Reciprocal complementarity in use between the knowledge linkages and organizational innovation

Abstract

External knowledge has becoming critical factor for firms’ innovation development. This study examines the relationship among knowledge linkages diversity, organizational innovation, and firm innovation performance. We anchor on the complementarity-in-use and knowledge-based perspective to provide a theoretical base in examining the how knowledge linkages diversity drive the innovation performance, and how organizational innovation influence the complementary between external knowledge linkages and innovation performance. We argue that prior research gas ignored that both capabilities are interrelated and complementary in sharing firms’ innovativeness. Drawing on the third Community Innovation Survey (CIS III), we conduct an empirical study to tests the hypotheses and the relationship among knowledge linkages diversity, organizational innovation and innovation performance. We found external knowledge linkages has an inverted U-shaped and significant effect on the firm innovation performance. In particular we find that availability of organizational innovation mitigates the effect of knowledge linkages diversity on innovation performance when diverse knowledge linkage is moderate and complements it as innovation resources become excessive. Furthermore, the empirical result also found that the organizational innovation has a positive and significant effect on firm innovation performance. Our findings have important implications for managers of firms innovation strategic decisions and the degree to which they acquire external knowledge in innovation deploying.