Collaborative innovation network embeddedness and a firm’s technological impact: Does prior networking experience matter?

A firm’s technological impact is an important metric because it reflects the firm’s influence in a specific technological arena, shapes the establishment of industry standards, and drives future technological innovations, contributing to long-lasting competitive advantage. Previous research has emphasized the significant role of a firm’s collaboration network characteristics in driving innovation. However, no consensus exists regarding the effects of network characteristics on innovation. Several studies have highlighted how relational and structural embeddedness positively impact exploratory innovation by enhancing trust and knowledge sharing and providing access to new information. Conversely, other research shows that structural embeddedness can hinder incremental innovation due to information noise. Additionally, not all innovations yield the same technological impact, underscoring the need to explore the determinants of a firm’s technological impact. Drawing upon social network theory, we propose that the relationship between relational and structural embeddedness and a firm’s technological impact is far from linear. Using patent data from the flat panel display industry for the period between 1996 and 2020, we find that a firm’s relational embeddedness demonstrates an inverted U-shaped relationship with its technological impact. In contrast, structural embeddedness has a consistent positive linear effect. Furthermore, a firm’s prior networking experience flattens the inverted U-shaped relationship between relational embeddedness and technological impact while weakening the positive linear relationship between structural embeddedness and technological impact.