Abstract
Innovation boosts economic growth, and one of the most critical factors when considering innovation-driven growth is the role of disruptive innovation, which is hailed as a lodestar by leaders of both small and large firms. However, little is known about the role of entrepreneurial orientation (EO) and digitalization strategy in enhancing or hindering firms' disruptive innovation. Our study thus addresses the relationships between EO and firms' ability to develop disruptive innovation under consideration of the firm's digital strategy. Our empirical analysis is based on quantitative survey data from a sample of 242 firms across a variety of industries, geographic locations, and sizes. Our results demonstrate that EO has a significant positive effect on disruptive innovation and that deployment of a digitalization strategy is perceived as a metaphorical cage for disruptive innovation among highly entrepreneurially oriented firms. However, a digitalization strategy supports disruptive innovation when firms are less entrepreneurially oriented. The insight of this work is that firms should focus on EO to allow disruptive innovation and increase or decrease digitalization strategy deployment and planning depending on the level of EO.