Influence of Technology Innovation Intensity on Firm Performance: Technology Innovation on Firm Performance - Case of Kenya

Influence of Technology Innovation Intensity on Firm Performance: Technology Innovation on Firm Performance - Case of Kenya

Samwel M. Chege, Daoping Wang, Shaldon Leparan Suntu
Copyright: © 2020 |Pages: 19
DOI: 10.4018/IJTHI.2020040104
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Abstract

The aim of this paper is to assess the effects of technology innovation intensity on firm performance. A sample of 297 businesses funded by the Youth Enterprise Development Fund in Kenya was used as study framework. Correlation and a regression model were used for content analysis. The findings show that technology innovation intensity contributes positively to firm performance, but the entrepreneur characteristic affects the firms' innovation level. Further, the results show low profitability and expansion level among micro and small enterprises. The findings provide information necessary for competitive advantages and recommends the empowerment of entrepreneurs in technology innovation trends for their firm performance. The study endeavors to discover and advance enterprise innovative strategies that are ideally anchored in the technological, organizational, and environmental frameworks. The value of this study is on the approaches of entrepreneur capability in handling technology innovation intensity within a competitive business environment to improve firm performance.
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Introduction

To survive and flourish in competitive environs, both macro, micro and small enterprises (MSEs) develop innovative strategies to navigate through commercial environment controlled by globalization, stiff competition, and technology innovation (TI) insurgency (Pilinkiene et al., 2013). Innovation is inevitable for businesses that wish to grow and remain competitive as well as gain entrance into new marketplaces (Lin and Chen, 2007). Entrepreneurs need to set up and follow innovation that inspires their staff to analyze work environment geared towards the attainment of its goals. In a contemporary volatile business environment with its swift and erratic alterations, it is imperative for a firm to advance its effectiveness through creativity and renewal. Thus, adoption of new technology through entrepreneurial innovativeness has become significant for businesses to have better performance (Serdyukov, 2017a).

Technology has been accepted and its extensive usage by both government and non-governmental organizations has changed the procedures of modern business management. Consequently, adoption of TI is an essential force underlying several economic developments (Ahmad et al., 2012a). As the implementation and commercialization of technology turn out to be more widespread worldwide, technology adoption by firms can enhance new trade opportunities among other advantages.

The external aspects that interrupt firm’s undertakings include clienteles’ demand, competitors, suppliers, government regulations, intricacy, lethargy, and munificence (Jong et al., 2011). The entrepreneur capability in decision-making on sensitivities of these environmental aspects determines the level of business survival (Raymond, 2012). Notably, these aspects and players can influence the future of a firm, entrepreneurs should understand their effects and seize the moment and opportunities to protect the firm from extortions, and quantify the effects of both firm performance and business environment (Chen et al., 2014).

Researchers have identified TI as a potent business enabler and a driving force for realizing and sustaining a competitive advantage (Alkali, 2012a). The innovation process may involve the combination of existing technology and inventions to make a new or improved product, process, or system. Innovation has changed the procedures of modern business management and is an essential force underlying several economic developments (Ahmad et al., 2012b). Innovation has encouraged businesses to change the old-style business technique to contemporary international business models. Innovation is an assurance by an organization to spend towards application and usage of an invention to maintain essential commercial operations supported by the application of online processes (Ramos and Williams, 2012). According to Talebi and Tajeddin (2011) innovation leads to; reduced operational costs, effectiveness, and efficiency, entry to the international market, enhanced communication channels to the customers and dealers.

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