Management Innovation in Focus: The Role of Knowledge Exchange, Organizational Size, and IT System Development and Utilization

Abstract

This study aims to examine the correlates of management innovation at the organizational level. We propose that internal knowledge exchange acts as a crucial predictor of management innovation. To fine‐tune the link between knowledge exchange and management innovation, we examine the mediating explanatory mechanism of IT system development and utilization, as well as the moderating boundary role of organizational size. In an attempt to find generalizable patterns across cultures, we test the model using mediated and moderated hierarchical regression analysis on data gathered from 604 firms in three countries: Slovenia, Spain, and South Korea. The results in all three samples indicate that knowledge exchange is an important correlate of management innovation. In addition, our study provides evidence that knowledge exchange results in management innovation through developed and utilized IT systems that enable information and knowledge to flow within an organization. We also find that the relationship between knowledge exchange and management innovation is hindered by firms' size.