Co-Innovation And Innovation Performance In Small Firms: The Mediating Role Of Absorptive Capacity

    Fansuri Munawar ,Mariana Rachmawati ,Annisa Lisdayanti ,Dinda Kayani Putri Bestari ,Ni Putu Nurwita Pratami Wijaya ,Gallang Perdana Dalimunthe

    Abstract

    This study analyzes the conceptual model to comprehend the relationship between co-innovation and innovation performance, directly or through the mediation of absorptive capacity in small firms. Take ninety-six small organizations employed in the handicraft, textile, food plus beverage, and numerous industries as study objects; this research tested and authenticated the conceptual design empirically using a partial least square based structural equation model analysis. The results show that co-innovation has a significant positive effect on innovation performance. In addition, absorptive capacity has a positive effect on innovation performance. In addition, this study shows that absorptive capacity plays a mediating role in the relationship between co-innovation and innovation performance. The effects of this study emphasize the importance of creating co-innovation with different partners, such as suppliers, competitors, consumers, and business industries, that can enable access to the broader range regarding resources to enhance innovation performance for small firms ultimately.

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