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Size, strategic, and market orientation affects on innovation

  • Laforet, Sylvie
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    Based on a random sample of 500 South Yorkshire non-hi-tech manufacturing small, medium-sized enterprises (SMEs) the quantitative findings support the hypothesis that size, strategic, and market orientation associate with innovation. The results show that prospectors are medium-sized companies and small companies, defenders. Prospectors are more innovative and market-oriented than defenders. The findings reveal that to succeed in an intense competitive environment, non-hi-tech manufacturing SMEs have to be proactive toward market opportunities, receptive to innovation and take the lead in new product innovation. However, their weaknesses include a lack of flexibility, a partial open culture and an organizational structure that impedes sustained innovation. This study addresses a gap in the literature, by linking innovation to the strategic orientation of the firm instead of examining firms' specific characteristics or the effects of external environment and structural factors. The research focuses on non-hi-tech manufacturing SMEs.

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    Article provided by Elsevier in its journal Journal of Business Research.

    Volume (Year): 61 (2008)
    Issue (Month): 7 (July)
    Pages: 753-764

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    Handle: RePEc:eee:jbrese:v:61:y:2008:i:7:p:753-764
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    1. E. Cefis & O. Marsili, 2003. "Survivor: The Role of Innovation in Firms' Survival," Working Papers 03-18, Utrecht School of Economics.
    2. Ramachandran, K. & Ramnarayan, S., 1993. "Entrepreneurial orientation and networking: Some Indian evidence," Journal of Business Venturing, Elsevier, vol. 8(6), pages 513-524, November.
    3. Charles Jabani Mambula & Frank E. Sawyer, 2004. "Acts of entrepreneurial creativity for business growth and survival in a constrained economy: Case study of a small manufacturing firm (SMF)," International Journal of Social Economics, Emerald Group Publishing, vol. 31(1/2), pages 30-55, January.
    4. Ghosh, B. C. & Liang, Tan Wee & Meng, Tan Teck & Chan, Ben, 2001. "The key success factors, distinctive capabilities, and strategic thrusts of top SMEs in Singapore," Journal of Business Research, Elsevier, vol. 51(3), pages 209-221, March.
    5. Acs, Zoltan J & Audretsch, David B, 1987. "Innovation, Market Structure, and Firm Size," The Review of Economics and Statistics, MIT Press, vol. 69(4), pages 567-74, November.
    6. Lipparini, Andrea & Sobrero, Maurizio, 1994. "The glue and the pieces: Entrepreneurship and innovation in small-firm networks," Journal of Business Venturing, Elsevier, vol. 9(2), pages 125-140, March.
    7. Woodside, Arch G. & Sullivan, Daniel P. & TrappeyIII, Randolph J., 1999. "Assessing Relationships among Strategic Types, Distinctive Marketing Competencies, and Organizational Performance," Journal of Business Research, Elsevier, vol. 45(2), pages 135-146, June.
    8. Kamien, Morton I & Schwartz, Nancy L, 1975. "Market Structure and Innovation: A Survey," Journal of Economic Literature, American Economic Association, vol. 13(1), pages 1-37, March.
    9. Bertschek, Irene & Entorf, Horst, 1996. "On Nonparametric Estimation of the Schumpeterian Link between Innovation and Firm Size: Evidence from Belgium, France, and Germany," Empirical Economics, Springer, vol. 21(3), pages 401-26.
    10. de Jong, Jeroen P.J. & Marsili, Orietta, 2006. "The fruit flies of innovations: A taxonomy of innovative small firms," Research Policy, Elsevier, vol. 35(2), pages 213-229, March.
    11. Atuahene-Gima, Kwaku, 1996. "Market orientation and innovation," Journal of Business Research, Elsevier, vol. 35(2), pages 93-103, February.
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