Enhanced Innovation Process as a Key Driver of Bakery Performance

Enhanced Innovation Process as a Key Driver of Bakery Performance

Kafigi Jeje (Institute of Accountancy, Arusha, Tanzania), Vannie Naidoo (University of KwaZulu-Natal, South Africa) and Rahul Verma (Delhi University, India)
DOI: 10.4018/978-1-7998-7951-0.ch013
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Abstract

Small and medium-sized enterprises (SME) in the food sector play a pivotal role in contributing to the developing county's economy. In order to improve a small and medium-sized enterprises (SME), one key driver is innovation, and for innovation initiatives to grow and succeed, they depend largely on the leadership and the innovation capabilities of the firm. This chapter will shed more light on the impact of the enhanced innovation process on the performance of small and medium-sized enterprise (SME) bakeries. A qualitative study was conducted on 186 registered bakery owners/managers of bakeries. The results indicated that the relationship between enhanced innovation process and output level in small and medium-sized enterprises (SME) bakeries are significant. It has been revealed that the workforce's professional behaviour, the acquired competency through training, and the rewarding systems moderate the relationship between enhanced innovation process and output level in small and medium-sized enterprise (SME) bakeries.
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Background

Small and Medium-sized Enterprises (SME) play a vital role in driving socio-economic development in many countries including developing nations. It is estimated that 99% of all of the operating businesses around the globe are Small and Medium-sized Enterprises (SME) (Robu, 2013; Savlovschi & Robu, 2011). They also account for 99% of all of the enterprises in developing countries, and 95% in Sub-Saharan Africa (Fjose et al., 2010). Small and Medium-sized Enterprises (SME) contribute significantly in poverty reduction and are the sources of employment opportunities (Katua, 2014; Savlovschi & Robu, 2011). They employ 60-70% of all employees (Robu, 2013; Savlovschi & Robu, 2011). In Tanzania, Small and Medium-sized Enterprises (SME) are also an engine in poverty reduction (URT, 2012), job creation (Maliti & Mnenwa, 2008), and GDP growth. For example, in 2010, about 27% of the GDP was contributed to by small enterprises (URT, 2012). The benefits of Small and Medium-sized Enterprises (SME) are numerous in various economies. For example, they can prevent large enterprises from controlling the market, and are drivers of innovation (Savlovschi & Robu, 2011), and competitiveness (Robu, 2013). Their competitive advantages can be translated in terms of their efficient utilization of resources and high capital productivity (Huang, 2003; Savlovschi & Robu, 2011), low production cost, management cost (Keskìn et al., 2010; Robu, 2013), high flexibility and fast decision making process, and their lower cost of creating employment opportunities than is in large firms (Savlovschi & Robu, 2011). Also, Small and Medium-sized Enterprises (SME) need small capital (Keskìn et al., 2010). However, in order to continue realizing their contribution to the socio-economic development of various economies such as Tanzania, Small and Medium-sized Enterprises (SME) need to realize growth. This can be realized when a positive performance is achieved. This performance can be influenced by Small and Medium-sized Enterprises (SME) entrepreneurial initiatives.

Key Terms in this Chapter

Performance: The process or action of performing a function or task.

Small and Medium-sized Enterprises (SME): These are operational Small and Medium Enterprises.

Key Driver: It is somewhat that has a great effect on whether the business does well or not.

Innovation: A new product/idea/method.

Bakery: A confectionery/bake shop/pastry shop/patisserie.

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