Jul 2026· International Journal of Asian Business and Information Management· 0 citations
TL;DR
The findings show that exploitative capability enhances both innovation capability and competitive advantage, while exploratory capability directly improves competitive advantage but does not significantly affect innovation capability.
Abstract
This study examines how dynamic capabilities and artificial intelligence (AI) capabilities shape innovation, competitive advantage, and business performance (BP) in Vietnamese small and medium-sized enterprises (SMEs). Drawing on the dynamic capabilities view, survey data from 1,512 managers in 301 SMEs were analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM). The findings show that exploitative capability enhances both innovation capability and competitive advantage, while exploratory capability directly improves competitive advantage but does not significantly affect innovation capability. Innovation capability positively influences BP both directly and indirectly through competitive advantage. AI capability emerges as a key organizational capability: it strongly predicts innovation capability, improves BP, and strengthens the relationship between innovation capability and competitive advantage. The study contributes by distinguishing between exploitation and exploration, positioning AI capability beyond technology adoption, and demonstrating how AI helps SMEs convert innovation into competitive advantage.
This study aims to analyze the influence of Innovation Capability, Market Orientation, and Resource Capability on Competitive Advantage with Firm Performance as a mediating variable among batik Micro, Small, and Medium Enterprises (MSMEs) in Tangerang Regency. A quantitative approach was employed using Partial Least Squares Structural Equation Modeling (PLS-SEM) through SmartPLS 4.0. A purposive sample of 147 respondents was obtained from a registered population of 247 active batik MSME units as of January 2026. Results reveal that all three antecedent constructs exert significant positive influences on both Firm Performance and Competitive Advantage, with Resource Capability emerging as the strongest predictor. Firm Performance is confirmed as a significant partial mediator in all three indirect pathways from Innovation Capability, Market Orientation, and Resource Capability to Competitive Advantage. These findings provide actionable strategic insights for batik MSME owners, policymakers, and development agencies seeking to strengthen sectoral competitiveness sustainably
Maman Sulaeman, Diksi Metris, Ahmad Rasyiddin et al.· Agregat Jurnal Ekonomi dan B...· 0 citations
Micro, small, and medium enterprises operating within free trade zones face intensifying competitive pressures that demand both strategic clarity and technological readiness to sustain business performance. Despite growing scholarly attention to strategy and technology as performance drivers, their simultaneous examination within a mediated structural model remains limited in open industrial zone contexts. This study investigates the influence of business strategy and technological capability on MSME business performance in Batam City, Indonesia, with competitive advantage as a mediating variable. A quantitative explanatory design was employed, with data collected from 350 MSME respondents through a structured Likert-scale questionnaire and analyzed via Partial Least Squares Structural Equation Modeling using SmartPLS 4.1. All seven hypotheses were supported. Both constructs significantly and positively affect competitive advantage and business performance, with technological capability producing the strongest path coefficient in the model, particularly toward competitive advantage. Competitive advantage partially mediates both the strategy-performance and technology-performance relationships. The findings extend the Resource-Based View and Dynamic Capabilities Theory to the MSME free trade zone setting and offer guidance for practitioners and policymakers seeking to support technology-driven competitive development.
King Abdul Aziz, S. Triono· Journal of Entrepreneurship· 0 citations
This study examines how AI adoption enablers influence AI-driven innovation, competitiveness and multidimensional firm performance among micro, small and medium-sized enterprises (MSMEs).
Data were collected from 268 Malaysian MSMEs and analysed using partial least squares structural equation modelling. A disjoint two-stage approach was used to model firm performance as a higher-order construct comprising technological, economic and sustainability performance. Necessary condition analysis (NCA) and importance-performance map analysis were also applied to identify performance bottlenecks and managerial priorities.
The results show that environmental conditions and technological readiness are positively and significantly associated with AI adoption, whereas organisational support does not operate as a sufficient adoption driver. However, AI adoption is strongly associated with AI-driven innovation, which in turn strengthens competitiveness and improves firm performance. The NCA further shows that high firm performance requires minimum threshold levels of technological readiness, environmental conditions, organisational support, AI adoption, AI-driven innovation and competitiveness.
Managers should not treat AI adoption as a symbolic digital upgrade. Performance gains depend on converting AI into process, product/service and business model innovation, and then into competitiveness. Policymakers should move beyond isolated AI grants towards coordinated support systems that combine infrastructure, skills development, advisory services, innovation financing and ecosystem confidence.
The study develops the Technology–Environment–Capability for AI Performance (TEC-AIP) Framework, integrating sufficiency and necessity logics to explain AI-enabled MSME performance in an emerging economy.
Mohammad Falahat, R. Thurasamy, Pureheart Ogheneogaga Irikefe et al.· Benchmarking : An Internatio...· 0 citations
This study examines the role of strategic flexibility (SF) in supporting sustainable growth among small and medium-sized enterprises (SMEs) operating in an emerging economy context. Specifically, it investigates the relationships between SF, business model innovation (BMI), competitive advantage (CA), and firm performance (FP) in Iranian SMEs. Drawing on the Resource-Based View (RBV) and Dynamic Capabilities Theory (DCT), the study empirically examines a capability–innovation–performance model and contributes by extending existing theoretical relationships to the context of SMEs in an emerging economy. Using structural equation modeling (SEM), data were collected through 391 validated questionnaires from SMEs across different sectors in Iran. The findings reveal that SF has a direct and significant effect on both BMI and CA, while BMI positively influences CA and FP. However, CA does not show a significant direct effect on FP, suggesting that competitive positioning alone may be insufficient to generate performance outcomes in uncertain and resource-constrained environments. The results indicate that adaptive and innovation-oriented capabilities play a central role in enhancing long-term organizational resilience and sustainable performance among SMEs operating under institutional and market volatility.
Mohammadsadegh Omidvar, Giovanna Lusini, Maria Palazzo· Sustainability· 0 citations
Purpose: This study examines the direct and mediating effects of market orientation, dynamic capability, and absorptive capacity on sustainable competitive advantage among Micro, Small, Medium-Sized Enterprises (MSMEs).Research Methodology: Employing a quantitative explanatory approach, this study analyzes data from 280 purposively selected MSMEs using structured questionnaires and Partial Least Squares Structural Equation Modeling (PLS-SEM).Results: The findings indicate that market orientation significantly enhances absorptive capacity by improving firms’ ability to acquire, assimilate, and utilize external knowledge. Market orientation and dynamic capability also positively affect sustainable competitive advantage, while absorptive capacity partially mediates these relationships.Conclusions: MSMEs need to strengthen market knowledge, organizational flexibility, and knowledge management capabilities to maintain long-term competitiveness.Limitations: The cross-sectional design and industry-specific context may limit the generalizability of the findings across different sectors and regions.Contributions: This study contributes to the Knowledge-Based View (KBV) and Dynamic Capability Theory (DCT) by explaining how knowledge utilization and adaptive capabilities generate sustainable competitive advantage. It also provides practical implications for MSME managers in improving strategic responsiveness and organizational adaptability.
Onita Sari Sinaga, C. Y. Setyawati, Rr. Chusnu Syarifa Diah Kusuma et al.· Studi Ilmu Manajemen dan Org...· 0 citations
The growing importance of Environmental, Social, and Governance (ESG) performance has become a critical focus for companies striving for sustainability and competitive advantage, particularly in the high-tech manufacturing sector. This study investigates how coopetition capabilities and market orientation shape ESG performance, emphasizing the mediating roles of innovation capabilities, digital infrastructure, and data analytics capabilities (DAC). The research focuses on Chinese SMEs within the high-tech manufacturing industry. The findings reveal that coopetition capabilities positively influence digital infrastructure and innovation capabilities but do not significantly impact DAC. Similarly, market orientation enhances digital infrastructure and innovation capabilities but does not impact DAC. Moreover, digital infrastructure and innovation capabilities contribute significantly to ESG performance, whereas DAC remains decoupled from sustainable outcomes. The interplay between coopetition, market orientation, and ESG outcomes is mediated exclusively through digital infrastructure and innovation capabilities. In this framework, firm size and age emerge as important contextual factors that positively impact ESG performance. This study contributes to the ESG literature by integrating the concepts of coopetition and market orientation, showcasing their pivotal roles in cultivating strategic and technological capabilities geared toward sustainable value creation. The insights underscore that high-tech SMEs can leverage coopetition and market alignment strategies to strengthen innovation and infrastructure, enabling improved ESG performance and supporting long-term sustainable growth.
Wei Lu, Nawal abdalla adam, Aftab Anwer et al.· The Journal of Environment &...· 0 citations