Environmental dynamism and cooperative innovation: the moderating role of state ownership and institutional development
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Environmental dynamism and cooperative innovation: the moderating role of state ownership and institutional development Xincheng Wang1 · Jide Sun2 · Longwei Tian1 · Wenjian Guo1 · Tianyu Gu1
© Springer Science+Business Media, LLC, part of Springer Nature 2020
Abstract Taking a strategic fit perspective, we investigate the relationships between task environment (environmental dynamism), institutional environment (state ownership and institutional development), and innovation strategy (cooperative strategy) in the context of China. Using a longitudinal data set of Chinese manufacturing firms from 2012 to 2017, we confirm that environmental dynamism positively drives firms’ decisions to cooperate for innovation. This driving effect is stronger for state-owned firms and firms located in regions with limited developed institutions. Overall, no one-size-fits-all innovation strategy exists, and the appropriateness of a strategy depends on the coalignment of a series of external and internal factors. The theoretical and practical implications of this finding are explored. Keywords Cooperative innovation strategy · Task and institutional environment · Strategic fit JEL Classification O32
1 Introduction An appropriate innovation strategy is fundamental to deliver better innovation performance (Li and Atuahene-Gima 2001; Ting et al. 2012). Strategy scholars argue that firms develop and implement strategies that match the contextual contingencies they face (Volberda et al. 2012; Zhao et al. 2017). In emerging economies, task and institutional environments affect a firm’s strategic choices (Farashahi and Hafsi 2009; Hillman et al. 2009). Task environments demand a firm’s quick and efficient strategic responses * Xincheng Wang [email protected] Longwei Tian [email protected] 1
Antai College of Economics and Management, Shanghai Jiao Tong University, Xinzhongyuan 209 Room, 1954 Huashan Road, Xuhui District, Shanghai 200030, People’s Republic of China
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School of Economics and Management, Tongji University, Shanghai 200092, People’s Republic of China
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in the face of changing market needs (Carroll and Huo 1986; Rosenbusch et al. 2013). Institutional environments shape a firm’s strategies through human-devised formal and informal institutions such as values, belief, statutes, and regulations (Dorobantu et al. 2017; Peng 2003). With a high contingency fit, firms thus need to adapt to the task environment and simultaneously consider the institutional environment (Volberda et al. 2012). As a strategic choice, cooperation has been a longstanding concern in innovation management. Innovation management involves efforts in capturing and effectuating innovation opportunities and governing and coordinating interorganizational relationships (Alexiev et al. 2016; Chadee et al. 2017). Environmental contingencies wherein firms adopt cooperative strategies are of great concern (Alexiev et al. 2016; Tojeiro-Rivero and Moreno 2019). The rapid and unpredictable changes in task environments
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