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The research aims to explore the relationships between the digital capabilities of micro, small and medium enterprises (MSMEs), their participation in global value chains and their adoption of innovative business models. Additionally, the study investigates how the prior experiences of entrepreneurial failure may influence or moderate these relationships.

To address these research objectives, the study draws upon data obtained from the Flash Eurobarometer 486 survey, a comprehensive dataset that explores the challenges faced by 13,197 European MSMEs as they navigate the complexities of growth, the integration of sustainable business models and the incorporation of digital technologies. To test the proposed hypotheses, the research employs multivariate logistic regression analysis.

Digital capabilities are found to be positively associated with business model innovation, while integration into global value chains is linked to a higher likelihood of implementing new business models. Interestingly, entrepreneurial failure did not significantly influence the relationship between digital capabilities and the adoption of new business models. In contrast, entrepreneurial failure significantly moderated the impact of global value chain inclusion on business model innovation, particularly in MSMEs with a history of failure.

This article provides practical guidance to entrepreneurs and companies interested in enhancing their digital strategies and engagement in global value chains, considering the entrepreneurs' business histories.

The purpose of this study is to describe latent classes explaining the innovation logic in the Finnish construction companies. Innovativeness is a driver of competitive performance and vital to the long-term success of any organisation and company.

Using finite mixture structural equation modelling (FMSEM), the authors have classified innovation logic into latent classes. The method analyses and recognises classes for companies that have similar logic in innovation activities based on the collected data.

Through FMSEM analysis, the authors have identified three latent classes that explain the innovation logic in the Finnish construction companies – LC1: the internal innovators; LC2: the non-innovation-oriented introverts; and LC3: the innovation-oriented extroverts. These three latent classes clearly capture the perceptions within the industry as well as the different characteristics and variables.

The presented latent classes explain innovation logic but is limited to analysing Finnish companies. Also, the research is quantitative by nature and does not increase the understanding in the same manner as qualitative research might capture on more specific aspects.

This paper presents starting points for construction industry companies to intensify innovation activities. It may also indicate more fundamental changes for the structure of construction industry organisations, especially by enabling innovation friendly culture.

This study describes innovation logic in Finnish construction companies through three models (LC1–LC3) by using quantitative data analysed with the FMSEM method. The fundamental innovation challenges in the Finnish construction companies are clarified via the identified latent classes.