Abstract
The age of big data analytics is now here, with companies increasingly investing in big data initiatives to foster innovation and outperform competition. Nevertheless, while researchers and practitioners started to examine the shifts that these technologies entail and their overall business value, it is still unclear whether and under what conditions they drive innovation. To address this gap, this study draws on the resource-based view (RBV) of the firm and information governance theory to explore the interplay between a firm’s big data analytics capabilities (BDACs) and their information governance practices in shaping innovation capabilities. We argue that a firm’s BDAC helps enhance two distinct types of innovative capabilities, incremental and radical capabilities, and that information governance positively moderates this relationship. To examine our research model, we analyzed survey data collected from 175 IT and business managers. Results from partial least squares structural equation modelling analysis reveal that BDACs have a positive and significant effect on both incremental and radical innovative capabilities. Our analysis also highlights the important role of information governance, as it positively moderates the relationship between BDAC’s and a firm’s radical innovative capability, while there is a nonsignificant moderating effect for incremental innovation capabilities. Finally, we examine the effect of environmental uncertainty conditions in our model and find that information governance and BDACs have amplified effects under conditions of high environmental dynamism.
Highlights
The past few years have seen a large number of studies examining the effects that big data analytics have on firm performance outcomes [1,2]
We argue that structured adoption of big data analytics in the form of big data analytics capabilities (BDACs) will lead to enhanced incremental and radical innovation capabilities, which will be amplified under the presence of information governance practices
While there has been a considerable amount of research examining the different ways through which incremental and radical innovation capabilities are enhanced in the organizational setting [18,52], there is still a lack of understanding regarding the extent to which big data analytics investments can enhance each type of innovation capability
Summary
The past few years have seen a large number of studies examining the effects that big data analytics have on firm performance outcomes [1,2]. As big data analytics projects entail large associated costs, it is important to identify what types of outcomes they can deliver and how to optimally achieve such targets to avoid investments that do not pay off [9] When it comes to strengthening a firm’s innovation capabilities, the literature has argued that a structured adoption of big data analytics coupled with a robust information governance scheme are prerequisites of success [10]. We argue that structured adoption of big data analytics in the form of BDACs will lead to enhanced incremental and radical innovation capabilities, which will be amplified under the presence of information governance practices In examining these associations, we factor in the effect of environ mental uncertainty variables to investigate how the external environ ment conditions the previously mentioned effects, differentiating as such between dynamism, heterogeneity, and hostility. We present the results of our empirical analysis, followed by a discussion on the theoretical and practical implication of findings as well as some core limitations
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