The Role of Organizational Unlearning in Manufacturing Firms’ Sustainable Digital Innovation: The Mechanism of Strategic Flexibility and Organizational Slack

Abstract

This study explores the underlying mechanisms of achieving sustainable digital innovation in the context of manufacturing companies. Building on the perspective of organizational unlearning, we propose that organizational unlearning could disrupt current innovation routines and positively relate to the sustainability of digital innovation, the features of which are self-referential improvement and iterative scalability. This study conducted a questionnaire survey of 274 Chinese manufacturing companies and used SmartPLS 4.0 to analyze the data. Drawing insights from data analysis results, this study discovers that organizational-level unlearning is able to make digital innovation achievable and sustainable. In addition, this study articulates the partial mediation mechanism of strategic flexibility and organizational slack. The findings unearth the utility of organizational unlearning to manufacturing companies in the digital context, contribute to the emerging literature on digital innovation by introducing organizational unlearning as a new theoretical perspective for introducing digital transformation, and offer managerial insights to help manufacturing companies leverage organizational unlearning proactively to release its long-term benefits.