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The intensities of exploitative and exploratory innovation vary across firms. From the perspectives of organisational slack and goal orientation, this study sheds light on how the actual proportions of exploitative and exploratory innovation are determined. It proposes and empirically tests the different effects of organisational slack on exploitative and exploratory innovation as well as the underlying mechanisms. The results show that organisational slack affects exploitative innovation negatively and has a positive effect on exploratory innovation. Performance goal orientation mediates the former, whereas learning goal orientation mediates the latter. Environmental munificence moderates the relationship between performance goal orientation and exploitative innovation negatively, and that between learning goal orientation and exploratory innovation positively.

Unpacking the effects of organisational slack on exploitative and exploratory innovation: a study of knowledge-intensive firms