Strategic Orientation Of Technological Innovation In Entrepreneurial Firms

Whether strategic orientation of technological innovation should be exploration or exploitation has been a hot topic in business and academic circles. Existing literature abounds in studies on this strategic orientation for entrepreneurial firms, yet most of the studies focus on the effects of organizational and environmental factors, there is a research gap on how CEO's social networks and TMT learning affect the orientation choice.This research focuses on two issues: (1) How CEO's social networks affect the choice between exploration and exploitation? What are the factors that moderate this mechanism? (2) How the TMT learning affects the choice between exploration and exploitation? What are the factors that moderate this mechanism?Hierarchical regression of cross-functional data is conducted in this research to test the theoretical model. Data used in the research were obtained by survey, Questionnaire for CEO and Questionnaire for CTO, which were filled out by CEOs and CTOs respectively. 122 effective samples obtained were from firms in provinces and municipalities including Shandong, Guangdong, Sichuan, Jiangsu, Chongqing. The response rate is 61% (122/200). The main purpose of the questionnaires are to help identify, from an adequate number of enterprise samples, the data of CEO's social networks, TMT's learning capacity, firms' exploration and exploitation, and other relevant data. These data were then used to test the theoretical hypothesis.Major results of the research show that: (1) an organization can carry out both exploration and exploitation by using different combinations of resources; (2) each dimension of the CEO's social networks will influence the choice between exploraton and exploitation in a different way, and the influence is moderated by the extent of CEO's power concentration; (3) TMT learning does not directly influence the choice. But the interaction between TMT learning and CEO's social networks markedly affect the strategic orientation; (4) each of the two dimensions of the CEO's external social networks, business networks and political networks, exerts wholly different influence on the strategic orientation of technological innovation. For entreperneurial firms in the economic transition, the CEO's political networks hinder the exploration.