When Do the Eyes Guide the Body? Understanding the Moderating Role of CEO Power between Big Data Orientation and Breakthrough Innovation

Abstract

Extant research has confirmed the positive relationship between big data and innovation. However, we still lack an understanding of how internal and external conditions matter in this relationship from a strategic perspective. This study introduces CEO power as a moderator of the relationship between big data orientation and breakthrough innovation. Using 5-year panel data from 995 listed firms in China, we find that a big data orientation is positively associated with breakthrough innovation and that this relationship is further strengthened by higher levels of CEO power. We also find that institutional fragility, defined as the differential pace of progress across different dimensions of the institution, plays a positive role in amplifying the moderating role of CEO power. These findings show that managers ought to look into internal and external contingency factors to boost their breakthrough innovations through strategic orientation in big data.

Keywords: big data orientation, breakthrough innovation, CEO power, institutional fragility