Research On The Influence Of SMEs Technological Innovation On Corporate Performance Volatility

Small and medium enterprises (SMEs) are the most actively innovative group and havebeen becoming a new force of technical innovation. Since the reform and opening-up, Chinahas possessed about65%of invention patents, more than75%of technological innovationand over80%of new products completed by SMEs[1]. How strong long-term sustainabledevelopment of an enterprise is not just depending on R&D capability, but most importantlyrelying on how much technological innovation has made contribution to the economicperformance of the enterprise. That means how it affects the volatility of the performance ofthe company. In other words, that is to say how the technology innovation of SMEs affectsthe level of corporate performance and operational risks.This paper is based on the perspective of risk and benefit to study thetechnological innovation performance of SMEs. Select the2007-2010SME Board ofShenzhen Stock Exchange listed companies for the study sample, use the Eviews6.0statistical analysis software to make regression analysis for the innovation panel dataand cross-sectional data consist of innovation investment indicators and companyperformance indicators. The study found that technology innovation has a significantpositive impact on firm performance, R&D investment has significant positive effect oncompany performance volatility, but human capital and R&D output has a significantnegative impact on the performance volatility of the company. The high-tech enterpriseson the one hand reduce the possibility of extreme performance of the company; on theother hand increase the volatility of the performance on the longitudinal time series. Firmage and government support both are increasing the scope of the volatility of performanceof the company. Therefore, when carrying out technology innovation, enterprises mustconsider the benefits and risks, particularly, consider the impact of R&D on businessperformance and performance volatility, and minimize the risk of corporate R&D.On the basis of the present study about technological innovation performance,this study focuses on corporate performance and performance volatility of SMEstechnology innovation, which not only enriches the scope of the theoretical study, butalso provides policy guidance when SMEs confront with and try to control operationalrisks of technological innovation.