Sustaining innovation during downsizing strategy through knowledge coupling, business process digitization, and market capitalizing agility

Sayed Muhammad Fawad Sharif, Naiding Yang, Atiq ur Rehman and Omar Alghamdi
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Naiding Yang: School of Management, Northwestern Polytechnical University, Xi’an, P.R. China
Atiq ur Rehman: NayaKam, Pakistan
Omar Alghamdi: Business Administration Department, Applied College of Najran University, Najran, Saudi Arabia

Australian Journal of Management, 2024, vol. 49, issue 3, 428-447

Abstract: COVID-19 has developed chaos and uncertainty for small and medium enterprises (SMEs) causing mass downsizing. Under such uncertainty, innovation is key to survival and agility to growth. This study examines role of knowledge coupling and business process digitization (BPD) in sustaining innovation through market capitalizing agility (MCA) besides downsizing strategy. Data have been collected from top and mid management of Chinese manufacturing SMEs and analyzed with knowledge-based view and self-tuning model through Smart-PLS 4. Knowledge coupling positively contributes to MCA and innovation irrespective of downsizing strategy. Effect of BPD on innovation performance is same; however, insignificant on MCA in no-downsizing sample. Likewise, MCA positively influences innovation performance and positively mediates between knowledge coupling (BPD) and innovation performance only during downsizing. This study is first of its kind to establish mediating effect of MCA between knowledge coupling (BPD) and innovation performance during downsizing phase and offers significant theoretical and practical implications. JEL Classification: J63, O31

Keywords: Business process digitization; downsizing; innovation performance; knowledge coupling; market capitalizing agility; SME (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:sae:ausman:v:49:y:2024:i:3:p:428-447

DOI: 10.1177/03128962221142435

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