The impact of innovation and differentiation strategy on financial performance with emphasis on the role of risk management and intellectual capital

Purpose The purpose of this study is to investigate the impact of innovation and differentiation strategy on financial performance with a focus on the role of risk management and intellectual capital of companies listed on the Tehran Stock Exchange. Design/methodology/approach In this research, differentiation and innovation strategy criteria are the independent variables, performance criteria are the dependent variables and risk management effectiveness and intellectual capital are the moderating variables. The statistical population of this research includes all the companies listed in the Tehran Stock Exchange during the 10-year period, and 127 companies were selected as a statistical sample using the systematic elimination method. The research model fitting and hypothesis testing were carried out using structural equation modeling and SPSS, Smart PLS software. Findings The results of the hypothesis testing showed a positive and significant relationship between the innovation and differentiation strategy and the firm performance. In addition, effective management of risk and intellectual capital also had a significant and positive impact on this relationship. Research limitations/implications Given that this research was conducted at the Tehran Stock Exchange, it was difficult for the researchers to collect data. Also, since the Tehran Stock Exchange is a new market, a lot of research needs to be done in different areas of this market to identify the existing problems and shortcomings and to provide reasons for its growth and development. Practical implications According to the results of the research on the impact of intellectual capital and risk management on corporate performance and the impact of strategy on this relationship, this paper can expect to see an improvement in corporate performance and an increase in shareholder wealth as a result of applying the results of this research. Social implications Considering that corporate strategy, intellectual capital criteria and risk management to increase the financial performance of companies have informational content; therefore, according to the results of this research, an increase in the performance of listed companies is expected, and naturally, this increase in performance will lead to the prosperity of the economic sector, increase in job creation and as a result, improve the quality of social life. Originality/value In the Tehran Stock Exchange, by properly evaluating the financial performance criteria of companies and identifying the factors that increase intellectual capital and risk management, they provide the means to improve knowledge in this area of research.