How Digitization and Agile Methods Influence Corporate Venture Performance: An Organizational Information-Processing Perspective

Firms increasingly utilize digitization and agile methods to effectively respond to changing preferences and needs in their internal and external environment. However, empirical analysis of these relationships is scant. Using organizational information-processing theory, we analyze how digitization and agile project management methods affect venture performance via two mediating organizational mechanisms: problem-solving and resource allocation. We collect survey data from more than 200 corporate ventures that operate in a highly dynamic environment. Building on our structural equation model, we make several contributions that help improve the theoretical understanding and embedding of digitization, agile methods, and organizational mechanisms. We show that (i) digitization facilitates resource allocation, (ii) agile methods have a positive effect on both problem-solving and resource allocation, and (iii) problem-solving and resource allocation are positively related to organizational performance of ventures.