Configurations of innovation performance in foreign owned subsidiaries: focusing on organizational agility and digitalization

Abstract

PurposeThe authors investigate conditions that drive innovation performance in foreign-owned subsidiaries. The authors study five variables affecting innovation performance: organizational agility and digital capabilities as the main drivers and competencies and embeddedness in internal and external networks as complementary antecedents of innovation.Design/methodology/approachThe authors draw on the neo-configurational perspective and apply fuzzy set qualitative comparative analysis (fsQCA) to empirically test survey data from subsidiaries located in the emerging economies of Thailand and Vietnam.FindingsWhile the authors find no single condition on its own determining innovation performance, the authors do find that in concert they form four configurations of high innovation performance. The results indicate that all configurations contain competencies, as well as that subsidiaries should prioritize between internal and external networks to complement agility, digital capabilities, to achieve high innovation performance. The authors also reveal intriguing contextual differences in the innovation performance configurations between the two host countries.Originality/valueBy incorporating causal complexity as well as substitutability and complementarity of innovation drivers, the authors extend the current understanding of subsidiary innovation performance outcomes.

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“…Contrarily, Marrucci et al (2023) investigate antecedents of Industry 4.0 implementation, finding that organizational agility and SF play a fundamental role. However, Dahms et al (2023) and Qin (2023) provide an integrative view of the interplay between SF and digitalization that combines these two apparently conflicting views. On the one hand, Dahms et al (2023) find that the interplay of organizational agility and digital capabilities contributes to superior innovation performance, but on the other hand, Qin (2023) empirically shows that a degree of flexibility is required for digital transformation that, in turn, increases flexibility.…”

“…(2023) investigate antecedents of Industry 4.0 implementation, finding that organizational agility and SF play a fundamental role. However, Dahms et al. (2023) and Qin (2023) provide an integrative view of the interplay between SF and digitalization that combines these two apparently conflicting views.…”

“…However, Dahms et al (2023) and Qin (2023) provide an integrative view of the interplay between SF and digitalization that combines these two apparently conflicting views. On the one hand, Dahms et al (2023) find that the interplay of organizational agility and digital capabilities contributes to superior innovation performance, but on the other hand, Qin (2023) empirically shows that a degree of flexibility is required for digital transformation that, in turn, increases flexibility. This gives an alternative perspective that puts forward a more sophisticated relationship where SF and digital technologies/ digitalization may influence each other, which still deserves further investigation.…”