The assessment of innovation management in small & medium-sized enterprises (SMEs) in Singapore retail industry

Abstract

The importance of innovation in association with organizational competitiveness and growth is widely researched and documented in academic literature. Innovation is generally considered the most valuable source of growth and competitiveness, since organizational innovations themselves have impact on business performance with regard to productivity, lead times, quality, and flexibility. Innovations can assist firms in building distinctive competencies or capabilities which result in developing new products/services, or improving existing products/services, or reducing the costs of producing such products/services. Innovativeness is the most important determinant of an organization’s performance. Innovation can take place only if the organization has innovation capabilities. There are many international studies on innovation capability with the aim of developing the concept itself and trying to identify the capabilities needed that allow the firm to innovate. However, there is a lack of research studying innovation capabilities holistically and systematically. Existing empirical studies on innovation capabilities and its impact on performance are also inconclusive and even contradictory. Previous researches have established that Small & Medium Enterprises (SMEs) are crucial economic actors within the economy of nations. There is, however, a shortage of data relating to SMEs and how they should approach innovation management, as the current literature does not provide universally acceptable theory and comprehensive frameworks for measurement of innovation capabilities and their impact on company performance. As such, carrying out research on innovation management practices, in this case innovation capabilities, targeting retail SMEs in Singapore context will help plug the research gap. This study is carried out based on the foundation of three theories: the resource-based view (RBV), dynamic capability view (DCV), and knowledge-based view (KBV), with the aim to identify key innovation capabilities at firm-level and investigate how such innovation capabilities impact retail SMEs (growth) performance. A research framework based upon extant literature was developed for quantitative investigation. In addition, a follow-up focus group discussion was conducted to gain further insights on innovation management practices, issues, and challenges facing. Primary data were collected from 220 retail SME management staff for empirical verification of the quantitative model using Structural Equation Modeling (SEM) technique. The model was accepted based upon model fit to data and theory and 27 hypothesized relationships under the research model were examined and analysed thereafter. Qualitative focus group discussion was conducted among 6 retail SME management staff to solicit in-depth richer insights on innovation management practices in retail SMEs in Singapore. The findings support most of the hypothesized relationships in the quantitative model. Implications of the findings are discussed and future research directions are recommended. The results derived from Singapore suggest that Leadership, Innovation Resources, and People Management are significant antecedents of innovation processes (including Innovation Process, Innovation Portfolio and Project Management, and Idea Management and Intellectual Property). It is worth-noting that People Management affects innovation processes in a negative manner. Although Technology Management also negatively affects innovation process, it does not have significant impact on Innovation Portfolio and Project Management and Idea Management and Intellectual Property respectively. Organization Learning and Knowledge Management positively impacts Idea Management and Intellectual Property as expected. Innovation Network positively affects Innovation Process, however, it has no significant impact on Innovation Portfolio and Project Management, or Idea Management and Intellectual Property. Innovation Process, Innovation Portfolio and Project Management, and Idea Management and Intellectual Property all positively affect retail SMEs company (growth) performance.

Date of Award	2018
Original language	English
Supervisor	Nizam Wiryawan (Supervisor) & Abu SALEH (Supervisor)