Dynamic Capabilities and Firm Efficiency: A Study of Agro-Processing SMEs in Thailand
DOI:
https://doi.org/10.55164/ecbajournal.v18i2.276828Keywords:
Dynamic Capabilities, Firm efficiency, Agro-Processing, SMEs, ThailandAbstract
Dynamic Capabilities play an important role for organizations in the era of rapidly changing business environments, especially in the context of SMEs and industries facing high uncertainty such as agro-processing businesses in Thailand. Therefore, this study aims to explore the role of dynamic capabilities in terms of sensing, searching, seizing, shifting, and shaping in enhancing the performance of SMEs in the agro-processing sector in Thailand. The quantitative research approach was conducted by conducting an online survey with 645 SMEs in the agro-processing industry throughout Thailand, selected by stratified random sampling by the Department of Industry in Thailand. 250 correct answers were received within 90 days. The data were then analyzed using structural equation modeling (SEM) to analyze the path analysis to examine the relationship between dynamic capabilities and performance. The results of the study revealed that dynamic capabilities have both direct and indirect positive effects on performance through technological innovation (p = 0.930, t = -3.064) with a significance level of 0.01, which is a high level of impact, which is in line with the coping of agro-processing businesses in Thailand who are not ready to adapt due to many constraints. SMEs should focus on developing dynamic capabilities and adopting innovative practices to improve their company performance and market positioning for survival amidst intense competition. And most importantly, the government should promote the development of knowledge to keep up with rapidly changing situations and accelerate awareness of the importance of seizing opportunities to adapt them into strong corporate strategies, as well as support accessible sources of funding for sustainable future expansion.
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