Exploring whether digital technologies ameliorate firms’ servitization: the moderating role of organizational slack and research and development intensity

Abstract

Purpose

Digital technologies are essential for improving efficiency and unlocking new opportunities in various domains. The purpose of this study is to assess whether digital technologies can ameliorate servitization among manufacturing firms via the interaction of organizational slack and research and development (R&D) intensity.

Design/methodology/approach

Drawing on resource-based and service-dominant logic, the study employs a deductive approach and gathers empirical evidence from 1,929 listed A-shares manufacturing firms in the top-seven China mainland industrial provinces spanning the period 2012–2021. It used fixed-effect logistic regression techniques while controlling for various factors to analyze the relationship between digital technologies and manufacturing firm servitization.

Findings

The findings revealed that digital technologies significantly ameliorate manufacturing firms' servitization. Moreover, the study uncovers the contingent nature of this relationship, demonstrating that high levels of both internal and external slack, which provide flexibility and support, intensify the direction of digital technologies towards servitization. Additionally, R&D intensity reflects the firm's commitment to innovation, thereby enhancing synergistic effects in the relationship.

Originality/value

This study contributes robust and comprehensive empirical evidence that validates and establishes a clear baseline relationship reflecting the most current digital technology landscape and its implications for manufacturing firms servitization. Moreover, it provides a more patterned understanding of how internal and external slack typologies and R&D intensity contextualize our study’s findings. Additionally, it demonstrates how our theoretical synthesis advances firms’ strategic shifts towards service-oriented business models through digital technologies.

Citation

Babalola, E.O., Wu, B., Fosu, E. and Shakeel, N. (2024), "Exploring whether digital technologies ameliorate firms’ servitization: the moderating role of organizational slack and research and development intensity", Journal of Manufacturing Technology Management, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/JMTM-04-2024-0169