IDEAS home Printed from https://ideas.repec.org/a/ibn/jmsjnl/v7y2017i4p36-50.html
   My bibliography  Save this article

The Effects of Absorptive Capacity, Intellectual Property and Innovation in SMEs

Author

Listed:
  • Luis Enrique Valdez Juarez
  • Elba Alicia Ramos Escobar
  • Gonzalo Maldonado Guzman

Abstract

The ability to learn and acquire knowledge has been one of the most important challenges for most companies, and especially for SMEs. The purpose of this study was to examine the effects of absorptive capacity on innovation, market orientation, and intellectual property management in SMEs. We also analyzed the influence of these variables on financial results in SMEs. The study was based on a sample of 412 companies in the industrial (manufacturing and agro-industry) and services (telecommunications and real estate) sectors operating in the Mexican Northwest. Data collection was carried out from June to October, 2014, using self-directed interviews with company managers. The estimation of relationships was tested by variance-based SEM statistical method with the PLS technique, using the SmartPLS software (version 3.2.6). Results showed that absorptive capacity has a significant influence on innovation and market orientation. Moreover, innovation and market orientation were found to have a significant influence on business profitability. No empirical support was found to explain the relationship between intellectual property management and absorptive capacity, innovation, and SME profitability. SME managers should continue with internal and external training of employees to strengthen their skills and knowledge. In addition, they must adopt and implement a business model that connects knowledge with intellectual property and innovation, through an R&D department, in order to increase profitability. With these actions the companies through their managers will have employees with greater skills, knowledge and with greater creativity. Leading to the SMEs to take advantage of its capabilities to develop new products, patent processes and products and protect their knowledge. It is also important for managers to continue to implement marketing strategies that allow them to become more competitive global markets. With the market focus companies can compete in global markets and achieve sustained profitability. This study is a contribution to absorptive capacity literature and to the resource-based view.

Suggested Citation

  • Luis Enrique Valdez Juarez & Elba Alicia Ramos Escobar & Gonzalo Maldonado Guzman, 2017. "The Effects of Absorptive Capacity, Intellectual Property and Innovation in SMEs," Journal of Management and Sustainability, Canadian Center of Science and Education, vol. 7(4), pages 36-50, December.
    • Handle: RePEc:ibn:jmsjnl:v:7:y:2017:i:4:p:36-50
    as

    Download full text from publisher

    File URL: http://www.ccsenet.org/journal/index.php/jms/article/view/68794/38965
    Download Restriction: no
    File URL: http://www.ccsenet.org/journal/index.php/jms/article/view/68794
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Milé Terziovski, 2010. "Innovation practice and its performance implications in small and medium enterprises (SMEs) in the manufacturing sector: a resource‐based view," Strategic Management Journal, Wiley Blackwell, vol. 31(8), pages 892-902, August.
    2. G. M.P. Swann, 2009. "The Economics of Innovation," Books, Edward Elgar Publishing, number 13211.
    3. Raju, P.S. & Lonial, Subhash C. & Crum, Michael D., 2011. "Market orientation in the context of SMEs: A conceptual framework," Journal of Business Research, Elsevier, vol. 64(12), pages 1320-1326.
    4. Dat-Dao Nguyen, 2017. "Designing Optimal Knowledge Base for Neural Expert Systems," International Business Research, Canadian Center of Science and Education, vol. 10(6), pages 137-144, June.
    5. Najafi-Tavani, Saeed & Sharifi, Hossein & Najafi-Tavani, Zhaleh, 2016. "Market orientation, marketing capability, and new product performance: The moderating role of absorptive capacity," Journal of Business Research, Elsevier, vol. 69(11), pages 5059-5064.
    6. David J. Teece, 2007. "Explicating dynamic capabilities: the nature and microfoundations of (sustainable) enterprise performance," Strategic Management Journal, Wiley Blackwell, vol. 28(13), pages 1319-1350, December.
    7. Jarvis, Cheryl Burke & MacKenzie, Scott B & Podsakoff, Philip M, 2003. "A Critical Review of Construct Indicators and Measurement Model Misspecification in Marketing and Consumer Research," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 30(2), pages 199-218, September.
    8. Ron Adner & Rahul Kapoor, 2010. "Value creation in innovation ecosystems: how the structure of technological interdependence affects firm performance in new technology generations," Strategic Management Journal, Wiley Blackwell, vol. 31(3), pages 306-333, March.
    9. Teece, David J., 2011. "Dynamic Capabilities and Strategic Management: Organizing for Innovation and Growth," OUP Catalogue, Oxford University Press, number 9780199691906, Decembrie.
    10. A. Spithoven & B. Clarysse & M. Knockaert, 2009. "Building Absorptive Capacity to Organise Inbound Open Innovation in Low Tech Industries," Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium 09/606, Ghent University, Faculty of Economics and Business Administration.
    11. Hudson Smith, Mel & Smith, Dave, 2007. "Implementing strategically aligned performance measurement in small firms," International Journal of Production Economics, Elsevier, vol. 106(2), pages 393-408, April.
    12. Rajagopal, 2012. "Competitive Advantage: Analysis and Strategy," Palgrave Macmillan Books, in: Darwinian Fitness in the Global Marketplace, chapter 3, pages 66-100, Palgrave Macmillan.
    13. Rosenbusch, Nina & Brinckmann, Jan & Bausch, Andreas, 2011. "Is innovation always beneficial? A meta-analysis of the relationship between innovation and performance in SMEs," Journal of Business Venturing, Elsevier, vol. 26(4), pages 441-457, July.
    14. Nonaka, Ikujiro & Kodama, Mitsuru & Hirose, Ayano & Kohlbacher, Florian, 2014. "Dynamic fractal organizations for promoting knowledge-based transformation – A new paradigm for organizational theory," European Management Journal, Elsevier, vol. 32(1), pages 137-146.
    15. Doh, Soogwan & Kim, Byungkyu, 2014. "Government support for SME innovations in the regional industries: The case of government financial support program in South Korea," Research Policy, Elsevier, vol. 43(9), pages 1557-1569.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Luis Enrique Valdez-Juárez & Domingo García-Pérez-de-Lema & Gonzalo Maldonado-Guzmán, 2018. "ICT and KM, Drivers of Innovation and Profitability in SMEs," Journal of Information & Knowledge Management (JIKM), World Scientific Publishing Co. Pte. Ltd., vol. 17(01), pages 1-34, March.
    2. Zahoor, Nadia & Al-Tabbaa, Omar, 2020. "Inter-organizational collaboration and SMEs’ innovation: A systematic review and future research directions," Scandinavian Journal of Management, Elsevier, vol. 36(2).
    3. Nicolas Classen & Martin Carree & Anita Gils & Bettina Peters, 2014. "Innovation in family and non-family SMEs: an exploratory analysis," Small Business Economics, Springer, vol. 42(3), pages 595-609, March.
    4. Suvi Nenonen & Kaj Storbacka & Charlotta Windahl, 2019. "Capabilities for market-shaping: triggering and facilitating increased value creation," Journal of the Academy of Marketing Science, Springer, vol. 47(4), pages 617-639, July.
    5. Alfonso Expósito & Juan A. Sanchis-Llopis, 2018. "Innovation and business performance for Spanish SMEs: new evidence from a multi-dimensional approach," Working Papers 1805, Department of Applied Economics II, Universidad de Valencia.
    6. Dolores Gallardo-Vázquez & Luis Enrique Valdez-Juárez & Ángela María Castuera-Díaz, 2019. "Corporate Social Responsibility as an Antecedent of Innovation, Reputation, Performance, and Competitive Success: A Multiple Mediation Analysis," Sustainability, MDPI, vol. 11(20), pages 1-28, October.
    7. Robertson, Jeandri & Caruana, Albert & Ferreira, Caitlin, 2023. "Innovation performance: The effect of knowledge-based dynamic capabilities in cross-country innovation ecosystems," International Business Review, Elsevier, vol. 32(2).
    8. Aksoy, Hasan, 2017. "How do innovation culture, marketing innovation and product innovation affect the market performance of small and medium-sized enterprises (SMEs)?," Technology in Society, Elsevier, vol. 51(C), pages 133-141.
    9. Wu, Shang-Ho & Lin, Feng-Jyh & Perng, Chyuan, 2022. "The affecting factors of small and medium enterprise performance 11The authors thank Kunhuang Huarng, National taipei University of Bussiness, and Fang-Yi Lo, Feng Chia University for their careful re," Journal of Business Research, Elsevier, vol. 143(C), pages 94-104.
    10. Marek Vokoun & Jiřina Jílková, 2020. "Eco-Innovation Activities in the Czech Economy 2008–2014: Impact of the Eco-Innovative Approach to the Profit Stream and Differences in Urban and Rural Enterprises," Economies, MDPI, vol. 8(1), pages 1-20, January.
    11. Lirios Alos-Simo & Antonio J. Verdu-Jover & Jose M. Gomez-Gras, 2020. "Knowledge Transfer in Sustainable Contexts: A Comparative Analysis of Periods of Financial Recession and Expansion," Sustainability, MDPI, vol. 12(12), pages 1-24, June.
    12. Elizabeth J. Altman & Frank Nagle & Michael L. Tushman, 2013. "Innovating Without Information Constraints: Organizations, Communities, and Innovation When Information Costs Approach Zero," Harvard Business School Working Papers 14-043, Harvard Business School, revised Sep 2014.
    13. Simona Alfiero & Laura Broccardo & Massimo Cane & Alfredo Esposito, 2018. "High Performance Through Innovation Process Management in SMEs. Evidence from the Italian wine sector," MANAGEMENT CONTROL, FrancoAngeli Editore, vol. 2018(3), pages 87-110.
    14. von den Driesch, Till & Eva Susanne da Costa, Maika & Christina Flatten, Tessa & Brettel, Malte, 2015. "How CEO experience, personality, and network affect firms' dynamic capabilities," European Management Journal, Elsevier, vol. 33(4), pages 245-256.
    15. Ifrah Quais & Danish Ahmed Siddiqui, 2017. "Measuring the Performance of Logistics Industry in the Context of Karachi," Information Management and Business Review, AMH International, vol. 9(5), pages 24-34.
    16. Adomako, Samuel & Amankwah-Amoah, Joseph & Donbesuur, Francis & Ahsan, Mujtaba & Danso, Albert & Uddin, Moshfique, 2022. "Strategic agility of SMEs in emerging economies: Antecedents, consequences and boundary conditions," International Business Review, Elsevier, vol. 31(6).
    17. Kolloch, Michael & Dellermann, Dominik, 2018. "Digital innovation in the energy industry: The impact of controversies on the evolution of innovation ecosystems," Technological Forecasting and Social Change, Elsevier, vol. 136(C), pages 254-264.
    18. Partanen, Jukka & Kohtamäki, Marko & Patel, Pankaj C. & Parida, Vinit, 2020. "Supply chain ambidexterity and manufacturing SME performance: The moderating roles of network capability and strategic information flow," International Journal of Production Economics, Elsevier, vol. 221(C).
    19. Rogier van de Wetering & Sherah Kurnia & Svyatoslav Kotusev, 2020. "The Effect of Enterprise Architecture Deployment Practices on Organizational Benefits: A Dynamic Capability Perspective," Sustainability, MDPI, vol. 12(21), pages 1-21, October.
    20. Christopher S. Hayter, 2016. "A trajectory of early-stage spinoff success: the role of knowledge intermediaries within an entrepreneurial university ecosystem," Small Business Economics, Springer, vol. 47(3), pages 633-656, October.

    More about this item

    Keywords

    absorptive capacity; innovation; market orientation; profitability; SME (Industrial and services sectors operating Mexican Northwest);
    All these keywords.

    JEL classification:

    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
    • Z0 - Other Special Topics - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ibn:jmsjnl:v:7:y:2017:i:4:p:36-50. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Canadian Center of Science and Education (email available below). General contact details of provider: https://edirc.repec.org/data/cepflch.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.