Significance of Globalization-Specific Factors for SME Competitiveness

Book excerpt: On the basis of existing theory we suggest two main types of factors for SME competitiveness. The first type is comprised of the basic factors, including internal, external and entrepreneur-related factors, all well-defined and discussed in the IO and RBV approach and the configuration theory as well. The second type consists of globalization-specific factors, referring to the innovation related processes as a response to the globalization challenges (innovation, internationalization, ICT and quality standards adoption, etc.). Our main research question is: Do globalization-specific factors have a significant impact on SME performance in times of crisis and post-crisis recovery? Using the two types of factors, we develop a conceptual model explaining their role for SME performance. We suggest that globalization-specific factors determine SME performance, and that the configurations of the two types of factors differ in times of crisis and post-crisis recovery. Research hypotheses are tested through construction of indexes for competitiveness and logit models using data on Bulgarian SMEs for two periods - one of economic crisis, and another of post-crisis recovery. Empirical evidence confirms significant impact of globalization-specific factors in period of post-crisis recovery only. Our findings show that the configuration of basic and globalization-specific factors with respect to business success is dynamic: in times of crises globalization-specific factors have no significant impact while basic factors have dominant role. In times of post-crises recovery both factors seem to be equally important for SME performance.