The impact of social capital on mass customisation and product innovation capabilities

Abstract

Social capital with customers has three dimensions: structural, relational and cognitive capital. We propose a research model on the joint effects of the three dimensions of social capital on mass customisation capability (MCC) and product innovation capability (PIC). The hypotheses are empirically tested using structural equation modelling and data collected from 276 manufacturing firms in China. The results show that the three dimensions of social capital contribute to MCC and PIC development through different mechanisms. In particular, cognitive capital has a significant impact on MCC; relational capital significantly influences PIC; and structural capital indirectly associates with both MCC and PIC. We also find that structural capital enhances both relational and cognitive capital. MCC improves PIC and fully mediates cognitive capital’s effect on PIC. The findings extend current understanding about the complex interrelationships among structural, relational and cognitive capital and how to develop MCC and PIC by investing in social capital.

Keywords:

• social capital
• mass customisation
• product innovation

Acknowledgments

This work was supported by the Institute of Supply Chain Integration and Service Innovations at South China University of Technology; Natural Science Foundation of China (NSFC) [71090403/71090400 and 71420107024]; and Research Grant Council of Hong Kong [459211].