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

Abstract

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 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.

Determining the role of sources of knowledge and IT resources for stimulating firm innovation capability: a PLS-SEM approach

“…Literature indicates that information is crucial for innovation; nevertheless, it is unclear which sort, amount, and sources of knowledge support the specific nature of innovation (Dost et al, 2019). Unlike other forms of innovation, product innovation capabilities incorporate a multi-faceted approachcompetitiveness, functionality, satisfying consumer preferences, navigating environmental uncertainty, and capitalizing on business possibilities (AlMulhim, 2021). Such results may need technical information from various sources, as Dost et al (2019) propose that knowledge from multiple sources may boost innovative capabilities.…”

Smart supply chain and firm performance: the role of digital technologies

“…Saudi Arabia is one of the most rapidly developing countries in the world, but it struggles with a feeble economy due to budget deficit, emergence challenges, increased government expenditures and risks, as well as lower oil prices. Moreover, the country is now focused on developing other industries, similar to many developed countries that do not rely exclusively on oil resources (Esmail, 2018;AlMulhim, 2021). Many countries are progressing from traditional production methods to digitization in industry and service, but Saudi Arabia is still only in the initial stages of digital transformation.…”

Linkages Between Knowledge Management Process and Corporate Sustainable Performance of Chinese Small and Medium Enterprises: Mediating Role of Frugal Innovation

“…ICs can be made more effective by combining input from internal and external sources. Companies with innovative capabilities can conduct FI or make frugal products using these sources, which are more beneficial ( AlMulhim, 2021 ).…”

“…Numerous studies have shown that implementing open innovation may have a beneficial impact on encouraging FIs, especially in healthcare. Developing comprehensive knowledge of frugality is important in some regions (Gulf) and countries (e.g., Saudi Arabia) ( AlMulhim, 2021 ). Despite the fact that there are many successful cases of small and medium Saudi Arabian businesses in anecdotal evidence, the literature rarely addresses them.…”

“… Le (2021) described the FI as “hardware or software advancement in association with green processes and products, including advanced technology involved in saving energy, avoidance of emissions, composting, green products development, organizational environment management. Innovative application at all levels.” Innovative technologies, environmental pollution control, recycling, green product design, and ecological management are key FI priorities ( AlMulhim, 2021 ; Hossain et al, 2021 ).…”