Digital Transformation and Innovation Performance in Manufacturing Firms: The Mediating Role of Absorptive Capacity and the Moderating Role of R&D Human Capital
Jul 2026· Human Resources Management and Services· 0 citations
TL;DR
The findings suggest that digital transformation contributes to innovation performance not only through technological efficiency but also through enhanced organizational learning and knowledge utilization capabilities.
Abstract
This study empirically investigated the effect of digital transformation on innovation performance in manufacturing firms and examined the mediating role of absorptive capacity and the moderating role of R&D human capital. As manufacturing industries increasingly experience rapid technological changes driven by artificial intelligence (AI), big data, the Internet of Things (IoT), and smart manufacturing systems, digital transformation has emerged as a critical strategic factor for enhancing organizational competitiveness and innovation capability. However, prior studies have suggested that the adoption of digital technologies alone does not necessarily guarantee sustainable innovation performance. Therefore, this study attempted to explain the relationship between digital transformation and innovation performance from the perspectives of organizational learning and human capital. Data were collected from 402 employees working in Korean manufacturing firms through online and offline surveys. The collected data were analyzed using Structural Equation Modeling (SEM) with SPSS 29.0 and SmartPLS 4.0. The results indicated that digital transformation had a significant positive effect on innovation performance and absorptive capacity. In addition, absorptive capacity positively influenced innovation performance and partially mediated the relationship between digital transformation and innovation performance. Furthermore, R&D human capital significantly moderated the relationship between digital transformation and innovation performance, indicating that the positive effect of digital transformation on innovation performance was stronger in firms with higher levels of R&D human capital. The findings suggest that digital transformation contributes to innovation performance not only through technological efficiency but also through enhanced organizational learning and knowledge utilization capabilities. This study provides academic implications by integrating digital transformation, absorptive capacity, and R&D human capital into a comprehensive research framework. In addition, it offers practical implications for manufacturing firms by emphasizing the importance of organizational learning systems and the development of R&D personnel capabilities alongside digital technology investment.
Amid the revolution in information technology, the digital transformation of manufacturing is reshaping traditional production models toward smart systems. While existing research has explored industrial digitalization at a macro level, systematic studies on how micro-level manufacturing firms evolve in performance and innovation during this process remain limited. This article aims to reveal the performance changes of manufacturing enterprises during digital transformation and examine the dynamic interaction between these changes and technological innovation capability. The study constructs a multi-level framework linking “digital transformation–innovation capability–corporate performance” focusing specifically on the mediating role of innovation capability in the transformation-performance relationship and comparing heterogeneous effects across ownership types and geographic regions. Using data from Chinese A-share listed manufacturing companies from 2019 to 2023, the research applies empirical modeling to test the proposed relationships. Findings indicate that digital transformation significantly enhances corporate performance, with innovation capability playing a crucial mediating role. Heterogeneity analysis shows that state-owned enterprises experience stronger performance gains than non-state-owned firms, and companies in central and western China benefit more than those in the eastern region. Based on these results, the study offers practical policy recommendations to support effective digital transformation in manufacturing.
Suyan Gong, Heng Ma· Proceedings of the Internati...· 0 citations
Findings indicate that digital transformation significantly enhances corporate performance, with innovation capability playing a crucial mediating role and practical policy recommendations to support effective digital transformation in manufacturing.
This study investigates the influence of digital leadership, digital dexterity, and digital culture on green innovation and circular manufacturing, while examining the moderating role of government regulatory intervention within an integrated Resource‐Based View theoretical framework. A quantitative cross‐sectional survey methodology was employed, collecting primary data from 372 manufacturing firm employees across China with a response rate of 32%. Hypothesized relationships were tested using partial least squares structural equation modeling (PLS‐SEM) via SmartPLS 4.0, with all measurement scales adapted from validated prior research works. Empirical results confirmed all seven hypotheses, establishing that digital leadership, digital dexterity, and digital culture each exert significant positive effects on green innovation, which in turn positively influences circular manufacturing adoption. Government regulatory intervention significantly moderated and strengthened the relationships between all three digital capability dimensions and green innovation, confirming its role as a critical institutional amplifier. This study makes an original theoretical contribution by integrating digital organizational capabilities, green innovation, and circular manufacturing within a unified RBV framework, while introducing regulatory intervention as a boundary condition. Practically, findings advocate for firm‐level investments in digital capabilities and progressive regulatory policy strengthening as complementary mechanisms for accelerating sustainable industrial transitions.
This study examines how firms convert dynamic capabilities into green innovation (GI) by developing green core competence (GCC). Drawing on resource-based theory and dynamic capability theory and incorporating core competence logic, the study investigates the direct effects of absorptive capacity (AC) and technological capability (TC) on GI, the mediating role of GCC, and the moderating role of green organizational culture (GOC) in the capability-to-competence process. Survey data were collected from 324 managers in China’s electronic information manufacturing industry, a technology-intensive sector facing pressures for technological upgrading and environmental improvement. Partial least squares structural equation modeling was used to test the proposed mediation and moderation model. The results show that AC and TC both positively affect GI and GCC, while TC has stronger effects. GCC positively affects GI and partially mediates the relationships between AC and GI and between TC and GI. GOC further strengthens the positive effects of AC and TC on GCC. These findings suggest that GI depends not only on the possession of dynamic capabilities but also on their conversion into a green-specific competence base. The study offers a contextualized explanation of how technology-intensive manufacturing firms organize internal capabilities to support sustainable manufacturing practices.
This study explores the relationship between digital orientation (DO), innovation and performance in small- and medium-sized manufacturing enterprises (SMEs) to answer the following research question: Is innovation a mediating mechanism in the relationship between DO and the performance of manufacturing SMEs?
A partial least squares structural equation model (PLS-SEM) was applied to data from a sample of 4,270 manufacturing SMEs in 16 Latin American countries, collected in 2022 by the Ibero-American Observatory of manufacturing SMEs (MSMEs).
The findings reveal a positive and significant relationship between DO and the performance of MSMEs. Likewise, the mediating role of innovation in this relationship is confirmed, albeit modestly. The article provides evidence that the DO of SMEs is enhanced as a dynamic capability when integrated with innovation processes.
The study fills a knowledge gap regarding the relationship between DO, innovation and business performance from three perspectives: the nature of these relationships, sector and firm size and regional context. First, by proposing and testing innovation as a mediator between DO and performance, it contributes to a better understanding of these relationships. Second, by focusing on MSMEs, it addresses a sector that has received relatively little scholarly attention despite its importance to the economy. Finally, by focusing on Latin America, it addresses a region that is largely overlooked in the existing literature.
Evelyn Núñez, J. C. Leiva, Ronald Mora-Esquivel· Academia : Revista Latinoame...· 0 citations
Digital transformation has come to the fore as a pivotal force behind corporate green innovation in the digital economy. Although previous research has documented that digital transformation can promote green innovation, the underlying organizational mechanisms remain theoretically fragmented. Moreover, the external conditions that shape the effectiveness of this relationship are not yet fully understood. To address these gaps, we develop an integrated analytical framework anchored in Organizational Information Processing Theory (OIPT) and the Resource-Based View (RBV). This framework explains how digital transformation promotes green innovation through two complementary organizational mechanisms—resource investment and technology application—and incorporates the moderating role of digital infrastructure. Using panel data on Chinese A-share-listed firms covering 2015–2024, this study examines the proposed relationships through a Bidirectional Fixed Effects Model, mediation analysis, and moderation analysis. The findings demonstrate a significant positive association between digital transformation and green innovation. This effect is partially mediated by increased R&D(Resource and Development) investment and deeper digital organizational embedding, which constitute complementary pathways reflecting resource investment and enhanced resource utilization, respectively. Additionally, digital infrastructure positively moderates this relationship by providing a more supportive external digital environment. This study enriches the existing literature by synthesizing previously dispersed perspectives on mechanisms into an OIPT-RBV framework, offering a more comprehensive account of how and under what circumstances digital transformation facilitates green innovation. Our findings also carry practical implications for managers seeking to strengthen innovation capabilities and for policymakers aiming to advance digital infrastructure and firms’ sustainable development.
