Enhancing E-Commerce SME Performance through Human Capital, Organizational Culture, and Product Innovation: The Mediating Role of Employee Performance

Abstract

This study investigates the impact of human capital, organizational culture, and product innovation on entrepreneurial performance in e-commerce small and medium enterprises (SMEs) in Shanghai, hypothesizing that these factors positively influence entrepreneurial performance with employee performance as a mediating variable. Approximately 375 entrepreneurs and staff from e-commerce SMEs participated, providing pertinent data through validated questionnaires rated on a 5-point Likert scale. Utilizing a quantitative research design, the study employed SEM-PLS analysis to examine relationships among human capital, organizational culture, product innovation, employee performance, and entrepreneurial performance. The findings indicate that human capital, organizational culture, and product innovation significantly impact entrepreneurial performance, with human capital having the most substantial effect, followed by product innovation. Employee performance was found to mediate these relationships, enhancing organizational competitiveness. Effect sizes and confidence intervals demonstrated strong content validity and statistical significance. The study concludes that strategic management of human capital, fostering a supportive organizational culture, and encouraging product innovation are crucial for improving entrepreneurial performance in e-commerce SMEs. These results suggest that SMEs should invest in human capital development, create an innovation-friendly environment, and emphasize effective leadership and ethical behavior. The implications highlight the importance of these factors in achieving success in the competitive e-commerce market, emphasizing the need for strategic management practices that prioritize human capital and organizational development to drive performance outcomes. This research provides actionable insights for SMEs seeking to enhance their competitiveness and sustainability in the rapidly evolving e-commerce landscape, underscoring the critical role of human capital and innovative organizational practices.