An Empirical Research Of Influencing Factors Of Non-R&D Innovation Of SMEs

In the past decades, research and development (R&D) activities have always been seen as the considerably important or even the only factor when explaining the innovativeness of firms. Innovative firms and activities without formal R&D have been recognized in innovation theory, but to a large extent, neglected by both academic studies and by the policy makers. For SMEs, they often do not have sufficient resources for R&D investment. Studies have shown that many SMEs performed almost no formal R&D activities, but they are as innovative as other firms and achieved great innovation performance. These non-R&D innovation activities of manufacturing SMEs are the subjects of our study.In our study, we define non-R&D innovation as firms’innovation activities beyond R&D innovation. The key point of non-R&D innovation is that, firms can improve their products, service, process, marketing methods or organization management by innovating with internal or external existing knowledge. In this process, firms invest little in R&D, but can also achieve innovation performance.This study focuses on three issues, the main non-R&D innovation activities of SMEs, the influence of non-R&D innovation activities on SMEs’performance, and factors that influence SMEs to carry out non-R&D innovation activities. Based on exploratory case study and the results of200survey samples, we found four major non-R&D innovation activities of SMEs through exploratory factor analysis, namely imitation and customization, technology adoption, organizational innovation and market innovation. Then with empirical analysis, we validated the positive influence of these four non-R&D innovation activities on the performance of SMEs. Then we continued to further explore the factors that influence non-R&D innovation activities of SMEs. We found that, three firm internal factors, including financial resources, human capital and innovation climate, have positive impact on non-R&D innovation activities of SMEs, while the risk-taking spirit of entrepreneur has a negative effect on non-R&D innovation activities. As for industry environment, the uncertainty of environment has a positive impact on non-R&D innovation activities. Besides, the uncertainty of environment also negatively moderates the relationship between financial resources, human capital, innovation climate and non-R&D innovation activities of SMEs.The theoretical and practical contributions of this study are as following. In terms of theory, this study refines4kinds of typical non-R&D innovation patterns, and verified the effect of non-R&D innovation on business performance. And for the first time, this research systematically explored the factors that influence non-R&D innovation of SMEs. Finally, for the first time, this research proposed the concept of active degree of non-R&D innovation, and present the measurement method of it, based on existing literature. In practice, this study found that, non-R&D innovation is an effective innovation strategy for survival and development of SMEs in their initial stage. And for government departments, non-R&D innovation should be concerned in improving of firms’ incentive policies.