THE IMPACT OF THE ORGANIZATIONAL INNOVATIVENESS ON THE PERFORMANCE OF INDONESIAN SMES

Abstract

The main objective of the current study is to examine the impact of the innovation types such as product, process and market innovation on the performance of the Indonesian SMEs. Additionally, the study has also examined the mediating role of organizational innovativeness. The study has adopted the quantitative method of data collection and gathered the primary data from the respondents by using questionnaires. The employees of research and development department of SMEs in Indonesia are the respondents that have been selected by using simple random sampling. The researcher has employed the statistical tools and procedures to analyze the data which was obtained from the self-administered questionnaires. For data analysation in the current study we have used the mixture of inferential and statistical tools. For getting the complete questionnaires all efforts had provided positive result. The results show that the performance of the firm is positively influenced by these four dimensions. The structural linkage among innovative skills (Organizational innovation, Product innovation, Marketing innovation, Process innovation) significantly and positively influenced the performance of SMEs which is determined in a single model. Practically, the innovative procedures for the production of high-quality goods and services, with new or advanced technology obviously enhances the performance of SMEs firm. For a long period of a time company aims for innovation and innovative technology that plays a vital role in high and competitive profit.