Innovation capability and culture: How time-orientation shapes owner-managers’ perceptions

Abstract

This study offers a cross-cultural perspective to better understand how time orientation shapes owner–managers’ perceptions of innovation capability in small and medium sized enterprises (SME) in tourism. We synthesise the extant literature and determine SME owner–managers’ internal and external innovation capability. Distinguishing between short- and long-term cultures and comparing data from Australian and German, Austrian and Swiss (DACH country cluster) SMEs, results confirm that perceptions of innovation capability vary across cultures. Results for SMEs in short term–oriented cultures show stronger appreciation for consumer orientation, creating prospective profit and staff incentives; by contrast, SMEs in long term–oriented cultures place higher value on accessible knowledge, commitment to learning, and adaptation. To effectively manage innovation capability in SMEs, we suggest a balanced approach of considering both short- and long-term factors. Acknowledging the scarcity of SMEs' resources, we propose that owner-managers first focus on strengthening their internal organisational drivers of innovation to enhance their innovation capability. We also discuss implications for tourism policy, offer recommendations for the field of innovation research and note the study's limitations.