Innovation vol2 extract

Leading Issues in Innovation Research Volume 2

Edited by Heather Fulford

Leading Issues in Innovation Research Volume Two

Copyright © 2015 The authors First published September 2015

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Note to readers: Some papers have been written by authors who use the American form of spelling and some use the British. These two different approaches have been left unchanged.

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Contents About the Editor ........................................................................................... ii

List of Contributing Authors ......................................................................... iii

Introduction to Leading Issues in Innovation Research Volume 2 Heather Fulford .......................................................................................... vi

Innovation Performance, Innovation Capacity and Growth in Small Enterprises: an Enterprise‐Level Analysis Helena Forsman .......................................................................................... 1

Using Innovation to Stimulate Growth in Owner Managed SMEs Paul Donaldson ......................................................................................... 21

Inter‐Firm Alliances: A Mechanism to Develop Innovative Capacity in Portuguese SMEs Luís Valentim, Mário Franco and João Lisboa .......................................... 37

Service Innovation: A Smaller Firm Perspective Edward McKeever, Sarah Jack and Danny Soetanto ................................ 53

Catalysts and Barriers of Open Innovation for SMEs in Transition Economy Allan Lahi and Tiit Elenurm ....................................................................... 71

Strategic Creativity as a Strength in Microsized Enterprises Tiina Tarvainen ......................................................................................... 89

Analysis of the Relationship Between the Company's Internal Resources and the Effectiveness of Innovative Activity of SMEs in Poland Tomasz Norek ......................................................................................... 105

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About the Editor Professor Heather Fulford is the Aca‐ demic Director of the Centre for Entre‐ preneurship and Research Coordinator for the Department of Management at Aberdeen Business School, Robert Gordon University in Scotland. Her re‐ search interests include: innovation in SMEs, enterprise education, business start‐up support and resources, and so‐ cial enterprise. Heather delivers pro‐ grammes on enterprise and employability, and new venture creation.

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List of Contributing Authors Paul Donaldson, Sysco, St Helens, UK Tiit Elenurm, Estonian Business School, Tallinn, Estonia Helena Forsman, The University of Winchester, UK Mário Franco, University of Beira Interior, Covilhã, Portugal Sarah Jack, Lancaster University Management School Allan Lahi, Estonian Business School, Tallinn, Estonia João Lisboa, University of Coimbra, Coimbra, Portugal Edward McKeever, Lancaster University Management School Tomasz Norek, University of Szczecin, Szczecin, Poland Danny Soetanto, Lancaster University Management School Tiina Tarvainen, University of Eastern Finland, Joensuu, Finland Luís Valentim, University of Coimbra, Coimbra, Portugal

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Introduction to Leading Issues in Innovation Research Volume 2 “Leading strategic thinkers are moving beyond the traditional prod‐ uct and service innovations to pioneering innovation in processes, value chains, business models, and all functions of management.

Thus, innovative attitudes and behaviours are necessary for firms of all sizes to prosper and flourish in competitive environments” (Kuratko, Goldsby and Hornsby 2012:4).

In my introduction to Case Studies in Innovation Research: For Researchers, Teachers and Students (2012), I noted that innovation is not an isolationist activity, but rather it is relational. In this volume of papers, which is de‐ voted to research on innovation in Small and Medium‐Sized Enterprises (SMES), that point about relationship and innovation emerges once more, and is reinforced by the findings of a number of the studies. A key issue for the management of an SME to contend with is knowing how to build rela‐ tionships successfully in order to be able sustain innovative thinking and behaviour beyond the start‐up phase of an enterprise. This requires the owner‐manager or management team of an SME to look to their internal resources to identify innovative individuals among their workforce. An organisational culture or environment needs to be established in which those individuals are valued, can flourish and are empowered with the freedom to engage in innovative activity for the benefit of the enterprise as a whole. Fostering a culture of innovation like this requires strategic thinking on the part of management, and at times more formal planning, resource management and leadership than is typical in many smaller en‐ terprises. The constraints of limited resource, whether time, money, or human capacity, can render this focus on planning, management and lead‐ ership considerably demanding for SMEs.

In addition, for many SMEs there is a need to look beyond their internal resources and capacity to stimulate or enhance their innovation activity.

Partnerships and alliances need to be formed and nurtured with external agencies, including other players in the marketplace, larger enterprises, v

Heather Fulford professional and trade associations, local and regional business networks, and knowledge‐based organisations such as universities and research insti‐ tutes. Successful development of such collaborations again requires care‐ ful and measured strategic thinking on the part of management. The bene‐ fits of collaborative working, and of participating in relevant networks, need to be acknowledged and understood; networking skills need to be honed; strategies must be formulated for accessing external resources efficiently and effectively; and approaches need to be developed for tap‐ ping into the knowledge and information available beyond organisational boundaries.

The papers selected for inclusion in this volume explore some of these is‐ sues relating to innovation stimulation and management in SMEs. The studies reported in these papers provide starting points for thought‐ provoking discussion and reflection on themes such as innovation and growth, innovation alliances, open innovation, and resource management for innovation. The papers raise questions about the role innovation plays in an SME’s ability to be competitive and sustainable, as well as some broader questions about the contribution of small firm innovation in the wider growth and development of a nation, including in transition and de‐ veloping economies. The research papers have been selected from papers published first in the refereed proceedings of the European Conference on Innovation and Entrepreneurship or the proceedings of the International Conference on Innovation and Entrepreneurship.

As Kuratko, Goldsby and Hornsby (2012:5) note, in the “constantly chang‐ ing economic environment” of the twenty‐first century, “innovative think‐ ing has become a critical skill”. The challenge for the entrepreneurs lead‐ ing today’s SMEs is to combine that innovative thinking with a careful process of innovation management, knowledge management and organ‐ isational learning.

References Fulford, H. (2012) Case Studies in Innovation Research: For Researchers, Teachers and Students. Reading: Academic Publishing International.

Kuratko, D. F., Goldsby, M. G. and Hornsby, J. S. (2012) Innovation acceleration: transforming organisational thinking. New Jersey: Pearson Education, Inc.

Heather Fulford Centre for Entrepreneurship Aberdeen Business School vi