Abstract: Disruptive innovation, as a type of innovation with strategic significance, has become an important tool for companies to develop new products and change the existing market structure. Disruptive innovation has been confirmed to be an effective strategy for new entrants and startups to compete with incumbents or larger competitors. Firm innovative activities are always embedded in a particular social context. In order to enable enterprises to use this tool more effectively, many scholars discuss the conditions and factors that influence disruptive innovation in the organizational level. Former researches emphasize that disruptive innovation origin from the combined effect of resource dependence of enterprises and function over-supply in the market. It is also important for the incumbent enterprises to avoid the loss of disruptive innovation ideas due to the brain drain. Moreover, the effective implementation of disruptive innovation strategies for a firm also requires the acquisition of external innovation resources, and the various external ties formed in the process of social interactions among enterprises are an important source of access to innovative resources. However, due to the variety of the social ties, it is still not clear about the relationship between various external social ties and internal disruptive innovation, which need to be analyzed according to the specific types of social ties outside the enterprise. The external social ties of the enterprises are divided into supply chain ties, competitors’ ties and ties with institutions for knowledge produce and service in this paper. Using a sample of 180 enterprises in Pearl River Delta, some hypotheses are tested with hierarchical regression analysis. The result shows that external social ties of enterprises may have a “double-sword” effect on the generation of disruptive innovation, which means various external social ties may not only have positive influence on disruptive innovation, but also have some dark sides under certain conditions. This study refines the former research by classifying the relationship between enterprise’s external social ties and disruptive innovation according to the types of cooperators, and also has managerial implications for the implementation and management practice of disruptive innovation.Based on the results, this study draws the following conclusions. First, supply chain ties have a significant positive linear impact on disruptive innovation for enterprises. This means that the more frequently firms cooperate with its suppliers and customers, the more beneficial it is for the company to understand the changes in customer preferences and product components, especially in the non-mainstream market. As a result, companies can better identify the niche market and enough technology needed for the development of disruptive innovation in low-end market or new market. This finding supports the former opinions that companies can use this kind of business linkage to search for favorable opportunities of market and technology change, gain useful related information and knowledge, and promote innovative activities inside, including disruptive innovation. Moreover, this study finds that the squared variable of supply chain ties has no significant impact on disruptive innovation, which means there is no nonlinear relationship between them. For the reason that enterprises and customers may have a reciprocal relationship instead of a competitive relationship, their cognitive judgments for supply ties are consistent. Therefore, even if the social ties among the company, its suppliers and its users reach to a high level, it can still bring this company with useful information and knowledge about disruptive innovation.Second, there is a U-shaped curve relationship between competitor ties and disruptive innovation of enterprises. Enterprises and competitors not only compete at the product and market levels, but also need to cooperate with each other to deal with the challenges brought by the changes in the industry’s environmental uncertainty. Hence, the connection between competitors is a complex exchange of information and knowledge. It depends largely on the company’s own understanding and using of this connection whether firms can acquire useful information and knowledge through the social interaction with competitor. In the initial stage of building ties between the two parties, the company lacks understanding of the competitors, and the competitors often provide some untrue data and information on the purpose of self-protection, which is not conducive to the identification of disruptive changes in the environmental turbulence of the industry. However, when the extent of this ties exceeds a certain threshold, the interaction between the two parties continues to increase, and the firm can gradually identify the authenticity of information and the developing trend of the competitors and the entire industry. All of these would help the enterprise to identify and seize the fleeting opportunities of disruptive innovation.Third, there is an inverted U-shaped curve relationship between the ties with institutions for knowledge produce and service and corporate disruptive innovation. This finding further supplements the former studies about the influence of ties intensity on enterprise innovation, which emphasize that there is an optimal level of positive effect of enterprises’ ties with institutions for knowledge produce and service on disruptive innovation. Specifically, before the extent of ties reaches to the optimal point, it is beneficial for the enterprise to strengthen the linkage with institutions for knowledge produce and service. As a result, firms can improve their disruptive technology, enrich technical knowledge about the mainstream functions and market knowledge about the emerging customer groups. When the extent of ties with institutions for knowledge produce and service exceeds the optimal point, the strengthen of social interaction will encourage enterprises to rely much more on the institutions for knowledge produce and service. This lock-in effects will limit the outsourcing of external new ideas and information, and reduce the diversity of problem-solving methods. Even if the opportunities for disruptive innovation appear, these firms are not able to identify effectively.Moreover, the conclusions of this paper have important implications for enterprises to carry out disruptive innovative activities in the context of open innovation. Enterprise innovative activities are always embedded in specific social situations. Due to the limited resources of internal resources and the accelerating speed of knowledge development, firms need to maintain proper interaction with external information and knowledge sources, and adopt different treatment methods according to different types of social ties in order to implement disruptive innovation.

Key words: supply chain ties, competitor ties, ties with the institutions for knowledge produce and service, disruptive innovation