How much internationalization is innovation-worthy for SMEs? Roles of the degree of internationalization and organizational unlearning on the joint innovation capabilities-exploratory innovation relationship

Abstract

The existing literature on SME internationalization has inadequately integrated joint innovation capabilities, organizational unlearning, and the internationalization process. Previous studies have primarily examined these concepts separately, obscuring their interconnection and reciprocal impact. This study fills in a gap in the literature and responds to calls for more studies (e.g., Du, Zhu & Li, 2023; Genc, Dayan & Genc, 2019) by developing and testing a moderated mediation model to examine how joint innovation capabilities affect exploratory innovation through the mediating role of organizational unlearning. The research also examines the moderating effect of the degree of internationalization on this relationship. A cross-sectional survey was conducted with 300 logistics and general managers from SMEs in the United Arab Emirates (UAE), utilizing partial least squares structural equation modeling (PLS-SEM) to evaluate the measurement models' validity and reliability, and to test the hypothesized relationships. The results demonstrate that organizational unlearning is a key mechanism linking collaborative innovation capabilities with exploratory innovation. Additionally, the degree of internationalization significantly moderates this relationship, with a stronger mediation effect when internationalization is low. These findings provide practical implications for SMEs and managers, especially in overseeing innovation and unlearning processes while accounting for the degree of internationalization in their growth strategies. Managers in SMEs must recognize the complexities introduced by internationalization, such as diverse cultural norms and regulatory frameworks, which can impede the process of unlearning. To address these challenges, SMEs should consider adopting region-specific innovation strategies or investing in cross-cultural training to effectively manage the integration of diverse knowledge sources.