Impact of Entrepreneurship on Innovation Performance of Chinese SMEs: Focusing on the Mediating Effect of Enterprise Dynamic Capability and Organizational Innovation Environment

The primary objective of this study is to examine the relationship of entrepreneurship, enterprise innovation performance, enterprise dynamic ability, and organizational innovation environment of small and medium enterprises in China. Based on a thorough literature review, this study constructed a research model of "entrepreneurship, enterprise dynamic ability, organizational innovation environment, and enterprise innovation performance". To meet this purpose, a survey was conducted by collecting data using a random sampling method targeting five cities in Shandong and Henan, where the proportion of small and medium-sized enterprises (SMEs) in China is high. Additionally, SPSS 26.0 and AMOS 24.0 were used to carry out correlation analyses, structural equation path analyses, and intermediary effect tests on 426 valid questionnaires. There are three major findings. First, entrepreneurship positively affects the dynamic ability of enterprises and the organizational innovation environment and enterprise innovation performance. Second, enterprise dynamic capability and organizational innovation environment positively affect enterprise innovation performance. Third, enterprise dynamic capability and organizational innovation environment play a partial mediating role on the influence path between entrepreneurship and innovation performance. The findings of this paper provide further evidence for the positive impact of entrepreneurship on innovation performance and the relationship between variables. Suggestions are provided for SMEs to improve their innovation performance. To stimulate entrepreneurship of SMEs, more attention needs to be given to cultivate their dynamic capabilities, create an environment of organizational innovation for enterprises, and help them maintain a competitive advantage in the ever-changing market environment.