Innovation Resistance of Vulnerable Workers: Focusing on Corporate Financial Performance

Innovation, as represented by information technology (IT), is considered essential to the survival of a business. Companies use IT innovation to improve their financial performance and the effectiveness of their operations. While technological innovation in the past focused on the introduction of machines to replace physical labor, modern IT innovation, represented by artificial intelligence, has shown that it can also replace human creativity and intellectual labor, increasing job insecurity for human resources at all levels. Therefore, the interests of companies and workers in IT innovation based on the assurance of job security conflict, and workers are motivated to reject IT innovation just like their predecessors who rejected machines. Moreover, vulnerable groups of workers will experience greater job insecurity. During the economic crisis, companies try to reduce labor costs to survive, which also poses a threat to workers' job security. This study examines the impact of IT innovation intensity on workers' innovation resistance by dividing it into system and process aspects and identifying the moderating effects of workers' vulnerability and firms' financial performance. Using data from the Korean Labor & Income Panel Study in South Korea, this study reveals that workplaces with a high proportion of female workers are more likely to engage in innovation resistance in response to IT innovation; this tendency is stronger the worse the financial performance of the firm. Furthermore, this study presents the implications and limitations and directions for future research. Innovation resistance of vulnerable workersThis study was conducted in the following context. First, organization-driven innovation is essential for their survival, but for the employees who are the subjects and targets of the innovation, it is a threat to their job security. This creates a conflict of interest between the organization and its employees regarding the adoption of the innovation. Second, IT innovations, such as kiosks, focus on the substitutability of human resources more than other types of innovations. Therefore, this study focuses on IT innovations to understand innovation rejection activities. Third, when an organization's financial performance deteriorates, such as during an economic crisis, the conflict of interest between the organization and its members on innovation could be maximized. In this study, the financial performance of the organization is a key contextual factor. The Core Strengths of this study are as follows. First, this study proposed the implications of the study by focusing on vulnerable labor groups with low job security. Paradoxically, they are the ones who can benefit the most from technological innovation, but they are also the ones whose job security is most threatened by innovation. Second, the worse the financial performance of an organization, the more the need for innovation increases, but at the same time, the more job insecurity they perceive. This study examines the three-way interaction effect of organizational financial performance and labor vulnerability on innovation rejection activities according to innovation intensity.