Management innovation, radical innovation and business performance, the role of knowledge resources for high technology SMEs

According to the strategy, innovation, and knowledge-based literatures, the notion that SMEs can enhance their innovation ability by developing knowledge resources has become important for achieving competitive advantage and long-term survival. Building upon theoretical work on the knowledge-based view and innovation management literature, this research examines how the management innovation related to radical innovation and how knowledge resources and management innovation influences on business practices and these effects differ across context of an economy. The conceptual model was developed and aims to answer three important questions. RQ1: What is the relationship between management innovation and radical innovation? RQ2: How does this relationship mediate between the development of company resources and business performance? RQ3: What is the impact of the economic environment (developed vs. developing economy) on the relationships between resources, management innovation, radical innovation and performance? This study examines the four knowledge resources: humanware (employees' knowledge and learning), techware (technological skills and knowledge), infoware (information management) and orgware (organization's values and norms) that impact a firm's management innovation and radical innovation and affects the success of SMEs. The model is tested with data collected from 123 British high technology SMEs and 133 Malaysian high technology SMEs. The empirical result for the UK dataset shows that humanware and techware contributed to the development of management innovation. The result specified that management innovation is an antecedent to radical innovation. The results also found that the indirect effects of infoware and orgware on performance occur through management innovation. The Malaysian dataset shows that techware and orgware are antecedents for the management innovation, which in turn are antecedents to radical innovation and business performance. Humanware and infoware have an indirect impact on business performance by facilitating management innovation that in turn fosters business performance. The results show that management innovation is important for a developed country, meanwhile for a developing country radical innovation is important. The evidence shows that management innovation is the mediator for the developed country and not for the developing country. Therefore, this finding concludes that the innovation model in the developed country is not applicable for the developing country. This research has noteworthy implications for both researchers and practitioners by (1) Providing guidelines for high-technology SME's in developed and developing countries about knowledge resources, management innovation, radical innovation and firms' business performance, (2) The innovation literature needs to consider empirically how knowledge resources enhance radical innovation and performance when management innovation is implemented and (3) Indicating that the most important manifestation of the different knowledge resources leads to the success of management innovation for SME success in the high - technology industry. Limitations in current research may create avenues for future research in terms of number of countries, companies, methodologies, innovation types and resources.According to the strategy, innovation, and knowledge-based literatures, the notion that SMEs can enhance their innovation ability by developing knowledge resources has become important for achieving competitive advantage and long-term survival. Building upon theoretical work on the knowledge-based view and innovation management literature, this research examines how the management innovation related to radical innovation and how knowledge resources and management innovation influences on business practices and these effects differ across context of an economy. The conceptual model was developed and aims to answer three important questions. RQ1: What is the relationship between management innovation and radical innovation? RQ2: How does this relationship mediate between the development of company resources and business performance? RQ3: What is the impact of the economic environment (developed vs. developing economy) on the relationships between resources, management innovation, radical innovation and performance? This study examines the four knowledge resources: humanware (employees' knowledge and learning), techware (technological skills and knowledge), infoware (information management) and orgware (organization's values and norms) that impact a firm's management innovation and radical innovation and affects the success of SMEs. The model is tested with data collected from 123 British high technology SMEs and 133 Malaysian high technology SMEs. The empirical result for the UK dataset shows that humanware and techware contributed to the development of management innovation. The result specified that management innovation is an antecedent to radical innovation. The results also found that the indirect effects of infoware and orgware on performance occur through management innovation. The Malaysian dataset shows that techware and orgware are antecedents for the management innovation, which in turn are antecedents to radical innovation and business performance. Humanware and infoware have an indirect impact on business performance by facilitating management innovation that in turn fosters business performance. The results show that management innovation is important for a developed country, meanwhile for a developing country radical innovation is important. The evidence shows that management innovation is the mediator for the developed country and not for the developing country. Therefore, this finding concludes that the innovation model in the developed country is not applicable for the developing country. This research has noteworthy implications for both researchers and practitioners by (1) Providing guidelines for high-technology SME's in developed and developing countries about knowledge resources, management innovation, radical innovation and firms' business performance, (2) The innovation literature needs to consider empirically how knowledge resources enhance radical innovation and performance when management innovation is implemented and (3) Indicating that the most important manifestation of the different knowledge resources leads to the success of management innovation for SME success in the high - technology industry. Limitations in current research may create avenues for future research in terms of number of countries, companies, methodologies, innovation types and resources