Understanding cognitive differences in the effect of digitalization on ambidextrous innovation: Moderating role of industrial knowledge base

Abstract

A number of existing researches agree that digitalization would facility firms to launch ambidextrous innovations. Digitalization is not only about technological change, but more importantly, the reshaping of the firms’ knowledge structure and routines to percept and integrate knowledge. Thus, some researchers suggest that whether firms could benefit from digitalization varies across firms and industries, since innovation in different firms and industries relies on differentiated level of cognitive and reasoning of knowledge. However, existing studies mainly focus on exploring the firm-level differences, and leave the industry-level difference underdeveloped. In response, this study integrates knowledge-based view to examine how a firm’s digitalization affects ambidextrous innovation, and further explore the conjoint effect of industrial knowledge bases—the knowledge base of the industry the firm is located in—on the relationship between firm digitalization level and ambidextrous innovation. This study uses Python to conduct text mining of firms’ annual reports, and obtains data of 394 listed companies from the year 2014 to 2020. The empirical results show that digitalization level has positive effect on both exploratory innovation and exploitative innovation, and the effect on exploitative innovation is stronger than on exploratory innovation. Moreover, the moderating effect of industrial knowledge base is significant on “digitalization–exploratory innovation” but not on “digitalization–exploitative innovation” relationship. By doing so, this study refines the research on the relationship between digitalization and firm innovation, and confirms that the usage of digitalization may lead to achieve an ambidextrous situation. This study also provides a theoretical basis for industrial differences of the effectiveness of digitalization, suggesting firms considering industrial characteristics to implement digitalization-assisted innovation practices.

The Impact of Technology Convergence on the Sustainable Innovation of China’s Modern Manufacturing Enterprises: The Mediating Role of the Knowledge Base

“…The formation of a knowledge base depends on the accumulation of knowledge and can be characterized by the collection of knowledge domains by its owner as well as the relationships established among them [44][45][46][47]. An enterprise's existing knowledge base comprises internal knowledge resources, alongside the information, inputs, expertise, and capabilities that support technological innovation [46].…”

“…The formation of a knowledge base depends on the accumulation of knowledge and can be characterized by the collection of knowledge domains by its owner as well as the relationships established among them [44][45][46][47]. An enterprise's existing knowledge base comprises internal knowledge resources, alongside the information, inputs, expertise, and capabilities that support technological innovation [46]. Knowledge is frequently viewed as a crucial unit for technology transfer; however, the breadth and intricacy of the technology domain within the technology convergence process transform it into a collection of knowledge domains that firms actively identify and engage with [16].…”

“…Conversely, the depth of the knowledge base pertains to the intricacy of critical domain knowledge, representing a vertical dimension that delves into unique, complex, and domain-specific expertise [45,49]. Together, these dimensions elucidate the structure and substance of the knowledge held by an enterprise, exerting a considerable positive influence on the enterprise's innovation performance [46].…”

“…This heterogeneity enhances the chances of successfully reorganizing both existing and novel knowledge, thereby fostering technological synergy and elevating innovation performance [38]. An enriched depth of the knowledge base, indicative of a wealth of domain-specific knowledge accrued over time, amplifies the imperative to broaden existing knowledge bases and the competency to unearth novel, valuable knowledge [42,46]. This enrichment facilitates the segmentation of technological innovation into several R&D subdomains, enabling a more structured and systematic approach to exploring subdomain technology convergence opportunities, consequently augmenting the efficiency of technology convergence and boosting innovation performance [46,50].…”

“…An enriched depth of the knowledge base, indicative of a wealth of domain-specific knowledge accrued over time, amplifies the imperative to broaden existing knowledge bases and the competency to unearth novel, valuable knowledge [42,46]. This enrichment facilitates the segmentation of technological innovation into several R&D subdomains, enabling a more structured and systematic approach to exploring subdomain technology convergence opportunities, consequently augmenting the efficiency of technology convergence and boosting innovation performance [46,50]. Consequently, the breadth and depth of the knowledge base serve as critical mediators in the dynamic between clustered technology convergence and innovation performance.…”