INFLUENCE OF RISK-TAKING AND PROACTIVITY BEHAVIOURS ON FRUGAL PRODUCT INNOVATION: THE MODERATING ROLE OF EXTERNAL SOURCES OF KNOWLEDGE

Growing changes in the present global environment is compelling firms to seek and exploit opportunities for market growth. Among others, an innovation that is cost-effective, functional, and sustainable (frugal) is one of the important factors for such growth. To validate this link empirically, we investigate the influence of risk-taking and proactivity behaviours (dimensions of entrepreneurial orientation (EO)) on frugal innovation (FI), and moderation of external knowledge. We nested the data from Small and Medium Entreprises that were engaged in frugal product innovation in Pakistan. The findings reveal that the behaviours of taking the risk and being ahead of competitors (proactiveness) have a significantly positive influence on FI. However, moderation of external knowledge strengthens the influence of risk-taking behaviour while weakens the influence of proactivity behaviour on FI. The authors also discuss some important theoretical and managerial contributions of this research.

From knowledge sourcing to firms’ productivity: investigating innovation value chain of Indonesian manufacturing firms

Purpose The purpose of this paper is to investigate the innovation value chain (IVC) that encompasses knowledge sourcing, transformation and exploitation activities among Indonesian manufacturing firms by using data from the Indonesia Innovation Survey. Design/methodology/approach A simple approach of single equation Probit model, Logit regression and Tobit regression are used in the first, second and third stages of IVC consecutively. Findings This study finds the existence of a synergistic relationship between internal and external sources of knowledge as well as among external sources of knowledge. In terms of the second link of the IVC, internal R&D plays an important role that positively influences knowledge transformation into all types of innovation and innovation success. External knowledge that has a similar pattern in shaping innovation mainly comes from market and open sources. Scientific institutions tend to contribute to innovation negatively, and few positive impacts on process innovation are observed from government R&D and non-profit R&D institutions. Informal knowledge is more likely to influence technological than non-technological innovation. Research limitations/implications Finally, the limitations of this study need to be acknowledged. Issues related to firms’ sectors have not been discussed in this study, and as a result, sectors’ effects on the three links of IVC cannot be detected. This study is a cross-sectional in nature, as a result, the dynamic of Indonesian manufacturing firms’ IVC is missing. Hence, future studies may address this limitation by conducting a longitudinal study. Originality/value This study is different from the previous IVC studies owing to the following reasons. Firstly, in this study, a broader source of knowledge is tested. Secondly, the wider innovation (technological and non-technological innovation) is also assessed.

The role of internal and external sources of knowledge on frugal innovation: moderating role of innovation capabilities

Purpose This study aims to analyze the effect of external and internal sources of knowledge on frugal innovation. Moreover, it investigated how this relationship is weakened/strengthened by the moderation of innovation capabilities. Design/methodology/approach This empirical study’s data were taken from 288 small and medium enterprises (SMEs) by using a questionnaire survey. To analyze this data, analysis of a moment structures software (AMOS) was used. Structural equation modeling was conducted to test the hypothesis and the slope test investigated moderation. Findings The study results showed the significant effect of internal and external sources of knowledge on frugal innovation. Moreover, the results highlighted that the moderating role of innovation capabilities strengthens this relationship. Research limitations/implications The SMEs of “Saudi Arabia” were considered for this study. Among these, this paper only focused on enterprises owned by Saudi citizens. Moreover, the data were collected from 288 SMEs. Therefore, future studies can be conducted from any other country with larger sample size. This study has used moderation of innovation capabilities and future studies can use information credibility as a moderating variable. Originality/value Previously, many studies have highlighted the importance of knowledge for innovation, but the effects of knowledge sources from the perspective of SMEs and emerging markets remain unexplained. Very limited studies have explored the relation of knowledge sources with frugal innovation. This study first examines the moderating role of innovation capabilities between “internal and external knowledge sources” and frugal innovation. Moreover, this research reveals the SMEs of Saudi Arabia and its sector of frugal products.

ABSORPTIVE CAPACITY, INNOVATION, AND EXTERNAL SOURCES OF KNOWLEDGE: THE BRAZILIAN POWER SECTOR

ABSTRACT Purpose: This paper discusses the relationship between absorptive capacity, external sources of knowledge, and innovation in the context of the power sector. In doing so, we follow the theoretical debate over absorptive capacity dimensions. We focus on the statistical testing of Zahra and George’s (2002) absorptive capacity construct to identify whether their dimensions find support in reality. We consider that the external environment encompasses both scientific and industrial sources of knowledge, which influence absorptive capacity. Originality/value: Zahra and George’s (2002) model initiated the debate of the absorptive capacity dimensions, and it is disseminated in literature. However, it is poorly tested. There is still a research gap related to the empirical validation stage of the absorptive capacity construct itself. Our research tries to decrease this gap, testing Zahra and George’s (2002) absorptive capacity construct in a Brazilian company’s context. Design/methodology/approach: The research design was quantitative. A survey was applied to 402 industrial firms. We used multivariate sta tistical techniques and the structural models were tested by Partial Least Squares (PLS). Findings: Zahra and George’s (2002) construct of absorptive capacity was proved, and innovation, as well as the external sources types of knowledge, are related to it. The absorptive capacity is contingent on types of external knowledge.

Internal and External Sources of Knowledge in Manufacturing and Service Enterprises. A Comparative Analysis of European Union Countries

Along with the development of economies based on knowledge, the importance of knowledge input in production processes has been increasing. Enterprises may acquire knowledge input by developing their internal knowledge base and/or purchasing knowledge from external entities. Their internal knowledge base may be developed mainly by employing highly qualified specialists and their own research. The aim of the paper is to examine the importance of all these knowledge sources in manufacturing and services enterprises, as well as to compare their changing role with productivity performance in EU countries. It is based on data from the World Input-Output Database, Eurostat, OECD and EU KLEMS. Thanks to the availability of relevant data, the analysed period covers the years 1995–2018. The study demonstrates that knowledge base, developed through both internal and external sources, played a significantly more important role in the EU-15 than in the EU-12, with a tendency to decrease these disparities (most visible with respect to KIBS input). The growing importance of an external knowledge base was more visible and stable in the EU-12 countries. R&D expenditures were an exception. The recent financial crisis heavily affected only external R&D expenditures.

Participation in Group Companies as a Source of External Knowledge in Obtaining and Making Profitable Radical Innovations

In the context of potential absorptive capacity, the present work analyzes sources of knowledge through the adjustment between the typology of sources and innovative results. Different external sources can condition the later phases of knowledge absorption. In relation to external sources of knowledge, we enrich their treatment by considering other companies in the same group as deeper relationships. In addition, we analyzed the results regarding the generation of radical innovations with impact on income. The results show that company groups can reduce costs in the exchange of technological knowledge, not only to develop radical innovations but also to improve their economic performance. Furthermore, membership in a group allows a company to obtain a greater economic return when combined with assimilation resources.