PII- potential innovation index: A tool to benchmark innovation capabilities in international context

Abstract

Benchmarking has become a useful tool for companies, enabling better decision-making and improvement of internal practices towards world-class performance. Nevertheless, concerning SMEs' innovation capabilities from traditional sectors, benchmarking applications have been scarce. This article uses a predefined metric named the "Potential Innovation Index (PII)", based on internal practices of the firms to compare innovation capabilities of two groups of similar SMEs from 2 different geographical, cultural and social contexts. Results were used to analyze similarities and differences, strengths and weaknesses of the groups. Obtained results confirm the difficulties to innovate of this type firms, no matters the sector or country, as over 55% of the companies studied were evaluated as having a low innovative performance. However, regarding the index's constitutive practices, significant differences were found. Which leads to infer that innovation support strategies to enhance innovation must be adapted to the local context and culture. © Universidad Alberto Hurtado, Facultad de Economía y Negocios.