Non-linear effects of technological competence on product innovation in new technology-based firms: Resource orchestration and the role of the entrepreneur's political competence and prior start-up experience

Abstract

The study applies the lens of resource orchestration theory to examine the nature of the relationship between technological competence and product innovation in new technology-based firms, and the moderating effects of the entrepreneur's political competence and prior start-up experience. Drawing upon a sample of 100 young technology-based firms, the results show that technological competence has an inverted U-shape relationship with product innovation, suggesting that returns to technological competence are increasing up to a crucial threshold level beyond which additional gains for innovation are decreasing. Political competence and prior start-up experience strengthen the positive effects of technological competence on innovation, with these abilities of the entrepreneurs increasing the optimal levels and innovation returns from technology competence. The results point to the level of technological competence and entrepreneurial competences as key contingencies that influence resource orchestration efficiency in the context of new venture innovation. These findings add to the burgeoning effort to advance research on resource orchestration at early stages of development of the firm, contributing to a deeper understanding of technology choices for value creation under conditions of limited resources and varying levels of individuals' orchestration capabilities.