Determinants of innovation decisions among Emirati female-owned small and medium enterprises

The purpose of this study is to investigate the factors that influence the innovation decisions of Emirati women-owned small and medium-sized enterprises (SMEs).

This study uses a two-phased approach. In the first phase, empirical research on 50 Emirati female entrepreneurs is conducted to discover the extent of innovation in their ventures. In the second phase, the study uses an analytical hierarchy process (AHP) to prioritize factors considered important in facilitating business innovation among SMEs. The AHP model is developed with 9 criteria and 25 sub-criteria based on the previous literature. Face-to-face interviews are conducted with Emirati female entrepreneurs operating nascent (n = 10), start-up (n = 10) and established innovative (n = 10) businesses to collect data for the AHP study. The data collected are interpreted and a priority vector is assigned to each criterion and sub-criterion.

Female SME owners prioritize government policies, research and development, innovation strategy and skill development as the main criteria that influence their innovation decisions. Family support, access to external financing, social networks and the allocation of funds are the main sub-criteria affecting their decisions to be innovative. Furthermore, respondents who are in the nascent business stage consider family motivation as the greatest influence on initiating new ideas through financial and moral support. Among all respondents, the nascent business owners rank skill development the highest because they are still in the initial stages of their business journeys, and thus, obtaining these skills could help them increase innovation and success in their ventures. However, respondents in the established stage rank innovation strategy the highest.

The study results can help policymakers and women’s associations, such as businesswomen councils, identify the specific inhibitors and facilitators linked to innovation and, thereby, help develop various effective policies to promote innovation among Emirati women-owned SMEs.

The study is one attempt to facilitate innovation among Emirati women-owned SMEs through its efforts to discover the determinants of innovation efforts at nascent, start-up and established business stages as defined by the Global Entrepreneurship Monitor (2012). The study can help Emirati women-owned SMEs understand the critical factors influencing innovation and can encourage them to incorporate innovative characteristics for business growth and resilience. Furthermore, the study can provide insights for policymakers, financial institutions and non-governmental organizations on factors hindering innovation among Emirati women-owned SMEs, which may serve as a tool for creating resilience among female entrepreneurs.