Small Medium Enterprises Research Articles

Talent philosophies and institutional factors as determinants of talent management in SMEs: a French country-specific empirical investigation

PurposeTalent management (TM) is a crucial strategic issue for global organizations, extending beyond multinationals and big companies to encompass small and medium-sized enterprises (SMEs) and contexts outside the Anglo-Saxon sphere. However, TM in SMEs is still under-researched, with a lack of studies and evidence on TM determinants and TM in practice. This study explores, using the lens of institutional theory, how talent philosophies and a combination of institutional factors shape TM in French SMEs, highlighting the interplay between these elements within the specific context of French SMEs.Design/methodology/approachGiven the limited knowledge about TM determinants in SMEs and the need to uncover and understand the phenomenon investigated, this study is exploratory in nature and lends itself to a qualitative research approach. In-depth semi-structured interviews with 27 CEOs, managers, TM and HR managers across 15 SMEs in France provided a comprehensive cross-industry perspective.FindingsThe study reveals that talent philosophies in French SMEs are predominantly inclusive and development-oriented, influenced by institutional factors such as the cultural logic of proximity and personalization, state support mechanisms like the Fonds Unique Interministériel (FUI) and legal frameworks that emphasize equal opportunity. Organizational elements like size and proximity foster a community-focused, egalitarian TM approach, while ownership and vulnerability lead to a reactive and informal TM strategy. The study presents a model that links these determinants to the specific TM approaches observed in French SMEs, illustrating how institutional factors like centralized control and egalitarianism shape TM practices.Research limitations/implicationsThis paper highlights the need for more empirical studies on talent philosophies, institutional and organizational factors not only in SMEs but also in comparison with multinational enterprises (MNEs), through institutional theory. Particular attention should be paid to the homogenization of SME sizes based on their level of establishment.Originality/valueThis study extends studies on TM determinants in SMEs, from the perspective of talent philosophies, utilizing insights from French institutional theory. It is also among the few and new studies to highlight contextual issues of TM as well as how TM is practiced depending on internal and external factors.

A thematic analysis of factors influencing small and medium enterprise adoption of social media marketing: a TOE framework perspective

Purpose This paper aims to examine the factors influencing the adoption of social media marketing by small and medium enterprises (SMEs) in Pakistan. By investigating the drivers and challenges/barriers affecting the adoption of social media marketing tools among SMEs, this study provides practical guidance to SMEs seeking to utilize social media platforms for marketing purposes in a developing context such as Pakistan. Design/methodology/approach Utilizing the Technology-Organization-Environment (TOE) framework as a theoretical framework, qualitative data were collected through semistructured interviews with representatives of SMEs in Pakistan, followed by thematic analysis of the data. Findings The research identifies several key factors influencing the adoption of social media marketing by Pakistani SMEs. These factors include doubts regarding the benefits of social media, alignment with regulatory requirements, challenges related to tracking social media performance, resistance from senior management (older employees), the positive influence of competitive pressure and the Covid-19 pandemic, political instability and increased government taxes on digital services. Stakeholders such as marketing professionals, academics, policymakers, government authorities and SME owners and managers can benefit from these findings. Originality/value This research contributes to the academic literature on the adoption of social media marketing by SMEs, especially within emerging economies. It enriches theoretical understanding of adoption processes and factors, filling gaps in existing knowledge and laying a foundation for future research in this domain. Using the TOE framework, the study reveals that when all factors are adequately considered, SMEs can transition from traditional marketing methods and embrace social media as a digital marketing strategy to enhance performance, profitability, and gain a competitive advantage over their rivals.

FACTORS INFLUENCING CLOUD COMPUTING ADOPTION : TECHNOLOGY, ORGANIZATIONAL AND ENVIRONMENT (TOE) FRAMEWORK APPROACH

The latest technology that must be applied to prepare for modernity is based on information technology. This technology is not only used by large companies (enterprises) but can also be utilized by Micro, Small and Medium Enterprises (MSMEs). One of the utilization of technology is cloud computing by Micro and Medium Enterprises (MSMEs) which is increasingly widespread. This is reasonable because cloud computing technology provides benefits with a simpler process and relatively low costs. In line with this, this study aims to determine the factors that influence the adoption of cloud computing in MSMEs. An integrated model was developed based on the Technology, Organization, and Environment (TOE) framework. This research data was obtained through a structured survey questionnaire given to 150 MSME owners/managers in the Soloraya Region. The results obtained through SEM-PLS analysis show that factors such as organizational readiness and competitor pressure have a significant effect on cloud computing adoption in MSMEs in the Soloraya Region. However, factors of relative advantage, complexity, and top management support were found to have no significant effect on cloud computing adoption. This research provides a theoretical contribution to the expansion of the TOE Framework.

Corporate governance and SME performance: Is technological capability a missing link?

Purpose This paper aims to examine the role of technological capability in the relationship between corporate governance and small and medium-sized enterprise (SME) performance. Design/methodology/approach Using panel data comprising 1,357 European SMEs from 2014 to 2020, this paper examines how technological capability acts as a mediator and moderator within the governance-performance nexus. Findings The results show a positive and significant link between corporate governance mechanisms and SME performance, as well as between technological capability and SME performance. In addition, this paper show that technological capability plays a crucial role in moderating and mediating the governance-performance relationship. Specifically, technological capability accentuates the positive effects of board size, the presence of outside directors and concentrated ownership on SME performance. Conversely, it attenuates the positive impacts of CEO duality and board gender diversity on SME performance. These results highlight corporate governance mechanisms and technological capability’s crucial role in significantly influencing SME performance. Practical implications The results suggest that SMEs should prioritize not only the implementation of effective corporate governance mechanisms but also the strategic utilization of technological innovations to boost performance. European policymakers are encouraged to enact supportive policies on technological innovation to strengthen the governance-performance dynamic. Originality/value This study contributes to the governance-performance literature by offering new insights into the critical role of technological capability, which has been previously explored in partial and fragmented ways.

“Sweeten the (i)-deal”: unveiling power and influence dynamics in family small and medium-sized enterprises

PurposeFamily small and medium-sized enterprises (SMEs) represent a substantial part of many economies. In these organizations, close and informal relationships between employers and employees often foster a mutual understanding of each other’s needs, facilitating the negotiation of idiosyncratic deals (i-deals), special employment conditions tailored for individual employees. However, research on how i-deals are negotiated in family SMEs, especially regarding power dynamics and influence, remains limited. This study aims to identify the types of i-deals negotiated in family SMEs and explore the role of power and influence in these negotiations.Design/methodology/approachSemi-structured interviews were conducted with 45 employees and 15 employers from Spanish family SMEs. Data were analyzed using ATLAS.ti 8, and thematic analysis was performed.FindingsThe study concludes that task, flexibility, financial and development i-deals are particularly negotiated in family SMEs. It identifies that referent and expert power play an important role in initiating these negotiations. Furthermore, rational tactics are generally employed for negotiating work performance, soft tactics for employment-related aspects and hard tactics for work flexibility. Additionally, the study identified gender differences in the negotiation of i-deals.Research limitations/implicationsThis study enhances i-deal literature by highlighting the distinct characteristics of family SMEs and their impact on i-deal negotiations. The findings suggest that power dynamics and influence tactics in family SMEs differ from those in larger firms. Moreover, certain i-deals may encounter resistance due to concerns about organizational performance and economic implications. Understanding these factors is essential for developing effective negotiation strategies in family SMEs.Originality/valueThis study offers a dual perspective, analyzing the power and influence tactics used by both employees and employers in family SME i-deal negotiations and highlighting gendered dynamics in these processes.

ENTREPRENEURIAL ORIENTATION AND SME SUCCESS: UNVEILING THE MEDIATING IMPACT OF AMBIDEXTERITY

This research seeks to assess how ambidexterity in exploration and exploitation mediates the relationship between entrepreneurial orientation and the performance of small and medium-sized enterprises (SMEs). Specifically, this study investigates the indirect influence of entrepreneurial orientation on business performance through the mediating roles of ambidexterity exploration and exploitation. A quantitative approach using structural equation modeling (SEM) is employed to examine the relationships among these variables. The research sample comprises 200 SMEs operating primarily in East Java, Indonesia. The findings demonstrate a significant mediating effect (p<0.05) of ambidexterity exploration and exploitation, which enhances the influence of entrepreneurial orientation on business performance. This indirect effect proves to be stronger than the direct impact of entrepreneurial orientation itself. The structural model shows a high R-square value of 68.6%, indicating a strong predictive capability. Additionally, the goodness-of-fit index reflects high model suitability (0.543 > 0.36), and the predictive power of the PLS model is considered medium. The study’s results underscore the importance of fostering both ambidexterity in exploration and exploitation alongside entrepreneurial orientation to optimize SME performance.

Growing with little

Purpose This paper aims to review the latest management developments across the globe and pinpoint practical implications from cutting-edge research and case studies. Design/methodology/approach This briefing is prepared by an independent writer who adds their own impartial comments and places the articles in context. Findings This paper identified that knowledge management can play a crucial role in helping small and medium sized enterprises (SMEs) achieve a competitive advantage. Originality/value The briefing saves busy executives, strategists and researchers hours of reading time by selecting only the very best, most pertinent information and presenting it in a condensed and easy-to-digest format.

Unlocking high-growth potential: does intellectual capital efficiency drive European entrepreneurial ventures?

PurposeThis paper investigates the influence of intellectual capital (IC) efficiency and its components – human capital efficiency (HCE), structural capital efficiency (SCE) and capital employed efficiency (CEE) – on the growth paths of small and medium-sized enterprises (SMEs) and their likelihood of becoming high-growth firms (HGFs).Design/methodology/approachDrawing on the resource-based view (RBV), our study reveals a positive relationship between IC efficiency and the likelihood of becoming HGFs. Using a longitudinal dataset of 554,076 firm-year observations corresponding to approximately 79,158 European SMEs from 2012–2019, our study employs probit regression to examine the impact of IC efficiency on the probability of becoming an HGF. To investigate the impact of IC efficiency across the growth rate distribution, we conduct further analyses via generalized least squares.FindingsThe results show that IC efficiency positively influences the growth paths of small entrepreneurial ventures and their likelihood of experiencing high-growth episodes.Practical implicationsFor practitioners, the findings underscore the importance of investing in IC to enhance the growth process of entrepreneurial firms and increase their likelihood of achieving HGF status. Investments in IC can maximize growth potential and competitiveness, informing strategic decision-making.Social implicationsPolicymakers should consider the critical role of IC in promoting SME growth and formulate policies that encourage the development of IC among entrepreneurial firms. Such initiatives can stimulate economic growth, innovation and job creation across European economies.Originality/valueThis study contributes to the literature by focusing on entrepreneurial firms and examining how IC efficiency drives their transition to HGF status. This study provides empirical evidence across several European contexts over an extended period, emphasizing the role of IC efficiency in shaping the growth paths of entrepreneurial firms.

The Development of MSMEs in India: a Bibliometric Analysis

This paper aims to evaluate the structure and evolutionary trend of research on development in MSMEs in India using a bibliometric examination. An analysis of academic research from 2008 to 2022 was conducted using bibliometric methods, searching for the terms used in emergent technologies. The research is intended to assess the development of micro, small, and medium companies and understand how far this topic has been achieved. Several research methods were applied, including the network method, thematic maps, and coefficients of approaching or intellectual tools. The result of this work can be helpful for new scholars and current trends, based on the study trends to achieve sustainable development goals against poverty, micro MSMEs (Micro Small Medium Enterprises), and unemployment. The highlight of the report stresses on the key issues where researchers are giving more focus which includes innovation and supply chain strategies. The findings from the study serve to enhance our understanding about areas within the extant research literature where less is known, particularly when it comes to advances and barriers that impact Micro, small-and medium enterprises (MSMEs). The present study will imbibe researchers and the experts from industry to have a profound insight into intellectual domains surrounding certain technologies that can facilitate growth of MSMEs in India, as well provide above detailed unattended research scope. The research concerning MSMEs has undoubtedly provided many facts about the growth and development of these enterprises, applicable particularly in India. To describe the research and intellectual progress on the Manufacturing industry, a bibliometric approach was used in this study. A comprehensive literature review and meta-analysis were employed to get trustworthy results.

Cloud Computing Practices among Small and Medium-Sized Enterprises (SMEs); Contemporary Trends, Possibilities, and Challenges

The study focused on Cloud Computing practices among Small and Medium-Sized Enterprises (SMEs), the Contemporary trends, Possibilities, and Challenges. The objectives were to review the history behind cloud computing in relation to SMEs in Ghana, to examine factors that impact the adoption of cloud computing by SMEs in Ghana that tend to affect their performance, to analyze the impact of cloud computing migration strategy on cloud computing adoption, to evaluate the merits and demerits of cloud computing adoption, and to analyze the security involved in using cloud computing. The study employed a descriptive research design to describe the variables of interest, and information. This study found that cloud computing has a favorable impact on SMEs by reducing their operating costs, thereby increasing their margins. It also revealed that despite the many advantages of cloud computing, demerits such as security and privacy, lack of skills, expertise, and resources, and limited flexibility and control contribute to the low rate of cloud service adoption in Ghana. It is recommended that cloud services must be developed to integrate seamlessly with the existing Information Technology (IT) systems prevalent in the SME industry, and cloud service providers provide adequate migration training for SMEs as part of the adoption process. It also emphasizes the need for future cloud technology research to review new cloud services and practices that SMEs can adopt to gain a competitive advantage in the market.

Exploring the Role of Knowledge on Adoptability of Islamic Banking and Financing Options for Micro, Small and Medium Enterprises: The Mediating Role of Trialability

Knowledge is the act of knowing something with familiarity gained through experience or education. Prior studies have discovered that knowledge has a significant relationship with the adoption of Islamic Banking and Financing Options (IBFOs) amongst Small and Micro Enterprises (SMEs). However, this study explores the role of knowledge on adoptability of Islamic Banking and Financing Options (IBFOs) for Micro, Small and Medium Enterprises (MSMEs), with the mediating role of trialability. While trialability has been suggested as an adoption factor, it has not been considered important in adoption studies and has thus received debates. A structured questionnaire survey consisting of a Likert scale from 1 to 5 was conducted with 300 MSME owners or managers. The findings revealed that trialability has a partial mediation between knowledge and adoptability of IBFOs. This implies that when IBFOs are offered on a trial basis, it will have an impact on the level of knowledge MSMEs will have about IBFOs with the adoptability of IBFOs. As a result, the banking and financing sector should consider offering IBFOs on a trial basis to enhance the knowledge of MSMEs and lead to its adoptability. This research contributes to literature by offering trialability as a mediating variable in the adoptability of IBFOs. The authors recommend testing trialability as a mediating variable in determining the adoptability of any other product or service or even testing it as a moderating variable.

The Impact of Entrepreneurial Leadership, Business Environment, Digital Literacy, and Religiosity on Msme Performance: The Mediating Role of Innovative Behavior in Pekanbaru

This study examines the influence of entrepreneurial leadership, business environment, digital literacy, and religiosity on the performance of micro, small, and medium enterprises (MSMEs) in Pekanbaru, with innovative behavior as a mediating variable. Using a sample of 300 MSME entrepreneurs and analyzed through Partial Least Squares (PLS) Structural Equation Modeling (SEM), the research finds significant direct effects of entrepreneurial leadership (β = -0.204, p = 0.047), business environment (β = 0.225, p = 0.007), digital literacy (β = 0.139, p = 0.022), and religiosity (β = 0.271, p = 0.011) on business performance. The mediating role of innovative behavior is only significant in the relationship between religiosity and business performance (β = 0.162, p = 0.012). The findings emphasize the critical role of religiosity and innovative behavior in improving MSME performance. This research contributes to the growing literature on MSMEs by demonstrating how leadership, environment, digital skills, and religiosity shape performance outcomes.

SME representation in chambers of commerce bodies – a model perspective

Background: The research analyzes the formal representation of micro, small, and medium-sized enterprises (SMEs) in the bodies of chambers of commerce in a model-based approach. Research purpose: Chambers of commerce are managed by their bodies (board, general assembly, etc.). Their composition is most often chosen by members in elections. It should reflect the structure of the associated enterprises – at least in terms of industry and size classes. The division of mandates affects the operational activity of the organization – including the content of positions developed in consultation processes and services provided to entrepreneurs. The aim of the study is to verify whether in the countries selected for analysis (representing different models of functioning of chambers of commerce) there are regulations securing the formal representation of SMEs in the bodies of chambers. And if they do exist, what form do they take? In addition to determining the actual situation, the advisability and possible way of regulating the SME parity in several model scenarios is analyzed. Methods: Using the deductive method and critical analysis, the study analyzes the statutes of chambers of commerce in selected countries and reviews sociological, economic and legal literature. Conclusions: The findings indicate that there are only a few examples of regulations protecting the representation of SMEs in chambers’ bodies. It was also found that the rules for representing different sized enterprises in the bodies and task groups of chambers of commerce are closely linked to the model of these organizations. In the Anglo-Saxon private law model, business owners primarily participate voluntarily in selected organizations. However, in countries with a single chamber per region, free choice of organization does not in fact exist. In the continental public law model, where membership is universal by operation of law, statutes focus primarily on mapping the structure of dominant industries in a region and usually omit other criteria. The sectoral model offers the greatest potential for balancing the representation of every size of industry and enterprise.

Digital finance for SMEs and startups: a bibliometric analysis and future research direction

PurposeThis paper aims to provide a broad overview of the corpus of studies on digital finance in relation to small and medium enterprises (SMEs) and startups.Design/methodology/approachBibliometric analysis was used, allowing to investigate the relevant literature (735 articles). In accordance with best practices, relevant articles were identified on the topic following the PRISMA 2020 framework that ensures reproducible and rigorous results. The search then proceeds with performance analysis, identifying key trends at the intersection of research fields, including distribution of articles by year, citations by year, most cited contributions and most cited and prolific authors. This is followed by analyses of co-citation, co-authorship and co-occurrence with a detailed description of the thematic clusters identified.FindingsPerformance analysis shows that scholarly output covers a 12-year period, starting in 2011, and demonstrates a growing interest in this topic. Co-occurrence analysis reveals a significant intellectual structure which allows numerous knowledge gaps to emerge, and these offer new opportunities to be addressed in future research.Originality/valueThis study uniquely focuses on the evolution of the research domain related to digital finance associated with SMEs and startups. It provides implications for practitioners and avenues that researchers can develop in the future to produce impactful studies.

Redesign of work facilities at the tofu pressing station with a participatory ergonomic approach

Tahu Palda is a small and medium-sized micro business in the food industry that produces tofu. This factory has been producing tofu since 2005, located in North Aceh. The workers in this tofu usually five workers, with an average of 7 working hours per day. Based on the observations at several workstations, initial data indicate that the dominant work posture is standing, bending, and lifting heavy loads such as a 20 kg weight for pressing and lifting a mold holder with a 15 kg load. This is done continuously for 7 working hours each day. Based on the results of the distribution of the Cornell Musculoskeletal Discomfort Questionnaire (CMDQ), it was found that workers at the station experience complaints such as back pain, lower back pain, and upper arm pain due to the high frequency of lifting heavy loads. If this continues to be neglected, it can lead to work-related diseases such as musculoskeletal disorders. The assessment of workers' posture using the Rapid Entire Body Assessment (REBA) method shows that the score obtained for the job of pouring soybean paste is 7, which means a moderate risk, the job of lifting the press weight is 5, which means a moderate risk, and the job of flipping molds has a score of 10, which falls into the high-risk category and needs improvement. Improvements were made using a participatory ergonomics approach, resulting in the decision to redesign the tofu press tool to fit the workers' body anthropometry. The anthropometric calculations for the height range of the press support tool and cutting tool are 141.1 cm, the press support range is 68.78 cm, the width of the press tool is 49.4 cm, the height of the tray is 4.54 cm, and the height of the tray holder is 103.85 cm.

Impact of TQM Practices on SMEs Performance in Pakistan: Information Technology Turbulence as a Moderator

The purpose of this paper is to investigate the impact of Total Quality Management (TQM) practices on the performance of Small and Medium Enterprises (SMEs) in Pakistan. This study considered how Information Technology Turbulence (ITT) by acting as a moderating factor in the era of technological advancements influenced the firm’s performance. The study compared the export performance of SMEs in the sports goods manufacturing sector over the last five years till 2021. About 361 questionnaires were chosen at random for study those were distributed and personally collected, the collected data analysed by using the Partial Least Squares Structural Equation Modelling (PLS-SEM). The research indicated that ITT moderated the association of practicing features of TQM as a major player with the SMEs’ performance. These revelations provided a better understanding of how TQM practices together with ITT affected SME performance, which is beneficial for researchers and policymakers. The researcher used a quantitative approach based on cross-sectional data. The conceptual model in this study intends to propose TQM practices as exogenous and ITT as a moderating variable on the performance of SMEs. This study will be useful for people in strategic positions to make decisions by providing a working ground on factors significance to enhance the SMEs’ performance.

A theoretical approach to address environmental management accounting implementation barriers in small and medium enterprises in developing countries

AbstractUniversal approaches to implementing environmental management accounting (EMA) have resulted in a paradigm shift in managing the physical and monetary aspects of the environment globally. While in developing countries, large enterprises continue to lead in implementing EMA, small and medium enterprises (SMEs) are finding it difficult to optimally benefit from embracing EMA. Hence, various players such as policymakers, academics, and environmental experts promote the establishment of new approaches that SMEs can apply to overcome a wide range of barriers inhibiting the successful implementation of EMA. Theories of small business growth, such as stakeholder and institutional, resource-based, and knowledge-based theories, advocate that an enterprise's success depends on the influence of stakeholders' expectations and institutional requirements and the management of the available resources and relevant expertise. A customised framework for applying these four (4) theories to understand the position of SMEs regarding EMA implementation barriers and the approach to address them is lacking. Therefore, in this article, we used a systematic literature review (SLR) using Preferred Reporting Items for Systematic Literature Review (PRISMA) to define the main aspects of these four (4) theories in the context of EMA implementation and identify EMA implementation barriers confronting SMEs. We recommend that SMEs consider applying the proposed framework to address EMA implementation barriers. The outcomes presented have implications for SME owners, government, environmental regulators, and large enterprises in establishing strong networks to encourage the implementation of EMA across the business spectrum.

Sustainable optimisation of SMEs closed-loop supply chain for lithium battery manufacturing

Maintaining the sustainability of small and medium-sized enterprises (SMEs) supply chain has positive impact on society. Under the ripple effect, the vulnerability of the SMEs supply chain and the collaboration uncertainty of participants have potentially negative impact on the sustainability that cannot be ignored. We consider the closed-loop SMEs supply chain network design based on the risk propagation to improve the triple sustainability. The basis of the simulation model structure is a bi-level multi-objective mixed-integer linear programming model that aims to maximise triple sustainability, and an improved dynamic non-dominated genetic algorithm (DNSGA2) is designed to solve the problem. An SMEs supply chain for closed-loop manufacturing of lithium batteries in China was considered. The results show that the centralised SMEs supply chain preform better when the supply-demand imbalance, and the distributed network structure is preform better in maintaining sustainability when manufacturer capacity imbalances. Supply chain managers should develop more flexible strategies based on the structure of downstream demand, increasing upstream manufacturers' participation to enhance their viability and improve the sustainability of the supply chain.

Do SMEs have an ESG communication strategy? Exploring the quality and influencing factors of voluntary ESG disclosures using web‐based and annual report channels

AbstractThis paper evaluates the influencing factors and disparities between web‐based and annual report channels for environmental, social and governance (ESG) disclosures by small and medium‐sized enterprises (SMEs). In contrast to the prevalent use of case‐studies in the context of SMEs, a quantitative study was conducted by performing a content analysis of the websites and annual reports of 100 manufacturing SMEs in Italy. Based on the collected evidence, SMEs exhibited a higher level of web‐based disclosures compared to annual reports. These disclosure channels appear to be independent of each other, with financial resources significantly influencing the quality of annual reports (i.e. profitability as a proxy) and size impacting information available on websites (i.e. turnover as a proxy). Both channels may be explained by the resource‐based view, while agency characteristics (such as having a Big Four external auditor or board size) have a relevant effect on the overall voluntary ESG disclosure score.

The mediating role of innovation in the impact of entrepreneurial bricolage on SME performance in the tourism sector

This study examines the mediating role of innovation in the relationship between entrepreneurial bricolage and the performance of small and medium-sized enterprises (SMEs) in the tourism sector. The research examines how resource-limited SMEs utilize creative problem-solving and resource optimization to enhance their competitive advantage. The study adopts a quantitative approach. Data was collected through surveys and in-depth interviews, data were collected from 46 SMEs in East Java, Indonesia, path analysis reveals that innovation significantly enhances the positive impact of bricolage on SME performance. Path analysis was employed to examine the direct and indirect effects of entrepreneurial bricolage on SME performance, with innovation as the mediating variable. The results demonstrate that entrepreneurial bricolage significantly improves SME performance by fostering innovation, which acts as a crucial mediator. SMEs practicing bricolage are able to optimize limited resources creatively, leading to innovative products, processes, and marketing strategies that enhance competitiveness and performance in the tourism sector. The findings provide practical implications for SME owners and policymakers in resource-constrained environments, offering strategies to leverage creativity and innovation for competitive advantage. The study provides valuable insights for SMEs, policymakers, and researchers. SMEs are encouraged to adopt bricolage as a strategic tool to navigate resource constraints, while policymakers should support innovation by improving resource accessibility and providing training programs. Future research can expand on this study by exploring bricolage practices across different regions and sectors, as well as investigating the long-term impact on SME performance. This research contributes to the limited literature on entrepreneurial bricolage in tourism SMEs, particularly in developing regions such as East Java. It offers new insights into how SMEs can leverage internal capabilities and innovation to achieve sustainable growth and maintain a competitive edge in resource-constrained environments.