The Effect of Business Model Innovation on Enterprise Performance: Application of Non-Monetary Indicators in SMEs
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Business model innovation (BMI) is crucial for long-term success in today's dynamic market characterized by rapid technical advancements and a complex network economy. This study examines the complex relationship between BMI and business performance, with a focus on non-monetary indicators. Expanding on prior studies, the study demonstrates that BMI's influence extends beyond simple value generation or proposal. The study presents the notion of value co-creation, which serves as a mediating mechanism connecting BMI dimensions to increased enterprise performance. This concept encompasses co-production and value-in-use. The study adopted a mixed-method approach that includes theoretical analysis and empirical data from Chinese SMEs. Four research variables were used, value co-creation as a mediator, enterprise performance as dependent variable, business model innovation as independent variable and the control factors. In data analysis, reliability and validity were tested using techniques such as CFA model fitness test, Cronbach’s alpha, and KMO and Bartlett's test. SEM technique was used to evaluate the hypothesis. The study’s findings shows that all BMI characteristics improve performance, both financially and non-financially. Value co-creation, particularly co-production and value-in-use, greatly improves the favorable relationship between BMI and performance, with company size serving as an important moderator. These findings contribute to resource-based theory's understanding of BMI's role in SME success and broaden value co-creation theory. The research presents a novel theoretical model that includes value co-creation as a mediator, providing a comprehensive framework for assessing BMI's impact on businesses.
While giving useful insights, the study admits limits in literature depth and data collecting breadth, recommending more research for model improvement and practical applicability development.
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