A Study of the Factors Influencing Innovation in Emirati Women Owned Small and Medium Enterprises (SMEs)
Huda, Al Matroushi
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Innovation is the best way to gain competitive advantage over the competitors and is a key aspect for business success in the current competitive market. Encouraging innovation in Small and Medium Enterprises (SMEs) is one of the main policy initiatives by the government at the local, regional, and national level for stimulating economic development. Women are the key contributor to United Arab Emirates (UAE) diverse talent pool and are taking the lead as change agents and innovators. The major purpose of the study is to identify the practice of innovation among Emirati women entrepreneurs, evaluate their innovation process, understand the types of innovation they use in their businesses, address the obstacles they face as entrepreneurs, and prioritise the factors influencing the innovation in the Emirati-owned nascent, start-up, and established SMEs. This study is timely and in alignment with the UAE’s vision to foster a unique innovation ecosystem for a knowledge-based economy. The study is divided into three stages: (a) identifying innovative female Emirati entrepreneurs, (b) case studies of selected entrepreneurs, and (c) an AHP (Analytical Hierarchal Process) based model to prioritise factors helpful in facilitating business innovation. In the first stage, a questionnaire based study was conducted to identify innovative firms owned by Emirati women. The second stage of the research was based on case study methodology. The major focus of this stage is to understand more closely issues like innovation characteristics, challenges and factors influencing innovation. The third stage of this research utilized AHP based model to prioritise factors influencing innovation. The findings from first stage of the research are that most of the Emirati women entrepreneurs have invested in service industry, whereas construction, technology and agriculture sector have the least percentage of Emirati women entrepreneurs. Among the 50 entrepreneurs only 10 Emirati women entrepreneurs have initiated the innovation characteristics in their business and 75% of respondents focus on incremental innovation, whereas 25% of them are focused on radical innovation. From the second stage of research, all the 10 respondents believe that a strong vision, qualified education background and risk taking attitude are the necessary characteristics imbedded in an innovative entrepreneur, whereas new technology adoption, networking, implementation of new or improve product, process, marketing and organizational innovation will help the innovative entrepreneurs to commercialize their business idea. Investing in research and development (R&D) activities and allocating training fund for their employees will boost the innovation level in the business and considered one of the influencing factors among Emirati women entrepreneurs. In the third stage respondents from the focus group collectively prioritised government policies, R&D, innovation strategy, and skills development as the main criteria influencing innovation for Emirati women owned SMEs. Family support, access to external finance, social networks, and allocation of funds are the main sub criteria affecting women entrepreneurs’ innovation and participation in the entrepreneurial field. The findings of this study will help policy makers and associations such as business women’s councils to identify the specific inhibitors and facilitators linked to innovation and hence will help in developing various effective policies to promote innovation among Emirati women-owned SMEs. This will eventually encourage Emirati women entrepreneurs to be more innovative in their businesses, ensuring successful entrepreneurial ventures ultimately leading to women’s empowerment and better economic development for the nation.