Innovative Firms or Innovative Owners? Determinants of Innovation in Micro, Small, and Medium Enterprises

Innovation is key to technology adoption and creation, and to explaining the vast differences in productivity across and within countries. Despite the central role of the entrepreneur in the innovation process, data limitations have restricted standard analysis of the determinants of innovation to consideration of the role of firm characteristics. We develop a model of innovation which incorporates the role of both owner and firm characteristics, and use this to determine how product, process, marketing and organizational innovations should vary with firm size and competition. We then use a new large representative survey from Sri Lanka to test this model and to examine whether and how owner characteristics matter for innovation. The survey also allows analysis of the incidence of innovation in micro and small firms, which have traditionally been overlooked in the study of innovation, despite these firms comprising the majority of firms in developing countries. More than one quarter of microenterprises are found to be engaging in innovation, with marketing innovations the most common. As predicted by our model, firm size is found to have a stronger positive effect, and competition a stronger negative effect, on process and organizational innovations than on product innovations. Owner ability, personality traits, and ethnicity are found to have a significant and substantial impact on the likelihood of a firm innovating, confirming the importance of the entrepreneur in the innovation process.innovation, microenterprises, SMEs, development

Investigating the Effects of IT Adoption between Micro-Enterprises from an Ethnic Community in the United States

The present research study aims to discover the effects of IT adoption in micro-enterprises in the Latino community in the United States. While the majority of the IT adoption literature considers large organizations, this study relies on Sen’s Capability Approach and an adaptation of Action Research to support the adoption of IT by micro-enterprises. This “IT therapy” process enables IT to be used by micro-entrepreneurs to grow their businesses. Following an analysis of four Latin American micro-enterprises, this paper presents the most predominant outcomes. An assessment is made of the IT solutions implemented in the participating micro-enterprises. This paper contributes with a better understanding of how IT adoption can enable micro-enterprises in ethnic communities to grow. This has implications for governmental and non-governmental agencies supporting technology implementations in local communities. Future research based on the research findings should investigate communities of local enterprises at underserved areas as they adopt technology

Mobile Value Added Services: A Business Growth Opportunity for Women Entrepreneurs

Examines the potential for mobile value-added services adoption by women entrepreneurs in Egypt, Nigeria, and Indonesia in expanding their micro businesses; challenges, such as access to digital channels; and the need for services tailored to women