The role of technological innovation in the mitigation of the crisis generated by COVID-19: an empirical study of small and medium-sized businesses (SMEs) in Latin America

Abstract

Purpose

This article aims to analyze the role of innovation in mitigating the economic crisis generated by the coronavirus disease of 2019 (COVID-19) pandemic in Latin American small and medium-sized enterprises (SMEs). The goal is to determine whether actions, activities, and perceptions related to impact and positioning within three distinct areas—finance, management, and competition—contribute to increased innovation within companies, remain neutral in their effects, or have an inverse impact.

Design/methodology

The sample consisted of 9,186 SMEs from 14 countries in the Ibero-American region: Argentina, Brazil, Chile, Colombia, Costa Rica, Ecuador, El Salvador, Spain, Guatemala, Honduras, Mexico, Panama, Paraguay, and Uruguay. The data were analyzed using a structural equation model (SEM).

Findings

The study provides empirical evidence that the SMEs in the Ibero-American region have faced the crisis generated by the COVID-19 with a predominant negative impact on their financial factors and sales. These impacts have affected the organization, particularly at the operational level, leading to the need for self-financing and more conscious resource management. The most significant finding is that, as financial challenges, as in productivity, turnover, and profitability, among other difficulties, increase innovation actions.

Limitations

Research exposes limitations that pave the way for future studies. Firstly, the study relies solely on data obtained from top-level company consultations. Second, there are variations in sample sizes by country.

Practical implications

The results reveal practical implications for SMEs owners and managers, shedding light on the influence of innovation in sustaining competitiveness during times of crisis. This, when combined with resilience, product quality, employee engagement and customer satisfaction, has facilitated the sustainability of a significant portion of SMEs that have weathered an unprecedented crisis.

Originality-value

The value of this work lies in highlighting the significance of innovation for SMEs and the opportunities that arise during a crisis to enhance competitiveness. Companies that have embraced innovations in the way they offer or deliver their products and services have managed to remain in the market despite the challenges posed by the crisis.

Propósito

Este trabajo analiza el rol de la Innovación en la mitigación de la crisis económica generada por la pandemia COVID-19 en las SMES de Iberoamérica. Se busca probar si las acciones, actividades y percepción de afectación y de posicionamiento, segmentada en 3 áreas: Financiera, Gestión y Competencia, surten más acciones de innovación en las empresas, o no inciden o su afectación es inversa.

Diseño/metodología

La muestra se compuso por 9.186 SMES pertenecientes a 14 países de la región de Iberoamérica: Argentina, Brasil, Chile, Colombia, Costa Rica, Ecuador, El Salvador, España, Guatemala, Honduras, México, Panamá, Paraguay y Uruguay. Los datos se analizaron mediante un modelo de ecuaciones estructurales (SEM).

Hallazgos

El estudio provee evidencia empírica de que las SMES en la región iberoamericana han afrontado la crisis generada por el COVID-19 con predominio negativo del factor financiero y las ventas, sufriendo los impactos sobre la organización, especialmente a nivel operacional, tolerando con autofinanciamiento y la administración consciente de los recursos. El hallazgo más importante reside en que, al aumentar las dificultades financieras, de productividad, facturación, rentabilidad y otras, aumentan las acciones de Innovación.

Limitaciones

La investigación expone limitaciones que descubren un camino para el futuro. En primer lugar, el trabajo utiliza como única fuente de información la consulta al más alto nivel de la empresa. En segundo lugar, los tamaños de las muestras por países difieren en tamaño.

Implicaciones practices

Los resultados revelan implicaciones prácticas para los propietarios y directivos de las SMES y ofrecen una visión de la influencia de la innovación para mantener su competitividad en épocas de crisis; lo cual, sumado a la resiliencia, la calidad productiva, el compromiso de los empleados y la satisfacción del cliente, permitieron la sostenibilidad de un gran segmento de las SMES y sobrevivir a una crisis sin precedentes.

Originalidad-valor:

El valor del trabajo reside en evidenciar la importancia de la innovación para las SMES y la oportunidad que subyace en la crisis para mejorar la competitividad, una vez que las empresas que han apostado por innovaciones en la forma de ofrecer, o brindar su servicio o producto han logrado mantenerse en el mercado a pesar de la crisis.

Keywords:

• COVID-19
• economic and financial impact
• economic crisis
• pandemic
• SMEs

Palabras claves:

• COVID-19
• crisis económica
• impacto económico y financiero
• Pandemia
• SMES

Additional information

Notes on contributors

Jorge Aníbal Restrepo-Morales

Jorge Aníbal Restrepo-Morales Full Professor, Faculty of Administrative and Economic Sciences, Tecnológico de Antioquia, IU. Doctor in business economics. Administrative engineer. Director of research group - RED. Research related to enterprises, competitiveness, quantitative modeling.

Marisol Valencia-Cárdenas

Marisol Valencia-Cárdenas Professor, Faculty of Administrative and Economic Sciences, Tecnológico de Antioquia, IU. Industrial Engineer, Msc in Statistics, P HD in engineer Industry and organizations. Research related to statistical applications, analytics and optimization. Member of research group: RED.

Domingo García-Pérez-de-Lema

Domingo García-Pérez-de-Lema Doctor in Economics and Business Sciences from the University of Murcia, Professor and Director of the Department of Financial Economics and Accounting at the Polytechnic University of Cartagena. Consultant specialized in Viability Plans and Business Valuation. Director of the Entrepreneurs Chair and Coordinator of R&D&I Business Creation at the UP CT. Co-director of the Strategic Analysis Foundation for the Development of SMEs (FAEDP YME). Professor at the Polytechnic University of Cartagena | UP CT. Department of Financial Economics and Accounting.