IDEAS home Printed from https://ideas.repec.org/a/eee/jbrese/v85y2018icp226-237.html
   My bibliography  Save this article

How do incentives motivate absorptive capacity development? The mediating role of employee learning and relational contingencies

Author

Listed:
  • Wang, Liwen
  • Zhao, Jane Zheng
  • Zhou, Kevin Zheng

Abstract

This study explores the antecedents of a firm's absorptive capacity by examining the role of innovation incentives. Building on expectancy theory and equity theory, we argue that innovation incentives enhance absorptive capacity through promoting employees learning; and the effectiveness of incentives is positively moderated by teamwork (i.e., horizontal relation) but negatively moderated by transformational leadership (i.e., vertical relation). To test our hypotheses, we employ a multi-respondent research design based on a sample of 102 Chinese automotive companies. The results show strong support for the hypotheses and demonstrate the positive impact of innovation incentives on a firm's absorptive capacity through the mediating role of employee learning, as well as the moderating effect of the relational context in shaping the influences of innovation incentives.

Suggested Citation

  • Wang, Liwen & Zhao, Jane Zheng & Zhou, Kevin Zheng, 2018. "How do incentives motivate absorptive capacity development? The mediating role of employee learning and relational contingencies," Journal of Business Research, Elsevier, vol. 85(C), pages 226-237.
    • Handle: RePEc:eee:jbrese:v:85:y:2018:i:c:p:226-237
    DOI: 10.1016/j.jbusres.2018.01.010
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0148296318300109
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.jbusres.2018.01.010?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Zheng Jane Zhao & Clint Chadwick, 2014. "What we will do versus what we can do: The relative effects of unit-level NPD motivation and capability," Strategic Management Journal, Wiley Blackwell, vol. 35(12), pages 1867-1880, December.
    2. Narda R. Quigley & Paul E. Tesluk & Edwin A. Locke & Kathryn M. Bartol, 2007. "A Multilevel Investigation of the Motivational Mechanisms Underlying Knowledge Sharing and Performance," Organization Science, INFORMS, vol. 18(1), pages 71-88, February.
    3. Stephanie C. Schleimer & Torben Pedersen, 2013. "The Driving Forces of Subsidiary Absorptive Capacity," Journal of Management Studies, Wiley Blackwell, vol. 50(4), pages 646-672, June.
    4. Birasnav, M., 2014. "Knowledge management and organizational performance in the service industry: The role of transformational leadership beyond the effects of transactional leadership," Journal of Business Research, Elsevier, vol. 67(8), pages 1622-1629.
    5. Julie Juan Li & Laura Poppo & Kevin Zheng Zhou, 2010. "Relational mechanisms, formal contracts, and local knowledge acquisition by international subsidiaries," Strategic Management Journal, Wiley Blackwell, vol. 31(4), pages 349-370, April.
    6. David Morand & Kimberly Merriman, 2012. "“Equality Theory” as a Counterbalance to Equity Theory in Human Resource Management," Journal of Business Ethics, Springer, vol. 111(1), pages 133-144, November.
    7. Jansen, J.J.P. & van den Bosch, F.A.J. & Volberda, H.W., 2005. "Managing Potential and Realized Absorptive Capacity: How do Organizational Antecedents matter?," ERIM Report Series Research in Management ERS-2005-025-STR, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
    8. Aime, Federico & Meyer, Christopher J. & Humphrey, Stephen E., 2010. "Legitimacy of team rewards: Analyzing legitimacy as a condition for the effectiveness of team incentive designs," Journal of Business Research, Elsevier, vol. 63(1), pages 60-66, January.
    9. Kevin Zheng Zhou & Fang Wu, 2010. "Technological capability, strategic flexibility, and product innovation," Strategic Management Journal, Wiley Blackwell, vol. 31(5), pages 547-561, May.
    10. Arie Y. Lewin & Silvia Massini & Carine Peeters, 2011. "Microfoundations of Internal and External Absorptive Capacity Routines," Organization Science, INFORMS, vol. 22(1), pages 81-98, February.
    11. D Minbaeva & T Pedersen & I Björkman & C F Fey & H J Park, 2003. "MNC knowledge transfer, subsidiary absorptive capacity, and HRM," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 34(6), pages 586-599, November.
    12. Zheng Jane Zhao & Jaideep Anand, 2009. "A multilevel perspective on knowledge transfer: evidence from the Chinese automotive industry," Strategic Management Journal, Wiley Blackwell, vol. 30(9), pages 959-983, September.
    13. Boas Shamir & Robert J. House & Michael B. Arthur, 1993. "The Motivational Effects of Charismatic Leadership: A Self-Concept Based Theory," Organization Science, INFORMS, vol. 4(4), pages 577-594, November.
    14. Margit Osterloh & Bruno S. Frey, 2000. "Motivation, Knowledge Transfer, and Organizational Forms," Organization Science, INFORMS, vol. 11(5), pages 538-550, October.
    15. Fiona K. Yao & Song Chang, 2017. "Do Individual Employees' Learning Goal Orientation and Civic Virtue Matter? A Micro-Foundations Perspective on Firm Absorptive Capacity," Strategic Management Journal, Wiley Blackwell, vol. 38(10), pages 2041-2060, October.
    16. Ebers, Mark & Maurer, Indre, 2014. "Connections count: How relational embeddedness and relational empowerment foster absorptive capacity," Research Policy, Elsevier, vol. 43(2), pages 318-332.
    17. Jae Hyeung Kang & George T. Solomon & David Y. Choi, 2015. "CEOs' Leadership Styles and Managers' Innovative Behaviour: Investigation of Intervening Effects in an Entrepreneurial Context," Journal of Management Studies, Wiley Blackwell, vol. 52(4), pages 531-554, June.
    18. Jeremy Bernerth & H. Jack Walker, 2012. "Reexamining the Workplace Justice to Outcome Relationship: Does Frame of Reference Matter?," Journal of Management Studies, Wiley Blackwell, vol. 49(5), pages 945-969, July.
    19. Martin Hoegl & Hans Georg Gemuenden, 2001. "Teamwork Quality and the Success of Innovative Projects: A Theoretical Concept and Empirical Evidence," Organization Science, INFORMS, vol. 12(4), pages 435-449, August.
    20. Henk W. Volberda & Nicolai J. Foss & Marjorie A. Lyles, 2010. "PERSPECTIVE---Absorbing the Concept of Absorptive Capacity: How to Realize Its Potential in the Organization Field," Organization Science, INFORMS, vol. 21(4), pages 931-951, August.
    21. Zheng Zhao & Jaideep Anand & Will Mitchell, 2005. "A Dual Networks Perspective on Inter‐Organizational Transfer of R&D Capabilities: International Joint Ventures in the Chinese Automotive Industry," Journal of Management Studies, Wiley Blackwell, vol. 42(1), pages 127-160, January.
    22. Oliver Gottschalg & Maurizio Zollo, 2007. "Interest Alignment and Competitive Advantage," Post-Print hal-00459446, HAL.
    23. Phyllis A. Siegel & Donald C. Hambrick, 2005. "Pay Disparities Within Top Management Groups: Evidence of Harmful Effects on Performance of High-Technology Firms," Organization Science, INFORMS, vol. 16(3), pages 259-274, June.
    24. Maurizio Zollo & Sidney G. Winter, 2002. "Deliberate Learning and the Evolution of Dynamic Capabilities," Organization Science, INFORMS, vol. 13(3), pages 339-351, June.
    25. Justin J. P. Jansen & Gerard George & Frans A. J. Van den Bosch & Henk W. Volberda, 2008. "Senior Team Attributes and Organizational Ambidexterity: The Moderating Role of Transformational Leadership," Journal of Management Studies, Wiley Blackwell, vol. 45(5), pages 982-1007, July.
    26. Greenberg, Jerald & Ashton-James, Claire E. & Ashkanasy, Neal M., 2007. "Social comparison processes in organizations," Organizational Behavior and Human Decision Processes, Elsevier, vol. 102(1), pages 22-41, January.
    27. Huang, Kuo-Feng & Lin, Ku-Ho & Wu, Lei-Yu & Yu, Pang-Hsiang, 2015. "Absorptive capacity and autonomous R&D climate roles in firm innovation," Journal of Business Research, Elsevier, vol. 68(1), pages 87-94.
    28. Chen, Chung-Jen & Huang, Jing-Wen, 2009. "Strategic human resource practices and innovation performance -- The mediating role of knowledge management capacity," Journal of Business Research, Elsevier, vol. 62(1), pages 104-114, January.
    29. Kostopoulos, Konstantinos & Papalexandris, Alexandros & Papachroni, Margarita & Ioannou, George, 2011. "Absorptive capacity, innovation, and financial performance," Journal of Business Research, Elsevier, vol. 64(12), pages 1335-1343.
    30. Ali, Murad & Park, Kichan, 2016. "The mediating role of an innovative culture in the relationship between absorptive capacity and technical and non-technical innovation," Journal of Business Research, Elsevier, vol. 69(5), pages 1669-1675.
    31. Martin Hoegl & Katharina Weinkauf & Hans Georg Gemuenden, 2004. "Interteam Coordination, Project Commitment, and Teamwork in Multiteam R&D Projects: A Longitudinal Study," Organization Science, INFORMS, vol. 15(1), pages 38-55, February.
    32. Wei, Yinghong (Susan) & Atuahene-Gima, Kwaku, 2009. "The moderating role of reward systems in the relationship between market orientation and new product performance in China," International Journal of Research in Marketing, Elsevier, vol. 26(2), pages 89-96.
    33. Ryan, James Christopher, 2016. "Old knowledge for new impacts: Equity theory and workforce nationalization," Journal of Business Research, Elsevier, vol. 69(5), pages 1587-1592.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Esthela Galván Vela & Yesenia Sánchez Tovar & Mónica Lorena Sánchez Limón & Rafael Ravina-Ripoll, 2022. "Intrapreneurship model in the software industry," Quality & Quantity: International Journal of Methodology, Springer, vol. 56(5), pages 3699-3727, October.
    2. Jian Zhou & Meixi Zhang & Sisi Wu, 2022. "Multi-Objective Vehicle Routing Problem for Waste Classification and Collection with Sustainable Concerns: The Case of Shanghai City," Sustainability, MDPI, vol. 14(18), pages 1-25, September.
    3. El Maalouf, Nicole & Bahemia, Hanna, 2023. "The implementation of inbound open innovation at the firm level: A dynamic capability perspective," Technovation, Elsevier, vol. 122(C).
    4. Hiu Kan Wong, Ada & Xinru Wu, Crystal & Whitla, Paul & Stanley Snell, Robin, 2022. "How LMX and marketing capabilities guide and motivate customer-facing employees’ learning," Journal of Business Research, Elsevier, vol. 138(C), pages 161-169.
    5. Christian Criado-Perez & Catherine G Collins & Chris Jackson, 2020. "Enablers of evidence-based management: Clues from the absorptive capacity literature," Australian Journal of Management, Australian School of Business, vol. 45(3), pages 468-487, August.
    6. Rafael Ricardo Jacomossi & Paulo Roberto Feldmann, 2020. "Good Management Practices and Absorptive Capacity: Impacts on Firms’ Productivity," RAC - Revista de Administração Contemporânea (Journal of Contemporary Administration), ANPAD - Associação Nacional de Pós-Graduação e Pesquisa em Administração, vol. 24(5), pages 432-447.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. H. Emre Yildiz & Adis Murtic & Udo Zander & Anders Richtnér, 2019. "What Fosters Individual-Level Absorptive Capacity in MNCs? An Extended Motivation–Ability–Opportunity Framework," Management International Review, Springer, vol. 59(1), pages 93-129, February.
    2. Zheng, Lu & Ulrich, Klaus & Sendra-García, Javier, 2021. "Qualitative comparative analysis: Configurational paths to innovation performance," Journal of Business Research, Elsevier, vol. 128(C), pages 83-93.
    3. Khan, Zaheer & Lew, Yong Kyu & Marinova, Svetla, 2019. "Exploitative and exploratory innovations in emerging economies: The role of realized absorptive capacity and learning intent," International Business Review, Elsevier, vol. 28(3), pages 499-512.
    4. Zhou, Abby Jingzi & Fey, Carl & Yildiz, H. Emre, 2020. "Fostering integration through HRM practices: An empirical examination of absorptive capacity and knowledge transfer in cross-border M&As," Journal of World Business, Elsevier, vol. 55(2).
    5. Emre Yildiz, H. & Murtic, Adis & Klofsten, Magnus & Zander, Udo & Richtnér, Anders, 2021. "Individual and contextual determinants of innovation performance: A micro-foundations perspective," Technovation, Elsevier, vol. 99(C).
    6. Weidner, Nadia & Som, Oliver & Horvat, Djerdj, 2023. "An integrated conceptual framework for analysing heterogeneous configurations of absorptive capacity in manufacturing firms with the DUI innovation mode," Technovation, Elsevier, vol. 121(C).
    7. Johann Piet Hausberg & Peter S. H. Leeflang, 2019. "Absorbing Integration: Empirical Evidence On The Mediating Role Of Absorptive Capacity Between Functional-/Cross-Functional Integration And Innovation Performance," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 23(06), pages 1-37, August.
    8. Xie, Xuemei & Zou, Hailiang & Qi, Guoyou, 2018. "Knowledge absorptive capacity and innovation performance in high-tech companies: A multi-mediating analysis," Journal of Business Research, Elsevier, vol. 88(C), pages 289-297.
    9. Beatriz Ortiz García Navas & Mario Javier Donate Manzanares & Fátima Guadamillas Gómez, 2017. "Capacidad de Absorción: Revisión Crítica y Proposición de un Modelo Teórico (Absorptive Capacity: Critical Review and Proposition of a Theoretical Model)," Revista Internacional de Gestión del Conocimiento y la Tecnología (GECONTEC), Revista Internacional de Gestión del Conocimiento y la Tecnología (GECONTEC), vol. 5(2), pages 1-22, December.
    10. Flatten, Tessa & Adams, Daniel & Brettel, Malte, 2015. "Fostering absorptive capacity through leadership: A cross-cultural analysis," Journal of World Business, Elsevier, vol. 50(3), pages 519-534.
    11. Christian Criado-Perez & Catherine G Collins & Chris Jackson, 2020. "Enablers of evidence-based management: Clues from the absorptive capacity literature," Australian Journal of Management, Australian School of Business, vol. 45(3), pages 468-487, August.
    12. Daniel Robert Adams & Tessa Christina Flatten & Helge Brinkmann & Malte Brettel, 2016. "Consequences And Antecedents Of Absorptive Capacity In A Cross-Cultural Context," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 20(01), pages 1-39, January.
    13. Yousaf, Umair Bin & Ullah, Irfan & Jiang, Junchen & Wang, Man, 2022. "The role of board capital in driving green innovation: Evidence from China," Journal of Behavioral and Experimental Finance, Elsevier, vol. 35(C).
    14. Enkel, Ellen & Heil, Sebastian & Hengstler, Monika & Wirth, Henning, 2017. "Exploratory and exploitative innovation: To what extent do the dimensions of individual level absorptive capacity contribute?," Technovation, Elsevier, vol. 60, pages 29-38.
    15. Arie Y Lewin & Silvia Massini & Carine Peeters, 2020. "Absorptive capacity, socially enabling mechanisms, and the role of learning from trial and error experiments: A tribute to Dan Levinthal’s contribution to international business research," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 51(9), pages 1568-1579, December.
    16. Latukha, M. & Veselova, A. & Selivanovskikh, L. & Artukh, E. & Mitskevich, E., 2016. "Re-thinking the role of talent management in a firm’s performance: Talent management practices and absorptive capacity," Working Papers 6442, Graduate School of Management, St. Petersburg State University.
    17. Bai, Xuan & Wang, Qingtao & Sheng, Shibin & Li, Julie Juan, 2021. "Cross-level interpersonal ties and IJV innovation: Evidence from China," Journal of Business Research, Elsevier, vol. 134(C), pages 618-630.
    18. Lau, Antonio K.W. & Lo, William, 2015. "Regional innovation system, absorptive capacity and innovation performance: An empirical study," Technological Forecasting and Social Change, Elsevier, vol. 92(C), pages 99-114.
    19. Mariano, Stefania & Al-Arrayed, Suad, 2018. "Combinations of absorptive capacity metaroutines: The role of organizational disruptions and time constraints," European Management Journal, Elsevier, vol. 36(2), pages 171-182.
    20. Kamal Sakhdari & J. Henri Burgers, 2018. "The moderating role of entrepreneurial management in the relationship between absorptive capacity and corporate entrepreneurship: an attention-based view," International Entrepreneurship and Management Journal, Springer, vol. 14(4), pages 927-950, December.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:jbrese:v:85:y:2018:i:c:p:226-237. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/jbusres .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.