Service Innovation Capability in Social and Health Care SMEs: The Impact of Market Orientation and Technology Orientation

Developing new services is vital for a service-based company to succeed in the long run. This requires both innovation capability and understanding customer needs. Previous research has shown that if a firm wishes to develop an innovation superior to the competition, it must have both a strong technology orientation and a strong market orientation. The objective of this study was to examine the effect of market orientation and technology orientation on service innovation capability in SMEs operating in the field of social and health care. In addition, this study examined the obstacles to using digitalization and new technologies in service innovations. Mixed methods design was applied so both quantitative and qualitative data was used. The results from the quantitative part of this study show that both technology orientation and market orientation have a positive and statistically significant effect on service innovation capability in SMEs operating in the field of social and health care. Furthermore, market orientation is the most important variable in the model. The results from the qualitative element again show that some of the hindering factors of using digitalization and new technologies arise from practices and attitudes of social and health care actors but others arise from the digitalization and new technologies themselves.