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1. Introduction
In light of a changing business environment and with significant competitive pressures on business organizations, especially in light of the COVID-19 pandemic, which has dramatically affected all business and activities in all countries of the world (Donthu and Gustafsson, 2020; Fairlie, 2020; Kwok and Koh, 2020), there is no country, organization or even individual left that has not been affected by this pandemic. The pandemic has created an environment of instability and ambiguity that has led to a clear, significant and essential disruption of the business environment (Altig et al., 2020; Sharma et al., 2020). The importance of innovation has emerged now more than before. Innovation is a source of competitive advantage (Abd Aziz and Samad, 2016; McDowell et al., 2018) and a general economy engine (Fan et al., 2017; Hogan and Coote, 2014). Innovation plays a pivotal role in improving human well-being and improving quality of life (Edwards-Schachter et al., 2012). The innovative potential and capabilities of organizations and countries may increase well-being levels in those organizations or countries (Koo et al., 2020).
Competitive advantage is defined as superiority over other organizations through the creation of different capabilities from competitors in the industry (Grant and Baden-Fuller, 2004; Rotjanakorn et al., 2020). Competitive advantage reflects an organization’s unique capacities and outperforms its counterparts from other organizations (Barney, 1991). Competitive advantage plays a pivotal role in improving an organization’s position in the market and makes it more distinctive and successful (Kaur et al., 2019). An organization’s focus on competitive advantage improves operational and strategic activities in line with the organization’s general plan, which focuses on creating a sustainable competitive advantage (Ma, 2000).
In innovation literature, several studies (Abd Aziz and Samad, 2016; Afraz et al., 2021; Ali, 2021; Liu, 2017) discussed the relationship between innovation and competitive advantage. Isada and Isada (2017) demonstrated that innovation could be divided into two basic types according to its novelty, namely, radical innovation and incremental innovation. Radical innovation involves significant improvements in products and services and the provision of new products and services (Nguyen, 2018). Incremental innovation involves slight changes in technology and some new value or differentiation in current products, services and technology (Okuyama, 2017). When comparing these...