Self-reliance or dependence? Patterns of information technology use on innovation performance

Abstract

The association between information technology (IT) and firms’ innovation performance remains underexplored within the current Operations Management literature. We attempt to address this void by exploring how patterns of IT use (exploration and exploitation) influence innovation performance. We also introduce distinct types of supply chain (SC) innovation strategies, and explore how internal, external, and ambidextrous (balanced and combined) innovation strategies moderate the relationship. Drawing upon the dynamic capability view, we consider patterns of IT use as firms’ dynamic capabilities that can foster innovation performance, and regard SC innovation strategy as organisational paths that may influence the effectiveness of IT use. We empirically examine the relationship using data from 995 manufacturing firms featured in the World Bank China Enterprise Survey. We find IT exploitation and exploration positively influence innovation performance. Additionally, the internal innovation strategy can amplify the positive effect of IT exploitation, while exerting a non-significant moderating effect on IT exploration. Interestingly, the positive impacts of both IT use patterns on innovation are weakened when firms adopt external and ambidextrous innovation strategies. Our study contributes to a deeper comprehension of the relationship among IT use, SC innovation strategies, and firms’ innovation performance based on a dynamic capability view.