Digital Transformation and Coupled Open Innovation in Manufacturing Enterprises: Capability Pathways, Executive Pay Gap, and Organizational Sustainability
TL;DR
How digital resources, organizational capabilities, and executive compensation context relate to formal collaborative innovation and the organizational and economic sustainability of manufacturing firms is clarified.
Abstract
Digital transformation can expand manufacturing firms’ capacity for interorganizational collaboration, but digitalization does not automatically translate into coupled open innovation. Drawing on dynamic capability theory and social comparison theory, this study examines the association between digital transformation and coupled open innovation, evaluates absorptive, adaptive, and innovative capabilities as parallel capability-related pathways, and investigates the external executive pay gap as a boundary condition. The analysis uses 12,791 firm-year observations from 2199 Chinese A-share listed manufacturing firms during 2011–2022. Digital transformation is measured from annual-report disclosures, while coupled open innovation is operationalized as joint patent applications with external co-applicants. Firm and year fixed-effects regressions with firm-clustered standard errors are complemented by Poisson pseudo-maximum-likelihood and negative-binomial count models and firm-cluster bootstrap mediation analyses. Digital transformation is positively associated with coupled open innovation across the linear and count specifications. In the simultaneous parallel-mediator model, the indirect associations through the absorptive-, adaptive-, and innovative-capability proxies are statistically distinguishable from zero, although the innovative-capability association is substantively small. The linear interaction specification indicates a stronger Digital–COI association at higher observed levels of the external executive pay gap, while the exploratory conditional-indirect analysis suggests selective moderation through the innovative-capability pathway rather than a uniform pattern across all three capability pathways. The results clarify how digital resources, organizational capabilities, and executive compensation context relate to formal collaborative innovation and the organizational and economic sustainability of manufacturing firms.