Managerial competence and innovation performance: The mediating role of willingness to change, entrepreneurial orientation and culture

Abstract

Small and medium-sized enterprises (SMEs) significantly influence Saudi Arabia’s economic stability and growth. However, this industry faces significant managerial competence (MC) and innovation performance (IP) obstacles. Based on the findings of previous studies, i.e., Kellermanns and Eddleston (2006), De Clercq et al. (2015), Vafaei-Zadeh et al. (2019) and Renwarin et al. (2023) and the dire need for further exploration, the researchers developed the conceptual framework and model for confirmation in the context of Saudi Arabia. The study aims to investigate the direct and indirect linkages between MC and IP, mediated by a willingness to change (WTC), entrepreneurial orientation (EO), and entrepreneurial culture (EC) among SMEs in Saudi Arabia. The study used responses from 368 managers of Saudi Arabian SMEs. The structural equation modeling (SEM) analysis results confirmed that MC has a significant positive effect on WTC, IP, EO and EC. Besides, the factors such as WTC, EO, and EC positively and significantly affect IP. Finally, the mediation analysis through path analysis suggests a mediating role of WTC, EO and EC between MC and IP. The findings of this study can assist SME managers in making informed resource allocation decisions that can lead to maximum outcomes for their businesses. Besides, this study can help SME managers overcome challenges while improving their organizations’ innovation performance.