Does formal knowledge search depth benefit Chinese firms’ innovation performance? Effects of network centrality, structural holes, and knowledge tacitness

Accessing external knowledge is an important factor in successful innovation. Knowledgesearch is an issue of concern for Chinese firms because many firms generally have relativelyweak research and development (R&D) and innovation capabilities that cannot supportinnovative development through mere internal innovations. This study examines theinteractive effects of network centrality, structural holes, and knowledge tacitness whenformal knowledge search depth (FKSD) affects innovation performance from theperspective of formal/informal knowledge search. A survey of 161 firms in China suggeststhat FKSD positively affects innovation performance, and the effect is positively moderatedby network centrality. Given high knowledge tacitness, FKSD is more effective in fosteringinnovation performance when firms’ network centrality is higher. Furthermore, highknowledge tacitness results in rich structural holes negatively moderating the effect ofFKSD on innovation performance, whereas low tacitness generates a positive moderatingrole. This indicates that Chinese firms may consider using more formal search channels toincrease external knowledge search depth and to dynamically adjust the depth of such aformal search or the mode of network structural embeddedness according to the degree ofknowledge tacitness.