The impact of informal social interaction on innovation capability in the context ofbuyer-supplier dyads

Author:  Xueyuan Liu(Deparment of Business Administration), Qihai Huang, Junsheng Dou, Xiande Zhao
Publication:  Journal of Business Research
Abstract:  ¡¾Keywords¡¿Informal interaction, Social networking, Innovation, Absorptive capacity, Knowledge acquisition
Although many studies employ social network theory to explain firm innovation, how individual-level factorslead to a firm's collective innovation capability remains under-researched. Building on studies that use thework boundary to define formal and informal social interactions,this research aims to illuminate how informalbuyer-supplier employee interactions influence buyer firms' innovation capabilities through knowledge acquisition.Integrating the literatures on absorptive capacity and social interaction, the analysis of survey data from273Chinese manufacturing firms suggests that employees' informal interactions are positively associated withknowledge acquisition and enhance firms' innovation capabilities. Furthermore, the indirect effects of informalinteractions on innovation capability are moderated by knowledge application.