Interest in the benefits of enterprise social media (ESM) has been increasingly receiving the attention of managers and academicians. ESM refers to Internet-based platforms that enable communication within companies, as well as between companies and their external stakeholders. They permit employees to post, edit, and arrange text documents and view messages communicated by everyone in the company [1
]. However, in practice, there are two ways in which organisations use ESM. In one way, organisations deploy social media for use among their internal stakeholders –employees, that is, internal enterprise social media (IESM). Examples of IESM platforms include Yammer, Jive, and IBM connections. In contrast, external enterprise social media (EESM) are social media platforms utilised by organisations for communication with their external stakeholders. These include connecting with customers via Facebook, Twitter, YouTube, and similar platforms. These platforms are considered mechanisms of knowledge-sharing [2
], collaboration [4
], and learning both within and outside organisations.
Initially, ESM platforms have popularly been deployed to aid managers’ communication, particularly with their customers. Increasingly, however, companies are also deploying similar platforms for use among their workforce [5
]. The literature shows that the utilisation of IESM by companies provides them the benefit of increased collaboration, increased organisational learning [6
], communication visibility, increased communication [7
], increased sharing [8
], and increased knowledge transfer [9
]. The enterprise social media literature also shows that through the deployment of EESM similar benefits accrue to affected companies [10
]. These define the innovation profiles of companies, at both the organisational and the product/service levels [13
In this study, product innovation is considered a good or service which is new or with notable improvements, including notable improvements in software, components and materials, technical specifications, user-friendliness, or other functional traits [15
]. Being innovative has become a necessary prerequisite for being competitive in the current dynamic global marketplace and signifies an organisation’s openness to new ideas [16
]. Hirunyawipada, Beyerlein and Blankson [17
] suggested that for service innovation to have performance benefits, calls for the input of multidisciplinary and cross-functional sources of knowledge. Innovation positions companies to gain competitive advantages in the market [16
], notwithstanding the changing needs, values, and demands of customers, as well as imitation by competitors. The continued and unprecedented growth of information communication technologies (ICT) ensures that the success status of companies at a given time is always under threat. Companies, therefore, will need to continually learn from their institutional environment how to survive. They will, furthermore, need to link the knowledge gained, particularly through their use of ESM, with their organisational strategies in developing their innovation profiles.
The extant ESM literature—though extensive—has not, to date provided a theoretical development of the mechanisms that drive the positive effect of ESM use on companies’ product innovation profiles. An understanding of this is useful for at least two reasons. First, the innovation profiles of companies can serve two disparate objectives: (1) to improve the internal efficiency of the affected organisation; and (2) to present the organisation as relevant among its constituents. Second, organisations are described to have many stakeholders with the power, legitimacy, and urgency to affect the realisation of their strategic orientations. The literature suggests that in the event that organisations face competing demands from among their stakeholders, they are likely to prioritise the needs of their stakeholders that have the power, legitimacy, and urgency [19
] or the demands that have the power, legitimacy, and urgency.
Therefore, it is an interesting extension of the enterprise social media literature to understand how the utilisation of ESM affects the market orientation strategy of companies. It is, furthermore, a useful extension of the literature to develop an understanding of how the market orientation strategy of companies affects their innovation profiles. Market orientation is an interesting variable in the innovation matrix as it is both an organisational culture and strategy [20
], where culture is important for the execution of strategy. This study fills the gaps in the literature by empirically investigating the path through which companies’ use of ESM drives their innovation. Specifically, it examined the role of companies’ market orientation strategies, namely customer orientation, competitor orientation, and inter-functional coordination, in mediating the positive effect of the use of ESM on the innovation profiles of companies.
Three research questions were answered: (1) Does ESM utilisation affect the innovation strategies of affected companies? (2) Does market orientation mediate the relationship between ESM and innovation? (3) Why is it crucial to utilise ESM in an integrated manner for product innovation? This study responded to the call for a deeper understanding of IT-enabled change in companies [21
]. It, furthermore, responded to the call for research on the effects of ESM use to companies that deploy ESM [22
]. Moreover, this research responded to the call for greater insight on the role of ESM in fostering innovation management [5
This study developed an understanding of the mechanisms that lie between companies’ deployment of ESM and their innovation profiles. Furthermore, it specifically identifies the role of companies’ market orientation strategies in linking the utilisation of ESM by companies to their innovation profiles. To the best of our knowledge, no study has investigated this. However, it is important that ESM deployment becomes aligned with companies’ strategic orientations that have been found to drive their innovation profiles [23
]. This study is among the first to investigate the integrated effects of both internal and external social media use on the innovation profiles of organisations. The study conceptualised ESM to incorporate both the external use and internal use of ESM by organisations. The current literature is fragmented in its study of IESM and EESM in a holistic manner, notwithstanding the fact that organisations are deploying both to realise organisational goals. This paper provides the understanding of the strategies that best facilitate the effect of the deployment of ESM on the product innovation profile of companies. It proposes that the use of ESM by organisations has a positive effect on their product innovation by positively influencing their market orientation strategy as illustrated in Figure 1
. A final contribution of this study is: (a) its focus on an African country context. This is particularly useful to complementing studies that have generally been focused on the contexts of Western and Eastern country contexts [9
]. And (b) its ability to provide a deeper understanding of whether ESM deployment has a positive effect on the innovation profiles of affected companies when the context for companies’ interaction with their stakeholders is fraught with less developed internet technology infrastructure and relatively higher costs of accessing this. Although South Africa is an emerging economy, it is located in Sub-Saharan Africa where universal internet access rates remain well behind the rest of the world [30
]. Internet access is crucial for organisations to flourish in modern economies; it engenders increase in productivity and efficiency, builds human capital, and enables organisations to stay connected to the global village.
The rest of this paper is organised as follows. Section 2
provides a review of the relevant literature, before presenting the hypotheses. Section 3
elaborates on the study methodology including data collection, demographics of the sample, and construct operationalisation. Results of the data analysis are presented in Section 4
. The results and their theoretical and practical implications are discussed in detail in Section 5
. Section 6
presents the limitations of the study.
This study aimed to contribute knowledge on the mechanisms that link the positive effect of ESM use on the product innovation profiles of organisations. It is premised on the view that organisations generally seek to secure their competitive advantages by continual innovation. This study confined its focus to the product innovation profiles of organisations and investigated the role of three market orientation strategies (customer orientation, competitor orientation and inter-functional coordination) in driving the effect of ESM utilisation on product innovation.
The results of structural equation modeling confirm and support extant studies that ESM utilisation has a positive effect of product innovation: IESM [7
] and EESM [44
] These results highlight that managers should strongly consider the use of IESM and EESM platforms if they seek to position their organisations as product innovators in the market. By doing so, these organisations would be better able to leverage both express and latent needs of their customers and would be able not only understand their competitors’ current directions and performance but also anticipate those. These results, in a sense, also support the implications of stakeholder theory and emphasise the important role of responding to stakeholder needs and signal for the securing of organisation success.
The contribution of this study to existing knowledge is its finding that the product innovation profiles of organisations are established by their use of IESM and EESM platforms through the defining of their market orientation strategies. The use of both IESM and EESM leads to customer orientation and competitor orientation strategies which both have a positive effect on organisations’ product innovation profiles. These significant findings offer the lesson for managers that organisations can leverage and harness the information communication technologies (ICT’s) such as ESM platforms to attain organisational objectives such as innovation. Results also reveal the mediation of customer orientation between EESM and product innovation (H3b) to be more significant compared to H3—IESM and PI—highlighting the importance of utilising EESM for product innovation. This reflects the importance of EESM utilisation in enhancing the customer orientation of organisations for product innovation. Customer orientation is the sufficient understanding of customers’ expresses and latent needs; EESM platforms allow organisations to directly interact and get constant feedback from customers, therefore explaining the statistically stronger relationship shown by H3b. Results also demonstrate that the organisations sampled have strong customer orientation cultures within their organisation.
The relationship between IESM and PI being mediated by competitor orientation (H4a) was significant, signifying that the organisations sampled are getting their inspiration to innovate products from competition as well through the utilisation of IESM. More importantly, the mediation of competitor orientation between EESM and PI (H4b) was more statistically significant highlighting the importance of using EESM platforms in enhancing the competitor orientation of organisations for product innovation.
While this study contributes the evidence that IFC fully mediates the relationship between IESM and PI, hence supporting H5a, unexpectedly H5b was non-significant, which shows that inter-functional coordination is not instrumental in the positive link between EESM use and product innovation. This result implies and highlights that the ability of organisations to amass information from their external constituents is an insufficient strategy and requires the assimilation of that information. In a sense, support is found in the absorptive capacity theory. At the core of inter-functional coordination lies the sharing of market knowledge and information which are vital for new product development [53
]. Cohen and Levinthal [34
] acknowledged the importance of absorbing new knowledge from external sources for innovation and flexibility giving organisations a sustainable competitive advantage. Poor external information dissemination on IESM platforms also hinders the absorption capacity of an organisation. Managers pursuing a product innovation (and possibly a differentiation strategy) may, therefore, wish to create an environment for the assimilation of market information obtained including through the deployment of EESM, by investing in the use of IESM. Employees should be encouraged to use this platform, as it is found to be helpful to the building of product innovation profiles.
The full mediation shown by H5a and the non-mediation shown by H5b highlight the importance of utilising ESM in an integrated manner. Where IFC failed to mediate the relationship between EESM and PI, it was compensated by the full mediation between IESM and PI. It is important for organisations to use both IESM and EESM simultaneously in an integrated manner to derive benefits from both EESM and IESM utilisation. The different platforms both contribute to innovation albeit in a different manner as they are utilised by different stakeholders—internal and external. EESM platforms such as Facebook and Twitter enable organisations to derive ideas from external stakeholders such as customers whilst IESM platforms enhance organisation’s ability to attain innovative ideas from their internal stakeholders such as employees. Alternatively, ideas generated from EESM platforms are further refined in IESM platforms. Utilising ESM in an integrated manner strengthens the innovation capabilities of organisations as they are getting ideas and input from different stakeholders. These results highlight the importance of deploying and utilising ESM in an integrated manner as they complement each other in the attainment of organisational goals such as innovation. Organisations are operating in highly complex and dynamic business environments, which call for the use of ICTs such as ESM in a holistic manner to maximise the benefits they proffer.
Organisations need to consider utilising both internal and external social media platforms in a concurrent and holistic manner to facilitate the smooth flow of information from both external and internal sources, therefore enhancing their innovation capability. Results from our study suggest the need to utilise both IESM and EESM; where IFC failed to mediate the relationship between EESM and PI, it was in a sense compensated and complemented for by its mediation of IESM and PI. Our findings show that indeed ESM has a positive influence on PI, therefore showing the need for organisations to train employees on how to utilise these platforms to derive maximum benefit.
This study makes several key contributions to the study of ESM and product innovation within the organisation. First, it provides new insights on how ESM use influences product innovation by organisations. Extant literature on ESM use has not provided knowledge on the mechanisms that drive the positive effect of ESM utilisation on product innovation. The study, therefore, is novel in its connection of independent concepts of ESM use, market orientation, and product innovation by organisations. The results not only contribute to the development of the burgeoning ESM literature but also to the market orientation and innovation literature streams. Second, this study conceptualised ESM in an integrated/holistic manner by investigating concepts of both EESM and IESM utilisation. Existing studies on social media usage in enterprises have been done largely from a singular perspective. However, both internal and external usage of ESM are vital to organisational performance and organisations are increasingly making use of both types of ESM, hence it became useful (if not necessary) to combine the two ESM typologies for the purpose of the current study. Finally, this study makes use of data from the African context in an effort to complement the existing ESM studies which have been mainly conducted in Western and Eastern country contexts. It, therefore, augments the growing ESM literature by proffering insights on ESM use from an African perspective, which can be considered to be less inclined to make use of ESM platforms, supposedly due to the limited deployment and relatively high cost of Internet connectivity, low absorptive capacity, and weak human capital.