Internal Capabilities and External Knowledge Sourcing for Product Innovation in LMT SMEs

Abstract

Low- and medium-tech small and medium-sized enterprises (LMT SMEs) constitute a large and important segment in European economies. Because of increasingly international competition, LMT SMEs must rely on innovation to strengthen their competitive position over time. In this study, we empirically analyze possible complementarity or substitutability between internal capabilities and external knowledge sourcing. Using a short panel of 142 Dutch LMT SMEs, we find empirical evidence that suggests a negative interplay between internal capabilities and external knowledge sourcing.

Impact of External Knowledge Inflow on Product and Process Innovation of Korean SMEs: Absorptive Capacity as a Mediator

“…The important role of acquired knowledge from government agencies is particularly emphasized to achieve superior capacity and product innovation. For Korean textiles, apparel, and footwear SMEs providing customized product innovation for customers, externally generated knowledge is critical for firms' competitive advantage and survival (Alvarez & Iske, 2015). Thus, in this study, we provide significant insights into where these companies can source market-and technology-relevant knowledge for innovation when they do not have sufficient internal knowledge.…”

“…While some scholars have used R&D intensity to classify an industry's technology base, it can also be argued that this indicator cannot sufficiently explain the innovation of LT firms (Santamaría et al, 2009). LT SMEs are highly heterogeneous in terms of their technology base, industry classification, and resources (Alvarez & Iske, 2015), generating a need to investigate an industry-specific sector. In addition, in order to remain competitive, these industries consistently need to develop new products and practices in response to market demands by utilizing external sources (Ha-Brookshire & Lee, 2010;Jacob, 2007;Lu & Karpova, 2012), making them appropriate for the current study.…”

The contradictory role of humor in international competitiveness and innovativeness

“…We believe that insight could be gained from combining innovation research with international competitiveness, especially since international competitiveness is not isolated from innovation activities and processes (Buckley et al, 1990). Among researchers who have examined the topic, Buesa and Molero (1998), for example, suggest that the degree of innovative regularity is positively related to the accumulation of international firm competitiveness, verified by Galende and de la Fuente (2003) and Alvarez and Iske (2015). Kafouros et al (2008) and Oura, Zilber, and Lopes (2016) also find these kinds of connections.…”

“…International competitiveness at the firm level refers to the capability of a firm to sustainably and profitably satisfy international customer requirements (Cetindamar & Kilitcioglu, 2013;Chikán, 2008). It can be measured in terms of three aspects: competitive potential (assets/factors, i.e., input), competitive performance (outcome), and management processes (Buckley, Pass, & Prescott, 1988, 1990Cetindamar & Kilitcioglu, 2013), and it can be enhanced in different ways, among which advancing innovativeness has been found highly relevant (Alvarez & Iske, 2015;Özçelik & Taymaz, 2004). Relatedly, earlier research has considered innovativeness and international competitiveness not only in terms of their interactions (e.g., Brännback & Wiklund, 2001;Kafouros, Buckley, Sharp, & Wang, 2008;Keogh, 1999;Kodama, 2017), but also in terms of the common denominators.…”

“…Relatedly, earlier research has considered innovativeness and international competitiveness not only in terms of their interactions (e.g., Brännback & Wiklund, 2001;Kafouros, Buckley, Sharp, & Wang, 2008;Keogh, 1999;Kodama, 2017), but also in terms of the common denominators. In this area, it has been established that relationships-internal and external-are relevant for both innovation and international business (see Alvarez & Iske, 2015;Ramamoorthy, Flood, Slattery, & Sardessai, 2005). By managing these relationships, one can find ways to enhance innovation and international processes.…”