Exploring innovation within low and medium technology SMEs: a qualitative study of Irish food companies

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Collins, Evan
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University College Cork
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R&D is a key determinant of innovation and yet Low and Medium Technology (LMT) industries by their definition, do not invest heavily in this driver of innovation. Small and Medium-Sized Enterprises (SMEs) account for the majority of enterprises, contributing significantly to economic output, employment and the regional economy of developed countries. In fact, much of the SME population operate in LMT industries and have continued to survive and grow in the face of market turbulence. Given their economic importance and sustainability, the question of if and how these LMT SMEs innovate is an important one, especially given that they are disadvantaged relative to both the scale and R&D intensity of larger enterprises. This innovation research concentrates on the largely silent enterprise majority of LMT SMEs (Hirsch-Kreinsen et al., 2005; Dooley et al., 2017; Trott and Simms, 2017; Hullova et al, 2019) to gain better insights into the nature and management of innovation within such firms and the organisational capabilities that nurture their innovation output and continued survival. Encouragingly, numerous innovation researchers have begun to explore the innovation activity of the LMT sector and the SME’ within same (Bender and Laestadius, 2005; Kirner et al., 2009; Hansen, 2010; Som and Kirner, 2015; Hirsch-Kreinsen, 2015; Dooley and O’Sullivan, 2018; Flor et al., 2019). This research answers calls by Robertson et al. (2009), Hirsch-Kreinsen (2015), Som and Kirner (2015) and Hullova et al., (2019) for increased study of this largely ‘forgotten sector’ and how they innovate for survival and growth. In addressing this gap in innovation research, the research employs a qualitative case-based approach that studies seven cases of LMT SMEs within the food sector in Ireland. Cases were developed through multiple interviews of management team members (including the general manager/owner) across the seven cases that agreed to participate. The research findings highlight that LMT SMEs innovate for survival and growth and that this innovation activity is primarily incremental in nature. The predominant innovation undertaken by such firms is that of constant process innovation, ensuring continued enterprise efficiency and survival, followed in strategic importance by periodic product innovation that nurtures enterprise growth. The findings highlight that although management of the innovation process is often ad hoc in nature, the centralised decision power within key individuals (e.g. entrepreneurial Managing Director) permits an opportunistic yet focused trajectory to innovation activity. While acknowledging significant resource constraints and low investment in traditional R&D, the research highlights that LMT SME leverage capabilities, both internal within the venture and from external sources to support innovation. The research highlights the importance of the capabilities of collaboration, Managing Director entrepreneurial orientation, deep knowledge of and interaction with the customer base and a learning mode of doing, using and interacting (DUI) as core to their innovation for survival and growth. The main implications of the research are twofold. Firstly, our findings suggest that LMT SMEs innovate constantly and do so in the absence of traditional R&D and the Science, Technology and Innovation (STI) learning mode of innovation. Governments and policymakers need to give greater attention to their capability development through policies that enhance management capability and their exposure to a wider network of potential collaborators. Secondly, given the entrepreneurial Managing Director influence across the SME organisation, then education, training and mentoring support of key SME management will nurture innovation for the LMT SME firm survival and growth.
Innovation , Small and medium sized enterprises , Low and medium technology , Irish food companies
Collins, E. V. 2020. Exploring innovation within low and medium technology SMEs: a qualitative study of Irish food companies. MRes Thesis, University College Cork.
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