To read this content please select one of the options below:

Resource-based model for small innovative enterprises

Moinak Maiti (Department of Finance, National Research University Higher School of Economics, Russian Federation)
Victor Krakovich (Department of Finance, National Research University Higher School of Economics, Russian Federation) (International Laboratory of Intangible-driven Economy, National Research University Higher School of Economics, Russian Federation)
S.M. Riad Shams (Newcastle Business School, Northumbria University, Newcastle upon Tyne, UK)
Darko B. Vukovic (Department of Finance and Credit, RUDN University, Moscow, Russian Federation) (Department of Finance, National Research University Higher School of Economics, Saint Petersburg, Russian Federation)

Management Decision

ISSN: 0025-1747

Article publication date: 5 May 2020

Issue publication date: 4 December 2020

1287

Abstract

Purpose

The paper introduces a resource-based linear programming model for resource optimization in small innovative enterprises (SIE).

Design/methodology/approach

The model is grounded on resource-based view on the firm and dynamic capabilities approach. Linear programming technique is used to provide the actual framework to the resource-based model.

Findings

The paper introduces a new resource-based linear programming model for resource optimization in small innovative enterprises. The conceptual model is grounded on resource-based view (RBV) and dynamic capabilities strategy. The RVB of firm and firm strategy is based on the concept of economic rent. Linear programming technique is used to provide the actual framework to the resource-based model. In developing the versatility concept, study suggests a distinct sight regarding resource fungibility. Study classifies resources into multipliable, rentable and expendable resources to increases adequacy of the model. The developed model includes both tangible and intangible assets such as human capital. The survival rate of SIE in the early stages of life cycle is very low due to the competition among SIEs. In this regard, the greatest advancement of the developed resource-based linear programming model is its simplicity and versatility which is much desirable for the SIE especially in their initial stages of the life cycle. Kelliher and Reinl (2009) argued that micro firms have unique advantage over bigger firms in following term: rate of learning or redeployment of strategy in micro firms is faster than the rate of change in their environment. One very significant feature of the developed resource-based linear programming model is that mathematically the proposed model could easily be transformed into mixed integer or stochastic linear programming models to meet the time variant requirement of small firms especially when it expands its operation.

Research limitations/implications

The survival rate of SIE in the early stages of life cycle is very low due to the competition among SIEs. In this regard, the greatest advancement of the developed resource-based linear programming model is its simplicity and versatility which is much desirable for the SIE especially in their initial stages of the life cycle. Kelliher and Reinl (2009) argued that micro firms have unique advantage over bigger firms in following term: rate of learning or redeployment of strategy in micro firms is faster than the rate of change in their environment. One very significant feature of the developed resource-based linear programming model is that mathematically the proposed model could easily be transformed into mixed integer or stochastic linear programming models to meet the time variant requirement of small firms especially when it expands its operation.

Originality/value

One very significant contribution of the present study is that the study develops a new resource-based model for SIE especially for the SIE in the initial stages of the life cycle, to gain competitive advantages. Furthermore, the present study contributes to the existing literature in strategy at least in three senses as mentioned below: 1. further addition of SIE research based on the RBV and dynamic capabilities in the strategy literature 2. in developing the versatility concept, the study suggests a distinct sight regarding resource fungibility and it classifies resources into three categories as follows: multipliable, rentable and expendable resources to increases adequacy of the model. 3. Finally, the study introduces a new resource-based linear programming model for SIE resources allocation. To the best of author’s knowledge, no such similar model is introduced by any previous studies for small firm. The greatest advancement of the developed resource-based linear programming model is its simplicity and versatility.

Keywords

Citation

Maiti, M., Krakovich, V., Shams, S.M.R. and Vukovic, D.B. (2020), "Resource-based model for small innovative enterprises", Management Decision, Vol. 58 No. 8, pp. 1525-1541. https://doi.org/10.1108/MD-06-2019-0725

Publisher

:

Emerald Publishing Limited

Copyright © 2020, Emerald Publishing Limited

Related articles