External knowledge, intraorganisational networks and exploratory innovation: an empirical examination

Abstract

External sources of knowledge are widely believed to be essential in fostering innovation. However, empirical evidence on the relationship between externally acquired knowledge and organisational innovation are inconsistent. Building on social network research, this study examines how the intraorganisational network structure affects the extent to which organisations can benefit from external knowledge in generating innovation. In particular, we focus on the effect of external knowledge diversity on exploratory innovation. Employing network and patent data collected from high technology companies in Taiwan, we find that the diversity of external knowledge has a positive impact on organisational exploratory innovation. Moreover, intraorganisational network brokerage increases the positive effect of external knowledge diversity on exploratory innovation, while intraorganisational network closure decreases the positive effect of external knowledge diversity on exploratory innovation. The results indicate that the effects of external knowledge on organisational innovation are contingents upon the configuration of intraorganisational networks.