How Organizational Slack Drive Corporate Entrepreneurship: The Ambidextrous Mediating Pathways of Resource Bricolage and Opportunity Recognition

Zhao Xinglu, Liu Heng, Zhang Jianqi

Foreign Economics & Management Vol. 39, Issue 06, pp. 54 - 67 (2017)  DOI:10.16538/j.cnki.fem.2017.06.005

Abstract

Whether and how organizational slack drive corporate entrepreneurship have been an important yet unsolved question in strategic research field. From the perspective of endogenous/exogenous opportunity in entrepreneurial process, this paper examines the mediating role of opportunity recognition and creative resource bricolage in the relation between organizational slack and corporate entrepreneurship. Structural equation modeling based on 336 firm-level data collected from Guangdong, Beijing and Hubei during July to October of 2015 indicates that:（1）unabsorbed slack like cash deposits and accounts receivable, which is quite fluid to buy and sell strategic valued goods, could stimulate firms to identify " buy low, sell high” market opportunities for value-added transactions and enhance firms’ ability of recognizing new opportunities;（2）absorbed slack embedded in fixed investment and production process, which is stable and is used inefficiently, would spur firms to explore their new uses to solve the problem of overcapacity, thereby improving the ability of resource bricolage;（3）the higher the firm’s opportunity recognition and resource bricolage, the higher its entrepreneurial performance. Finally, opportunity recognition and resource bricolage play fully mediating role in the relations between organizational slack and corporate entrepreneurship performance. Overall, these empirical results clarify the " black box” process of transforming organizational slack into corporate entrepreneurship, and provide the new theoretical perspective and empirical evidence for deeply understanding the internal connection mechanism of slack and entrepreneurship.

Keywords

organizational slack; opportunity recognition; resource bricolage; corporate entrepreneurship