Impact of Business Model Innovation on the Performance of Sharif S&T Park Tenants

The fast technological change and increasing intensity of competitive environment have led to different types of innovation, including product and process innovation. However, this does not to guarantee firms’ success unless they adopt a holistic approach to innovation through business model innovation (BMI). As imitating BMI is not easy for competitors, it’s an efficient business experiment to attain a sustainable competitive advantage. By reviewing the existing literature on BMI, we concluded that one of the notable overlooked research streams is the analysis of BMI impact on firms’ performance. In this regard, this paper investigates the impact of BMI and its four dimensions (product, process, organizational and marketing innovation) on the performance of the tenants (firms) located at the Sharif Science and Technology (S&T) Park and highlights the moderating effect of networking and knowledge-based status of tenants.

The statistical population of this research includes firms located at the Sharif S&T Park which are 70 as of the summer 2020. Data to test our hypotheses was gathered by distributing questionnaires - formulated through the literature review and the Community Innovation Survey’s questionnaire - in the fall and summer of 2020. Among the filled questionnaires 59 ones were consideres as the basis for our statistical analysis. We conducted confirmatory factor analysis to test our hypotheses by SmartPLS3 software. Validity and reliability of constructs were also verified by Cronbach’s Alpha, composite reliability and average variance.

The obtained results proved the positive and significant impact of BMI on the tenants’ performance. Among BMI’s dimensions, product and marketing innovation had also significant positive effect on the tenants’ performance. On the other hand, the impact of process and organizational innovation on the tenants’ performance was not significant and these two hypotheses were accordingly rejected. Besides, the positive, significant, and moderating impact of both moderators were confirmed.

Our contribution involves analyzing BMI in overlooked S&T park tenants which are small and newly established firms. In the academic literature, research on BMI is dominantly focused on large firms. Therefore, research on BMI in tenants is another novel aspect of this paper. Studied firms, Sharif S&T Park tenants, are generally small and dedicate most of their resources to product innovation; however, they neglect process and organizational innovation. Insignificant impact of process and organizational innovation on performance implies that tenants’ capabilities should be strengthened in these BMI dimensions. As our findings suggests, Sharif S&T Park tenants’ performance is not influenced by process and organizational innovation. Despite due to the limitations on generalization the achieved results, this paper provides theoretical and managerial implications to both tenants and the managers to reinforce BMI and its dimensions, particularly, process and organizational innovation of tenants.