Strategic orientations, joint learning, and innovation generation in international customer-supplier relationships

Abstract

While innovations generated by international supply channel relationships, as opposed to individual partners, are playing an increasingly important role in the success of all international supply chain partnerships, research on how international supply chain relationships cultivate the process of such innovation generation, particularly for contracting suppliers firms, remains scant. This study explores how supplier joint learning capability can play a role in developing both incremental and radical innovations. The empirical test, which used a sample of 204 Taiwanese executives in electronic suppliers, supports most of the hypotheses in the study. The results demonstrate that different strategic orientations can drive various types of innovation through different paths by the mediating effect of joint learning capability. Specifically, we find that long-term orientation influences only incremental innovation, whereas radical innovation is driven by electronic integration and proactive customer orientation by joint learning. Furthermore, environmental uncertainties such as technological uncertainty and demand uncertainty are found to be moderating the impacts of joint learning capability on radical innovations. Some implications of the results are discussed at the end.