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Innovation Eco-Embeddedness, Breakthrough Innovation, and Performance of Non-Core Firms: A Mediation Moderation Study

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  • Mohamed Shawesh

    (Department of Business Administration, Institute of Graduate Research and Studies, University of Mediterranean Karpasia, 33010 Mersin, Northern Cyprus, Turkey)

  • Kolawole Iyiola

    (Department of Business Administration, Institute of Graduate Research and Studies, University of Mediterranean Karpasia, 33010 Mersin, Northern Cyprus, Turkey)

  • Ahmad Alzubi

    (Department of Business Administration, Institute of Graduate Research and Studies, University of Mediterranean Karpasia, 33010 Mersin, Northern Cyprus, Turkey)

Abstract

In today’s rapidly evolving business landscape, non-core firms face increasing pressure to innovate while adhering to sustainable practices. Non-core firms are organizations that operate in peripheral or less central positions within an ecosystem, having limited access to critical resources but playing essential supportive roles in innovation processes. Innovation eco-embeddedness, which integrates ecological considerations into innovation processes, is becoming a critical factor for enhancing innovation performance. However, the dynamics between eco-embeddedness, breakthrough innovation, and innovation performance, especially under varying levels of ecological legitimacy and technology turbulence, remain under examination. This study aims to investigate the relationships between innovation eco-embeddedness, breakthrough innovation, and innovation performance in non-core firms. Additionally, it examines the moderating effects of ecological legitimacy and technology turbulence on these relationships. This study developed and tested seven hypotheses using a conceptual framework based on innovation ecosystem theory, breakthrough innovation theory, and institutional theory. We collected data from a diverse sample of non-core firms and used structural equation modeling to analyze the direct, mediating, and moderating effects. The findings reveal a positive relationship between innovation eco-embeddedness and both breakthrough innovation and innovation performance. Breakthrough innovation also directly enhances innovation performance and mediates the relationship between eco-embeddedness and performance. Ecological legitimacy significantly moderates the impact of eco-embeddedness on breakthrough innovation, while technology turbulence intensifies the mediated relationship between eco-embeddedness and innovation performance when both moderating factors are high. This study provides valuable perceptions for managers and policymakers in non-core firms, highlighting the importance of embedding ecological considerations in innovation processes.

Suggested Citation

  • Mohamed Shawesh & Kolawole Iyiola & Ahmad Alzubi, 2024. "Innovation Eco-Embeddedness, Breakthrough Innovation, and Performance of Non-Core Firms: A Mediation Moderation Study," Sustainability, MDPI, vol. 16(20), pages 1-24, October.
    • Handle: RePEc:gam:jsusta:v:16:y:2024:i:20:p:8736-:d:1495522
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