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SMEs Performance in Malaysia: The Role of Contextual Ambidexterity in Innovation Culture and Performance

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  • Mohamad Rohieszan Ramdan

    (Faculty of Management and Economics, Universiti Pendidikan Sultan Idris, Tanjong Malim 35900, Perak, Malaysia
    Faculty of Economics and Management, Universiti Kebangsaan Malaysia, Bangi 43600, Selangor, Malaysia)

  • Nurul Ashykin Abd Aziz

    (Faculty of Entrepreneurship and Business, Universiti Malaysia Kelantan, Locked Bag 36, Pengkalan Chepa, Kota Bahru 16100, Kelantan, Malaysia)

  • Nor Liza Abdullah

    (Faculty of Economics and Management, Universiti Kebangsaan Malaysia, Bangi 43600, Selangor, Malaysia)

  • Norsamsinar Samsudin

    (Faculty of Management and Economics, Universiti Pendidikan Sultan Idris, Tanjong Malim 35900, Perak, Malaysia)

  • Gurcharanjit Singh Veer Singh

    (Faculty of Economics and Management, Universiti Kebangsaan Malaysia, Bangi 43600, Selangor, Malaysia)

  • Thuraiya Zakaria

    (Faculty of Management and Economics, Universiti Pendidikan Sultan Idris, Tanjong Malim 35900, Perak, Malaysia)

  • Nursyazwani Mohd Fuzi

    (Azman Hashim International Business School, Universiti Teknologi Malaysia, Johor Bahru 81310, Johor, Malaysia)

  • Sharon Yong Yee Ong

    (Faculty of Humanities, Management and Science, Universiti Putra Malaysia Bintulu Campus, Bintulu 97008, Sarawak, Malaysia)

Abstract

Small and medium-sized enterprises (SMEs) in both the industrial and service sectors have been identified as the drivers of Malaysia’s fast economic growth. However, SMEs are faced with an inherent issue of lack of resources and capabilities which constrains the ability of SMEs to improve performance. Due to this, it is critical for SMEs to understand and develop an important capability that supports them in facing a dynamic and competitive business environment. This study examines the mediating role of contextual ambidexterity as a dynamic capability in the relationship between innovation culture and SME performance. The online surveys were carried out starting from 5th July until 25th July 2021. A total of 277 SMEs in Selangor, Malaysia participated in this study and Covariance-Based Structural Equation modeling analysis was utilized to test the hypotheses. The findings show that in terms of direct relationships, innovation culture has a significant positive relationship with contextual ambidexterity, while innovation culture and contextual ambidexterity have a significant positive relationship with SME performance. The findings showed that contextual ambidexterity is significant as a mediator in the relationship between innovation culture and SME performance. This study makes an important contribution to the management field by highlighting the role of contextual ambidexterity, which is often the focus of large companies. These findings support the notion of dynamic capability that accentuates the importance of developing capabilities in dealing with dynamic and challenging situations.

Suggested Citation

  • Mohamad Rohieszan Ramdan & Nurul Ashykin Abd Aziz & Nor Liza Abdullah & Norsamsinar Samsudin & Gurcharanjit Singh Veer Singh & Thuraiya Zakaria & Nursyazwani Mohd Fuzi & Sharon Yong Yee Ong, 2022. "SMEs Performance in Malaysia: The Role of Contextual Ambidexterity in Innovation Culture and Performance," Sustainability, MDPI, vol. 14(3), pages 1-18, February.
    • Handle: RePEc:gam:jsusta:v:14:y:2022:i:3:p:1679-:d:740038
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    References listed on IDEAS

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    1. Nurul Ashykin Abd Aziz & Mohamad Rohieszan Ramdan & Nik Syuhailah Nik Hussin & Zuraimi Abdul Aziz & Juliana Osman & Hasif Rafidee Hasbollah, 2021. "The Determinants of Global Expansion: A Study on Food and Beverage Franchisors in Malaysia," Sustainability, MDPI, vol. 13(18), pages 1-16, September.
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    Cited by:

    1. Nursyazwani Mohd Fuzi & Sabrinah Adam & Mohamad Rohieszan Ramdan & Sharon Yong Yee Ong & Juliana Osman & Subramaniam Kolandan & Siti Zubaidah Mohd Ariffin & Nor Sa’adah Jamaluddin & Karmilah Abdullah, 2022. "Sustainability Management Accounting and Organizational Performance: The Mediating Role of Environmental Management System," Sustainability, MDPI, vol. 14(21), pages 1-17, November.
    2. Thillai Raja Pertheban & Ramayah Thurasamy & Anbalagan Marimuthu & Kumara Rajah Venkatachalam & Sanmugam Annamalah & Pradeep Paraman & Wong Chee Hoo, 2023. "The Impact of Proactive Resilience Strategies on Organizational Performance: Role of Ambidextrous and Dynamic Capabilities of SMEs in Manufacturing Sector," Sustainability, MDPI, vol. 15(16), pages 1-32, August.
    3. Nurul Ashykin Abd Aziz & Mohd Hizam-Hanafiah & Hasif Rafidee Hasbollah & Zuraimi Abdul Aziz & Nik Syuhailah Nik Hussin, 2022. "Understanding the Survival Ability of Franchise Industries during the COVID-19 Crisis in Malaysia," Sustainability, MDPI, vol. 14(6), pages 1-17, March.
    4. Sabrinah Adam & Nursyazwani Mohd Fuzi & Mohamad Rohieszan Ramdan & Rosmah Mat Isa & Albert Feisal Muhd Feisal Ismail & Mohd Yussni Hashim & Sharon Yong Yee Ong & Shah Iskandar Fahmie Ramlee, 2022. "Entrepreneurial Orientation and Organizational Performance of Online Business in Malaysia: The Mediating Role of the Knowledge Management Process," Sustainability, MDPI, vol. 14(9), pages 1-19, April.
    5. Agus Joko Pramono & Suwarno & Firdaus Amyar & Renny Friska, 2023. "Sustainability Management Accounting in Achieving Sustainable Development Goals: The Role of Performance Auditing in the Manufacturing Sector," Sustainability, MDPI, vol. 15(13), pages 1-13, June.

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