How Do Digital Transformation Changes Affect Innovation Growth? -An Analysis of Born-Global Ventures in Korea-

[Purpose] Our study aimed to identify how born-global ventures’ digital transformation as an idiosyncratic resource influences their innovation growth. Using the resource-advantage theory of competition as an underlying framework, we developed an empirically testable model in order to explain and predict the effects of born-global ventures’ digital transformation changes on their innovation growth. [Methodology]Data were obtained from the Korea Enterprise Data and the Smart Factory Business Management System managed by the Ministry of SMEs and Startups. The unit of analysis was a born-global venture’s accounting year in which its digital transformation was evaluated. A total of 943 cases were analyzed through a multiple regression model. [Findings]The results of the multiple regression analysis indicated that changes in digital transformation of born-global ventures positively influence their innovation growth. Nonetheless, born-global ventures’ innovation capability change, firm-size change, and government support little affect innovation growth. [Implications]The results of our study provided several implications. First, from the perspective of the resource-advantage theory of competition, we proposed a model that explains how born-global ventures can accomplish innovation growth. Second, managers of born-global ventures should prioritize resource-investments in digital transformation that enable the ventures to achive innovation growth that may leads to a attaining a competitive advantage position in the global marketplace.