Capacity for Social Exchange in Buyer-Supplier Relationships and its Impact on Innovation Speed: The Mediating Role of Information Sharing and the Moderating Role of Knowledge Channels

Abstract

Generating innovative products and services at a faster rate generates advantages for B2B service organizations in keeping up with and moving ahead of rivals. In this study, we introduce the concept of capacity for social exchange (CSE) in buyer-supplier relationships, which reflects the degree to which individuals possess competencies that enable the exchange of information; and we explore how CSE affects knowledge sharing and innovation speed within a supply chain. Using data collected from 264 executives working in the B2B service sector, we conclude that 1) CSE facilitates knowledge sharing; 2) knowledge sharing is positively related to innovation speed; and 3) the relationship between CSE and innovation speed is fully mediated by knowledge sharing. Additional analysis reveals that knowledge channels which are designed as boundary-spanning strategies utilized to transfer and create knowledge between business units directly increase—and positively moderate—the relationship between CSE and innovation speed.