How Knowledge Services Clustered Firms Leverage Different Channels of Local Knowledge Spillovers for Service Innovation

Abstract

Built upon configuration theory, this study performs a Qualitative Comparative Analysis (QCA) to delineate alternative and sufficient configurations of local knowledge spillover (LKS) channels, that is, how informal interactions and spinoff, and absorptive capacity are combined to facilitate service innovation. Primary data was collected from the largest software outsourcing cluster in Vietnam in 2018, which provides a sample size of 42 firms. The findings imply that multiple configurations of different channels of LKS in conjunction with absorptive capacity can lead to service innovation. This study makes three important contributions. First, it contributes to the debate over the critical role of LKS and absorptive capacity in innovation by offering a more holistic, yet nuanced understanding of the causal mechanisms underlying service innovation. Second, this study sheds light on viable and equifinal pathways for enhancing innovation capabilities, therefore contributing to the literature on cluster upgrading and global service sourcing. Third, it provides some managerial implications for indigenous spinoff firms in developing countries seeking to innovate through the strategic use of LKS.

A configurational analysis of innovation ambidexterity: evidence from Chinese niche leaders

“…FsQCA, a methodology increasingly used in the field of management and organization (Greckhamer and Gur, 2021), finds application in diverse areas such as innovation (Ngo and Thornton, 2022; Villani et al , 2023), entrepreneurship (Douglas et al , 2020; McSweeney et al , 2022), international business (Cui et al , 2017; Li et al , 2022b), business model (Hsieh and Vergne, 2023; Jiang et al , 2021), corporate governance (Pandey et al , 2022; Witt et al , 2022) and regional development (Cui et al , 2020; White and Burger, 2022). It combines the strengths of qualitative analysis, such as its case-oriented and in-depth nature, while addressing the limitations of quantitative analysis, which often relies on large samples and lacks granularity.…”