DISENTANGLING THE INNOVATION ORIENTATION, INTELLECTUAL CAPITAL, AND DYNAMIC INNOVATION CAPABILITY RELATIONSHIPS IN EMERGING ECONOMY START-UPS

Abstract

Purpose: Based on the Dynamic Capabilities View (DCV) and Knowledge-based View (KBV), this study investigates the relationships between intellectual capital (IC) resources and dynamic innovation capabilities in the context of new ventures. Design/methodology/approach: Data for the study is collected from 311 start-up firms in Turkey and is analysed via Structural Equation Modelling. Findings: The results indicate that the effects of human capital and social capital on dynamic innovation capability are fully mediated by innovation orientation (IO). Besides, dynamic innovation capability is found to be strongly associated with innovation performance. Practical implications: In the study, IO is suggested as a useful mechanism for encouraging the deployment of an innovation focus in all functions of a firm for attaining long-term sustained competitiveness. Thereby, the findings are expected to present important implications for start-up founders and policy-makers, by highlighting the importance of knowledge management and investing in human and social capital resources for generating the capability to innovate. Originality/value: The most significant contribution of the study is the development of a model suggesting IO as a mediating variable between the IC resources and dynamic innovation capability relationship in the context of start-up firms. Furthermore, the findings indicate a positive and significant association between the dynamic innovation capability and innovation performance in these economic units.