Product Innovation Capability Research Articles

INNOVATION in SMEs: THE ROLE OF EFFECTIVE RESOURCE AND KNOWLEDGE MANAGEMENT CAPABILITIES

Small and medium enterprises (SMEs) in the manufacturing sector make a significant contribution to a country’s economic growth. Despite this contribution, majority research concerning innovation management in the manufacturing sector is focused on large organisations. This paper therefore explores the role of effective resource and knowledge management capabilities on innovation in the context of SMEs. Using a sample of 185 manufacturing firms, we find a positive association between increased investments in R&D and human resources (i.e, training employees) with innovation capabilities. Our data also supports that SMEs with intermittent R&D would experience stronger associations between R&D investments and product innovation capabilities, and that SMEs should not strive for balance in the choice between internal and external search. The results of this study offer both theoretical and managerial implications for SMEs striving to increase performance and innovation.

DETERMINANTES DO DESEMPENHO DAS STARTUPS BRASILEIRAS

A presente pesquisa tem como objetivo identificar a relação entre as variáveis que favorecem o desempenho organizacional das startups brasileiras. A pesquisa foi desenvolvida com as startups associadas à Associação Brasileira de Startups (ABStartup). Para análise dos dados coletados, optou-se utilizar a Modelagem de Equações Estruturais. Identificou-se que a orientação para o mercado, apesar de importante para as startups, não influencia no desempenho organizacional, no entanto, influencia positivamente a capacidade inovativa de produto. Além disso, verificou-se que existe relação positiva entre a capacidade inovativa de produto e o desempenho organizacional.

Firm-specific advantages-product innovation capability complementarities and innovation success: A core competency approach

The purpose of this study builds on a core competency perspective to examine the relationships among firm-specific advantages, product innovation capability, and innovative performance. This study propose that the role of product innovation capability is different in the relationships between two dimensions of firm-specific advantages (R&D orientation and marketing orientation) and the innovative performance. Regression analysis was used to test the hypotheses in a sample of 150 new product development cases. The empirical findings indicate that product innovation capability positively moderates the relationship between marketing orientation and innovative performance while R&D orientation affects the innovative performance primarily through the mediating effects of product innovation capability. Managerial implications and future research are discussed.

Environmental Sustainability as a Source of Product Innovation: The Role of Governance Mechanisms in Manufacturing Firms

Over the past two decades, since the emergence of the triple bottom line philosophy, the relationship between environmental sustainability and corporate performance has received a lot of attention, but has generated mixed or often even contradictory results. A few recent studies have inferred that innovations are the missing link that connects the environmental sustainability of a firm to other performance metrics; however, the evidence of such a proposition has been restricted to being conceptual or anecdotal. Relying on a knowledge governance approach, this study presents exploratory empirical evidence indicating that the impacts of a firm’s sustainability initiatives on its innovation performance originate from the governance mechanism it uses for sustainability, not sustainability outcomes per se. We tested this research proposition by using a subsample of Global Manufacturing Research Group’s global survey data. Our results support the positive impacts of two widely-used environmental sustainability governance mechanisms (i.e., internal monitoring and supplier collaboration) on product innovation capability. The findings further provide more useful and effective options for manufacturing firms and managers, to establish environmental sustainability governance mechanisms that can be converted into product innovation capability.

Re-thinking and re-operationalizing product innovation capability

PurposeThis paper aims to enhance the understanding of the essence of product innovation capability (PIC) as a dynamic capability by systematically assessing its conceptualization and construct validity. The paper answers the call by numerous researchers to undertake research efforts to better understand and operationalize dynamic capability constructs.Design/methodology/approachA priori and scholarly contentions based on complementarities between the tenets of three prominent frameworks (Dynamic Capability View, Process Management and Organizational Ambidexterity) were utilized for conducting a theoretical triangulation, as presented in the paper. Established approaches to explication and measurement of multi-dimensional latent constructs were used for guiding this paper.FindingsThis paper enhances the conceptualization of dynamic capabilities and identifies a lacuna in frequently adopted PIC operationalization approaches that is pertinent to other dynamic capabilities. It presents substantive and specific prescriptions for enabling the development of superior capability (both dynamic and operational) measurement models in empirical research.Research limitations/implicationsThe diverse implications for research and practice are discussed in the paper alongside suggestions for future research.Originality/valueThis paper guides future theoretical and empirical research by reviewing the conception and validity of PIC. It presents a comprehensive conception of dynamic capabilities by extending the dynamic capability definition to address the identified problems. The arguments presented have wide-ranging applications and broad generalizability across multiple research fields.

Application of Information System Technology and Learning Organization to Product Innovation Capability and Its Impact On Business Performance of Leather Tanning Industry

Information system technology and learning organization play a strategic role in the development of small leather industry performance. Even so, most of small leather industries in Garut assume that technology is a big investment that cannot have a direct impact on business performance. This study applied a quantitative explanatory survey method. The samples were 95 tanners in both formal and home industries located in Sukaregang, Garut, West Java. Data were analyzed using PLS-SEM. Based on the results of data analysis, it was concluded that the application of information system technology had a positive impact on the innovation ability of leather tanning products. On the other hand, the learning organization had no effect on the product innovation ability. Nevertheless, both information system technology and learning organization directly affected the business performance.

Women's Empowerment Model through Development of Households Industry Locally Specific in District of Abang, Karangasem Regency

This study aims to identify the profile of households handicraft industries and to propose strengthening women’s strategic role models through the development of households industries locally specific. Household industry profiles were analyzed descriptively and The Analytic Network Process (ANP) was selected as women's empowerment priority decision analysis tools and Super Decisions software as supporters.The results showed that (a) most household’s handicraft industries in the District of Abang, Karangasem Regency, Bali Province are classified as business-type starters and undeveloped; (b) rural people assume that women's businesses are conducted merely as a sideline and there has been no attempt to reach a wider market segment; (c) the contribution of women in the household handicraft industry can be summed up very strong, but not as a profitable business for themselves; (d) the results of Analytic Network Process (ANP) showed that the strengthening of the competence of human resources is the best alternative to the empowerment of women by relative priority of 39%.It is therefore, in applying the strategy of strengthening the competency of human resources, women need to incorporate important strategic orientation and product innovation capabilities in order to expand the business and in turn is able to increase the scale of their business from households scale only becomes SMEs.

How collaborative innovation networks affect new product performance: Product innovation capability, process innovation capability, and absorptive capacity

The current literature has investigated the direct relationship between collaborative innovation networks and new product performance, but the results are inconsistent. This research aims to explore the role of product and process innovation capabilities as two distinct mechanisms through which collaborative innovation networks improve new product performance. The study also examines the contingent effects of absorptive capacity on the relationship between collaborative innovation networks and the two innovation capability dimensions (i.e. product and process innovation). Survey data from 258 respondents from the Iranian high and medium technology manufacturing industries indicates the need for caution when developing collaborative innovation networks. We found that the effects of collaborative innovation networks on either product or process innovation capability are significant only in the presence of absorptive capacity. This finding suggests that the level of collaboration with different partners can enhance firms' innovation capabilities only if the focal firm's managers have developed the capacity to scan and acquire external knowledge. Our analyses further indicate that in the presence of absorptive capacity, only collaboration with research organizations and competitors have a positive effect on product innovation capability. In the case of process innovation capability, collaboration with research organizations and suppliers are the most important factors.

An Analysis of the Optimal Customer Clusters Using Dynamic Multi-Objective Decision

The M-type society has emerged in recent years, under which the Food and Beverage (F&B) industry is facing more intense competition. Product innovation and development capabilities, competition, increasing raw material costs, and the rising awareness of consumers pose even further challenges. This study used a project portfolio as the decision subject to identify customer clusters, with the research purposes: (1) to identify the optimal customer clusters by minimizing inter-cluster relationships and (2) to maximize the intra-cluster relationships. The findings help address the problem of a dispersed optimal intra-group structure caused by clustering in the inter-group relationships. Computerized management of that is conducive in accounting and information analysis. Thus, dynamic multi-objective service decisions can provide the related industries with development strategies when facing uncertainties.

Knowledge Creation Process and Sustainable Competitive Advantage: the Role of Technological Innovation Capabilities

This study examines the relationship between the knowledge creation process and technological innovation capabilities, and analyzes their effect on a firm’s sustainable competitive advantage using a knowledge-based view theoretical framework. We conduct structural equation modeling analyses using survey data from 315 Chinese industrial firms to test the direct and indirect effects of the knowledge creation process on sustainable competitive advantage. Technological innovation capabilities—operationalized to reflect the dimensions of process innovation capability and product innovation capability—are used as the mediating variable for explaining the relationship between the knowledge creation process and sustainable competitive advantage. The results indicate that the knowledge creation process does not have a significant direct effect on sustainable competitive advantage. Rather, the knowledge creation process can only influence the sustainable competitive advantage through the mediating effect of technological innovation capabilities completely. Consequently, the knowledge creation process favors the development of technological innovation capabilities for processes and products, because processes and products can lead to a sustainable competitive advantage.

Mediation effects of trust and contracts on knowledge-sharing and product innovation

PurposeThe purpose of this paper is to analyze the mediating role of contracts and trust on the generation of product innovations stemming from buyer-supplier knowledge-sharing (KS) among the members of the supply chain. Together with the individual effects of trust and contracts, their joint effect is examined in order to determine whether these are complementary or alternative mechanisms of safeguarding and control.Design/methodology/approachDrawing on a survey of 202 European machine tool firms acting as buyers and sellers, the authors propose and evaluate a structural equation model.FindingsResults confirm that there is a positive relation between contracts and trust with respect to buyer-supplier KS, and of the latter with respect to innovation performance. They also show that firms in which both the levels of trust and contract use are high reinforce their product-innovation capability based on buyer-supplier interaction (complementarity thesis). However, results also show that, contrary to trust, contracts by themselves do not act as a stimulus for product innovation.Research limitations/implicationsEstablishing contracts seems to be a highly recommended action in a buyer-supplier relationship focused on increasing innovation capacity. This does not go against engendering trust in a relationship. Both trust with a degree of formalization, in different ways, help to increase the effect of sharing valuable knowledge on innovation capacity.Originality/valueTo the authors’ best knowledge, no prior study has delved into differentiating the use of contracts and trust as mechanisms in mediating the effect originated from knowledge-sharing on product innovation performance with two different samples formed by buying and selling firms.

The role of organizational capabilities in attaining corporate sustainability practices and economic performance: Evidence from Italian wine industry

Corporate sustainability assigns firms the key role of integrating and pursuing economic, environmental and social goals. Thus, firms struggle to link corporate sustainability practices and organizational performance. These efforts require enabling factors, namely organizational capabilities, which have yet to be identified and studied. Applying a dynamic resource-based perspective, the present study aims to explore the role of three organizational capabilities for implementing proactive socio-environmental practices and related economic performance: collaboration with partners-suppliers, adoption of advanced technologies and product innovation. By estimation of a structural equation model with survey data from 357 firms in the Italian wine industry, the results indicate that collaboration with partners-suppliers and product innovation capability foster the implementation of proactive socio-environmental practices. Hence, the role of fostering corporate sustainability is not accidental but can be managed by taking different dimensions into account, namely motivation within the firm and interaction at organizational as well as systemic levels. In addition, the direct link between the proactive socio-environmental practices and economic performance, and their positive mediating effect on the capabilities identified and economic performance highlight the opportunity to trigger a virtuous circle to address corporate sustainability because organizations are involved at strategic and operational levels. These results provide important managerial implications. First, companies oriented towards sustainability should identify and develop specific capabilities rooted in the organization to implement practices that are a source of competitive advantage in a market increasingly conscious and attentive to sustainability issues, such as the wine industry. Second, the development of specific organizational capabilities can overcome some possible disadvantages associated with young and small-medium enterprises interested in implementing the concept of corporate sustainability.

Does organizational creativity always drive market performance?

AbstractThis study develops and tests arguments that the relationship between organizational creativity and market performance is channeled through new product development (NPD) capability, and that the indirect effect of creativity on performance, via NPD capability, is conditional upon levels of environment dynamism and market responsiveness. The proposed relationships are tested on a sample of 221 small‐ and medium‐sized enterprises (SMEs) in a major sub‐Saharan African market. Findings from the study indicate that process and product NPD capabilities partially mediate the effect of novelty and usefulness elements of organizational creativity on market performance. The study further finds that while environment dynamism weakens the indirect effects of novelty and usefulness of organizational creativity, via process and product NPD capabilities, on market performance, the effects are strengthened under conditions of greater responsiveness to target market needs. A theoretical contribution from this study is the finding that how organizational creativity dimensions drive market performance is more complex than previously thought: it depends on whether or not organizational creativity components are first used to develop an organization's process and product innovation capabilities, and whether target market environment conditions are dynamic and an organization has ability to respond to target market demands.

Product innovation capability, export scope and export experience

PurposeBy applying the logic of the resource-based view and process-based internationalisation theory, this study aims to provide a better understanding of the effects of product innovation capability on the export scope of firms based in developing countries and the role of export experience as a facilitating mechanism.Design/methodology/approachUsing survey data obtained from three developing countries, two main research hypotheses were empirically tested: a quadratic relationship exists between product innovation capability and export scope and export experience has a moderating effect in this relationship.FindingsProduct innovation capability and export scope have a U-shaped relationship, and export experience exerts a moderating effect. The greater the export experience is, the more the relationship between product innovation and export scope changes, taking on a more inverted U-shaped form.Practical implicationsFirms based in developing countries need to catch-up on innovation capabilities before being able to succeed in international markets. Managers must be aware that initial investments in product innovation could not pay off immediately and that significant additional efforts might be needed to obtain noteworthy results in terms of international expansion.Originality/valueThis study is among the first to focus on the curvilinear relationship between product innovation capability and export scope for firms based in developing countries while accounting for the moderating role of firms’ export experience.

The effect of export marketing capabilities on export performance: Moderating role of dysfunctional competition

This study utilizes multiple-informant and time-lagged primary data from 162 industrial exporting firms in Sub-Saharan Africa to contribute to an understanding of when export marketing capabilities can be deployed to drive export performance. The study finds that market responsiveness capability drives export performance when it is deployed together with a product innovation capability. The joint effect of both capabilities on export performance is weakened at high levels of dysfunctional competition in export market environment. The findings suggest that a stronger capability to respond to export market needs and a greater competence in introducing new products in export markets are not always beneficial in Sub-Saharan African markets as the resulting export performance outcome is dependent upon degrees of dysfunctional competition.

Relating open innovation, innovation and management systems integration

Purpose The purpose of this paper is to analyze the impact of the level of integration of management systems (IMS) over product and process innovation capabilities (IC), by considering the role of open innovation (OI) activities as a moderating effect of those relationships. Design/methodology/approach A longitudinal empirical study was performed on an existing Spanish panel database that contains information related to innovation, where 9,765 companies were selected for the panel analysis. A logit approach with random effects was considered. Findings The level of IMS positively influences process and product IC. Moreover, external cooperation, and using it to a high extent not only positively moderates the effects of the level of IMS over process IC, but also of process over product IC, where it becomes indispensable for its effect to be positive. Finally, investing in external knowledge is a positive moderator of the effects of the level of IMS over both: process and product IC. Originality/value This is one of the first studies on empirically finding evidence of the impact of the level of IMS on process and product IC, and of the moderating effect of performing OI activities in order to achieve higher process and product IC through the IMS.

The unique chinese innovation pathways: Lessons from chinese small and mediuem sized manufacturing firms

Many researchers equate the development of Chinese product innovation capabilities to Japanese and South Korean's development paths, that is, from imitation to innovation. Nonetheless, today many Chinese products have competed successfully in the global markets in terms of speed, cost, quality, and innovativeness. China's product innovation performance has gained the world's recognition. The performance of some industrial areas have also outperformed Japan and South Korea. This paper aims to understand and identify the unique phases of Chinese innovation. We collected empirical data from field studies and interviews with managers of ten small and medium enterprises (SMEs) in the Suzhou province of China. The research shows three unique Chinese innovation phases that are distinctive from the Japanese and South Korean. The results provided interesting insights into how Chinese SMEs in different industries cultivated their skills and knowledge under the three unique phases. We believe the findings contribute towards a better understanding of Chinese innovation in the context of China's evolving institutions and growing firm capabilities. Moreover, findings from this research help to shed light on existing debates for the unique Chinese innovation pathways.

Enhancing the sales benefits of radical product innovativeness in internationalizing small and medium-sized enterprises

This study draws on resource-based theory to examine the strategic orientation conditions under which radical product innovation capability is more or less beneficial. To test these relationships, this study conducts multiple survey studies among international small and medium-sized enterprises (SMEs) in developed and developing economies. This study finds that, although a positive association exists between radical product innovativeness and sales performance in the context of a developed economy, the relationship is non-significant in a developing market context. In addition, across both the developed and developing economy contexts, when high levels of radical product innovativeness exist, as well as when entrepreneurial orientation increases in magnitude, a corresponding increase in sales performance occurs. Similarly, this study finds that, across both contexts, high market-orientation levels strengthen the effect of radical product innovativeness on sales performance.

How SMEs Build Innovation Capability Based on Knowledge Sharing Behavior? Phenomenological Approach

The research problem was how Small Medium Enterprises (SMEs) behaviour shared their knowledge with the impact on improving product innovation capabilities. Research using phenomenological approach and Creswell Model Analysis Data. The research findings showed that attitude toward knowledge sharing behaviour to be addressed as a spirit to move forward, obligation, fortune sharing, and efficiency. Motivation of knowledge sharing behaviour were growth, independent, partnership, and consumer's satisfaction. Whist, harmony and patience were meanings of the embedded value of SMEs owners. Perceived behavioural of knowledge sharing behaviour was determined by learning together, willingness, and understanding other. Finally, innovation capability was defined as innovative product, improved production techniques, and improved quality.

THE MEDIATING EFFECT OF PRODUCT INNOVATION CAPABILITY ON ENTREPRENEURIAL PRO-ACTIVENESS AND HOTEL PERFORMANCE

This study is based on a phenomenon that occurred in Thai hotel industry. Nowadays, innovation is a critical concern in most enterprises particular in hotel businesses due to the fact that hotels have the uniqueness of product and service. For a hotel to be competitive and achieve efficient outcomes, it is important to understand the manager’s perspectives of product innovation capability (PIC) and entrepreneurial pro-activeness (EPA) that lead to hotel performance (HP). The purpose of this study was to examine and explain the PIC in mediating the effect of EPA and HP in Thailand. A structured questionnaire was developed to collect data from 240 hotel managers in Thailand. The constructs were measured by using established scales. A structural equation model (SEM) was used to examine research hypotheses. The results showed that PIC has a direct and significant impact on HP and strongly mediates the relationship between EPA and HP. An important finding of this study is being able to integrate the effect of EPA towards HP through PIC as a mediating variable. This finding is also encouraging for hotel owners and managers in implementation and development of strategies appropriate to the environment, and achievement of competitive advantage. It is anticipated that these factors will lead to higher levels of product and service in the Thai hotel industry and enhance the positive travel experiences in Thailand.