How to leverage the economic and social value-added of entrepreneurship activities via modern technologies?

Driven by the research focus on fundamental pillars for successful innovation commercialization and sustainable entrepreneurship activities, Vilnius University Business School researchers Lauzikas and Miliute (2021) examined the role of modern technologies on entrepreneurship dynamics across efficiency and innovation-driven countries, which was published in Springer’s book ‘Legal-Economic Institutions, Entrepreneurship, and Management’ (part of Contributions to Management Science), edited by Nezameddin Faghih and Ali Hussein Samadi. GILE experts answered the question how to leverage the economic and social value-added of entrepreneurship activities via modern technologies, how to create synergy among stakeholders and reach business sustainability.

Over the last 3 years, the scholars drew a lot of attention to the value-added of modern technology to business sustainability: some of them (Ashrafi at al., 2019; Love and Matthews, 2019; Zhang et al, 2020; Li et al., 2020; Kopalle et al. 2020; Liu et al. 2021; Yu et al 2021; Yang et al, 2021; Hussien et al. 2021) addressed the applicability of modern technology across various industries and among firms of various development stage; some scientists centred their research on innovation (Wahyu et al., 2019; Liao et al. 2019; Klein et al. 2020; Jain and Ranjan, 2020; Brennan, 2020; Hagspiel et al. 2021); another group of scholars emphasized the main barriers, challenges related to the application of modern technology (Mohanta  et al., 2019; Hassan et al. 2019; White et al. 2020); and many authors measureed the contribution of technologies for sustainable growth (Rane et al. 2019; Paschen et al. 2020; Morgan-Thomas et al. 2020; Min at al. 2020; Kim et al. 2020; Riegger et al. 2021).

According to Lauzikas and Miliute (2021), the necessary levels of inputs/ innovation-related expenditures should be set after ingenious data analysis, compounding of the market trends and competitor analysis; thus, business intelligence techniques should be applied as well as business model innovation process launched (Morkunas et al. 2019; Sjödin et al 2020; Paiola and Gebauer, 2020; Keiningham et al. 2020; Shi et al. 2021). The acknowledgment of the global market and industry trends (along with social innovation perspectives) and the allocation of the necessary expenditures are not sufficient, because a technology-driven leader needs to identify and build the fundamental pillars for sustainable innovation processes in terms of the key responsible departments or individuals in charge of innovation commercialization as well as their roles, based on the development stage of a company and effectiveness/ efficiency of those departments.

The previous studies led Lauzikas and Miliute (2020 a,b) to the conclusion that the role of modern technology (technological application effectiveness/ efficiency and speed), unique strategic collaboration and innovative organizational architecture (including innovation climate and creativity system) also depend on cultural/ social norms, the R&D transfer power, while linking the educational institutions with technology-driven firms. Therefore, understanding the effectiveness/ efficiency level of each innovation-related department (while commercializing entrepreneurial initiatives) helps firms set adequate strategic goals and liaise various strategies, along with the corresponding inputs and leadership efforts.

Within their Springer’s study Lauzikas and Miliute (2021) accentuate the significant differences of the cumulative experience between the efficiency and innovation-driven economies: it should prevent efficiency-driven business from making the mistakes in the field of innovation commercialization, while innovation-driven businesses could better understand the investment directions, and/ or the of internationalization potential in the catching-up economies. According to GILE experts (2021), there is no clear formula for improving the competitive advantage via modern technology due to specificity of cultural and social norms across different economies as well as because of a rather holistic approach to entrepreneurship framework conditions. While combining the primary data (qualitative semi-structured interviews with technology-driven business experts coming from Lithuania, Malta, Canada, and South Korea) and the scientific literature review, the GILE experts created and tested the conceptual model, helping leverage the economic and social value-added of entrepreneurship activities via modern technologies, along with the synergy effects among stakeholders, and recommendations for business sustainability (Lauzikas and Miliute, 2021).

Deriving from the idea that technological transformation is impossible without lifelong learning (Lauzikas and Miliute 2017; Aluri et al. 2019; Brunner and Jodlbauer, 2020), the GILE experts (2020 a,b) first of all identified the role of the HR and R&D departments in this technological metamorphosis: enhancing technology-based entrepreneurship and innovation learning; facilitating the link between technology and stakeholders; creating innovation climate and facilitating ethical and moral standards as part of shared-value economy (Lauzikas and Miliute, 2019b), based on transactional communication style, social trust, and creative technological leadership (Lauzikas and Miliute, 2019a).

The R&D culture should already incorporate a set of criteria, such as smooth and effective/ efficient data management, business intelligence, monitoring, and knowledge sharing process, which in parallel links diverse educational institutions with innovative firms via R&D transfer institutions and technology hubs. According to GILE experts (2020 a, b), the R&D performance might be severely hit by the insufficient HR culture, although the technology-based firms do not have inexhaustible reservoir of time to wait for HR innovations to support R&D projects. Therefore, the efficiency-driven countries should emphasize the role of the HR department as a locomotive of technological knowledge enhancement while accelerating the activities within other departments, such as the R&D, Marketing or Sales. Given sufficient HR capabilities could serve as a value multiplicator for the R&D projects while improving the overall competitive advantage of a firm; on the other hand, insufficient capabilities may prohibit companies from their expansion via innovation processes. For example, having a clear advantage in terms of the role of modern technologies on R&D transfer organizations’ efficiency (Canada – the average expert evaluation of c.a. 7, South Korea – exceeding 8; compared to Lithuania and Malta with the average value of 5 on the scale of 10) Canada and South Korea can dedicate more efforts and generate bigger value added in terms of engaged society or communication during the time of change, healthier living and environmental protection as well as the knowledge development and sharing, which is particularly important in the big data era.

The preconditions/ pillars for effective innovation strategy formation relate to the dimension of management and leadership, the decision-making process via engaging society, consumer, and other stakeholders as well as to the product co-creation process. Based on their previous studies (2017), GILE experts emphasized the role of entrepreneurship education on developing and implementing technology platforms, when transdisciplinary and technology-based educational background could strengthen the HR and R&D performance (particularly when the education factor is abundant, based on the GEM framework conditions model). Notwithstanding the development stage of an economy, education could be a key trigger for effective and efficient selection and implementation of modern technologies. Thus, the published Springer’s paper (Lauzikas and Miliute, 2021) is not only part of Contributions to Management Science, but also an important liaison with the previous studies, which could be summarised within the conceptual model below (see 3 links attached).

Step 1

Step2

Step 3

Source: GILE experts 2021, based on Lauzikas and Miliute (2017, 2019a, 2019b, 2020a, 2020b, 2021).

As it is illustrated in the conceptual model, the firms in the efficiency-driven economies should acknowledge that education not only affects leadership, management, and the innovation system, but also in parallel enhances competences, oriented to monitoring and support of other departments, that are necessary to reach the competitive advantage of a firm in the technology-driven volatile market. This could be achieved via providing a multiplicator (following a set of preconditions) necessary to reach the desired economic and social value-added. In line with the function of creating necessary preconditions and multipliers, the efficiency-driven HR should not diminish the role of innovation and should excel and proactively reshape the strategy, because other similar companies might be more proactive, effective, and sustainable.

Although the interrogated experts representing the innovation economies  were adamant with regards to their well-functioning HR department (Lauzikas and Miliute, 2021), they emphasized severe competition in terms of attracting R&D specialists and/ or the effectiveness of innovation commercialization process, accentuating the knowledge and resource sharing (starting from the ideas generation, moving forward to organizational structure and business models and finally reaching the expected volume, competitive profit margin and strong brand awareness). Therefore, strategic process innovation models might be an epicentre of equilibrating the company’s departmental structure, efforts, resources, and knowledge, thanks to modern technologies. GILE experts will continue examining the impacts of technology platforms on business model innovation models and, thanks to the collaboration with young researchers at Vilnius University Business School, in their upcoming studies will provide a methodological model of measuring the value-added of modern technology to business strategy effectiveness.

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