Intrapreneurship and Business Model Innovation in ICT Incumbents in Hong Kong: The Mediating Role of Digital Transformation
DOI:
https://doi.org/10.70301/Keywords:
Intrapreneurship, organizational structure strategy, dynamic capabilities, business model innovation, digital transformation, disruptive technologies, incumbent, ICT industry in Hong Kong.Abstract
In the last decade, proliferating digital and AI technologies enabled digital entrepreneurs to create disruptive business models eroding incumbents’ businesses. Incumbents must react to mitigate such erosion. This research hypothesizes a framework and examines whether characteristics of digital entrepreneurs, an intrapreneurship organizational structure and dynamic capabilities, enhance business model innovation of incumbent Information, Communication and Technology (ICT) companies in Hong Kong, the special administrative region of China. The study also examines the moderating effect of the stage of digital transformation
A quantitative survey analyzed responses from 181 Hong Kong ICT companies. The structural model shows that dynamic capabilities and intrapreneurship positively influence business model innovation, with dynamic capabilities being as an effective mediator. The stage of digital transformation enhances dynamic capabilities but does not moderate relationships in this framework. Companies with longer histories find it more difficult to innovate, but company age moderates the effect of dynamic capabilities on business model innovation. Respondents’ education level, age, and industry age are associated with more intrapreneurial behavior. Three interviews with senior management from Hong Kong ICT incumbents provide qualitative insights supporting the framework.
The proposed framework offers heuristic guidance for ICT incumbents seeking to innovate business models during the digital transformation era.
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