Good Strategy, Good Entrepreneurship? Examining When and How Digital Business Strategy Drives Firm Strategic Entrepreneurship

Abstract

Theory and practice suggest that digital business strategy may help enterprises to seek opportunities in competition. However, there is little knowledge about how and when digital business strategy works in driving strategic entrepreneurship. In order to address this issue, we used dynamic capability theory to discuss how digital business strategy can facilitate strategic entrepreneurship through the mediating role of absorptive capacity while also exploring the moderating role of market turbulence and technology turbulence in the relationship between digital business strategy and absorptive capacity. We test the hypotheses by conducting a survey study which use longitudinal date collected from 290 firms in China with digital features. Findings suggest that digital business strategy promotes the entrepreneurial orientation, accessing relational resources and relational embeddedness in firms, which is achieved mainly through enhanced absorptive capacity. Furthermore, market turbulence strengthens the relationship between digital business strategy and absorptive capacity, whereas technological turbulence plays an inverted U-shaped moderating role. The study contributes valuable theory and management insights concerning digital platform capabilities and strategic entrepreneurship.