SME Innovative Capacity, Competitive Advantage and Performance in a ‘Traditional’ Industrial Region of Portugal

Carla Susana Marques; João Ferreira

doi:10.4067/S0718-27242009000400005

Authors

Carla Susana Marques Universidade de Trás-os-Montes e Alto Douro
João Ferreira Department of Business and Economics, University of Beira Interior (UBI)

DOI:

https://doi.org/10.4067/S0718-27242009000400005

Keywords:

competitive advantage, innovative capacity, performance, SME, strategy.

Abstract

This study aims to identify the factors that contribute to the building of a firm’s innovative capacity and to assess the way in which this contributes to our understanding of how much this contributes to improvements in the firm’s performance. A conceptual model is proposed consisting of five separate dimensions: the firm; the entrepreneur; the external business environment; the firm’s innovative capacity; and the firm’s performance. The study was based on questionnaire-based data from a sample of firms drawn from the manufacturing industry in the Beira Interior Region of Portugal. The results provided evidence regarding the factors influencing the innovative capacity of firms and permitted conclusions to be drawn regarding effects of superior innovative capacity on the construction of firms’ competitive advantage, which in turn contributes to improved performance.

Downloads

Download data is not yet available.

Author Biographies

Carla Susana Marques, Universidade de Trás-os-Montes e Alto Douro

Universidade de Trás-os-Montes e Alto Douro

João Ferreira, Department of Business and Economics, University of Beira Interior (UBI)

Estrada do Sineiro, 6200-209 Covilhã, Portugal. Tel: +351 275 319 600; Fax: +351 275 319 601.E-mail: [email protected]

References

ACQUAAH, M. (2007). Managerial social capital, strategic orientation, and organizational performance in an emerging economy. Strategic Management Journal, 28,1235-1255.

AVERMAETE, T., Viaene, J., Morgan, E., Crawford, N. (2003). Determinants of innovation in small food firms. European Journal of Innovating Management, 6 (1), 8-17.

BARNEY, J. (1991). Firm Resources and Sustained Competitive Advantage. Journal of Management, 17, 99-120.

BECATTINI, G. (1999). Flourishing small firms and the re-emergence of industrial districts. Proceedings of the 44th World Conference - Innovation and Economic Development: The Role of Entrepreneurship and SMEs, Italy, 20-23 June, p. 10.

BRUSH, C., Vanderwerf, P.A. (1992). A comparison of methods and sources for obtaining estimates of new venture performance. Journal of Business Venturing, 7,157-170.

CHANDLER, G.N., Hanks, S. (1994). Market Attractiveness, Resource-Based Capabilities, Venture Strategies and Venture Performance. Journal of Business Venturing, 9, 331-349.

COOKE, P. (2007). Regional innovation, entrepreneurship and talent systems. Int. J. of Entrepreneurship and Innovation Management, 7, 117-139.

COVIN, J.G., Slevin, D.P. (1991). A conceptual model of entrepreneurship as firm behaviour. Entrepreneurship Theory and Practice, Fall, 7-25.

CRESSY, R. (1996). Are business startups debt-rationed?. Economic Journal, 106 (438), 1253-1270.

DAVIDSSON, P. (1989). Continued Entrepreneurship and Small Firm Growth. Stockholm School of Economics, Stockholm.

DRUCKER, P. (1985). Innovation and Entrepreneurship. Harper & Raw, New York.

ELBANNA, S., Child, J. (2007). Influences on strategic decision effectiveness: Development and test of an integrative model. Strategic Management Journal, 28, 431-453.

FERREIRA, J. (2003). Estudo do crescimento e desempenho das pequenas empresas: A influência da orientação estratégica empreendedor. Unpublished doctoral thesis, Universidade da Beira Interior, Covilhã, Portugal.

FOMBRUN, C.J., Wally, S. (1989). Structuring small firms for rapid growth. Journal of Business Venturing, 4 (2), 107-122.

HAMEL, G. (2000). Leading the Revolution. Harvard Business School Press, Boston, MA.

HARADA, N. (2001). Who succeeds as an entrepreneur? - An analysis of post entry performance of new firms in Japan. Working paper, Japan Centre for Economic Research Discussion Paper, No. 68.

HERNÁNDEZ, M. (2000). Empresas Gacela en Extremadura. Ed. Ediciones la Coria, Spain.

HITT, M.A., Ireland, R.D., Clifford, P.G., Coyne, K.P. (2001). Guest editors' introduction to the special issue strategic entrepreneurship: Entrepreneurial strategies for wealth creation. Strategic Management Journal, 22, 479-491.

ISAKSEN, A. (2001). Building Regional Innovation Systems: Is endogenous industrial development possible in the global economy? Canadian Regional Sciences, 24 (1),101-120.

KAUFMANN, A., Wood, C., Theyel, G. (2000). Collaboration and technology linkages: A strategic supplier typology. Strategic Management Journal, 21 (6), 649-663.

KEMP, R.G.M., Folkeringa, M., Jong, J.P.L., Wubben, E.F.M. (2003). Innovation and firm performance. Research Report H200207, SCALES - Scientific Analysis of Entrepreneurship and SMEs, Zoetermer.

KLEINKNECHT, A., Oostendorp, R. (2002). R-D and export performance: Taking account of simultaneity. In A. Kleinknecht and P. Mohnen (eds.) I nnovation and firm performance. Palgrave, London, pp. 310-320.

KLOMP, L., Van Leeuwen, G. (1999). The importance of innovation for company performance. Netherlands Official Statistics, 14, Winter, 26-35.

LEIFER, R., McDermott, C.M., O'Connor, G.C., Peters, L.S., Rice, M., Veryzer, R.W. (2000). Radical Innovation. Harvard Business School Press, Boston.

LUMPKIN, G.T., Dess, G.G. (1996). Clarifying the entrepreneurial orientation construct and linking it to performance. Academy of Management Review, 21 (1), 135-172.

LUMPKIN, G.T., Dess, G.G. (1997). Proactiveness versus competitive aggressiveness: Teasing apart key dimensions of an entrepreneurial orientation. In P. D. Reynolds, W. D. Bygrave, N. M. Carter, et al. (Eds.), Frontiers of Entrepreneurship Research, Babson College, Wellesley, MA.

MARQUES, C., Monteiro-Barata, J. (2006). Determinants of the innovation process: An empirical test for the Portuguese manufacturing industry. Management Research, 4 (2), 113-126.

MILLER, D. (1983). The correlates of entrepreneurship in three types of firms. Management Science, 29 (7), 770-791.

MINTZBERG, H. (1984). La Estructuración de las Organizaciones. Ariel Economia, Barcelona, Spain.

MOGOLLÓN, R., Vaquero, A. (2004). El comportamiento innovador y los resultados de la empresa: Un análisis empírico. Proceedings of the XVIII Congreso Anual y XIV Congreso Hispano-Francês, AEDEM, Ourense, Spain.

MOLITERNO, T.P., Wiersema, M. (2007). Firm performance rent appropriation, and the strategic resource divestment capability. Strategic Management Journal, 28, 1065-1087.

NAS, S.O., Leppälahti, A. (1997). Innovation, Firm Profitability and Growth. STEP Report 1/97, May, Oslo: STEP GROUP.

NAYAK, P.R., Ketteringham, J. (1986). Breakthroughs: How Leadership and Drive Create Commercial Innovations that Sweep the World. Mercury, London.

NEWBERT, S. (2007). Empirical research on the resource-based view of the firm: An assessment and suggestions for future research. Strategic Management Journal, 28, 121-146.

PAZOS, D., López, S. (2004). Situación de las Pymes gallegas respecto a la innovación. Proceedings of the XVIII Congreso Anual y XIV Congreso Hispano-Francês, Junio, Universidade de Vigo, Ourense, Spain.

PORTER, M. (1990). The Competitive Advantage of Nations. Macmillan, New York.

PORTER, M. (1994). Construir as Vantagens Competitivas de Portugal. Edição do Fórum para a Competitividade, Portugal.

PORTER, M. (1996). What is strategy? Harvard Business Review, Nov./Dec., 60-80.

ROBERTS, P., Amit, R. (2003). The dynamics of innovative activity and competitive advantage: The case of Australian retail banking, 1981 to 1995. Organization Science, 14 (2), 107-122.

ROTHWELL, R. (1991). External networking and innovation in small and medium-size manufacturing firms in Europe. Technovation, 11 (2), 93-112.

SCHUMPETER, J. (1934). The Theory of Economic Development. Harvard University Press, Cambridge: MA.

SCOTT, M., Bruce, R. (1987). Five stages of growth in small businesses. Long Range Planning, 20 (3), 40-52.

SHORT, J.C., Ketchen, D.J., Palmer, T.B., Hult, G.T. (2007). Firm, strategic group, and industry influences on performance. Strategic Management Journal, 28, 147-167.

SILVA, M., Raposo, M., Ferrão, M. (2004). Capacidade inovadora empresarial: Estudo dos factores que influenciam a Inovação no Processo. Proceedings of the XVIII Congreso Anual y XIV Congreso Hispano-Frances de AEDEM, Ourense, Spain.

SILVA, M. (2003). Capacidade inovadora empresarial - Estudo dos factores impulsionadores e limitadores nas empresas industriais portuguesas. Unpublished doctoral thesis, Universidade da Beira Interior, Covilhã, Portugal.

STIEGLITZ, N., Heine, K. (2007). Innovations and the role of complementarities in a strategic theory of the firm. Strategic Management Journal, 28, 1-15.

TEECE, D., Pisano, G. (1994). The dynamic capabilities of firms: An introduction. Industrial and Corporate Change, 3 (3), 537-556.

TIDD, J., Bessant, J., Pavitt, K. (2001). Managing Innovation: Integrating Technological, Market and Organizational Change. 2nd Ed. Chichester: Wiley.

TSAI, W., MacMillan, I.C., Low, M.B. (1991). Effects of strategy and environment on corporate venture success in industrial markets. Journal of Business Venturing, 6 (1), 9-28.

USSMAN, A., Almeida, A., Ferreira, J., Mendes, L., Franco, M. (1998). Padrões de comportamento face à inovação - Estudo aplicado às PME da região da Beira Interior. Proceedings of the VI Encontro Nacional da APDR -Regiões e Cidades na União Europeia: Que Futuro?, Universidade da Beira Interior, October, Covilhã, Portugal.

WIKLUND, J. (1998). Entrepreneurial orientation as predictor of performance and entrepreneurial beh aviour in small firms: Longitudinal evidence. In P. D. Reynolds, W. D. Bygrave, N. M. Carter, et al. (Eds.) Frontiers of Entrepreneurship Research, Babson College, Wellesley, MA.

ZAHRA, S., Belardino, S., Boxx, W. (1988). Organizational innovation: Its correlates and its implications for financial performance. International Journal of Management, 5, 133-142.