LEVERAGING STRATEGIC BENCHMARKING AND ABSORPTIVE CAPACITY FOR INNOVATION PERFORMANCE: THE MEDIATING EFFECT OF ORGANIZATIONAL AGILITY IN INDONESIAN SMEs

Agung Augustrianto, Anita Silvianita

Abstract


Innovation is crucial for small and medium-sized enterprises (SMEs) to remain competitive in a changing market. However, many SMEs struggle due to limited resources and a lack of agility. This study delves into an unexplored area: how knowledge-driven capabilities like strategic benchmarking and absorptive capacity contribute to innovation performance by fostering organisational agility.  Drawing on Dynamic Capability Theory, the Knowledge-Based View (KBV) and Open Innovation Theory, the research argues that learning from industry leaders and utilising external knowledge significantly boosts innovation, particularly when companies can swiftly adapt to environmental changes.  Data were gathered through a quantitative survey of SME owners and managers in Indonesia and analysed using Partial Least Squares Structural Equation Modelling (PLS-SEM).  The findings demonstrate that both strategic benchmarking and absorptive capacity have a substantial positive impact on organisational agility and innovation outcomes.  Importantly, organisational agility acts as akey mediator in these relationships, explaining a considerable amount of variance in agility (R2 = 0.587) and innovation performance (R2 = 0.671). These results offer a fresh perspective for Indonesian SMEs on how combining benchmarking, external knowledge utilisation and operational responsiveness can enhance their innovative capabilities.

Keywords


Strategic Benchmarking; Absorptive Capacity; Organizational Agility; Innovation Performance; SMEs; PLS-SEM.

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DOI: https://doi.org/10.17509/mimbardik.v11i2.104377

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