Kerim Karmeni, Lorraine Uhlaner and Lorenzo Lucianetti
As the transition between exploration and exploitation is a unique challenge for SMEs, what mechanism(s) might facilitate this transition? Building on the entrepreneurship…
Abstract
Purpose
As the transition between exploration and exploitation is a unique challenge for SMEs, what mechanism(s) might facilitate this transition? Building on the entrepreneurship literature's entrepreneurial opportunity identification and development framework, this study hypothesizes that the novelty-centered business model (NCBM) may serve as such a mechanism.
Design/methodology/approach
Based on cross-sectional survey data collected from 169 Italian SMEs in various sectors, this study tests the mediation, moderation and moderated mediation relationships using the statistical PROCESS procedure.
Findings
Supporting the hypotheses that exploration and exploitation are positively associated within SMEs, that NCBM mediates this relationship and that the indirect relationship between exploration and exploitation by way of NCBM is stronger for SMEs with employees of medium to high creative human capital, the results suggest that SMEs can more effectively exploit new ideas identified in the exploration phase by developing an NCBM and accessing their creative human capital.
Research limitations/implications
Although the robustness checks confirm the direction of the proposed hypotheses, given the cross-sectional nature of the dataset used, a longitudinal study would further validate the proposed framework.
Practical implications
SMEs can successfully achieve the transition between exploration and exploitation by reinventing their business model to compensate for their limited resources in terms of financial or relational capital. They can further enhance their ability to reinvent their business model and, in turn, to exploit innovations by hiring and retaining employees with greater creative human capital.
Originality/value
This study draws on the entrepreneurial opportunity, ambidexterity (exploration-exploitation) and business model literature to enhance our understanding of the role of the NCBM design concept (business model innovation) as a mechanism to achieve temporal ambidexterity in SMEs.
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Keywords
Kerim Karmeni, Olivier de la Villarmois and Adel Beldi
The purpose of this paper is to investigate the relationship between organizational control and innovation. The authors address two questions: “First, does the organizational…
Abstract
Purpose
The purpose of this paper is to investigate the relationship between organizational control and innovation. The authors address two questions: “First, does the organizational control have a positive impact on innovation within a franchise network? Second, if such positive relationship exists, how we can explain it?”
Design/methodology/approach
The study used a survey data of 106 outlets belonging to franchise networks in France, using partial least squares and mobilizing an analysis of mediating effects.
Findings
Organizational control is positively related to innovation; this positive relationship can be partly explained by the mediating effect of knowledge creation.
Research limitations/implications
Taking care to use appropriate techniques that guarantee a higher response rate (e.g. following up contacts after the initial request, phoning before sending the questionnaire), this study could be extended to other forms of organization, such as cooperatives or MNCs, to generalize the explanation of the positive impact of control on innovation through the mediating effect of knowledge creation.
Practical implications
The empirical results show that control encourages knowledge creation and innovation, which is a strong argument for franchisors to persuade franchisees of the necessity and utility of implementing organizational control. Moreover, the results constitute a practical tool to help managers making decision regarding innovation management. Innovation success can be improved by paying attention to the organizational control and deploying a combination of different control mechanisms including process, outcome and social.
Originality/value
To the authors’ knowledge, this is the first study to investigate both direct and indirect effects of organizational control on innovation. The authors contribute by explaining the complex relationship between control and innovation.