Does Culture Eat Strategy? The Antecedents of Cooperation Capability in Young ICT Firms

Abstract

Cooperation enable young firms to access critical resources and skills that lie beyond their internal boundaries. However, to successfully create and capture value from cooperation, firms require the capability to cooperate. While empirical evidence highlights the importance of cooperation capability and its outcomes, research neglected how this dynamic capability emerges in young firms. The present study examines how the individual behavior of decision makers—innovation championing behavior—affects the cooperation capability of young firms. We introduce innovation strategy and innovation culture as the two crucial mechanisms in this relationship transforming the benefits of individual behavior into the organizational capability to cooperate. Drawing on a dataset of 283 young firms in the information and communication technology (ICT) industry, we found that innovation culture is the decisive mediator in the significant positive relationship between innovation championing behavior and firms’ cooperation capability. Surprisingly, innovation strategy, does not directly affect the development of cooperation capability, but rather fosters the development of innovation culture, which in turn increases firms’ capability to cooperate. We report theoretical and managerial implications emphasizing the value of innovation culture and its interplay with innovation strategy to transfer innovation championing behavior into cooperation capability in young ICT firms.