Organizational Slack, Innovation And Performance During Institutional Transitions: Moderating Effect Of Environmental Factors

China is experiencing economic transformation, and there is much slack, especially the "slack human resources" resource in the Chinese enterprise. Many companies are dealing positively with the organizational slack, such as "downsizing efficiency","management innovation". Organizational slack resources have been one of the focuses of western management field, and it has also aroused heated argument. March and Cyer(t1963), as representative of some scholars ,take organizational slack resources as a kind of unique resource, which can resolve conflicts within the organization, alleviate the external impact to the organization. These scholars point out that slack resource has positive influence on organizations. Another school of scholars, such as Leihenstein and Jensen(1976), point that organizational slack resources have negative effect, due to the principal-agent problem. In that situation, managers will use the slack resources according to their own interests, which will make organizations operate under the optimal state and give rise to low efficiency. Such Two conflicting views have been reconciled by Nohria and Gulati(1996), they pointed out there is an inverted u-shaped relationship between organizational slack and innovation. That is , when slack resources is under low level, it can be used as an unique resources to promote innovation, and when the slack resources exceed the optimal point, the principal-agent problem will highlight and the slack resources will have negative impact on innovation. Tan and Peng's empirical study on organizations under Chinese economic transition also get to similar conclusions, namely, there is an inverted u-shaped relationship between slack resources and performance.This paper discusses the relationship between slack resources, innovation and performance more deeply. This paper discuss the relationship between different kinds of slack resources (unabsorbed slack and absorbed slack) and different kinds of innovation (exploratory innovation and exploitative innovation).The main problems discussed in this paper are as follows: absorb slack's impact on exploitative innovation ,unabsorbed slack's impact on exploratory innovation , environmental uncertainty and environmental munificence's impact on the above relationship, slack resources'impact on performance and exploitative innovation and exploratory innovation's impact on performance.This study follows the method of theoretical deduction and empirical analysis and discusses the above problems systematically and comprehensively. This paper mainly does the following aspects of work:(1) Constructing the conceptual model and theoretical analysis framework through theoretical deduction and practice observationThis paper makes a systematic carding about slack resources and organization innovation, discriminating the inner logic and relationship between the concepts of slack resources, organization innovation and organizational performance. Based on the grasping of theory and the observation of enterprises in Beijing, Liaoning, Jilin, this study selected some developed coastal provinces and inland provinces the research object. This paper constructs comprehensive analysis framework, namely the"slack resource-innovation, performance"framework, with the concept of slack resource as the core. This analysis framework comprehends the concepts of slack resource, innovation and environment, etc.(2) Getting the details about slack and innovation through field interview and questionnaire methodDuring the researching period, I have done deep investigation in some organizations in Beijing, Jilin and Liaoning under the guidance of my tutor. After talking with many senior management personnel and department managers, I get deep understanding about slack resources. Altogether I collected 215 valid questionnaires for empirical studies.(3) Doing empirical test on conceptual model and hypotheses through statistical methodThis article constructs a comprehensive concept model about slack resources through strict logical deduction and gets the sample data through the questionnaire survey method. This paper use SPSS16.0 statistical analysis software for data analysis, and analyze hypothesis empirically through the factor analysis, multiple regression analysis method, etc... Through empirical test, this research mainly gets the following conclusions:Firstly, slack resources exist within the organizations in different forms and have different impact on organizations. Absorbed slack has significantly positive effects on exploitative innovation, and unabsorbed slack has significantly positive effects on exploratory innovation. Secondly, environmental uncertainty and environmental munificence moderate the absorbed slack- exploitative innovation and unabsorbed slack - exploratory innovation relationship. This research proves that in low environmental munificence environment absorbs and unabsorbed slack play a stronger function. In higher dynamic and competitive environment, unabsorbed slack have on a more apparent effect on exploratory innovation. Thirdly, exploratory innovation and exploitative innovation have significant positive effects organizational performance. Fourthly, organizational slack has significantly positive effects on organizational performance.Around the theory framework of analysis "organizational slack - organizational innovation - organizational performance", this paper makes tentative theories innovation in the following three aspects:(1) This paper discusses the impacts of absorbed slack on exploitative innovation, unabsorbed slack on exploratory innovation. Based on previous research venation of slack and innovation, this paper discusses the relationship between slack and innovation more deeply. Scholars such Geiger and Cashon(2002),Tan and Peng(2003),along the research direction of Nohria and Gulati(1996) ,further classify the concept of slack, and discuss the relationship between different types of slack and innovation and performance. This paper also classified the concept of slack, and examine the how different types of slack influence different types of innovation.(2) Organization usually obtains resources by two means, one of which is internal accumulation and the other of which is through external environment acquisition. Meanwhile, when organization has rich resources, it is easier to resist the external environment of uncertainties. In view of these two points, we can see that the external environment factors play an important is role in the impact of slack resources on organization, and inspecting environment factors in the relationship between slack and innovation is necessary. Based on economic transition background, this paper measure the environmental factors, and this is another innovative points.(3) This paper establishes a comprehensive analysis model of the concepts of slack resources, innovation and performance; the three concepts coordinate with each other, which is more useful to systematic carding the relationship between the variables. There is little research on the slack resource through questionnaire survey way under the transitional economy. This paper measures all the variables through questionnaire and established a comprehensive analysis model.This paper has some theoretical significance and practical value. But due to the author's research ability and the research time, there exists some the deficiency in this study unavoidably, which looks for follow-up study for improvement.