How does digital transformation affect the innovation resilience of manufacturing firms?

Purpose Innovation resilience, which refers to firms’ ability to consistently innovate and recover from disruptions, has recently gained increasing attention. Digital transformation plays a crucial role in the innovation of manufacturing firms. This paper aims to investigate the impact mechanisms of manufacturing firms’ innovation resilience in the context of digital transformation. Design/methodology/approach Using panel data from Chinese A-share listed manufacturing firms spanning from 2017 to 2022 as an example, this research examines the impact of digital transformation on innovation resilience. It also tests the moderating effect of innovation network embeddedness and the mediation effect of absorptive capacity. Findings It is found that digital transformation can enhance the innovation resilience of manufacturing firms. Furthermore, the structural embeddedness and relational embeddedness of manufacturing firms within innovation networks moderate the relationship between digital transformation and innovation resilience. The absorptive capacity of manufacturing firms acts as a mediator in the relationship between digital transformation and innovation resilience. Originality/value This paper is one of the first studies that investigates the impact mechanisms of digital transformation on the innovation resilience of manufacturing firms based on network embeddedness theory and dynamic capability theory.