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The role of operational stickiness in impacting new venture survival

Yingjie Shi (College of Management and Economics, Tianjin University, Tianjin, China)
Xuechang Zhu (College of Management and Economics, Tianjin University, Tianjin, China)
Shuaishuai Zhang (College of Management and Economics, Tianjin University, Tianjin, China)
Yu Lin (College of Management and Economics, Tianjin University, Tianjin, China)

Journal of Manufacturing Technology Management

ISSN: 1741-038X

Article publication date: 30 April 2019

Abstract

Purpose

The purpose of this paper is to examine the existence of operational stickiness, and explores the relationship between operational stickiness and the likelihood of survival. Furthermore, the authors investigate this relationship in different manufacturing industries.

Design/methodology/approach

Using a large sample of more than 200,000 new manufacturing small and medium enterprises between 2000 and 2013 in China, the authors use the survival analysis method to investigate the non-linear relationship between operational stickiness and the likelihood of survival.

Findings

The authors demonstrate the existence of operational stickiness, such as inventory stickiness, property, plant, and equipment (PPE) stickiness, and labor stickiness. Next, the authors find the inverted U-shaped relationship between operational stickiness and the likelihood of survival. Furthermore, the authors document the differential effect of operational stickiness on the likelihood of survival in different industries.

Practical implications

Managers can improve the firm’s likelihood of survival by maintaining a moderate inventory stickiness and PPE stickiness. However, managers should not adopt sticky labor management in manufacturing industries.

Originality/value

This paper may be the first study to demonstrate the existence of operational stickiness, and confirm the inverted U-shaped relationship between operational stickiness and the likelihood of survival.

Keywords

Citation

Shi, Y., Zhu, X., Zhang, S. and Lin, Y. (2019), "The role of operational stickiness in impacting new venture survival", Journal of Manufacturing Technology Management, Vol. 30 No. 5, pp. 876-896. https://doi.org/10.1108/JMTM-07-2018-0206

Publisher

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Emerald Publishing Limited

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