Leveraging Data Management Capabilities for Innovation Capabilities: The Moderating Role of Cross-Functional Integration

Abstract

In today’s dynamic and competitive business environment, data are crucial for sustaining a competitive advantage. Organizations are also constantly seeking ways to enhance their innovation capabilities in order to stay ahead of the competition. One critical factor that has been identified as influential in enabling innovation are the organization’s data management capabilities. Past studies have found that cross-functional integration may enhance the impact of data management on innovation. Hence, this study aimed to investigate the influence of data management capabilities on explorative and exploitative innovation by considering the role of cross-functional integration as a moderating variable. This study used 116 data samples from medium and large companies across different industries in Indonesia. The PLS-SEM analysis was applied to test the research hypotheses. The results indicate that data management capabilities as a third-order construct, consisting of three dimensions, namely data governance, technology, and skills, have significant direct influences on explorative and exploitative innovation. This study demonstrated that cross-functional integration still plays an important role in amplifying the relationship between data management capabilities and innovation capabilities, especially in relation to explorative innovation.