THE INFLUENCE OF ENTREPRENEURSHIP, CORPORATE DYNAMIC CAPACITY, ORGANIZATIONAL INNOVATION ENVIRONMENT ON CORPORATE INNOVATION PERFORMANCE IN CHINESE SMEs

Abstract

This study investigates the pivotal factors influencing innovation performance in Chinese Small and Medium Enterprises (SMEs). Focusing on the roles of entrepreneurship, dynamic capabilities, and the organizational innovation environment, the research unveils how these elements interrelate to shape innovation outcomes. Drawing from qualitative and quantitative data, the findings underscore that SMEs with a robust entrepreneurial spirit, characterized by risk-taking, proactive initiatives, and novelty, tend to have superior innovation performance. Additionally, firms with strong dynamic capabilities, specifically the ability to sense market shifts and adeptly reconfigure resources, emerge as frontrunners in innovation. Furthermore, an innovation-conducive organizational environment, accentuated by psychological ownership among employees and inclusive leadership, was found to significantly boost innovative behavior. The study adds depth to the understanding of the innovation landscape in Chinese SMEs and offers insights for SME development strategies in the context of China's burgeoning entrepreneurial ecosystem.