Strategic flexibility helps on firms obtaining profit from product innovation

PDF(884 KB)

Science Research Management ›› 2011, Vol. 32 ›› Issue (10) : 10-17.

He Yuetong^1,2, Lu Yanqiu¹

Author information +

History +

Abstract

Although it is generally acknowledged that product innovation is critical for firms to sustain their competitive advantages, however the firms sometimes fail to obtain economic returns from product innovation. The moderative effect of strategic flexibility (composed of resource flexibility and coordination flexibility) on the relationship between product innovation and firm performance is focused on in order to address an important but previously unexplored question as follows: Could strategic flexibility help on firms obtaining profit from product innovation? Utilizing the sample of 607 Chinese firms, an empirical test reveals that the moderative effect of resource flexibility on the positive relationship between product innovation and firm performance is negative, while that for coordination flexibility is positive. Furthermore, such moderative effects are very likely to be profound for confronting a high level of competitive intensity by firms. In conclusion, the implications and possible future extensions are discussed.

Key words

strategic / flexibility / product innovation / competitive intensity / performance

Cite this article

EndNote

Ris (Procite)

Bibtex

Download Citations

He Yuetong, Lu Yanqiu. Strategic flexibility helps on firms obtaining profit from product innovation[J]. Science Research Management. 2011, 32(10): 10-17

References

[1] Aiken, L.S., West, S.G., .Multiple Regression: Testing and InterpretingInteractions. Sage Publication, Newbury Park, CA[M].1991. [2] Alegrea, J., Chiva, R., 2008. Assessing the impact of organizational learning capability on product innovation performance: an empirical test[J]. Technovation 28, 315-326. [3] Anderson, J.C., Gerbing, D.W., 1988. Structural equation modeling in practice: a review and recommended two-step approach[J]. Psychological Bulletin 103 (3), 411-423. [4] Armstrong, J.S., Overton, T., 1977. Estimating non-response bias in mail surveys[J]. Journal of Marketing Research 14, 396-402. [5] Atuahene-Gima, K., Li, H., 2006. The effects of formal controls on supervisee trust in the manager in new product selling: evidence from young and inexper- ienced salespeople in China[J]. Journal of Product Innovation Management 23, 342-358. [6] Auh, S., Menguc, B., 2005. Balancing exploration and exploitation: the moderating role of competitive intensity[J]. Journal of Business Research 58, 1652-1661. [7] Capon, N., Farley, J.U., Hoenig, S., 1990. Determinants of financial performance: a meta-analysis[J]. Management Science 36, 1143-1159. [8] Cetindamara, D., Phaalb, R., Probert, D., 2009. Understanding technology manage- ment as a dynamic capability: a framework for technology management activities[J]. Technovation 29, 237-246. [9] Chandy, R.K., Tellis, G.J., 2000. The incumbent’s curse? Incumbency, size, and radical product innovation[J]. Journal of Marketing 64, 1-17. [10] Chen, X.P., Chun, H., Sego, D.J., 1998. The role of organizational citizenship behavior in turnover: conceptualization and preliminary tests of key hypotheses[J]. Journal of Applied Psychology 83, 922-931. [11] Cohen, M.A., Cohen, P., Applied Multiple Regression/Correlation Analysis for Behavioral Science. Lawrence Erlbaum Associates, Hillsdale, NJ.[M]. 1983. [12] Cottrell, T., Nault, B.R., 2004. Product variety and firm survival in the microcomputer software industry[J]. Strategic Management Journal 25, 1005-1025. [13] Fornell, C., Larcker, D.F., 1981. Evaluating structural equation models with unobservable variables and measurement error[J]. Journal of Marketing Research 18, 39-50. [14] Gronhaug, K., Kaufmann, G., Innovation: a Cross Disciplinary Perspective. Norwegian University Press, Oslo.[M].1988. [15] Ireland, R.D., Hitt, M.A., Sirmon, D.G., 2003. A model of strategic entrepreneurship: the construct and its dimensions[J]. Journal of Management 29, 963-989. [16] Jaworski, B.J., Kohli, A.K., 1993. Market orientation: antecedents and consequences[J]. Journal of Marketing 57, 53-70. [17] Johnson, R.A., Wichern, D.W., Applied Multivariate Statistical Analysis, fourth ed Prentice-Hall, Englewood Cliffs, NJ. [M].1998. [18] Kraatz, M.S., Zajac, E.J., 2001. How organizational resources affect strategic change and performance in turbulent environments: theory and evidence[J]. Organiza- tion Science 12, 632-657. [20] Mu, J., Peng, G., MacLachlan, D.L., 2009. Effect of risk management strategy on NPD performance[J]. Technovation 29, 170-180. [21] Teece, D.J., 1986. Profiting from technological innovation: implications for integra- tion, collaboration, licensing and public policy[J]. Research Policy 15, 285-305. [22] Teece, D.J., Pisano, G., Shuen, A., 1997. Dynamic capabilities and strategic management[J]. Strategic Management Journal 18, 509-533. [23] Todtling, F., Lehnera, P., Kaufmann, A., 2009. Do different types of innovation rely on specific kinds of knowledge interactions[J]. Technovation 29, 59-71. [24] Verdu-Jover, A., Llorens-Montes, J., Garcia-Morales, V., 2005. Flexibility, fit and innovative capacity: an empirical examination[J]. International Journal of Technology Management 30, 131-146.