What question did this study set out to answer?

To explore how innovation capability mediates the effects of customer relationship management and market orientation on the performance of SMEs.

February 13, 2026SHILAP Revista de lepidopterología0 citationsOpen Access

The role of innovation capability in mediating the effect of customer relationship management and market orientation on SME performance

MIMei IndrawatiUniversitas Wijaya Putra IPIndra PrasetyoUniversitas Wijaya Putra RRRusdiyanto RusdiyantoUniversitas Gresik

Key Points

To explore how innovation capability mediates the effects of customer relationship management and market orientation on the performance of SMEs.
Quantitative research design targeting SMEs in the food and beverage sector.
Data collected from 103 SMEs in East Java, Indonesia.
Analysis performed using SEM-PLS with SmartPLS software.
Customer relationship management significantly influences SME performance and innovation capability (p = 0.000 and p = 0.005).
Market orientation has a significant impact on both performance and innovation capacity (p = 0.001 and p = 0.000).
Innovation capability also positively affects SME performance (p < 0.001).
Innovation capability partially mediates the relationship between customer relationship management and SME performance (p = 0.042) and market orientation and SME performance (p = 0.002).

Abstract

Type of the article: Research ArticleAbstractEvery developing country, including Indonesia, relies on SMEs as an important part of its economic structure. However, SMEs encounter significant problems in terms of competition on the local and global markets. This study aims to examine the mediating role of innovation capability in the relationships between customer relationship management, market orientation, and SME performance. The survey targeted 103 SMEs in the food and beverage sector in East Java, Indonesia. This is quantitative research. SEM-PLS (SmartPLS software) was used to evaluate the study model. Empirically, customer relationship management has a marked influence on the performance (p = 0.000) and innovation capability (p = 0.005) of SMEs. Besides, market orientation has a significant impact on both SME’s performance (p = 0.001) and innovation capacity (p = 0.000). The capability of innovation also has an influence on the performance of SMEs (p lt; 0.001). Further, the study revealed that innovation capability partially mediates (p = 0.042) the relationship between customer relationship management and SME performance, as well as the relationship between market orientation and SME performance (p = 0.002). Therefore, the findings reveal that customer relationship management and market orientation in SMEs in East Java, Indonesia, have direct effects on SME performance and indirect effects through innovation capabilities.AcknowledgmentThe research process would not have been possible without the Rector of Universitas Wijaya Putra Surabaya, whose support and dedication have been instrumental in the completion of this article. Support and cooperation, which might have been missed or taken for granted in the conduct of the research, are deeply appreciated. This research would not have been successful without the countless hours and contributions of many, and for that, they have my sincerest appreciation.

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