How can digital technology-related acquisitions affect a firm's innovation performance? Online publication date: Thu, 17-Feb-2022
by Jianghua Zhou; Chenrui Liu; Xiaoqiang Xing; Jizhen Li
International Journal of Technology Management (IJTM), Vol. 87, No. 2/3/4, 2021
Abstract: This paper studies how acquiring digital firms affects the post-acquisition innovation performance of traditional firms. Based on the longitudinal dataset of Chinese listed firms from 2007 to 2017, our findings show that digital technology-related acquisitions have a positive effect on a firm's innovation performance. Moreover, the construction of regional-level digital infrastructure plays a positive moderating role in this relationship. Furthermore, we propose a contingency model to investigate the moderating effect of internal digital investment and unabsorbed slack. The results indicate that the acquirer's internal digital investment has a positive moderating effect on the relationship between digital technology-related acquisitions and innovation performance. Meanwhile, the acquirer's unabsorbed slack also moderates this relationship positively. Our paper expands the contingency perspective within a traditional firm's digital transformation and has implications for future research and management practices.
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