Nonmarket strategy and innovation performance in pharmaceutical industry: the moderating effect of internal capability and external IT environment

Purpose: The purpose of this study is to explore the relationship between nonmarket strategy and innovation performance, as well as the boundary factors that influence this relationship in the context of the pharmaceutical industry in emerging markets. Design/methodology/approach: This study analyzed matched data of 227 Chinese pharmaceutical firms and two secondary databases with SPSS to examine the hypotheses. Findings: Nonmarket strategy promotes the innovation performance. High level of firm internal knowledge utilization ability and strategic flexibility strengthens the effect of nonmarket strategy in promoting innovation performance, while information technology (IT) environment weakens the effect of nonmarket strategy in promoting innovation performance. Originality/value: The research studies the positive impact of nonmarket strategy on innovation performance in the specific context of Chinese pharmaceutical industry, and it introduces the internal capabilities and external IT environment of the firm as moderators of the relationship between nonmarket strategy and innovation performance. More importantly, this research echoes the call for research on moderator of nonmarket strategy and identifies important boundary conditions. To the best of the authors’ knowledge, it also explores the impact of the IT environment on the implementation of nonmarket strategy for the first time, which deepens the research on nonmarket strategy’s effect on innovation.