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Customers as Predictors of Rent Returns to Innovation and Small Firms – an exploratory study

Author

Listed:
  • Tim Mazzarol

    (UWA Business School - UWA - The University of Western Australia)

  • Sophie Reboud

    (CEREN - Centre de Recherche sur l'ENtreprise [Dijon] - BSB - Burgundy School of Business (BSB) - Ecole Supérieure de Commerce de Dijon Bourgogne (ESC))

Abstract

Small to medium enterprises (SME) are frequently associated with high levels of innovation. However, it is difficult for such firms to fully assess the merits of a particular innovation. This study examined the risk-return profile of future investment in innovation by SME with respect to anticipated ‘rent' or financial returns. A survey of highly innovative SME was undertaken that examined management perceptions of the key strategic influences on rent returns. Regression analysis suggests that the firms' assessment of the rent returns from their innovation may be influenced by the value it is likely to deliver to the customer, the customer's expected use of the innovation to generate new sales and the ease of integrating the new innovation into existing technologies. The findings have implications for how entrepreneurs from early stage ventures are assisted.

Suggested Citation

  • Tim Mazzarol & Sophie Reboud, 2005. "Customers as Predictors of Rent Returns to Innovation and Small Firms – an exploratory study," Post-Print hal-00472438, HAL.
    • Handle: RePEc:hal:journl:hal-00472438
    Note: View the original document on HAL open archive server: https://hal.science/hal-00472438
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    File URL: https://hal.science/hal-00472438/document
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    References listed on IDEAS

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    1. Rinaldo Evangelista & Tore Sandven & Giorgio Sirilli & Keith Smith, 1998. "Measuring Innovation in European Industry," International Journal of the Economics of Business, Taylor & Francis Journals, vol. 5(3), pages 311-333.
    2. Martin, Stephen & Scott, John T., 2000. "The nature of innovation market failure and the design of public support for private innovation," Research Policy, Elsevier, vol. 29(4-5), pages 437-447, April.
    3. Jeroen de Jong & Brouwer, 1999. "Determinants of the innovative ability of SMEs," Scales Research Reports B199902, EIM Business and Policy Research.
    4. Jon Sundbo, 2001. "The Strategic Management of Innovation," Books, Edward Elgar Publishing, number 2514.
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    Cited by:

    1. Lars Löfqvist, 2017. "Product Innovation In Small Companies: Managing Resource Scarcity Through Financial Bootstrapping," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 21(02), pages 1-27, February.

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