighten the level of IDO, which can in turn, result in an enhanced BPM. Originality/value ‐ This paper expands and improves upon the current understanding of how the diffusion of innovation can be accelerated within the AED firm context. By focusing on the socio-psychological processes, the paper depicts the pathways to improve IDO and BPM through fostering a robust climate for innovation. These pathways have been constructed empirically and are verified in this paper under real-work settings. Based on the validated model and the specific insights derived from the explanatory case studies, the paper also highlights a number of strategic implications for AED firms seeking to enhance their BPM through improving innovation diffusion practices.