A Simulation Model for the Main Factors Affecting Business Innovation Performance

Abstract

Building on previous research, this study develops a research simulation model for the main factors affecting business innovation performance. It links the properties of knowledge obtained from outside network, firm’s absorptive capacity and the features of a firm’s knowledge network topology to predict innovation performance. We use VB.NET 2005 programming languages to develop simulations to conduct tests of the propositions developed in the model. We find that the interaction between absorptive capacity and network topology has significant, positive effects on business innovation performance. This study will provide a tool that may help decision makers of those types of businesses to effectively turn knowledge into actions by matching their firms’ knowledge network topology to the particular properties of the knowledge that is going to be communicated.