On the Enabling Role of Party Organization Embedding on the Healthy Development of Private Enterprises in the VUCA Environment - A Perspective Based on Network Embedding and Higher Echelon Theory

Abstract

Promoting the transformation and upgrading of enterprises is an important way to promote the construction of national ecological civilization and achieve high-quality economic development. Meanwhile, the incorporation of party organizations helps private enterprises solve this problem. Based on the network embedding and high-order ladder theory in the VUCA environment, this paper proposes two major hypotheses: firstly, the embedding of party organizations effectively promotes the healthy transformation of private enterprises, and secondly, the heterogeneity of executive teams modifies the healthy transformation of enterprises. We construct an empirical model and define the main variable factors based on relevant studies from previous scholars, taking into account various aspects of enterprise technology transformation. This paper sequentially verifies the hypotheses through empirical analysis. The hypotheses are verified through Tobit regression, and the regression coefficients of models (1)–(4) are 2.578, 1.845, 0.715, and 0.425, respectively, and they are all significant at the 1% level, which shows that the enterprises that set up a party organization will have a better performance in transformation and upgrading, and the hypothesis H1 is verified. In the moderating effect analysis, the three heterogeneity of the executive team’s age, occupational background and educational background, and the coefficient of the interaction term of the heterogeneity of network embedding are −0.091, 0.037, 0.029, respectively, of which the coefficient of the age heterogeneity is negative and insignificant, which indicates that the age heterogeneity of the executive team does not affect the relationship between the network embeddedness of the party organization and the transformation of the private enterprises, and Hypothesis 2a is not valid, The remaining two coefficients are positive and significant at more than 10% level, hypotheses 2b and 2c are valid.