Superior Innovation Research Articles

The role of IT practices in facilitating relational and trust capital for superior innovation performance: the case of Taiwanese companies

PurposeThe purpose of this study is to explore the moderating role of information technology (IT) practices in the increase of organizational capacity for generating innovation performance from its relational (internal and external) capital and trust capital.Design/methodology/approachSurvey data has been collected from 102 publicly listed enterprises in Taiwan and is analysed by using symmetric structural equation modelling–partial least squares (SEM–PLS) and asymmetric fuzzy set qualitative comparative analysis (fsQCA) techniques.FindingsThe findings derived from SEM–PLS show that internal relationships and trust embedded in firms' relationships play a significant role in the innovation performance of Taiwanese enterprises, and reveal a more closed approach to innovation. The results also confirm the important role of IT advancement in amplifying the effect of internal and external relationships and trust formation on innovation performance. One more interesting note, the integration of fsQCA demonstrates several configurations that lead to superior innovation performance.Research limitations/implicationsThe study was limited to Taiwanese companies with at least 200 employees. It might well be that the economically significant small business sector has distinct relationships with stakeholders, trust building strategies and IT practices, and that innovation performance depends on other macroeconomic effects. This study combines symmetric (SEM–PLS) and asymmetric (fsQCA) techniques to improve our understanding of the complementarities between relational and trust capital, and IT practices, and identify configurations that could yield organizational benefits for innovation outcomes.Practical implicationsThis study provides new knowledge about IT utilization in the workplace which practitioners may use to capitalize on internal and external networks and enhance innovation performance.Originality/valueExploring together intellectual capital (IC) components and IT practices, this study merges IC and knowledge management (KM) streams of literature and adds to the prominent discussion on how IC and technology-based KM together contribute to superior innovation performance. In introducing the notion of equifinality, and testing our hypothesis by applying fsQCA, we also provide new ground for methodological discussions in the field of innovation performance.

Does staying private longer affect innovation of VC-backed IPOs and outcomes of VC investments?

This paper studies how staying private longer plays a role in the innovation of VC-backed IPO companies and the outcomes of VC investments. I find that without public short-termism of targeting short-term earnings, companies staying private longer can enhance their innovation productivity through VC support prior to IPOs. The effects of staying private longer on post-IPO innovation activities for VC-backed companies depend on their pre-IPO innovation performance. Based on superior innovation productivity before IPOs, all more innovative companies encounter pressure from the stock market and thus have similar performance in post-IPO innovation, which is unrelated to how long they stay private. In contrast, depending on poor innovation productivity preceding IPOs of less innovative companies, going public earlier has a favorable effect on the post-IPO quantity and quality of innovation outputs. I provide new evidence that rather than realizing benefits from rapidly pursuing IPOs for portfolio companies, VCs are motivated to back their portfolio companies to stay private longer due to the upside potential of backing more innovative companies, while VCs could face the risk of losing reputation by backing less innovative companies.

The Role of Multidimensional Intellectual Capital and Organizational Learning Practices in Innovation Performance

The purpose of this paper is to explore how managers transform human, renewal, and entrepreneurial capital through specific organizational learning practices into superior innovation performance. We draw implications for managing organizational learning and guiding companies on how to create innovation‐based competitive advantages grounded in the human aspects of intellectual capital. The study is based on a survey of companies located in the transitional economy of Serbia. We found that human, renewal, and entrepreneurial capital all positively affect organizational learning practices. Furthermore, organizational learning practices contribute to innovation performance on their own and in combination with the tested human‐based intellectual capital dimensions. The integration of fuzzy set qualitative comparative analysis (fsQCA) confirms a pattern of equifinality, as there are multiple combinations of static and dynamic conditions leading to superior innovation performance. This paper is among the first attempts to merge the disciplines of intellectual capital (IC) and knowledge management (KM) and combine symmetrical and asymmetrical techniques to determine which configurations may yield organizational benefits in terms of innovation performance outcomes.

Organizational learning ambidexterity and openness, as determinants of SMEs' innovation performance

PurposeSMEs could achieve their innovation goals, either through exploitation, exploratory, or ambidextrous learning strategies. This study presents ambidexterity as a more effective and efficient strategy that offers superior innovation advantage to SMEs. We also present the role of openness in this relationship.Design/methodology/approachEmpirical analysis was based on 388 SMEs in Ghana. Various validity and reliability checks were conducted before the presentation of the actual analysis, which was conducted using Ordinary Least Squares approach, run using SPSS (v. 20).FindingsFindings indicate that although exploitative and exploratory learning strategies individually had a positive significant effect on SMEs' innovation performance, organizational learning ambidexterity was found to have a greater positive impact on innovation performance among SMEs. High levels of openness further boosted the effect of organizational learning ambidexterity on SMEs’ innovation performance.Research limitations/implicationsThis study was conducted without recourse to some specific factors that could influence organizational learning ambidexterity among SMEs. Future studies should thus pay particular attention to the determinants of organizational learning ambidexterity among SMEs.Practical implicationsInnovation performance is very critical for the sustainability of firms, and SMEs in particular. Management of SMEs must therefore seek to simultaneously adopt both learning strategies, as that gives firms greater advantage, compared to the adoption of only one strategy.Originality/valueThe study demonstrates that organizational learning ambidexterity had a superior effect on SMEs' innovation performance. High levels of openness further boosted the effect of organizational learning ambidexterity on SMEs' innovation performance.

Mogućnosti e-poslovanja i inovacione performanse - posrednički efekat strategija upravljanja znanjem

The aim of this paper is to analyze the mediating effect of the knowledge management strategies on the relationship between e-business capabilities and innovation performance. The research model was tested with a sample of 102 firms belonging to IT intensive sectors, located in an emerging country that is a regional leader in terms of e-business adoption. Structural equations by the consistent partial least squares method were used. The main result indicates that only the personalization strategy has a partial mediating effect. In conclusion, e-business capability alone is insufficient for achieving a superior innovation performance. This finding also helps consolidate the incipient study perspective that understands knowledge management not as an antecedent variable which becomes indispensable for e-business adoption, but as an organizational factor that intervenes a posteriori and which is focused on achieving an effective use of all the knowledge resulting from the digital operation of the business.

Champions of Digital Transformation? The Dynamic Capabilities of Hidden Champions

Hidden Champions (HCs) are small- and medium-sized global market leaders that repeatedly show superior innovation capabilities and economic performance. However, empirical evidence on how the digital transformation may affect their success story remains scarce. I argue that HCs show stronger dynamic capabilities which enables them to be better prepared for the digital transformation than non-HCs firms. To test this hypothesis, I use data from the Mannheim Innovation Panel. This allows me to identify a representative set of German HCs and develop a firm digital readiness index, reflecting the use of important digital technologies and applications. An instrumental variable estimation suggests that higher levels of digital readiness lead to an increase in share of revenue from innovations and productivity. In combination with higher average digital readiness levels of HCs compared to non-HCs, my findings indicate that HCs may indeed be better prepared for the digital transformation.

The Real Stranded Assets of Carbon Lock-In

Climate debates over stranded assets are focusing on the wrong assets. Fossil-fuel companies and petrostates argue that they will suffer economic losses from climate policies. Although true, this ignores assets that will be stranded in the absence of climate policy. These are the real stranded assets of carbon lock-in and could prove much more costly.

Inbound openness and its impact on innovation performance: an agent‐based and simulation approach

A firm’s superior innovation performance is embodied not only by its average innovation performance but also by the likelihood of extremely high innovative outcomes. The former benchmark is associated with the mean of the performance distribution, while the latter is associated with the variance, both of which play an important role in instructing the achievement of superior innovation performance. In this paper, we explored how inbound open innovation impacts superior innovation performance by considering both the average and variance effects of inbound openness. We conducted agent‐based modeling and simulation research to untangle the relationship between inbound openness and superior innovation performance and how the relationship is moderated by the disruptiveness of industrial innovation. We found that inbound openness significantly influences both the benchmarks. Specifically, search breadth positively influences the likelihood of extremely high innovative outcomes in general, whereas search depth positively influences average innovation performance; and the strength of these effects varies under different disruptiveness.

Ambidexterity in External Knowledge Search Strategies and Innovation Performance: Mediating Role of Balanced Innovation and Moderating Role of Absorptive Capacity

The importance of external knowledge acquisition for innovation by firms is well established. In particular, there has been an increasing focus on the two distinct modes of firms’ external search strategies, which have a differential effect on their learning and innovation: search breadth and depth. By applying organizational ambidexterity lens, we hypothesize that pursuing high levels of both external search strategies is beneficial to achieve a balance between exploitative and explorative innovation, which, in turn, has a positive impact on the firm’s innovation performance. We also hypothesize that, even among the firms that maintain high levels of both search strategies, firms with higher absorptive capacity better achieve a balance between both modes of innovation, thereby producing higher performance. The findings on a multi-industry sample of Koran manufacturing firms confirm our hypotheses and imply that it is essential for firms to develop capabilities for different modes of external search activities in conjunction with internal absorptive capacity for superior innovation performance.

Ego-Network Stability and Innovation in Alliances

Much research has shown that firms’ ego network configurations—i.e., structural holes or network closure—help them achieve superior innovation outcomes. However, little is known about how the stabi...

Technology diffusion, innovation size, and patent policy

We develop a Schumpeterian growth model based on technology diffusion and innovation, whereby the distribution of the innovation size is endogenously determined. Firms improve the targeted products by randomly combining existing technologies owned by other firms. Furthermore, the firms contribute to the adoption of newly developed frontier technology. The innovators must attain the minimum innovation size required for a patent. That is, the patent office grants patents only for superior innovations. We show that an increase in the minimum innovation size may reduce the average patentable innovation size because of an endogenous response of the distribution of innovation size. This implies that even if the patent office requires superior innovations in order to assign patents, innovators tend to produce inferior patentable innovations on average.

The Market for Innovation Leadership

In an increasingly technology-driven economy, CEOs' innovation leadership forms an essential part of companies' human capital. We find CEOs with superior innovation leadership, measured by their proven on-the-job innovation performance, are more popular on the directorship market. Through the directorship market, superior innovation leadership is matched to the boards of firms that are more innovative or have deeper technology overlap with the CEO's firm. The appointing firms improve their innovation and operating performance subsequently. Our results suggest that the benefit of CEO innovation leadership diffuses across firm boundaries through a subsection of the labor market.

Absorptive capacity, technological innovation capability and innovation performance: an empirical study in Hong Kong

This study examines how different learning processes associated with absorptive capacity (AC) influence technological innovation capability (TIC) and lead to superior innovation performance and product competitiveness under a new industrial environment. Data from an industrial survey conducted in 200 firms in Hong Kong were used. The results show that combination of four individual learning processes (acquisition, assimilation, transformation and exploitation) of AC provide a better fit of the study rather than any single construct. All the learning processes affect innovation performance through TIC. Assimilation and exploitation have direct effects on product competitiveness. The finding from this study contributes to the understanding of how the learning processes of AC relate to TIC and firm performance. This study also addresses many current weaknesses of the use of AC in empirical studies by using direct measures of AC by breaking down AC into four separate components and studying the intangible outcomes of AC.

Absorptive capacity, technological innovation capability and innovation performance: an empirical study in Hong Kong

This study examines how different learning processes associated with absorptive capacity (AC) influence technological innovation capability (TIC) and lead to superior innovation performance and product competitiveness under a new industrial environment. Data from an industrial survey conducted in 200 firms in Hong Kong were used. The results show that combination of four individual learning processes (acquisition, assimilation, transformation and exploitation) of AC provide a better fit of the study rather than any single construct. All the learning processes affect innovation performance through TIC. Assimilation and exploitation have direct effects on product competitiveness. The finding from this study contributes to the understanding of how the learning processes of AC relate to TIC and firm performance. This study also addresses many current weaknesses of the use of AC in empirical studies by using direct measures of AC by breaking down AC into four separate components and studying the intangible outcomes of AC.

The relationship between innovation culture and innovation outcomes: exploring the effects of sustainability orientation and firm size

Being sustainability‐oriented has become a key strategy for many firms. Equally, innovation culture and innovation outcomes have long been recognized as important contributors to the growth of firms. However, the literature on sustainability and innovation provides limited understanding of the important relationship between sustainability orientation, innovation culture and innovation outcomes. Given that large firms and small firms differ in building and employing their strategic assets, firm size matters in understanding the relationship. Through the lens of resource‐based view, we develop a theoretical model embedding the four components and test it using data from a global survey: the 2012 Comparative Performance Assessment Study. Our research contributes to sustainability literature and innovation theory by providing an integrated framework to explicate the mechanism through which the innovation culture of the firm impacts on innovative performance through the sustainability orientation of the firm. The findings advance our understanding of the extent to which sustainable orientation can explain the relationship between innovation culture and innovation outcomes. Our evidence shows that the innovation culture of a firm facilitates the sustainability orientation of the firm and that the converse also applies. The research also contributes to our knowledge of the differences between large and small firms in leveraging their strategic assets in terms of innovation culture and sustainability orientation to facilitate superior innovation outcomes. Although firm size moderates the relationship between innovation culture and innovation outcomes, the research shows that this no longer holds when sustainability orientation is included in the relationship. A strong sustainability orientation can be a competitive advantage for firms in the R&D Management delivery of superior innovation outcomes.

How does open innovation affect firms’ innovative performance

PurposeThis paper aims to explore the direct effects of open innovation (OI) on firms’ innovative performance, and to examine the moderating effects of knowledge attributes, including knowledge distance, knowledge embeddedness and partner opportunism on this relationship.Design/methodology/approachSurvey data of 247 samples from China were used to test the proposed model through hierarchical regression analysis.FindingsThe findings indicate that the dimensions of OI are positively related to innovative performance. The results also reveal that knowledge distance positively moderates the relationship between inbound OI and innovative performance, whereas knowledge embeddedness negatively affects that relationship. Knowledge embeddedness negatively affects the relationship between inbound OI and innovative performance, whereas knowledge distance positively moderates that relationship. Thus, a new finding is proposed that knowledge attributes could align effectively with specific OI type to achieve superior innovation outcomes. In addition, the empirical results suggest that partner opportunism plays a negative moderating role on the relationship between outbound OI and innovative performance.Originality/valueThe proposed view that a firm’s innovation outputs will be superior when its knowledge attributes effectively align with OI enriches studies of the OI context and expands the literature of both the resource-based view and the knowledge-based view. Furthermore, this study provides insights into how OI benefits can be influenced by external contexts from the perspective of partners’ opportunistic behaviour.

Fit between Organizational Culture and Innovation Strategy: Implications for Innovation Performance

Although prior studies have indicated the interrelationships between specific types of innovation strategy and specific elements of organizational culture, few studies simultaneously evaluate the relationship between the two multi-dimensional constructs in holistic perspective. Based on configuration theory, we conceptualize fit as ‘profile deviation’, and investigate the fit between an organization’s culture and its innovation strategy. Data were collected from 183 Chinese organizations. We examine the hypothesis that greater fit between organizational culture and innovation strategy encourages superior innovation speed and innovation quality. Our results provide evidence that in the group of organizations exhibiting either exploratory or exploitative innovation strategy, the more similar the organizational culture configurations are to those of the top performers, the higher their innovation speed and innovation quality are. In the group of organizations exhibiting ambidextrous innovation strategy, the fit between organizational culture and innovation strategy is insignificantly associated with innovation speed and innovation quality. Implications for applying the culture–strategy fit in innovation management are discussed.

A Configurational Analysis of Agglomerations, Networks, and Institutions in European Aerospace

It is well-established that clusters have the potential to strengthen firm innovation. However, our knowledge of which firms benefit the most, and how these benefits are created is contradictory and limited. We argue that the extant literature’s emphasis on linear, correlational models has held back our understanding. We approach the cluster concept through a configurational lens. Using fuzzy set qualitative comparative analysis (fsQCA), we uncover that complementarities between geography, networks, and institutions, as well as firms’ internal capabilities, shape innovation outcomes for firms in European aerospace clusters. Moreover, we find evidence that these three types of external resources can provide a substitute for weak internal resources to achieve high innovation performance. All in all, the relationship between internal and external resources is causally complex, and, in various configurations, can generate multiple pathways to superior innovativeness.

The impact of relational governance on performance improvement in export manufacturing firms

Purpose: This paper seeks to identify the factors affecting social performance improvemens in the Pakistan export manufacturing firms and investigae inter-relationships existing among them.Design/methodology/approach: This study used a cross-sectional survey; data were collected using self-administered survey questionnaire. Using data collected from 239 small- and medium-sized direct exporters manufacturing firms in Pakistan. We used structural equation modelling (SEM) approach to test structural model, and mediation analysis was conducted with regression analysis.Findings: The results support that meta-cognitive dimensions of cultural intelligence effect on social performance improvements, while the social performance improvement significant associated with innovation performance improvements. We suggest that cultural intelligence is a key to maintaining a relationship through development better cultural understanding and creating harmony among suppliers and buyers through minimizing the differences and disputes, requires developing social cohesion. Our results reveal that exporting firms need to adapt, reconfigure cultural knowledge and integrate resources into the operations to build learning capability, in turn, they can improve social performance and achieve superior innovation performance.Practical implications: Through the application of cultural intelligence capabilty, a firm could increase its ability to sense cultural differences, seize and adapt globally scattered cultural practices on social issues and allows for the development of unique knowledge resources and capabilities, impact on firm social performance and innovation performance improvements.Originality/value: The study conducted in Pakistan cultural context, which can be extended to other Asian countries. We argue that in a globalising world it is pertinent for exporting firms to have a better understanding of the various facets of cultural when dealing with inter-organisational relationships.

How strategic knowledge management drives intellectual capital to superior innovation and market performance

PurposeThe purpose of this paper is to explore the moderation effect of strategic knowledge management (SKM) on the relationship between three components of intellectual capital (IC) and firm innovation and market performance. The authors argue that specific combinations of IC components and SKM activities can lead to higher innovation and market performance. It is also trying to assist companies to capitalize on both their IC and SKM.Design/methodology/approachSurvey data have been collected from 101 Serbian companies, and these have been analyzed by using structural equation modelling (SEM) and fuzzy set qualitative comparative analysis (fsQCA) techniques.FindingsThe SEM results show that structural capital and relational capital have a direct effect on innovation performance. Although, there is no significant direct effect of human capital on innovation performance, the relationship becomes significant when moderated by SKM. The effects of human and structural capital on innovation performance are negatively moderated by SKM activities, while SKM positively moderates the effect of relational capital on innovation performance, but remained insignificant. Moreover, the insights from fsQCA show a clear pattern of equifinality, in that there are multiple combinations of static and dynamic conditions that can lead to higher innovation and market performance.Originality/valueTwo separate research fields of “static” IC and “dynamic” knowledge management have been combined in one integrated framework. From a methodological perspective, symmetric and asymmetric statistical tools have been combined to better understand contingency and interactions. This approach contributes to the literature and potentially offers a better understanding of how static intangible assets should be enabled by dynamic knowledge-based managerial activities to achieve high performance. The paper demonstrates that SKM capability matters with only a specific constellation of IC resources and therefore suggests a novel explanation for performance variances.