Volume: 23, Issue: 1

Page: 91-105
International Journal of Science and Business
2023
Journal homepage: ijsab.com/ijsb

The Impact of Management Innovation,

Organizational Inertia, and Organizational
Learning on Organizational Performance: A
Case Study of the Manufacturing Industry in the
Yangtze River Delta Region of China

Song Guo Jiang

Abstract
Enterprise innovation has always been a hot issue in enterprise development and
theoretical research. China has now entered a new stage of development. The
implementation of innovative strategies and the acceleration of the construction of
an innovative country have made innovation even more critical to business
operations and development. Technological limited resources of the enterprise and
the uncertainty in the research and development process, the implementation of
technological innovation will face great unknowns and challenges. The successful
implementation of management innovation must effectively integrate the existing IJSB
knowledge and resources of the enterprise. Organizational learning is the process of Accepted 17 May 2023
using existing resources and learning new knowledge. The development of Published 18 May 2023
DOI: 10.58970/IJSB.2136
management innovation will effectively promote the enterprise to carry out
organizational learning. Only when the organic combination of management
innovation and organizational learning is realized, can the organization's
competitive advantage be enhanced and the enterprise's own performance
improved. This study’s purpose is attempts to explore the relationship and provide
data support for it, and then puts forward management suggestions for enterprises
trying to improve organizational performance by implementing management
innovation. After sorting out the relevant literature, for the research design, this
study takes organizational learning as an intermediary variable and constructs a
theoretical model among management innovation, organizational inertia,
organizational learning, and organizational performance; uses SPSS and AMOS
software to conduct an empirical test on the collected 2407 valid questionnaires.
The findings and the conclusions are management innovation and organizational
inertia influence organizational performance, and organizational learning has a
mediating role. Finally, management suggestions are put forward for enterprises to
improve organizational performance by implementing management innovation. ISSN: 2520-4750 (Online) 2521-3040 (Print)

Papers published by IJSAB International are

licensed under a Creative Commons Attribution-
NonCommercial 4.0 International License.

Keywords: Management Innovation, Organisational Inertia, Organisational learning, Organisational

performance.
About Author (s)

Song Guo Jiang, Asia Metropolitan University, Malaysia.

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Introduction
In 2020, the GDP of the Yangtze River Delta region was 24.5 trillion-yuan, accounting for 24.1%
of the country's total GDP with less than 4% of the country's land area, and it created nearly a
quarter of my country's total economic output. It is a representative economic zone. Since
modern times, the Yangtze River Delta region has rapidly developed the manufacturing
industry by virtue of its regional advantages and has become one of the advanced
manufacturing regions in my country. However, with the increasingly urgent situation of
economic transformation, the transformation and upgrading of the manufacturing industry in
the Yangtze River Delta region has become the current focus. With the expansion of economic
globalization and the development of market informatization, the competitive pressure faced
by enterprises in the Yangtze River Delta region is intensifying, and the changes in the business
environment of enterprises also show the characteristics of discontinuous changes, which
makes it difficult for enterprises to grasp the diversification of customer needs .Relevant survey
data show that the average life expectancy of domestic enterprises is 7-8 years, while that of
small enterprises is no more than 3 years, which fully shows that the survival problem is a very
serious problem that enterprises face and needs to be solved urgently. The manufacturing
industry, which is the cornerstone of the national economy, is also facing the same problems in
the current political, economic, cultural, and social environment. Some scholars believe that
innovation is also an effective measure to enable enterprises to adapt to changing
environments. (Wang 2021; Yu & Li 2021; Sun & Ren 2020). A common law in the history of
world enterprise development is that enterprise innovation promotes enterprise growth. In
the study of enterprise development, in addition to change and innovation, there is also
organizational inertia. In the study of organizational theory, scholars have two diametrically
opposed views on the mechanism of organizational inertia affecting organizational
performance. The theory based on the resource view believes that with the strengthening of
organizational inertia, enterprises will gradually accumulate a large amount of valuable and
difficult-to-imitate resources. However, the theory based on the concept of inertia believes
that: organizational inertia will reduce the adaptability of enterprises to the external
environment, and cannot adjust their own strategies in time, thereby reducing organizational
performance. Some scholars believe that the impact of organizational inertia on organizational
performance is related to the stability of the environment. In a static environment, it has a
promoting effect, and in a dynamic environment, it has a hindering effect. Although some
scholars have begun to study this issue, few scholars have studied the effect of organizational
inertia on organizational performance for a specific type of enterprise, making the current
research relatively incomplete and needs to be further deepened and refined. Therefore, this
paper tries to quantify variables such as organizational inertia and organizational performance
on the basis of synthesizing the research results of domestic and foreign scholars on the effect
of organizational inertia on organizational performance and analyzes the interaction between
these variables from the perspective of the mediating role of organizational learning, to discuss
the sustainable development of Chinese manufacturing enterprises. (Wang 2021; Yu & Li 2021;
Sun & Ren 2020)

Problem Statement
The Twelfth Five-Year Plan clearly pointed out that in the case of a bad external environment,
enterprises need to increase organizational innovation, strengthen internal control, accelerate
organizational structure adjustment, implement management system and management
method innovation, increase technological innovation, and improve product quality, to ensure
the long-term stable development of the enterprise. Facing the severe internal and external
environment, it is becoming more and more urgent for organizations to implement
organizational reform and innovation for long-term, stable, and sustainable development.

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Many empirical studies have confirmed that organizational innovation positively affects
organizational performance. The researchers believe that although in the Yangtze River Delta
manufacturing enterprises, different enterprises have different enterprise conditions,
innovation will bring higher performance to the organization. (Wang 2021; Yu & Li 2021; Sun
& Ren 2020). Organizational innovation prompts enterprises to increase their efforts in new
production technologies and new management technologies. It promotes enterprises to
actively develop new products and implement technological transformation; optimizes the
organizational structure, reduces the coordination cost of enterprise management; It ensures
the rational allocation of organizational resources, enhances the market competitiveness of
enterprises, and finally brings about the improvement of organizational performance. With the
development of the Internet and the prosperity of e-commerce, information technology has
broken the information barriers between industries and adjusted the industry rules of each
industry. Innovations in various business models and product technologies have emerged in
an endless stream. And these new technologies have also greatly changed people's life and way
of thinking, which makes traditional manufacturing companies must continue to innovate to
improve their own competitiveness. Also in the rapidly changing environment, more and more
enterprises have lost their competitive advantage and even eventually failed because they
failed to make timely and rapid adjustments to adapt to the rapidly changing environment.
More and more scholars have noticed that the characteristics of enterprises that keep their
operating status unchanged and resist changes, that is, organizational inertia, hinder their own
development and become the root cause of enterprise decline (Song, 2015). Today, modern
enterprises are facing a dynamic environment of rapid technological advancement, shortened
product life cycle and globalization. Continuous organizational learning and transformation
have become the strongest voice in the field of global enterprise management in recent
decades. Especially since entering the era of knowledge economy, enterprises need to promote
and enhance innovation activities and cultivate innovation capabilities through continuous
learning. Organizational learning is the key source for enterprises to obtain and maintain
competitive advantage. Because of this, organizational learning has become a focus topic
related to the sustainable survival and development of enterprises and the improvement of
competitiveness, and the establishment of learning organizations has become the starting
point and destination of scholars' research and managers' practice (Wang, 2016). Based on the
above points of view, the impact of management innovation, organizational inertia and
organizational learning on organizational performance is significant. Most of the current
academic research focuses on the impact of organizational innovation and technological
innovation on organizational performance, the impact of organizational inertia on
organizational performance, and the impact of organizational learning on organizational
performance. However, there are very few studies that use management innovation and
organizational inertia as two independent variables to ultimately affect organizational
performance through the effect of the intermediary variable organizational learning.
Therefore, this paper mainly examines the interrelationship and internal logic of management
innovation, organizational inertia, organizational learning , and organizational performance
through literature review and on the basis of previous research, using empirical research and
data analysis . And on this basis, discuss the impact of management innovation and
organizational inertia on organizational performance under the intermediary role of
organizational learning.

Research objective
In the review of related literature on management innovation, organizational inertia,
organizational learning and organizational performance, this research finds that there is a gap
in the empirical research on the relationship between management innovation and

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organizational performance. At present, there are not many discussions on the integration of
management innovation, organizational inertia, and organizational performance. Therefore,
this study will use organizational learning as an intermediary variable to conduct an in-depth
discussion on the relationship between management innovation and organizational
performance and introduce job characteristics variables in combination with the triggering
factors of organizational inertia and use them in the relationship between management
innovation implementation and organizational inertia analysis of the mediating role.

Research question
This paper builds a relationship model based on management innovation , organizational
inertia and organizational performance under the background of the Yangtze River Delta
manufacturing industry , integrates organizational learning theory, and proposes
organizational learning as an intermediary variable .I adopt literature research method,
implementation of questionnaire survey, and data statistics to study the constructed model, so
as to provide guidance for manufacturing enterprises in the Yangtze River Delta region from
the theoretical and practical aspects. Based on this, this paper proposes the following research
questions as: (1) Does the management innovation of manufacturing enterprises in the Yangtze
River Delta region of China have a significant impact on organizational performance?; (2) Does
the organizational inertia of manufacturing enterprises in the Yangtze River Delta region of
China have a significant impact on organizational performance?; (3) Does the organizational
learning of manufacturing enterprises in the Yangtze River Delta region of China have a
significant impact on organizational performance?; (4) Does the organizational learning of
manufacturing enterprises in the Yangtze River Delta region of China play an intermediary role
between management innovation and organizational performance?; (5) Does the
organizational learning of manufacturing enterprises in the Yangtze River Delta region of China
play an intermediary role between organizational inertia and organizational performance?

Scope of study
The research topic of this paper is the influence of the relationship between management
innovation and organizational inertia on organizational performance. Based on this, to ensure
the rigor and standardization of academic research, first of all, the scope of sample sampling in
this paper is limited to the Yangtze River Delta region, and the industry of the sample is the
manufacturing industry. Secondly, the relationship between the variables explored in this
paper only explores the research objectives proposed in this paper, including only the
relationship between the four variables of management innovation, organizational inertia,
organizational learning and organizational performance, without considering the influence of
other variables. In summary, the scope of this study is defined.

Literature review
Organizational Performance
Chen (2010) used return on investment, sales growth rate, net profit rate, customer
satisfaction, loyalty, etc. to measure organizational performance ; Kai Wah Chul et al. (2011)
studied organizational performance from a financial perspective and found that Factors that
determine financial capabilities include market value, production capacity, profitability, etc.;
Muchlbacher (2012) used organizational innovation as a non-financial factor to measure
organizational performance ; Dong (2016) proposed to combine non-financial indicators and
financial indicators when measuring organizational performance More reasonable .According
to the degree of objectivity of the data, it can be divided into subjective performance and
objective performance (Jiang, Liu & Jiang , 2014). Among them, subjective performance focuses
on the relative value of performance, which is composed of subjective evaluator's cognitive

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evaluation, such as satisfaction, etc.; While objective performance focuses more on the absolute
value of performance, which is composed of objective data, such as sales, growth rate. Empirical
studies by Daniel & Raquel (2011) and Saumyaranjan Sahoo (2019) concluded that a series of
products and management innovation carried out by the organization will have a significant
enhancement effect on organizational performance; Many domestic scholars have also
conducted some research in this regard. Xie (2006) conducted research in South China and
found through empirical analysis that enterprises carrying out management innovation
practices will effectively improve organizational performance. Eric Viardot (2017) clearly
stated in his book that innovation activities, including management innovation, are key drivers
of business performance and business growth.Li (2011) also obtained a conclusion similar to
that of Damanpour et al. (1989) in his research. He believed that both technological innovation
and management innovation will have a positive effect on organizational performance, and the
effect of management innovation is stronger. Yu (2017) studied the form of management
innovation alone, and the conclusion he reached still supports the positive effect between the
two variables. In addition, the General Motors Corporation of the United States and the Haier
Group of China have implemented management innovation within the enterprise to adjust the
organizational structure, which has improved the operating efficiency of the enterprise and
brought higher organizational performance to the enterprise (Su , 2019).

Management Innovation
Xue (2011) believes that management innovation is the invention and application of the latest
management practices, processes, structures or skills in the enterprise, and its main purpose
is to promote the goals of the organization. Volberda's (2013) study pointed out that
management innovation is a series of change activities for the overall or partial improvement
of the original management concept, management system, management process and structure
of the enterprise, which are difficult to grasp. Zhang et al. (2020) put forward the concept of
two-way management innovation in their research on management innovation. Management
innovation introduced from the outside to the inside refers to the process by which an
enterprise acquires and integrates external management innovation resources to internalize
them. From the inside to the inside External management innovation mainly refers to the
behavior of enterprises actively self-summarizing and learning to imitate internal management
innovation in a theoretical and systematic form, as well as the unconscious spillover process of
enterprises in organizational cooperation. Ke (2021) research believes that management
innovation is the optimal allocation of resources, including the optimal allocation of human
resources and other element resources of the enterprise. Management innovation is a
management practice that remodels and innovates the existing management system and
improves management capabilities through the introduction or improvement of advanced
management concepts, management mechanisms, management processes, management
models and systems. Foreign scholars Boscari et al. (2016) pointed out that only fundamental
changes in the organization can play the role of "breaking the situation". For example, if the old
rigid organizational form, outdated ideas, and original profit distribution pattern are broken,
the impact of the change will be reduced. Resistance, laying the foundation for the
implementation of management innovation and the improvement of management efficiency.
Sun & Ren (2020) took a total of 60 agricultural science and technology enterprises in southern
Jiangsu, central Jiangsu, and northern Jiangsu as the research object, and found through
empirical analysis that organizational change has a significant positive impact on enterprise
innovation capabilities (Wang 2021; Yu & Li 2021; Sun & Ren 2020).

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Organizational Inertia
Hodgkinson (1997) pointed out that there is cognitive inertia in the organization, and the
organization will rely on the previous successful thinking mode to solve the problem and is
unwilling to change. Nickerson and Zenger (2009) studied structural inertia formed by
informal organizations, and the results showed that structural inertia is a kind of "double-
edged sword", which is related to the external environment of the organization. Therefore, we
believe that organizational inertia can be divided into promoting and hindering functions due
to its different functions in different environments. Liu et al. (2017) used empirical methods to
study the relationship between organizational structure inertia and organizational
performance. The research results showed that with the development of the organizational life
cycle, the relationship between organizational structural inertia and organizational
performance gradually showed an inverted U-shaped curve, and organizational structural
inertia Initially, it is beneficial to corporate performance, but when the inertia reaches a certain
level, it will have a negative impact on performance. The mechanism of organizational inertia
's impact on organizational change, and pointed out that organizational inertia, as an inherent
attribute in the operation of an organization, has the characteristics of stability, accumulation,
path dependence, variability, and bidirectionality. Inertia is widely used in the research of
enterprise behavior, enterprise activities, organizational structure, etc., thus forming the
inertia of the organization.

Organizational Learning
Since March & Simon (1958) put forward the theory of organizational learning, many scholars
have studied it, and the theory of organizational learning has been greatly developed. Although
the relevant theories are still controversial, in practice, the importance of organizational
learning has been well recognized. In 1987, March proposed the concept of organizational
learning (organization learning) in his related research, but in articles such as Permana &
Laksmana (2020), they defined the concept of organizational learning as the process of
identifying and correcting errors in a timely manner. Since then, the academic community has
carried out a lot of theoretical research and practical discussions on the concept of
organizational learning, some of which are listed here. Among them, Zheng, Cheng et al. (2019)
mentioned in the article that starting from the aspect of knowledge, the stage composition of
organizational learning is divided into four stages: acquiring knowledge, matching knowledge,
absorbing knowledge, and organizing memory. It is concluded that building an organizational
learning environment is helpful for organizations to form memory and accumulate knowledge.
Liang (2016) built the organizational learning framework on the basis of dual learning. She
believes that organizational learning is based on the existing development of the organization
and the extent to which the organization learns and utilizes new external knowledge and
methods and summarizes and integrates existing internal knowledge and methods.
Knowledge, and then realize a dynamic process of organizational self-improvement through
the double loop of feedforward and feedback. Ding (2016) believes that based on the
perspective of cognition, the learning organization can self-examine its deficiencies, and
correct them through related reasons, so that the cultural framework of team members can
become more complete. Organizational learning is the process of changing organizational
cognition and organizational behavior (Islam et al., 2016).

Methodology
Research Design
By consulting the literature on management innovation , organizational inertia organizational
learning and organizational performance , on the basis of summarizing and summarizing , put
forward research hypotheses , construct a structural equation model that represents the

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interrelationship among management innovation ,organizational inertia， organizational

learning and organizational performance in manufacturing enterprises ; combined with
research design the questionnaire indicators according to the actual situation, use the internal
consistency test and exploratory factor analysis to test the reliability and validity of small
sample data, further improve the initial questionnaire according to the analysis results and
research purposes, form a formal questionnaire, and collect large sample data; Based on
unreasonable data, establish an analysis database based on valid data, and use confirmatory
factor analysis to conduct validity analysis and model verification of large sample data, and use
reliable data to verify the involved structural equation model, draw research conclusions and
summarize the analysis thus forms the research framework. This study mainly uses SPSS17.0
and AMOS18 software for statistical analysis of data. According to the conclusions of frontier
research, the questionnaire is designed, the pre-test is carried out, and the unreasonable
indicators in the questionnaire are deleted to improve the validity and reliability of the
questionnaire. Finally, a formal questionnaire is formed, and a large sample of data is collected.
The statistical analysis methods used include descriptive statistical analysis, reliability test,
correlation analysis, regression analysis, mediation effect test, etc.

Data collection
Data collection and sample selection are important parts of the questionnaire survey and play
a decisive role in the results of data analysis. Among the four variables involved in this paper,
the process of management innovation, organizational inertia and organizational learning
requires the participation of all staff, while the evaluation of organizational performance
mainly involves the managers in the enterprise, so the survey object of this study is the
managers Mainly. This paper adopts the form of an electronic questionnaire and distributes
paid questionnaires on the questionnaire star platform. To achieve the purpose of sample
diversity, the survey objects of the questionnaire are manufacturing enterprises in the Yangtze
River Delta region of China. Therefore, this research is carried out in representative cities in
the Yangtze River Delta. In 15 cities including Shanghai, Ningbo, Zhoushan, Hangzhou, Jiaxing,
Suzhou, Huzhou, Wuxi, Changzhou, Nanjing, Nantong, Zhenjiang, Yangzhou, Taizhou, and
Shaoxing, 20 manufacturing enterprises were selected, and a total of 3000 questionnaires were
distributed. There were 2800 questionnaires, and the invalid questionnaires were eliminated
according to the following principles: (1 ) the working experience was less than one year; ( 2 )
all the invalid questionnaires had the same answer or other obvious mistakes, and a total of
2407 valid questionnaires were obtained , and the effective recovery rate was is 80.23 %.

Target population
The term "target population" refers to a certain group of people that the researchers would like
to focus their attention on while carrying out the study (Sekaran & Bougie, 2016). There are
many distinct target groups that may be found in various types of research; therefore, we need
to choose which target population will provide us with the best opportunities to collect data
and information for our study. The employees of manufacturing enterprises in the Yangtze
River Delta region of China are the population that will serve as the focal point of this
investigation. This study choose 20 manufacturing enterprises to do the questionnaire. There
are around 20,000 people in the targeted enterprises. The individual who is going to be given
priority in this investigation is the sampling elements.

Sampling frame and sampling location

The Yangtze River Delta region of China were the focus of this research. The sampling frame
consisted of a list of all employees of the manufacturing enterprises in the Yangtze River Delta
region of China that participated in this study. There are 20 manufacturing enterprises in 15

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cities including Shanghai, Ningbo, Zhoushan, Hangzhou, Jiaxing, Suzhou, Huzhou, Wuxi,
Changzhou, Nanjing, Nantong, Zhenjiang, Yangzhou, Taizhou and Shaoxing. The Yangtze River
Delta region of China were chosen as the locations for the
sample collection for this study.

Sampling size
The size of the sample that is collected from the whole population is known as the sampling
size. The size of the sample should be large enough to eliminate the possibility of sampling
errors and biases (Gill, Johnso 8, 1 8 0 n & Clark, 2014). Full population research will be
impractical and prohibitively expensive to carry out; instead, establishing a sampling size will
be the most effective way to cut down on the time and money required to carry out a study. For
our study, the population that we focused on consisted of 20 manufacturing enterprises in the
Yangtze River Delta region of China. The total employees’ number is about 20,000, and this
study chooce 3000 sampling, so the sampling size is 15%.

Questionnaire design and instrumentation

Questionnaire survey, as a method commonly used in empirical research, has the advantage of
directly obtaining data. When researchers use it, they are based on the following assumptions:
First, most survey respondents will Choose the answer after carefully reading each item;
second, most respondents can understand the content of each item well; third, the respondents
will answer truthfully according to the actual situation (Chen et al., 2012). To better meet the
above assumptions, the design of the questionnaire has gone through multiple tasks such as
consulting many documents, expert discussions, soliciting opinions from managers, and small
sample pre-investigation.

Measurement of management innovation

This paper uses the subjective measurement scale developed by Lin (2001) and Cai ( 1997 )
according to the need . Various attempts made during management innovation. The scale
includes two dimensions: employment and management innovation and organization and
planning innovation. The former has 10 items, and the latter has 5 items. Since the item "the
company's current complaint handling plan can effectively solve customer complaints" The
item has little relevance to this research, so this item was deleted, and finally a management
innovation scale with 14 items was formed. The specific content is shown in Table 3-1.

Table3- 1 Management innovation scale

measurement serial
item item source
dimension number
The salary system currently applied by the company is quite original and can effectively
EI1
motivate employees.
The company adopts a new financial control system to detect the gap between the
EI2
company's actual completed work and the target
The benefits system used by the company is quite original and effective in motivating
EI3
employees
The company has updated the original performance appraisal system and can truthfully
Employment EI4 and comprehensively measure the contribution of employees to the development of theLin Yiping
and enterprise ( 2001 )
management EI5 The company adopts a unique employee selection system, and the effect is good Cai Qitong
innovation The company has formulated a new production operation system and can implement the( 1997 )
EI6
completed task indicators to the greatest extent. How far is it from the expectation?
The company created a new assessment method to help leaders better measure the
EI7
completion and quality of employees' work
The leadership will adopt a different leadership style than in the past and be able to
EI8
effectively connect the strength of subordinates to complete the work
The director of the company has used new management methods and can fully mobilize
EI9
the enthusiasm of employees

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OI1 The company tweaked certain workflows and it worked out well
OI2 The company actively implements new policies that can improve performance
Organizational The company will change the service items and improve the service method according to
OI3
and Planning the needs of customers
Innovation The company will adjust the division of responsibilities of each department according to
OI4
the changing environment
The company will adjust the work of employees in a timely manner to better achieve the
OI5
company's goals
Source: Compiled and drawn by the author

Measurement of organizational inertia

Zahra, Ireland, etc. developed a scale for measuring organizational inertia, which divides
organizational inertia into two dimensions , capacity extension and change capacity restriction
, and uses them for measurement. Among them, capability extension includes the upgrading of
existing technologies, investment in mature technologies, and improvement of existing
organizational processes; the limitations of organizational changes include the company's slow
response to market changes and the lag in implementing organizational changes. The speed of
communication of decision-making information is slow, and the company's product line
portfolio is stable. In view of the fact that the scale has good reliability and validity and has
been widely used in the research field of organizational inertia , this paper will use this scale to
measure organizational inertia . The specific items are shown in Table 3-2.

Table3- 2 Organizational inertia scale

measureme
serial
nt item item source
number
dimension
When technology is updated, enterprises adopt technology upgrading strategy instead
AE1
Capability of introducing brand new technology
Extension AE2 Companies love workflow optimization to increase productivity
(AE) Companies prefer to build upon existing products rather than redesign them from
AE3
scratch
Companies value short-term profits over risky long-term investments Zahra , Ireland
O CR 1
(2016)
Organizatio
O CR 2 The company's technology investment cycle is long
nal Change
It is easy for companies to ignore information about environmental changes that have a
Constraints O CR 3
direct impact on operations
(OCR )
The company's response to market changes is slow, and the speed of making strategic
O CR 4
changes is relatively lagging
Source: Compiled and drawn by the author.

Measurement of organizational learning

This study uses the scale designed by Sinkula, Baker & Noordewier ( 1997 ) , which is widely
used and has high reliability and validity. It includes three dimensions: learning commitment,
common vision, and open mind. There are 4, 4, and 3 items in each dimension, and there are
11 items in total. The specific items are shown in Table 3-3 .

Table3- 3 Organizational learning scale

measureme
serial
nt item item source
number
dimension
The management of the company agrees that whether the organization has the ability to
CO 1
learn has an important impact on the formation of competitive advantages.
Commitme
The employees of the company agree that organizational learning can help the company
nt toCO 2
improve
Learning Sinkula, Baker
CO 3 Companies view training of organizational members as an investment rather than a cost
( CO ) & Noordewier
The company believes that continuous learning is a necessary way to ensure its long-
CO 4 ( 1997 )
term development
Shared VS 1 Company leaders share their goals and vision with other members
Vision ( VS ) VS 2 Share the same organizational vision from top to bottom
VS 3 All members of the company are committed to achieving organizational goals

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All members of the company agree that they are responsible for the development of the
VS 4
organization
The company's employees dare to question the various planning assumptions made by
OM1
Open Mind management
( OM ) OM2 Company management is open to employees questioning its views
OM3 Company management encourages employees to think outside the box
Source: Compiled and drawn by the author

Measurement of organizational performance

Organizational performance can also start from its form of expression. The scale of Spanos &
Lioukas (2001) is composed of financial performance indicators and market performance
indicators. The former includes return on investment and sales volume, and the latter includes
product coverage and Market share and other aspects; Zhang et al. (2007) focused on two
aspects of financial indicators and human capital when designing the organizational
performance scale. In addition to the above-mentioned direct financial performance
dimensions that can directly reflect the organizational performance surprises of enterprises,
non-financial performance dimensions are also very important forms. Banker et al. (2001) and
Said & Hassabelnaby (2003) stated in their research that employee satisfaction and customer
satisfaction can better reflect organizational performance; Venkatraman & Ramanujam (1986)
combined the two indicators of financial performance and non-financial performance.
Domestic researchers Xie et al. (2006), Shi (2010), Dong (2016) combined the two dimensions
of financial indicators and non-financial indicators to reflect the operation status of the
organization more comprehensively. The former and the latter include the satisfaction of the
enterprise on operating costs, product development, etc.; this study uses a subjective method
to measure organizational performance through the satisfaction of two indicators of financial
performance and non-financial performance, which can more comprehensively reflect the
organizational performance. overall parameters. Referring to the research of Said &
Hassabelnaby (2003), Xie et al. (2006), and Shi (2010), the questionnaire items are determined,
and the specific items are shown in Table 3-4.

Table3- 4 Organizational performance scale

measurement serial
item item source
dimension number
OP1 The company's satisfaction with the return on assets is high
OP2 High company satisfaction with sales growth
The company's satisfaction with the cash flow in the course ofSaid &
OP3
operations is high Hassabelnaby
OP4 The company is highly satisfied with its market position ( 2003 )
organizationa
High level of company satisfaction with the products and services itXie Hongming et
l performance OP5
produces al. ( 2006 )
The company's satisfaction with the future development prospectsShi Ruilong
OP6
of its employees is high ( 2010 )
The company is highly satisfied with its impression and evaluation
OP7
among the public and employees
Source: Compiled and drawn by the author

Findings
Demographic Profile
The results of descriptive statistical analysis of the data in the questionnaire are shown in
Tables 4-1 to 4-8:
Table4- 1 Gender Distribution of Respondents
frequency percentage effective percentage cumulative percentage
male 104 33.8 33.8 33.8
efficient female 204 66.2 66.2 100.0
total 308 100.0 100.0

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Table4- 2 Age Distribution of Respondents

frequency percentage effective percentage cumulative percentage
18-25 years old 194 63.0 63.0 63.0
26-35 years old 65 22.1 22.1 84.1
efficient 36-45 years old 28 9.1 9.1 93.2
over 45 years old twenty 6.8 6.8 100.0
one
total 308 100.0 100.0

Table4- 3 Educational Status of Respondents

frequency percentage effective percentage cumulative percentage
Technical secondary school and8 2.6 2.6 2.6
below
junior college 7 2.3 2.3 4.9
efficient undergraduate 101 32.8 32.8 37.7
Postgraduate 177 57.5 57.5 95.1
Doctorate and above 15 4.9 4.9 100.0
total 308 100.0 100.0

Table4- 4 Distribution of Respondents’ Working Years

frequency percentage effective percentage cumulative percentage
within 2 years 157 51.0 51.0 51.0
3-5 years 37 12.0 12.0 53.0
efficient 6-8 years 34 11.0 11.0 74.0
9-15 years 31 10.1 10.1 84.1
over 15 years 49 15.9 15.9 100.0
total 308 100.0 100.0
Fom Table 4-1 that the proportions of men and women among the respondents are 33.8% and
56.2% respectively, and there are some gaps. It can be seen from Table 4-2 that most of the
respondents are 18-25 years old, accounting for 63.0% of the total. From Table 4-3, we can see
that there are more respondents with bachelor’s degree and master’s degree, accounting for
32.8% and 57.5% of the total.

From Table 4-4, among the respondents, employees with working experience within two years
accounted for the majority, accounting for 51.0% of the total, and the number of respondents
with other working years was close. It can be seen from Table 4-5 that among the respondents,
the employees whose company size is more than 1,000 people accounted for the most,
accounting for 33.8%. It can be seen from Table 4-6 that among the respondents, employees of
state-owned enterprises accounted for the most, accounting for 32.8%, and employees of
foreign-funded enterprises accounted for the least, accounting for 6.8%. From Table 4-7, we
can see that among the respondents, employees in the service industry accounted for the
largest proportion, 45.5%. It can be seen from Table 4-8 that among the respondents, the
proportion of employees in technical positions is 70.8%.

Table4- 5 Respondents’ Company Size

frequency percentage effective percentage cumulative percentage
Less than 50 people 64 20.8 20.8 20.8
50-100 people 52 16.9 16.9 37.7
100-500 people 53 14.2 14.2 54.9
efficient 500-1000 people 35 11.4 11.4 66.2
More than 1000 people 104 33.8 33.8 100.0
total 308 100.0 100.0

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Table4- 6 Respondents’ Company Types

frequency percentage effective percentage cumulative
percentage
State-owned 101 32.8 32.8 32.8
enterprises
Private Enterprise 93 30.2 30.2 63.0
efficientForeign companies twenty one 6.8 6.8 69.8
other 93 30.2 30.2 100.0
total 308 100.0 100.0

Table4- 7 Post Distribution Respondents

frequency percentage effective percentage cumulative percentage
Management position 90 29.2 29.2 29.2
efficient Technical position 218 70.8 70.8 100.0
total 308 100.0 100.0

Reliability and Validity

Reliability analysis of the scale
The reliability of the scale means that the results have a high consistency no matter how many
times they are measured. The higher the reliability, the more stable the results. Reliability
analysis can be done directly with the help of the "reliability" function in the statistical
software, and the result is expressed in the form of Cronbach’s coefficient. According to the
standard given by DeVellis (1991), the level of reliability is determined by the two critical
values of Cronbach's α coefficient. If the value of this coefficient is greater than 0.7, the
reliability of the scale has passed the test; if the value of this coefficient exceeds 0.8, indicating
that the level of stability of the scale is very high. In this paper, with the help of SPSS19.0
software, the results shown in Table 3-5 are obtained.

Table3- 5 Scale Reliability Analysis

measurement Number ofCronbach's alpha Overall Cronbach's alpha
scale name
dimension items coefficient value coefficient value
Employment and
management 9 0.927
management
innovation 0.933
innovation
Organizational and
5 0.878
Planning Innovation
Capability extension 3 0.851
organizational
organizational change 0.869
inertia 4 0.854
inhibition
organizational learning commitment 4 0.867
0.887
learning common vision 4 0.842
open mind 3 0.875
organizational
organizational 0.925
performance 7 0.925
performance
Source: Compiled and drawn by the author
It can be seen from the above results that the overall Cronbach's α coefficient values of the four
scales involved in this study are all above 0.8, and the coefficient values of each dimension of
the scale are also greater than 0.8. Therefore, the reliability of the scale in this study is higher.

Validity analysis of the scale

The operating premise of exploratory factor analysis is that the variable is suitable for factor
analysis. According to the standard of Kaiser (1974), the KMO value must reach at least 0.7 to
be considered suitable for factor analysis, and the larger the value, the higher the degree of
suitability. In addition, the p-value of Bartlett's sphericity test should reach a significance level
of less than 0.05. The results of this test are shown in Table 3-6.

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Table3- 6 Variable KMO and Bartlett sphericity test results

research variable KMO Bartlett test for sphericity
Approximate chi-square df Sig
management innovation 0.937 2939.034 91 0.000
organizational inertia 0.862 1448.653 28 0.000
organizational learning 0.838 1955.713 55 0.000
organizational 0.918 1524.387 twenty one 0.000
performance
Source: Compiled and drawn by the author
From the results in the table above, we can see that the KMO value of management innovation
is 0.937 , the KMO value of organizational inertia is 0.862, and the KMO values of organizational
learning and organizational performance are 0.838 and 0.918 , respectively , all of which are
above the standard, and the four the p-values of the variables also meet the requirements,
indicating that the variables of the scale are very suitable for factor analysis.

Conclusion
(1) Management innovation has a significant and direct positive impact on organizational
performance
The empirical analysis in chapter 4 has confirmed that the two dimensions of management
innovation, that is, employment and management innovation and organization and planning
innovation, have a significant positive effect on organizational performance. Enterprises can
fully integrate resources through innovations in concepts, methods, structures, and systems,
so that enterprises can obtain optimal deployment under the condition of limited resources
(Yu & Li，2021). Employment and management innovation refers to innovations including
management methods and systems, as well as the leadership style of managers. Managers can
better stimulate the vitality of organizational members through the implementation of
employment and management innovation, thereby improving organizational performance;
Organizational and planning innovation refers to the innovation of the development concept
and the innovation of the organizational structure of the enterprise. The innovation means of
this dimension can help the enterprise to adjust the enterprise strategy and enterprise
structure in a timely manner, realize the adaptation with the market environment, and thus
bring about the improvement of organizational performance. Therefore, when enterprises
adopt and implement management innovation, they need to integrate the innovation means of
the two dimensions of employment and management innovation, organization and planning
innovation, so as to improve organizational performance more effectively. (Wang 2021; Yu &
Li 2021; Sun & Ren 2020)
(2) Management innovation can effectively promote organizational learning
The previous empirical analysis has confirmed that management innovation can effectively
promote organizational learning, and the two dimensions of management innovation will also
have a positive impact on the three dimensions of organizational learning. Among them,
employment and management innovation have positive effects on the three dimensions of
organizational learning, but organization and planning innovation only have positive effects on
learning commitment and common vision. The process of organizational learning is essentially
the flow of knowledge and information at the level of individuals, departments or enterprises,
and the positioning and setting of factors such as organizational structure, organizational
system, and management methods will directly affect the efficiency and effectiveness of the
flow process (Liu et al., 2005). If the various systems formulated by the company put personal
learning in a very important position, or if the company and departments have formed a
concept of encouraging communication and sharing knowledge and information, and the
managers are willing to listen to the different opinions of members, this will undoubtedly affect
the Provide strong support and guarantee for the effective development of organizational
learning. However, organizational and planning innovations have no significant effect on the

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dimension of open mind, which does not support the hypothesis. The possible reasons are as
follows: first, the innovation of organization and planning emphasizes the adjustment of the
company’s development strategy and organizational structure, and most of the decisions are
made by high-level managers, but the survey objects of this research are not in the majority of
high-level managers, so there is a certain error. Second, there may be other ways in which
management innovation may affect organizational learning, but this study did not consider it.
(3) Organizational inertia will hinder organizational learning and organizational performance
It can be seen from the previous empirical research that organizational inertia has a significant
negative impact on organizational learning, which in turn negatively affects organizational
performance. Both dimensions of organizational inertia, capability stretching and
organizational change inhibition, negatively affect learning commitment, shared vision, and
open mind. Therefore, to improve organizational learning and organizational performance,
enterprises should try their best to overcome organizational inertia, reduce capability
extension, and weaken inhibition of organizational change, to rejuvenate the enterprise, create
a learning atmosphere, and promote organizational performance.
(4) Organizational learning can effectively promote organizational performance
It has been confirmed above that organizational learning and the three dimensions of
organizational learning have a positive impact on organizational performance. Organizational
learning not only includes the application of existing knowledge and information of the
enterprise, but also includes the exploration of new knowledge, which provides a powerful
force for knowledge aggregation, thereby promoting the development of enterprises and laying
the foundation for the improvement of organizational performance (Wang, 2021). The
significance of learning commitment is that learning is regarded as a value within the
organization, which helps to improve the enthusiasm of members to learn; having the same
vision and concept within the department and the organization will enhance internal cohesion;
having an atmosphere of breakthrough thinking in the organization will promote the
generation of new knowledge, so all three links can improve performance.
(5) Organizational learning plays a mediating role between management innovation and
organizational performance
The results of data analysis have proved this conclusion, and organizational learning also has a
partial mediating effect between the two dimensions of employment and management
innovation, and organization and planning innovation. In this study, after the hypopaper that
both employment and management innovation and organization and planning innovation have
positive effects on organizational performance is verified, organizational learning is used as an
intermediary variable to continue to explore the positive effect of management innovation on
organizational performance. In practice, enterprises carry out management innovation
changes, bringing new values and new businesses. Only when organizational learning is fully
and effectively carried out among members and departments can the knowledge required for
the implementation of management innovation be digested and absorbed., thus bringing about
the improvement of organizational performance. (Wang 2021; Yu & Li 2021; Sun & Ren 2020)

References
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Cite this article:

Song Guo Jiang (2023). The Impact of Management Innovation, Organizational Inertia, and
Organizational Learning on Organizational Performance: A Case Study of the Manufacturing
Industry in the Yangtze River Delta Region of China. International Journal of Science and
Business, 23(1), 91-105. doi: https://doi.org/10.58970/IJSB.2136

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