IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v15y2023i13p10555-d1186903.html
   My bibliography  Save this article

Innovation and the Sustainable Competitive Advantage of Young Firms: A Strategy Implementation Approach

Author

Listed:
  • Uyen Nguyen Thi

    (Strategic Management Department, Faculty of Business Administration, Thuongmai University, Hanoi 100000, Vietnam)

  • Manh Hoang Van

    (Political Economy Department, Faculty of Political Theories, Thuongmai University, Hanoi 100000, Vietnam)

  • Imran Mahmud

    (Department of Software Engineering, Daffodil International University, Daffodil Smart City, Dhaka 1216, Bangladesh)

  • Linh Vu Thi Thuy

    (Department of Research Methodology, Thuongmai University, Hanoi 100000, Vietnam)

Abstract

This study examines the impact of innovation at the strategy level on innovation at the process and system levels, which are considered to be forms of function-level innovation, based on the strategy implantation approach. The study also reveals the effect of process and system innovation on the sustainable competitive advantage (SCA) of young firms in Vietnam. The research used primary data from a survey of 289 young firms’ leaders in Vietnam. PLS-SEM using SmartPLS software was employed to assess the ability of the measurement model and structural model to test hypotheses. The findings indicated that the four hypotheses about the effects of strategy innovation on process and system innovation and the effects of process and system innovation on the SCA of young firms in Vietnam were all confirmed. These crucial results fill the research gap of innovation in young firms, especially the gap in the context of developing countries. The current study addresses an important implication for the use of innovation practices in young firms to sustain the firm’s SCA. Accordingly, young firms are able to significantly strengthen their sustainable competitive advantage through innovation practices at both strategy and function levels.

Suggested Citation

  • Uyen Nguyen Thi & Manh Hoang Van & Imran Mahmud & Linh Vu Thi Thuy, 2023. "Innovation and the Sustainable Competitive Advantage of Young Firms: A Strategy Implementation Approach," Sustainability, MDPI, vol. 15(13), pages 1-13, July.
    • Handle: RePEc:gam:jsusta:v:15:y:2023:i:13:p:10555-:d:1186903
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/15/13/10555/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/15/13/10555/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Raphael Amit & Paul J. H. Schoemaker, 1993. "Abstract," Strategic Management Journal, Wiley Blackwell, vol. 14(1), pages 33-46, January.
    2. Joe Tidd & Frank M. Hull, 2003. "Managing Service Innovation: Variations of Best Practice," World Scientific Book Chapters, in: Joe Tidd & Frank M Hull (ed.), Service Innovation Organizational Responses to Technological Opportunities & Market Imperatives, chapter 1, pages 3-34, World Scientific Publishing Co. Pte. Ltd..
    3. Gannon, Martin & Taheri, Babak & Olya, Hossein, 2019. "Festival quality, self-connection, and bragging," Annals of Tourism Research, Elsevier, vol. 76(C), pages 239-252.
    4. Joe Tidd & Frank M Hull (ed.), 2003. "Service Innovation:Organizational Responses to Technological Opportunities & Market Imperatives," World Scientific Books, World Scientific Publishing Co. Pte. Ltd., number p294, August.
    5. Protogerou, Aimilia & Caloghirou, Yannis & Vonortas, Nicholas S., 2017. "Determinants of young firms’ innovative performance: Empirical evidence from Europe," Research Policy, Elsevier, vol. 46(7), pages 1312-1326.
    6. Ferreira, Jorge & Coelho, Arnaldo & Moutinho, Luiz, 2020. "Dynamic capabilities, creativity and innovation capability and their impact on competitive advantage and firm performance: The moderating role of entrepreneurial orientation," Technovation, Elsevier, vol. 92.
    7. Hair, Joseph F. & Astrachan, Claudia Binz & Moisescu, Ovidiu I. & Radomir, Lăcrămioara & Sarstedt, Marko & Vaithilingam, Santha & Ringle, Christian M., 2021. "Executing and interpreting applications of PLS-SEM: Updates for family business researchers," Journal of Family Business Strategy, Elsevier, vol. 12(3).
    8. Popa, Simona & Soto-Acosta, Pedro & Martinez-Conesa, Isabel, 2017. "Antecedents, moderators, and outcomes of innovation climate and open innovation: An empirical study in SMEs," Technological Forecasting and Social Change, Elsevier, vol. 118(C), pages 134-142.
    9. Rita Gunther McGrath & Ming-Hone Tsai & S. Venkataraman & I. C. MacMillan, 1996. "Innovation, Competitive Advantage and Rent: A Model and Test," Management Science, INFORMS, vol. 42(3), pages 389-403, March.
    10. Leckel, Anja & Veilleux, Sophie & Dana, Leo Paul, 2020. "Local Open Innovation: A means for public policy to increase collaboration for innovation in SMEs," Technological Forecasting and Social Change, Elsevier, vol. 153(C).
    11. Reinartz, Werner & Haenlein, Michael & Henseler, Jörg, 2009. "An empirical comparison of the efficacy of covariance-based and variance-based SEM," International Journal of Research in Marketing, Elsevier, vol. 26(4), pages 332-344.
    12. James R. Brown & Steven M. Fazzari & Bruce C. Petersen, 2009. "Financing Innovation and Growth: Cash Flow, External Equity, and the 1990s R&D Boom," Journal of Finance, American Finance Association, vol. 64(1), pages 151-185, February.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Waseem Ul Hameed & Muhammad Farhan Basheer & Jawad Iqbal & Ayesha Anwar & Hafiz Khalil Ahmad, 2018. "Determinants of Firm’s open innovation performance and the role of R & D department: an empirical evidence from Malaysian SME’s," Journal of Global Entrepreneurship Research, Springer;UNESCO Chair in Entrepreneurship, vol. 8(1), pages 1-20, December.
    2. Lingyan Meng & Md Qamruzzaman & Anass Hamad Elneel Adow, 2021. "Technological Adaption and Open Innovation in SMEs: An Strategic Assessment for Women-Owned SMEs Sustainability in Bangladesh," Sustainability, MDPI, vol. 13(5), pages 1-22, March.
    3. Barba-Aragón, María Isabel & Jiménez-Jiménez, Daniel, 2020. "HRM and radical innovation: A dual approach with exploration as a mediator," European Management Journal, Elsevier, vol. 38(5), pages 791-803.
    4. Marzi, Giacomo & Fakhar Manesh, Mohammad & Caputo, Andrea & Pellegrini, Massimiliano Matteo & Vlačić, Božidar, 2023. "Do or do not. Cognitive configurations affecting open innovation adoption in SMEs," Technovation, Elsevier, vol. 119(C).
    5. Shao, Yanmin & Xu, Kunliang & Shan, Yuan George, 2024. "Leveraging corporate digitalization for green technology innovation: The mediating role of resource endowments," Technovation, Elsevier, vol. 133(C).
    6. Tikas, Gaurav Dilip, 2023. "Team innovation capability: Scale development and validation," Technovation, Elsevier, vol. 126(C).
    7. Augustina Asih Rumanti & Afrin Fauzya Rizana & Lutfia Septiningrum & Rocky Reynaldo & Mohammad Mi’radj Isnaini, 2022. "Innovation Capability and Open Innovation for Small and Medium Enterprises (SMEs) Performance: Response in Dealing with the COVID-19 Pandemic," Sustainability, MDPI, vol. 14(10), pages 1-21, May.
    8. Omar Carrasco-Carvajal & Mauricio Castillo-Vergara & Domingo García-Pérez-de-Lema, 2023. "Measuring open innovation in SMEs: an overview of current research," Review of Managerial Science, Springer, vol. 17(2), pages 397-442, February.
    9. Lovlyn Ekeowa Kelvin-Iloafu & Francis Ezieshi Monyei & Wilfred Isioma Ukpere & Happiness Ozioma Obi-Anike & Phina Njideka Onyekwelu, 2023. "The Impact of Human Capital Development on the Sustainability and Innovativeness of Deposit Money Banks’ Workforces," Sustainability, MDPI, vol. 15(14), pages 1-15, July.
    10. Dao Thi Ta & Chia-Han Yang, 2018. "Exploring The Impacts Of Service Innovation On Customer Satisfaction In The Telecom Industry: A Perspective From Interactive And Supportive Service Innovations," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 22(07), pages 1-30, October.
    11. Behl, Abhishek & Jayawardena, Nirma & Nigam, Achint & Pereira, Vijay & Shankar, Amit & Jebarajakirthy, Charles, 2023. "Investigating the revised international marketing strategies during COVID-19 based on resources and capabilities of the firms: A mixed method approach," Journal of Business Research, Elsevier, vol. 158(C).
    12. Alghamdi, OmarA. & Agag, Gomaa, 2024. "Competitive advantage: A longitudinal analysis of the roles of data-driven innovation capabilities, marketing agility, and market turbulence," Journal of Retailing and Consumer Services, Elsevier, vol. 76(C).
    13. Junaid Aftab & Nabila Abid & Huma Sarwar & Anam Amin & Mahsa Abedini & Monica Veneziani, 2024. "Does corporate social responsibility drive financial performance? Exploring the significance of green innovation, green dynamic capabilities, and perceived environmental volatility," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 31(3), pages 1634-1653, May.
    14. Wilawan Jansri, 2019. "Perception of Residents, Community Participation and Support for Tourism Development in the Old Town Muang Songkhla, Thailand," Proceedings of the 13th International RAIS Conference, June 10-11, 2019 07WJ, Research Association for Interdisciplinary Studies.
    15. Philippe Cohard, 2020. "Information Systems Values: A Study of the Intranet in Three French Higher Education Institutions," Post-Print hal-02987225, HAL.
    16. Lirios Alos-Simo & Antonio J. Verdu-Jover & Jose M. Gomez-Gras, 2020. "Knowledge Transfer in Sustainable Contexts: A Comparative Analysis of Periods of Financial Recession and Expansion," Sustainability, MDPI, vol. 12(12), pages 1-24, June.
    17. Kusa, Rafał & Suder, Marcin & Duda, Joanna, 2023. "Impact of greening on performance in the hospitality industry: Moderating effect of flexibility and inter-organizational cooperation," Technological Forecasting and Social Change, Elsevier, vol. 190(C).
    18. Gareis, Johannes & Mayer, Eric, 2020. "Financial shocks and the relative dynamics of tangible and intangible investment: Evidence from the euro area," Discussion Papers 39/2020, Deutsche Bundesbank.
    19. Hirokazu Mizobata & Hiroshi Teruyama, 2020. "Factor Adjustments and Liquidity Management: Evidence from Japan's Two Lost Decades and Financial Crises," KIER Working Papers 1043, Kyoto University, Institute of Economic Research.
    20. Katalin Bodnár & Ludmila Fadejeva & Marco Hoeberichts & Mario Izquierdo Peinado & Christophe Jadeau & Eliana Viviano, 2017. "Credit shocks and the European labour market," Working Papers 1747, Banco de España.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:15:y:2023:i:13:p:10555-:d:1186903. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.