Organizational unlearning, innovation outcomes, and performance: The moderating effect of firm size

Purpose of the researchMany studies uphold innovation as a key factor in creating and sustaining a firm's competitive advantage. This research explores this topic by developing the links between a firm's innovation outcomes, overall performance, and process of organizational unlearning. This study empirically tests the mediating role of innovation outcomes in the relationship between organizational unlearning and overall performance. Furthermore, this study recognizes the moderating role of firm size in reducing the strong link between organizational unlearning and innovation outcomes.MethodologyThis study constructs a conditional process model and uses a sample of 145 firms from Spanish automotive components manufacturing sector. This study employs variance-based structural equation modeling and the PROCESS tool to analyze data.Principal resultsResults show that innovation outcomes partially mediate organizational unlearning influence on overall performance, and that firm size negatively affects this indirect effect.Major conclusionsFindings can guide managers to establish policies that foster unlearning, allow for new knowledge, and enable innovation, which may in turn enhance firm performance.