How Does Digitalization Affect Innovation Output? The Case of German Small- and Medium-Sized Enterprises

Marcel Kremser (), Christian Schröder () and Arndt Werner ()
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Marcel Kremser: University of Siegen, School of Economic Disciplines
Christian Schröder: University of Siegen, School of Economic Disciplines
Arndt Werner: University of Siegen, Chair of SME Management and Entrepreneurship, School of Economic Disciplines

A chapter in Management of SMEs and Startups, 2026, pp 375-406 from Springer

Abstract: Abstract This study focuses on how digitalization relates to product and process innovation in small-and medium-sized enterprises (SMEs). Based on data from 332 German SMEs we draw on a multidimensional scale to account for different digitalization activities. We find that digital products and services relate positively to the firm’s product innovation output. As hypothesized, we also uncover a positive relationship between digital operations and process innovation output. Interestingly, our analysis reveals that digital products and services do not significantly contribute to process innovation, nor do digital operations enhance product innovation. In sum, our study provides important contributions to the existing literature on digitalization and innovation activities in SMEs. By subdividing digitalization into (a) digital products and services and (b) digital operations our study enables a differentiated analysis of the impact of digitalization on innovation output in SMEs.

Keywords: Process innovation; Product innovation; Digitalization; Digital innovation; Digital operations; Digital products and services; SMEs (search for similar items in EconPapers)
Date: 2026
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Persistent link: https://EconPapers.repec.org/RePEc:spr:fgfchp:978-3-032-17538-0_15

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DOI: 10.1007/978-3-032-17538-0_15

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