Leveraging social media for innovation: A conditional mediation model

Previous research has highlighted the benefits of organizations leveraging external sources of knowledge to drive innovation, called open innovation. Social media is one mechanism to source such knowledge from customers; however, little empirical research has investigated how customer knowledge gained through social media may increase innovation performance. Further, while previous research has discussed the role of absorptive capacity, little research has investigated its link with social media and innovation performance, especially accounting for the firm-internal social context. Therefore, in this study we develop and empirically test a mediated moderation model of the effects of customer knowledge gained from social media on innovation performance contingent on internal information sharing and decision-making participation. Our results from a sample of Chinese SMEs show that information sharing enhances the effect of absorptive capacity on innovation performance, while decision-making participation does not have a significant moderation effect.