Disentangling performance outcomes of a firm’s innovativeness: A resource-advantage perspective

Abstract

Inconsistent findings from the literature suggest that the relationship between innovativeness and performance is more complex than it might be presumed. By drawing on the resource-advantage theory, in this study we investigate: 1) the moderating effect of buyer power and competitive rivalry, and 2) the mediating role of customer- and competitor-based positional advantage on the relationship between innovativeness and sales-based and profit-based performance. The findings from the survey on 132 medium- and large-sized industrial firms in Croatia show that buyer power and competitive rivalry positively moderate the relationship between innovativeness and performance outcomes. Moreover, it was found that customer- and competitor-focused positional advantages mediate the link between innovativeness and performance outcomes. The findings of this study contribute to the literature and management practice by shedding new light on the nature of innovativeness in industrial firms.