Innovation Performance Relationship Research Articles

The mediating roles of financialization and vertical integration in the innovation culture and performance relationship: An examination of SME investment firms

ABSTRACT This study extends innovation culture and performance research by examining vertical integration and a newly conceptualized financialization measure as mediators in the context of small- to medium-sized (SME) investment firms participating in real estate. The work responds to several calls for research that includes more industry-specific strategies that mediate the innovation culture and performance relationship, a financialization measure and examination of its outcomes, and expanding on the limited vertical integration research in real estate. The results show that innovation culture is partially mediated by both vertical integration and financialization, such that innovation culture is directly related to performance but also indirectly via the two strategies. The findings suggest that SME investment firms participating in real estate should create an innovation culture to better execute relevant strategies such as vertical integration and financialization, promoting sustained performance. The paper concludes by offering recommendations for future research and managerial implications.

Examining the interaction effect of digitalization and highly educated employees on ambidextrous innovation in Chinese publicly listed SMEs: A knowledge-based view

With the advancement of technology, digitalization has attracted increasing attention in recent years. Previous studies have linked firm digitalization to innovation performance; however, less attention has been given to ambidextrous innovation and small and medium-sized enterprises (SMEs), which play a vital role in economic development. Based on a knowledge-based view (KBV), this research investigates the relationship between digitalization and ambidextrous innovation in Chinese publicly listed SMEs. We found that digitalization promotes radical innovation more significantly than incremental innovation of listed SMEs. We further observed that firm digitalization and highly educated employees with a master's degree or above have a complementary effect on radical innovation, and the financial background of firms' top management team (TMT) members strengthens strengthens this complementary effect. This study not only enriches the digitalization–innovation performance relationship literature, but also contributes to the KBV by tying together three vital elements (technology, people, and relational networks) in the KBV and examining their relationships with ambidextrous innovation. It also has implications for managers of SMEs related to increasing the innovation returns from digitalization endeavors.

PRODUCT INNOVATION, MARKETING INNOVATION AND BUSINESS PERFORMANCE RELATIONSHIP OF MALAYSIAN PRODUCT INDUSTRIES: MEDIATING EFFECT OF DESIGN MANAGEMENT

Due to the increasing significance of design management and innovation to business performance, it is critical for the product sectors to stay up with the world's rapid changes in economic model and technology. As a result, industrialized countries regard design management as a competency that falls under the umbrella of innovation management. The objectives of this study are to identify the relationship between product innovation and marketing innovation on the business performance of Malaysian product industries, to analyze the effect of product innovation and marketing innovation on design management of Malaysian product industries, to examine the effect of design management on the business performance of Malaysian product industries and to test the mediating effect of design management between innovation and marketing innovation. This study uses a mixed method of qualitative and quantitative research design to collect data from 386 respondents from Malaysia's product industries. Simple random sampling was utilized to acquire the required data using a verified questionnaire. Furthermore, the qualitative survey data was analyzed using the Partial Least Square Structural Equation Model (SmartPLS3-SEM) in early phase as back data for qualitative method and for qualitative concerns, the researcher is using Likert scale form for subject matter expert to validate the gathered data with the hypothesis based on the findings of this study to check on the validity of the data gathered. In accordance to this research, the researcher defines “Malaysian Product Industries” as a group of small and medium enterprises in the services, primary agriculture and Information & Communication Technology (ICT) sectors that are enterprises and private company with full-time employees not exceeding 50 or with annual sales turnover not exceeding RM5 million. This study presents empirical evidence that the effect of design management on the relationship between innovation types and business success in Malaysia's product industries could lead to increased company performance. This research could assist the product industries better their businesses by identifying critical factors that contribute to greater business performance.

The interdependence of R&D, innovations, and productivity: case of Polish manufacturing companies

Motivation: The structural model proposed by Crepon, Duguet, and Mairesse (the CDM model) in 1998 has been the workhorse of the empirical analysis of the relationship between firms’ innovation input and output and performance. Most research applying the CDM methodology shows a positive relationship between firms’ R&D, innovation, and productivity, primarily in highly developed countries. However, some studies do not confirm the universal nature of these relations, pointing to possible differences between countries, sectors, firm characteristics, sources of knowledge, types of innovation, or performance indicators. Aim: The study aims to explore the relationship between R&D expenditures, patent applications, and labour productivity among Polish manufacturing firms. The study applies a four-stage analysis of the innovation-performance relationship based on the CDM model. The method enables us to track the transformation of innovation input into output and its impact on the performance of companies. The analysis is based on the survey conducted in 2018 on a random sample of 1049 Polish manufacturing firms. Results: The results reveal interesting insights into the analysed relationship. Firstly, initial results confirm the vital role of cooperation, being an exporter, and functioning in specific markets for deciding to invest in R&D. Secondly, state aid, employees’ education, and being part of the capital group are crucial for the R&D intensity. The analysis confirms a statistically significant positive relationship between Polish manufacturing firms’ innovation input and output. However, the results of the last stage of the analysis indicate that the performance of manufacturing firms is unrelated to the innovation output.

Dynamic pathways to SMEs performance: Unraveling the influence of organizational learning capability, innovation, market dynamism and market responsiveness in an African emerging economy

ABSTRACT This study explores the complex relationships among organizational learning capability (OLC), innovation, market dynamism, market responsiveness, and the performance of small and medium-sized enterprises (SMEs) in African emerging economies. Our research investigates the role of innovation as a mediator in the OLC-performance relationship, the moderated mediation impact of market dynamism, and the mediated moderation effect of market responsiveness in the indirect relationship. Using data from 225 SMEs from Ghana, and Hayes’s PROCESS bootstrapping procedure the findings confirm that innovation mediates the OLC-performance. Although, market dynamism does not moderate the OLC-innovation relationship, it moderates the indirect relationship between OLC and performance through innovation, with a stronger effect at high levels of market dynamism. Additionally, market responsiveness negatively moderates the innovation–performance relationship, but it amplifies the OLC-performance relationship via innovation, with a more pronounced effect at low levels of market responsiveness. The findings indicate that the OLC-performance relationship is not only complex but depend in firm-specific and external factors.

Innovation and Organizational Performance in Nigerian Startups: A Study of Selected Entrepreneurial Ventures

The Nigerian startup ecosystem has emerged as a dynamic player in the global entrepreneurial landscape. However, the path to success is fraught with unique challenges, and understanding the drivers of innovation and organizational performance is paramount. This study aims to investigate these critical factors within the Nigerian context. The central objectives of this research are to explore the relationship between access to technology, human capital, and financial resources and innovation; assess the efficacy of context-specific performance metrics in representing organizational performance; examine the impact of government policies and a supportive ecosystem on innovation and organizational performance; and scrutinize sectoral variations in the innovation-performance relationship within Nigerian startups. A quantitative research design was employed, using a stratified random sampling technique to ensure sectoral representation. Survey data, paired with statistical analyses, were used to test hypotheses and generate insights from the findings. The results of the study provide valuable insights into the Nigerian startup ecosystem. The findings highlight the significance of resource allocation, context-specific performance metrics, government support, and sector-specific strategies. Access to technology, human capital, and financial resources positively influences innovation, while context-specific performance metrics enhance organizational performance assessment. Government policies and a supportive ecosystem have a positive impact on innovation and performance. Sectoral variations necessitate tailored strategies. The study recommends strategic resource allocation, adoption of context-specific metrics, collaboration with government initiatives, and sector-specific focus to enhance startup success. These recommendations are instrumental for startups, policymakers, and stakeholders in the Nigerian entrepreneurial ecosystem. Keywords: ecosystem, entrepreneurship, performance, innovation, startup

Does knowledge management mediate the relationship between entrepreneurial orientation and firm performance?

PurposeThis study investigates the impact of entrepreneurial orientation (EO) and knowledge management (KM) on firm performance (PERF), as well as the mediating role of KM in the EO–PERF (EO-PERF relationship). In particular, this study aims to explain the impact of KM on the relationship between the EO dimensions and PERF; dimensions are risk-taking (RT), innovativeness (IN) and proactiveness (PR).Design/methodology/approachThis study uses structural equation modelling and fuzzy-set qualitative comparative analysis (fsQCA) methodologies to explore target relationships. The sample consists of 150 small furniture manufacturers operating in Poland (out of 1,480 in the population).FindingsThe study findings show that KM partially mediates the IN–PERF relationship. Furthermore, fsQCA reveals that KM accompanied by IN is a core condition that leads to PERF. Moreover, the absence of KM (accompanied by the absence of RT and IN) leads to the absence of PERF. In addition, the results show that all the variables examined (RT, IN, PR and KM) positively impact PERF.Originality/valueThis study explores the role of KM in the context of EO and its impact on PERF in the low-tech industry. The study uses simultaneously two methodologies that represent different approaches in the search for the expected relationships. The findings reveal that KM mediates the EO-PERF relationship.

Antecedents and outcomes of open innovation over the past 20 years: A framework and meta‐analysis

AbstractThe open innovation paradigm emphasizes that firms can improve their innovation performance by collaborating with other firms. However, there is no consensus in the open innovation literature regarding what drives firms' implementation of inbound and outbound open innovation and how the two types of open innovation influence innovation and firm performance. The present meta‐analysis synthesizes previous research to advance our understanding of open innovation by reexamining its antecedents and its moderating effects on innovation and firm performance. Using data from 157 articles, our results show that appropriation strategy, formal organizational structure, learning culture and top manager competence drive inbound open innovation, while innovation strategy, appropriation strategy, learning culture, and top manager competence drive outbound open innovation. In addition, we find that absorptive capacity positively moderates the positive impact of inbound and outbound open innovation on innovation performance. However, industry type (i.e., high‐ and low‐tech) is not found to moderate the effect of open innovation on innovation or firm performance, suggesting that both high‐ and low‐tech firms can equally reap benefits from open innovation. Furthermore, this study also partially supports the moderating effects of firm size and cultural value (individualism vs. collectivism) on the open innovation—performance relationship. These findings collectively suggest that the effects of inbound and outbound open innovation on performance are subject to contextual factors. Although this meta‐analysis does not allow us to generate new theories in the open innovation literature, it offers valuable insights to both academics and practitioners regarding factors affecting the implementation of open innovation and its performance implications.

Innovation in the tourism sector, organizational learning and performance

PurposeThe purpose of this research paper is to establish the impact of process and service innovation on non-financial and financial performance in the tourism sector, as well as to explain the mediating role of organizational learning.Design/methodology/approachA quantitative approach was used, based on partial least squares–structural equation modeling (PLS-SEM), Smart PLS 4.0 software. The sample consisted of 426 establishments in the tourism sector in Zone I, Ecuador. Online surveys were employed to collect data, yielding 118 responses, to assess the impact of innovation on business performance from 2020 to 2022.FindingsProcess and service innovation positively and significantly affect non-financial and financial performance, respectively. Organizational learning mediates the relationship between process innovation and disservice. The relationship between non-financial and financial performance could not be confirmed. The model explains 53.10% of non-financial performance and 26.10% of financial performance.Originality/valueThe relationship between innovation and performance in the tourism sector has been studied in several developed economies, while little has been studied in developing countries. This work contributes to an empirical discussion including a mediating variable in the innovation–performance relationship in the Latin American context.

Paradoxes of accelerator programs and new venture performance: Do varieties of experiences make a difference?

Incubators and accelerators have proliferated, but their impact on new ventures’ performance remains unclear. This article explores whether all ventures benefit equally from participating in accelerator programs. We propose that the entrepreneurs’ human capital resources influence the benefits extracted from accelerator program participation. Using application data from the accelerator programs across developed and developing countries, we find participation in accelerator programs positively impacts the ventures’ innovation performance but has a mixed impact on social performance. Founders with high education benefit from participating in accelerator programs for innovation and social performance. However, entrepreneurial experience and vast industry experience do not significantly influence ventures’ social and innovation-related performance from accelerator participation. The result is consistent for both solo and team founders.

DRIVEN BY EMOTIONS: THE MODERATING EFFECT OF SOCIOEMOTIONAL WEALTH DIMENSIONS ON THE LINK BETWEEN ENTREPRENEURIAL ORIENTATION AND INNOVATION PERFORMANCE IN FAMILY FIRMS

This study examines the influence of socioemotional wealth (SEW) dimensions on the relationship between entrepreneurial orientation (EO) and innovation performance in family firms. Based on an analysis of a dataset comprising 145 family firms, our findings provide evidence that SEW positively moderates the association between EO and innovation performance. Notably, the dimension ([Formula: see text]) emotional attachment of family members within SEW solely drives this interaction effect. Surprisingly, none of the other dimensions exhibit a significant moderating effect on the entrepreneurial orientation–innovation performance relationship. Furthermore, the overall moderation is substantially more pronounced for multidimensional SEW than for unidimensional SEW. Our findings challenge the results of previous studies on the entrepreneurial orientation–performance relationship in family firms, which considered SEW as unidimensional. Finally, we discuss implications for corporate entrepreneurship as well as SEW literature and provide directions for future research.

The catalytic role of “responsible investments” in innovation and firm performance link: in the context of manufacturing in Asia-Pacific

AbstractTechnological innovations while economically prudent may have harmful consequences to the planet and/or people. This paper empirically investigates the moderating effect of responsible investment on the influence of innovation on firm performance in manufacturing industry. The hypothesized relationships are justified using signalling theory. Relationships are tested using data from six countries in Asia-pacific region, namely Australia, Korea, Taiwan, China, India, and Vietnam. The established measures are drawn from well-established GMRG fifth version survey instrument. The empirical analysis on 297 data points was done using SmartPLS3. The result strongly suggests that the responsible investments have significant positive moderating effect on the innovation, product and process, and firm performance relationships. Managers are, therefore, encouraged to not only consider responsible consequences of technological innovation, but also pay attention to the responsible investment aspects that influence innovation-performance relationship.

Interplay of Intellectual Capital and Digital Transformation to Enhance Innovation Performance

The current era of knowledge economy equipped with technological advancements has intensified the importance of innovation. Firms are seeking ways to upgrade their innovation related performance in order to achieve the competitive advantage as well accomplishing the growth. The innovation performance is heavily focused towards improving existing products or creating new products. Moreover, firms tend to amass their capabilities to enable process innovation as well, in order to gain efficiency, improve service quality, and cost reduction. This study investigates the role of intellectual capital to improve the innovation performance of firms. Moreover, the mediating role of digital transformation is undertaken in this relationship. As a result of performing empirical investigation on Malaysian high-tech firms where data collected was undergone to PLS-SEM. The findings reveal that the dimensions of intellectual capital – including human, structural and relational – improve the innovation performance of firms. Furthermore, results exhibit the full mediation of digital transformation for improving innovation performance of firms. This study contributes novel insights in literature by uncovering the role of intellectual capital and digital transformation towards innovation performance of high-tech firms. The study recommends that firms and policy makers should pay attention to developing the intellectual capital dimensions of firms in order to realize the benefit of digital transformation towards enhancing innovation performance of firms. Future researchers are suggested to perform investigations on medium-tech and low-tech firms as well as across the manufacturing sectors.

A meta-analysis of the relationship between collaborative innovation and innovation performance: The role of formal and informal institutions

To cope with highly competitive business environments, an increasing number of firms are actively exploring collaborative innovation strategies. Yet, among the studies on this subject, there has been no consensus regarding the impact of collaborative innovation on innovation performance. To address this gap, we conducted a meta-analysis of 50 independent empirical samples, comprising 29,456 observations, to test the collaborative innovation–innovation performance relationship. We carried out both subgroup analyses and meta-regressions to explore how formal and informal institutions might moderate the collaborative-innovation–innovation-performance link. This work demonstrated that collaborative innovation strongly and positively correlates with firms’ innovation performance. Then, to further deepen our understanding of this subject, we examined two different collaboration types and found that supply chain (SC) collaborative innovation has a more significant impact on firms’ innovation performance than the effect produced through industry–university–research (IUR) collaborations. Furthermore, this study revealed that formal and informal institutions strengthen the positive relationship between collaborative innovation and innovation performance. This paper offers new insights for collaborative innovation research and provides important managerial implications for firms’ innovation strategies.

Enhancing innovation performance of SMEs through open innovation and absorptive capacity: the moderating effect of business model

ABSTRACT Open innovation (OI) is an effective way for small and medium-sized enterprises (SMEs) to acquire external resources and enhance innovation performance. This study focuses on the effect of OI on innovation performance of SMEs. Specifically, this study classifies OI into inbound and outbound OI, and explores their respective impacts on SMEs’ innovation performance. Besides, this study investigates the mediating role of absorptive capacity and the moderating role of business model on the above relationships. Based on the survey data from 218 Chinese manufacturing SMEs, our empirical results show that: (1) both inbound and outbound OI have positive impacts on SMEs’ innovation performance; (2) absorptive capacity partially mediates relationships between inbound and outbound OI and innovation performance of SMEs; (3) efficiency-centered business model positively moderates the inbound and outbound OI-SMEs’ innovation performance relationships, and novelty-centered business model only exhibits a moderating effect on outbound OI-innovation performance relationship. This study provides deeper insights into the relationship between OI and SMEs’ innovation performance. Besides, this study reveals the mediating mechanism of OI on SMEs’ innovation performance, and enhances our understanding of why some SMEs more successfully utilise OI activities to improve innovation performance than others.

Involving online community customers in product innovation: The double-edged sword effect

Existing research in the field of business has generated differing views on the relationship between customer involvement and firms' product innovation. Drawing from their findings, some researchers have presented a positive assessment of customers' utility in product innovation, while others have provided a nonsignificant or even negative assessment of customers' usefulness in this area. This paper reconciles these different views by demonstrating that there exists a nonlinear relationship between customer involvement and firms' product innovation performance. To arrive at this conclusion, we use survey data from Chinese manufacturing firms and their online community customers, as well as objective data from the Chinese technology firm Xiaomi, to empirically test our hypothesized nonlinear relationship theory. The results of analyzing the two datasets demonstrate that there is an inverted U-shaped relationship between online customer involvement and firms' product innovation performance. Additionally, we find that customer online community affiliation moderates this relationship; specifically, for low or moderate levels of customer involvement, customer online community affiliation strengthens the positive online customer involvement–product innovation performance relationship, while for high levels of customer involvement, such customer affiliation weakens the positive impact of online customer involvement on firms' product innovation performance. Furthermore, we also show that the factor “customer online knowledge contribution” mediates the relationship between customer involvement and product innovation performance. Overall, this study provides new empirically-supported insights into the impacts of customer involvement and the contribution of customer knowledge through online communities on firms’ product innovation performance, thereby adding significant findings to the literature, as well as offering practical implications to firms regarding how they can best involve online customers in product innovation to achieve the most effective performance.

Moderation of innovation capability on innovation performance relationship

The purpose of this research is to investigate the antecedents of innovation performance and the role demonstrated by innovation capability; whether strengthening or weakening the relationship within Malaysian manufacturers. This study implements quantitative approach with data collected from Malaysian manufacturing industry using structured questionnaires. The hypothesised relationships from 105 companies are further tested using Smart PLS software in measuring the framework's structural equation modelling. The results from this study support the proposed research objectives indicating the positive direct relationship between the influencers and innovation performance. The finding reflects on the partial moderating effect of innovation capability on the relationship. From the obtained results, the scholars provide several recommendations to assist decision-makers within manufacturing industries. This paper further confers on suggestions to improve firm's innovation performance through understanding and developing the constructs investigated.

Is the correlation between knowledge sharing and firm innovation performance contingent on network trust and hierarchical culture Evidence from the Chinese high-tech sector

Innovation is of great significance to firms seeking competitive advantage and survival. Building upon the resource-based view and social exchange theory, we explore whether the association between knowledge sharing and firm innovation performance is contingent on network trust and hierarchical culture. Using a survey dataset from 151 Chinese high-tech employees. We find that: 1) knowledge sharing affects firm innovation performance; 2) knowledge sharing influences network trust; 3) network trust played a significant mediation role in the knowledge sharing - firm innovation performance relationship; 4) network trust affects firm innovation performance; 5) hierarchical culture significantly moderates the correlation among network trust and firm innovation performance. The study proposes a moderated mediation model to fully illustrate the linkages amongst knowledge sharing, network trust, hierarchical culture, and innovation performance to offer a guide regarding how high-tech sectors can attain superior innovation outcomes.

A global study of innovation-oriented firms: Dimensions, practices, and performance

Innovation orientation research has accumulated, with most studies examining its relationship with performance in select countries or regions. The research stream is evolving to include the exploration of the practices of companies with high innovation orientations but remains limited. This study explores the innovation orientation and performance relationship, the practices of companies with high innovation orientations, and the differences in innovation orientation scores of companies across the world. Based on insight from 1265 companies in nine countries, this research confirms the innovation orientation and performance relationship in a global context, identifies crowdsourcing, open innovation, design thinking, stage-gate systems, scientific discovery, big data analytics, measuring innovation, and innovation management software as common practices of high innovators, and shows that companies' innovation orientation dimensions and overall scores differ based on country. It offers an extensive and global perspective to the research and provides managerial considerations for executives seeking to enhance firm-level innovativeness, corporate performance, and economic prosperity.

Internationalization of R&D and Innovation Performance in the Pharma Industry

This research investigates the effect of R&D internationalization and contingency variables on innovation performance. A number of prior studies addressing this question have concluded in diverse and inconsistent findings, which can be attributed only partly to sample selection and measurement discrepancies. Using a longitudinal dataset of global pharmaceutical firms, we partly solve this ambiguity in the R&D internationalization and innovation performance relationship. The results reveal an S-shaped relationship, suggesting the benefits of R&D internationalization ultimately overcome the costs after critical levels of R&D internationalization. This finding combines and unites prior findings of a U-shaped, followed by an inverse U-shaped curve. In addition, we find that the experience in conducting R&D internationally, but not the degree of general internationalization, moderates the relationship between degree of R&D internationalization and performance. This suggests that the effect is contingent on the knowledge of internationalization path of the firm but can flourish in the absence of overall internationalization as well. Implications for theory and practice are derived.