Growth through SME Business Model Innovation and Competence Changes

As a result of sudden changes in the business environment, SMEs in many industries are facing the need to change their business models radically and seize new business opportunities or fall out of business. The important impact of SMEs in economic growth and job creation is well known, but current knowledge is rather limited on the effects of competences and their transformation that is needed for changing the business models in SMEs. This paper addresses the questions, how SME competence changes and business model innovations enable sustainable growth in sudden changes of the external environment? How do these changes reflect to growth on a larger, regional scale? The findings of a comparative case study are presented to highlight the competence transformation strategies enabling business model innovation and the effects of different institutional environments.