Identifying Key Determinants for New Product Introductions and Firm Performance in Small Service Firms

Abstract

Small firms have gained increasing attention in the innovation literature. Focusing mainly on manufacturing based literature we identified several key factors that contribute to the innovative potential of small firms. However, we do not know if these factors are recognised and used in small service firms. Distinguishing various types of service industries, our goal with this paper is threefold. First, we describe to what extent service firms use the key factors to their advantage. Second, we try to establish if there is a relation between the key factors and new product introductions. Third, we want to see if new product introductions indeed contribute to firm performance. After a survey among 502 Dutch service firms, we reveal some major differences between various types of service industries.