Are digital technologies killing future innovation? The curvilinear relationship between digital technologies and firm's intellectual property
| DOI | https://doi.org/10.1108/JIC-03-2020-0078 |
| Published date | 17 December 2020 |
| Date | 17 December 2020 |
| Pages | 587-609 |
| Subject Matter | Information & knowledge management,Knowledge management,HR & organizational behaviour,Organizational structure/dynamics,Accounting & finance,Accounting/accountancy,Behavioural accounting |
| Author | Beatrice Orlando,Alice Mazzucchelli,Antonio Usai,Melita Nicotra,Francesco Paoletti |
Are digital technologies killing
future innovation? The curvilinear
relationship between digital
technologies and firm’s
intellectual property
Beatrice Orlando
Department of Economics and Management, University of Ferrara, Ferrara, Italy
Alice Mazzucchelli
Department of Business and Law, University of Milano–Bicocca, Milan, Italy
Antonio Usai
Department of Economics and Business, University of Sassari, Sassari, Italy
Melita Nicotra
Dipartimento di Economia e Impresa, Catania, Italy, and
Francesco Paoletti
Department of Business and Law, University of Milan–Bicocca, Milan, Italy
Abstract
Purpose –The study aims to investigate the interplay among digital technologies, intellectual capital and
innovation. Thus far, there have been scant research on such intricatebundle of interactions. Also, the findings
of previous studies were rather inconclusive, because conflicting results emerged over time. Building on the
existence of heterogeneous evidences, this study solved the detected criticism by suggesting a curvilinear
relationship among digital technologies, digital skills of human capital and intellectual property. Specifically,
we argue that the relationship between digital technologies and intellectual property is inverted u-shaped.
Design/methodology/approach –Hypotheses are tested by applying a generalized linear model (GLM)
regression analysisand a quadratic model for non-linear regression. The study analysed a large-scale sample of
micro-data drawn from Eurostat. Such sample embraces the population of firms operating in all European
member states.
Findings –Overall, the results of the study confirm that digital technologies are curvilinearly related to
intellectual property. Precisely, the curve is inverted u-shaped. Notably, results show that digital skills only
matter when employees have very demanding duties to accomplish. In all other cases, digital skills do not affect
intellectual property significantly.
Research limitations/implications –The research is solely focused on firms’operating in the European
Union. Future studies should extend the analysis to other geographies.
Practical implications –At a real impact level, the study suggests that intellectual property is only partially
fostered by digital skills and digital technologies. In this sense, digital skills might be overrated.
Originality/value –Differently from prior research, this study originally detangles the impact of digital
technologies on firm’s intellectual capital by suggesting the existence of an inverse u-shaped relationship
between variables.
Keywords Intellectual capital, Intellectual property, Innovativeness, Digital technologies, ICT, u-shaped
Paper type Research paper
1. Introduction
There is a popular belief for what digitization is extremely positive for business and society.
However, digital technologies also have negative effects on businesses. As a matter of fact,
Are digital
technologies
killing future
innovation?
587
This research was supported by the University of Sassari–research funds 2020.
The current issue and full text archive of this journal is available on Emerald Insight at:
https://www.emerald.com/insight/1469-1930.htm
Received 6 March 2020
Revised 4 August 2020
24 September 2020
9 November 2020
Accepted 11 November 2020
Journal of Intellectual Capital
Vol. 22 No. 3, 2021
pp. 587-609
© Emerald Publishing Limited
1469-1930
DOI 10.1108/JIC-03-2020-0078
digital technologies have massively changed the way firms compete on the market (Aloini
et al., 2017;Olivo et al., 2016), because they lowered the barriers in many sectors, increased the
pace of competition and made the imitation phenomenon extremely at hand and frequent.
Despite anecdotal evidences of the dark side of digital technologies, scholars seemed
curiously caught by a sort of digitization spell: they kept praising and seeing only the bright
side of digital technologies, at a business level. As the consequence, it is not rare to find, in this
research domain, studies that emphasize the importance of digital technologies for firms’
intellectual activities and for the generation of new knowledge (Berger et al., 2019;Sung et al.,
2012;Urbinati et al., 2017). However, there is one relevant missing tile in this landscape, and it
concerns the lack of robust studies focusing on the interplay between digitization, skills of
human capital and innovation. As a matter of fact, digital technologies may also inhibit
employees’productivity and innovation capabilities (Nambisan et al., 2019;Tarafdar
et al., 2015).
The retrieved gap goes hand in hand with the general concern of management studies to
overcome the limit of over-simplistic assumptions such that of linearity (Haans et al., 2016). As
the authors stated, “we find serious underdevelopment of u-shaped relationships, where
researchers fail to explicate the latent mechanisms underlying such relationships”(Haans
et al., 2016, p. 1177).
Given the complexity of the matter, it is highly unlikely that there can be a linear
relationship among digital technologies, digital skills and intellectual property.
Based on above considerations, the current study aims to unveil the negative latent effect
of digitization on intellectual cap ital. Traditiona lly, firms strive fo r outperforming
competitors by grabbing unique and scarce resources that are also hardly imitable. As a
matter of fact, boosting firm’s knowledge and intellectual capital (IC) is deemed the ultimate
weapon both to takeover markets (Carayannis and Alexander, 1999;Del Giudice and Della
Peruta, 2016) and to enable firm’s growth and innovation (Duodu and Rowlinson, 2019). By
and large, previous evidences suggested that intellectual capital and innovation are strongly
entwined (Bontis et al., 2005;Kianto et al., 2017;Subramaniam and Youndt, 2005). However,
intellectual capital is a broad concept that embeds several dimensions, and each one is related
differently to innovation. Broadly speaking, there is a large consensus between scholars on
the role of human capital as the very engine of firms’innovation (Edvinsson, 1997;Nonaka
and Takeuchi, 1995). Similarly, the relational capital exerts a positive influence on firm’s
innovation performance, thanks to those interaction mechanisms that promote knowledge
sharing, stimulate creativity and generate cross-fertilization of ideas (Berraies and Chaher,
2014;Delgado-Verde et al., 2015,2016). Structural capital is a further component of intellectual
capital. Structural capital includes intellectual property (Bollen et al., 2005). Intellectual
property –for example, patents, copyrights and trademarks –is the outcome of firm’s
innovation activity, and it is essential for a firm’s growth (Bollen et al., 2005). For instance,
intellectual property is commonly used by innovation scholars to quantify or rate firms’
innovative activities during a defined period of time (Gangopadhyay and Mondal, 2012;
Jensen and Webster, 2009;Papageorgiadis and Sharma, 2016).
Over time, the increasing pervasiveness of digital technologies in business and society
might have altered the way intellectual capital and innovation are generated. As a matter of
fact, digital technologies –as a set of innovative and collaborative tools –transformed work
places and the way employees perform their tasks (Tarafdar et al., 2015). In this sense, firms
are struggling to understand how to digitize and integrate new technologies, in order to
optimize and synergize intellectual capital (Berraies, 2019;Duodu and Rowlinson, 2019).
However, despite all the fuss around digital technologies, there is still a poor
understanding of what their contribution to growth really is and how they affect
innovation and intellectual capital. Prior research found a significant effect of both
information and communication technologies (ICTs) on IC (Kianto et al., 2010;Ramadan
JIC
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