Barriers to Technological Innovation for Small Local Confectionery
Companies
Katarzyna Piwowar-Sulej, Izabela Kwil and Krzysztof Podsiadły
Wrocław University of Economics, Poland
[email protected]
[email protected]
[email protected]
10.34190/ECIE.19.141
Abstract: With regard to manufacturing companies, technological innovations are the subject of analyses. These
innovations include new products and processes as well as significant technological changes in products and processes. The
aim of the article is to answer the following research questions: What are the main barriers to technological innovation for
small local companies representing confectionery industry in Poland? In order to achieve this objective, a literature review
(devoted mainly to the determinants of enterprise innovation) and empirical research was conducted based on the case
study method. The research focuses on four small Polish confectionery enterprises. The research shows that the lack of
financial resources and competent employees is the main barrier to innovation for small enterprises. The enterprises are
characterized by flat organizational structures and therefore do not give their employees as vast growth opportunities as
international corporations. In addition, small enterprises are often located in rural areas or in small towns, while young
people frequently migrate to large cities. This is referred to as a spillover effect. The companies also focus on internal
innovation projects and do not implement the open innovation concept. The article offers insights into barriers to
technological innovation for small domestic enterprises operating in a specific industry. These insights can be used to
stimulate innovative activities across the confectionery industry – for example to maintain and develop the Polish
confectionery tradition. Bearing in mind the growing interest of foreign investors in the confectionery industry in Poland,
note that the article may also provide information useful for making decisions on the location of further investments.
Keywords: technological innovation, barriers to technological innovation, confectionery industry, food industry
1. Introduction
Every company operating in the modern market is constantly facing new challenges arising from specific
opportunities and threats. Survival in many industries requires meeting ever-changing consumer expectations.
An enterprise needs to find a way to “produce better”. In such a case, of importance is external innovation,
which is associated with improving and launching new products in accordance with the current market
demand, and internal innovation, which is focused on improving all the processes in an organization.
Innovation is a process of formulating, applying, launching, and developing a creative idea and guiding it as it
matures and falls (Griffin, 2005). These process stages are interlinked, and one follows the other. Looking at
the above innovation process stages from the perspective of external innovation, it can be seen that
innovation is at first formulated, which means that a company evaluates, modifies, and improves creative
ideas. The next stage is application, where the company uses an idea to design production. At the launching
stage, the company brings new products to the market. The fifth stage (innovation maturity) means the
demand for the specific innovation decreases, which in turn determines the formulation of a new innovation
to replace the previous one.
There are numerous types of innovation distinguished in the source literature. In terms of production
companies, the problem of the so-called technological innovations is raised. These include new production and
processes as well as significant technological changes in products and processes. This means technical changes
resulting in the development of new technologies as well as new products and services satisfying new
consumer needs or the existing consumer needs, but on a new level. Therefore, technological innovations
include (Sosnowska et al., 2005):
x product innovations,
x process innovations,
x system innovations.
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