Effect of network embeddedness on innovation performance of small and medium-sized enterprises: The moderating role of innovation openness
Journal of Strategy and Management
ISSN: 1755-425X
Article publication date: 24 March 2020
Issue publication date: 1 April 2020
Abstract
Purpose
The purpose of this study was to identify if network embeddedness and innovation performance relationship, which has been largely studied in multinational enterprises (MNEs) and large corporations, was also applicable in the context of small and medium-sized enterprises (SMEs). Secondly, the authors also sought to identify the moderating role of innovation openness in the relationship between network embeddedness and SMEs' innovation performance.
Design/methodology/approach
Empirical analysis was based on 388 SMEs in Ghana. Various validity and reliability checks were conducted before the presentation of the actual analysis, which was conducted using the structural equation modeling in Amos (v.23).
Findings
Findings revealed that, in the context of SMEs, network embeddedness had significant positive effect on innovation performance. The authors further identified that SMEs with both high levels of network embeddedness and innovation openness had a much higher performance in their innovation, compared to SMEs that relied solely on network embeddedness.
Research limitations/implications
The current study found innovation openness to further strengthen the relationship between network embeddedness and SMEs' innovation performance. The relationship between network embedded and SME's innovation could, however, be mediated by knowledge transfer mechanisms, so future studies should pay particular attention to the mediating mechanisms.
Practical implications
Management of SMEs is advised to develop conducive organizational structures, such as trust, openness to collaboration and so on, for effective innovative knowledge transfer and transformation.
Originality/value
Past research studies on network embeddedness and innovation performance have dominantly resided in MNE and large corporations. This current study extends the body of knowledge by extending the network embeddedness and innovation performance research studies to SME context.
Keywords
Acknowledgements
This project was funded by National Natural Science Foundation of China: Research on open innovation in SMEs and promotion policies from the perspective of network embeddedness (grant number: 14BGL024). The authors wish to acknowledge the management of all the SMEs who responded to our questionnaire.
Citation
Dogbe, C.S.K., Tian, H., Pomegbe, W.W.K., Sarsah, S.A. and Otoo, C.O.A. (2020), "Effect of network embeddedness on innovation performance of small and medium-sized enterprises: The moderating role of innovation openness", Journal of Strategy and Management, Vol. 13 No. 2, pp. 181-197. https://doi.org/10.1108/JSMA-07-2019-0126
Publisher
:Emerald Publishing Limited
Copyright © 2020, Emerald Publishing Limited