Innovation is a need or a tool to survive the competition : A study on the perception of rural MSMEs towards the adoption of innovation

Abstract

Business innovation is becoming an imperative feature of both growth and survival of MSMEs. This paper explores the importance of choice, need, or government intervention towards the adoption of innovation in rural MSMEs. It addresses the fundamental understanding-implementation vacuum of innovation. The study was accomplished through a survey of 453 rural MSMEs. The analysis was conducted through Principal Components Analysis (PCA) using SPSS and Structural Equation Modelling (SEM) using AMOS. The results showed that rural MSMEs depended heavily on government intervention for adopting innovation in uplifting their business. Following others is the standard norm in rural MSMEs. Innovation becomes the last choice when the urgency to revamp their business comes up. The research results present empirical inference for the government, academicians, research bodies and scholars, as they can be encouraged to find out the means to change the perception towards innovation by educating them and giving them all support.