Business model innovation and creativity impact on entrepreneurship development: An empirical study

Abstract

Creative ideas are introduced to the market by business owners, and inventiveness creates new demands that cause existing markets to be disrupted and new ones to be created, which are then destroyed by even more innovative goods or services. In this rsesearch work, an empirical study is undertaken to gather information about business model innovation and creativity as well as Entrepreneurship development in Greek SMEs. Using the stratum sample size determination formula, a valid sample of 257 people influenced the study. SEM and the F-test were used in the research’s data analysis. The findings of the study demonstrate that entrepreneurship has a significant connection between business model innovation & creativity and digital capabilities. The test results also indicate that digital capabilities have a favorable impact on the business model innovation & creativity. They also found that the creativity and innovation of business models have a favorable impact on entrepreneurs’ business survival. However, the creativity and innovation of business models have no favorable impact on entrepreneurs’ business performance and reputation.

Keywords

Entrepreneurship Development business Model innovation digital capability creativity

1. Introduction

A business model is similar to a thorough explanation of a company’s strategy since it outlines the methods through which a company develops, delivers and collects value [3,8,40]. Both scholars and practitioners are increasingly interested in business strategies and business model innovation. For instance, according to a poll of 3,000 CEOs from 26 countries, developing “an effective business model” is one of their biggest challenges when it comes to innovation [19]. Researchers from a variety of disciplines, including information systems (IS), entrepreneurship, and strategy, underline the significance of business model innovation for a firm’s ability to compete [4,20]. Because it depends on the generation of innovative business model ideas and frequently necessitates the collaboration of people from different disciplines (such as sales, marketing, information systems, and research & development), business model innovation is both a creative and a collaborative endeavour [26]. Prior studies in several sectors have discovered that software tools can help with collaborative and creative efforts [33]. The usage of software tools can have a significant impact on how well its users produce creative outputs, according to studies on creativity support structures, group support systems, andthedevelopment of new products [12].

By utilizing their creative outputs, employers may challenge workers to think creatively, which in turn fosters big ideas and creates new possibilities. The corporation may continuously reinvent its goods and services to maintain a competitive edge by welcoming the innovative ideas of its personnel [13]. Companies have increased their attention on creativity as its significance has grown over the years. While the surrounding context of creativity has significantly altered due to the increasingly digitized corporate world, creativity itself has not changed much [17,36]. Virtual classrooms, decision cockpits, different communication tools, and interactive dashboards are examples of technology-driven solutions that have replaced and improved traditional methods of fostering innovation. The Internet of Things (IoT), AI, and virtual reality (VR) in particular influence the inventiveness of innovators and their teams. These resources help improve the creative process [38]. The purpose of this study article is to comprehend how business owners and their teams may employ digital technologies to boost creativity because there is a sizable research gap relating the online realm to creativity [27,31].

A conceptual framework known as the business model outlines who the company serves, what it provides, how it provides it, and how it fulfills its objectives to maintain the firm’s profitability. The whole set of operational policies and regulations that a firm creates and upholds are included in the business model [44]. A business model needs to explain who your target market is, the value you can create for them, and how you can do it affordably. A business model thereby outlines how a company creates, distributes, and receives profits for both its clients and itself. We consequently hypothesized that the findings of this research may have repercussions for Entrepreneurs in business model innovation and creativity. This study focuses on the digital capabilities impacting business model innovation and creativity and also, investigates how business model innovation and creativity could be used to help Greek entrepreneurs develop their businesses.

Some of the research questions to be answered are as follows:

Ques1.
To comprehend how business entrepreneurs and their teams may promote creativity via the use of digital technologies?
Ques2.
To determine how firms might modify or develop their present business models thanks to digitalization?

The main contributions are:
–
A review of the empirical data is made to determine the small-medium sized firms’ business model creation and innovation of entrepreneurs.
–
As a novelty, this study proposed the digital capabilities variable,to determine the effect of digital skills on the growth of entrepreneurship.
–
The owners and managers of small and medium-sized firms are given an organized questionnaire. Every question has the label “mandatory.”
–
The result reveals that the importance of creativity and innovation in developing novel concepts for businesses attracts additional advantages and value addition to the enterprises.

We first review the relevant papers on original and creative marketing strategies in this research. The results and research approach are then presented. Finally, we address the study issues and theories and present the findings of the statistical evaluation. Finally, we provide a summary of the results and recommend new research fields.
2. Literature review

It’s intriguing to note that academic literature, along with a large amount of entrepreneurship literature, frequently uses the phrases creativity and creative methods interchangeably. There is still a significant need to develop thoughts and proposed techniques from a novel Entrepreneurial Firm viewpoint to provide innovative goods or services, a rebalancing and integrative system for an existing business. The main study to focus on is entrepreneurial innovation and creativity as well as their formation in attaining greatness in small and medium-sized firms to its environment. This study goes beyond current network studies and makes a significant contribution to current understanding to explore the empirical significance of this occurrence in entrepreneurial performance.

In 2017 Chris Richter et al., [37] explored the importance of digital entrepreneurship in the shared economy. They performed data collection by conducting interviews with 14 companies in Germany, Switzerland, and Austria. By performing an analysis of the collected data they found that e increasingly digitalized environment has led to a changed living situation characterized by urbanity, openness to new solutions, changed working situations, and new mindsets.

In 2018 Jorge Ferreira et al., [15] demonstrated the effects of dynamic capabilities and the role of environmental dynamism. To test the proposed investigation model, they performed data collection. They collected required data from small and medium-sized industries in Portuguese. For the collected information they performed structured equation modeling. From the resultant outcome, they found that competitive advantage influences the performance of the firms in Portuguese.

In 2018 Julian Marius Müller [29] identified the role that entrepreneurs played and the business concepts employed in the industry. They conducted 43 in-depth expert interviews with representatives from the three largest German industry sectors—mechanical and plant engineering, electrical engineering, and automobile suppliers. Industry 4.0 business model implications were assigned using the Business Model Canvas, and the paper made a distinction between providers and users of Industry 4.0. According to their results, the firm model’s core competencies and business model are among the elements that are most adversely affected.

In 2019 Jorge Ferreira et al., [14] explored how competitive advantage and business success are affected by dynamic capabilities, innovativeness, and branding capabilities. To investigate the relationships between dynamic skills and the innovation variable, they created a questionnaire survey. For the data they had gathered, Structural characterization and multi-group analysis were done. Their final findings showed that dynamic capacity has a direct and beneficial influence on SMEs’ performance.

In 2019 Thomas Clauss et al., [9] evaluated how much tactical agility is projected to influence the adoption of three business models depending on the created value (value creation, profit potential, and value proposition). They proposed that the relationship between a firm’s strategic adaptability and business adoption is influenced by the degree of environmental volatility. They collected information from 432 German electronics manufacturers. Their study revealed that although value propositions and business models that create value have positive connections with firm success, the enterprise value business model has a negative link with firm performance.

In 2020 Andreja Pucihar et al., [35] investigated the results and obstacles of small- and medium-sized businesses’ business model innovation. They used data gathered in 2017 from 71 Slovenian SMEs to empirically evaluate the model using the PLS-SEM technique. Their findings demonstrated that the degree of BMI activities in the firms is positively impacted by the innovativeness of the business and their business environment.

In 2020 Maria Urbaniec and Agnieszka Żur [41] explored the goals of businesses’ collaboration with startups in the creation of corporate accelerators. They used in-depth conversations with company leaders involved in the creation of technology companies as well as a focus group discussion with industry experts as part of their research design, which is based on a subjective interpretive approach and exploits a triangulation of methodologies. Their study showed that a variety of advantages result from accelerator operations, which in turn can lead to improvements in big businesses.

In 2021 Mohammad-Ali Latif et al., [25] illustrated the competitiveness of the firm and its business model innovation. They conducted structural equation modeling using the data they obtained from a cross-industry population of 563 European SMEs. Their findings showed that there is no substantial correlation between business model innovation and company success; instead, this relationship is mediated by increases in efficiency, organizational capability, and revenue.

Table 1.
Analysis of review.

[Reference] Research design Objective Findings Limitations

[37] Qualitative research approach To explore the importance of digital entrepreneurship in the shared economy. Recognized the distinction between the applicability of social and economic orientation. Include another perspective (customer) for a better understanding

[15] Qualitative and quantitative (structured questionnaire) To demonstrate the effects of dynamic capabilities and the role of environmental dynamism. Through creativity and innovative skills, dynamic capability has an indirect impact on performance and competitiveness. Methodological limitations

[29] Exploratory research design To identify the role that entrepreneurs played and the business concepts employed in the industry. Key resources and business models are among the parts of the company model that are most impacted. A required quantitative method to extend the empirical results

[14] Quantitative research approach To explore how competitive advantage and business success are affected by dynamic capabilities, innovativeness, and branding capabilities. Key resources and business models are among the parts of the company model that are most impacted. Managerial implications

[9] Exploratory research design To illustrate how a firm’s competitiveness may be increased through business model innovation. Value capture creativity was inversely correlated with company success, but value proposition and provisions relating to bias showed favorable correlations with it. Sector-specific data selection

[35] Qualitative approach To investigate the results and obstacles of small- and medium-sized businesses’ business model innovation The amount of innovation of business model activities in the companies is positively correlated with the innovativeness of the firms. Industrial implications

[41] Qualitative approach (in-depth interview) To explore the goals of businesses’ collaboration with start-ups in the creation of corporate accelerators Corporate accelerators may assist businesses in developing more flexible business models and are a source of new model innovation. Small sample size

[25] Exploratory research design To illustrate a firm’s competitiveness and business model innovation. Innovation in business models and company success are not significantly correlated.
The success of the company is impacted by organizational capabilities, revenue growth, and efficiency growth. Owners and managerial implication

[Reference]	Research design	Objective	Findings	Limitations
[37]	Qualitative research approach	To explore the importance of digital entrepreneurship in the shared economy.	Recognized the distinction between the applicability of social and economic orientation.	Include another perspective (customer) for a better understanding
[15]	Qualitative and quantitative (structured questionnaire)	To demonstrate the effects of dynamic capabilities and the role of environmental dynamism.	Through creativity and innovative skills, dynamic capability has an indirect impact on performance and competitiveness.	Methodological limitations
[29]	Exploratory research design	To identify the role that entrepreneurs played and the business concepts employed in the industry.	Key resources and business models are among the parts of the company model that are most impacted.	A required quantitative method to extend the empirical results
[14]	Quantitative research approach	To explore how competitive advantage and business success are affected by dynamic capabilities, innovativeness, and branding capabilities.	Key resources and business models are among the parts of the company model that are most impacted.	Managerial implications
[9]	Exploratory research design	To illustrate how a firm’s competitiveness may be increased through business model innovation.	Value capture creativity was inversely correlated with company success, but value proposition and provisions relating to bias showed favorable correlations with it.	Sector-specific data selection
[35]	Qualitative approach	To investigate the results and obstacles of small- and medium-sized businesses’ business model innovation	The amount of innovation of business model activities in the companies is positively correlated with the innovativeness of the firms.	Industrial implications
[41]	Qualitative approach (in-depth interview)	To explore the goals of businesses’ collaboration with start-ups in the creation of corporate accelerators	Corporate accelerators may assist businesses in developing more flexible business models and are a source of new model innovation.	Small sample size
[25]	Exploratory research design	To illustrate a firm’s competitiveness and business model innovation.	Innovation in business models and company success are not significantly correlated. The success of the company is impacted by organizational capabilities, revenue growth, and efficiency growth.	Owners and managerial implication

2.1. Research gap and problem statement

Table 1 describes the review of traditional literary works. Existing literature illustrates the importance of innovation,creativity, and entrepreneurship in the introduction of cutting-edge products and services. Economic development is said to be significantly influenced by entrepreneurship. This article largely concentrated on entrepreneurship’s originality and innovation. Innovation and creativity are now crucial components in boosting the value of the enterprise. We learn how to enhance current company practices through creativity. Making a method that can transform an invention or concept into a more marketable good or service is what innovation is all about. This paper examines the effects of business model creativity and innovation on the growth of small- and medium-sized company owners, it tries to fill the knowledge gap.

The environment for small and medium-sized businesses is evolving, and this calls for imaginative, strategic, and entrepreneurial brains to help close the gap via originality and creative problem-solving skills. This will contribute to satisfying market demands, tastes, and preferences. The growth of entrepreneurship relies heavily on creativity and invention, which have been in use for a long time. It takes the form of skill acquisition, whereby individuals pick up innate abilities from their families or talented neighbors. Without creativity and innovation, the business cannot continue to grow and expand. Therefore, overcoming obstacles to entrepreneurial intention in Greece includes getting rid of the failure of the majority of businesses due to poor market analysis, a lack of inventiveness, a lack of succession planning, inexperience, an absence of proper records, a lack of resources, a lack of technology, a lack of management support, and other factors. To discover or confirm a fact as mentioned in literature in these situations, several inquiries and tests are necessary. Despite the government efforts to encourage entrepreneurship in Greece, growth has been slow, and failure and even mortality have been frequent. As a result, Greece has not been able to contribute to the development of the nation’s entrepreneurship. Therefore, this study investigates the usage of innovative and creative business models to encourage the growth of entrepreneurial activity in Greece.

2.2. Research hypothesis and conceptual framework

Creative items are introduced to the market by business owners, and inventiveness creates new demands that cause existing markets to be disrupted and new ones to be created, which are then destroyed by even more innovative goods or services. The outcomes of creativity are developing fresh concepts and cutting-edge technologies. Innovation is the result of creativity, and innovation adds value. The majority of companies listed as the largest most inventive firms are also among the most valuable, whether via the goods they develop, the services they provide, or how they position themselves to approach their clients. As a result, the suggested hypothesis investigates how innovative and creative business models affect the growth of entrepreneurship, the hypothesis put forth:

$H_{1}$ – Entrepreneurs influence business model innovation and creativity favorably.

Recent research efforts focus on understanding the impact of digital technology on the internationalization of new ventures in light of the expanding importance of entrepreneurial enterprises in global marketplaces [46]. As a result, current research mostly ignores the human and his or her capacity to use such tools, focusing instead on understanding the enabling function of digitalization as a contextual frame [23]. To ascertain the effect of digital skills on the growth of entrepreneurship, the hypothesis is put forth.

$H_{2}$ – Digital capabilities enhance entrepreneurship.

Innovation and originality are the only ways for businesses to obtain a competitive edge. Making decisions is a main essential to inventive and innovative steps because it forces business owners to consider their options, draw lessons from the past, and conduct more analysis before selecting the best concept. After creative investigation, every concept may be successfully put into practice [45]. A company’s ability to succeed hinges on its ability to combine entrepreneurship and innovation flawlessly. Additionally, digital technology supports entrepreneurs’ efforts to improve their invention and creativity [43]. This hypothesis is put out to illustrate how digital capabilities affect creativity and innovation, the hypothesis is put forth:

$H_{3}$ – The innovation and creativity of entrepreneurs are positively impacted by digital capabilities.

For the firms to be successful and reach their long-term objectives, entrepreneurs may live on creativity and innovation. Innovation contends that innovation and creativity may produce fresh notions and strategies that can spur a company’s development in the desired manner [21]. An organization may remain ahead of the competition through innovation and creativity by generating higher financial returns and greater profitability [5]. The solution to ground-breaking findings is innovation. Innovation and creativity offer a fresh viewpoint for addressing a business or operational issue. The purpose of this hypothesis is to ascertain how inventiveness and originality among entrepreneurs affect the development of business performance, the hypothesis is put forth:

$H_{4}$ – The inventiveness and creativity of entrepreneurs’ company models improve Business Performance.

Small and medium-sized businesses are essential for driving sustainable development, job creation, and economic growth [6]. Due to this, the entrepreneur, who is largely in charge of the company’s survival and development, must possess problem-solving abilities as well as self-assurance in their capacity to overcome obstacles, adaptive aggressiveness, and entrepreneurial self-efficacy [16]. As a result, the presented hypothesis discovered the influence of entrepreneurs’ innovation and creativity on the longevity of their businesses, the hypothesis is put forth:

$H_{5}$ – Business survival is positively impacted by the innovation and creativity of entrepreneurs’ business models.

Small and medium-sized businesses may achieve new levels of product quality, continuous improvements, efficiency, marketing domain, and internal harmony by embracing creativity and innovation [42]. New notions and ideas might emerge from the creative process. A company that customers perceive as creative receives higher product evaluations, benefits from more consumer interaction, and can foster customer loyalty [2]. This improves client retention and will inevitably improve the company’s reputation. To determine how creativity and innovation affect a company’s reputation, the hypothesis is put forth:

$H_{6}$ – Business reputation benefits from the originality and ingenuity of entrepreneurs’ business models.

Businesses all over the globe are prioritizing the creation of new business models to gain a competitive edge, but little is understood about the complexity and dynamics of this kind of innovation due to the rapid change in the business world and the early saturation of all markets and goods.The framework of the hypothesis is presented in Figure 1.

Figure 1.

Conceptual framework.

3. Research methodology

3.1. Variable definition

Entrepreneurship: According to Drucker (1985), Entrepreneurship is defined as a form of innovation that relies on the ability to generate money being added to already-existing resources [11].

Dynamic capabilities: The concept of dynamic capabilities is defined as “the subset of competence/capabilities, which allow the firm to create novel goods and procedures, and adapt to changing business circumstances” (Teece et al., 1997) [24].

Business model innovation and creativity: In entrepreneurship, innovation, and creativity are interconnected; innovation is the action that turns an idea into a product, while creativity is the intellectual activity that generates new ideas [28].

Business Performance: The capacity of a corporation to adopt optimal organization to provide a product or service that satisfies the expectations of consumers and customers determines business performance, which is strongly related to commercial effectiveness [7].

Business Survival: Business survival is the ability to continue functioning for a predetermined period [16].

Business Reputation: A business reputation refers to how the general public views the business and its operations [2].

3.2. Research design

For this study project, a survey method was used. Due to its many benefits, this study methodology was chosen above others. It will offer quick, effective, and exact ways and techniques of gathering data on the study’s target audience. It is highly sought and appropriate when secondary data is lacking. So, by adopting this research strategy and conducting surveys, it is possible to get a lot of data for the study. This strategy aims to elicit managers’ and entrepreneurs’ thoughts and impressions.

3.3. Data collection

In this paper, data from both primary and secondary sources are utilized, albeit relevant research will be more heavily weighted [30]. Because the material was previously available before the performance of this study activity, secondary sources of data will include journals, papers, books, journals, newsletters, and online for information on creative thinking and inventive abilities of entrepreneurial activities. But more crucially, original data will be strongly desired to generate the essential data for this research. Before the research, we used the Likert scale to deliver surveys using closed-ended sets of questions.

3.4. Population of the study

For the study, a target demographic of 500 businesses was taken into account. However, 457 genuine replies from the central Greece region were obtained out of the projected sample of 467 businesses, which was included in the data analysis. These example businesses were chosen based on the kind of Modern Greek StereáEllás they engage in. Due to the difficulties in obtaining information to validate a fact or draw a generalization about the growth of entrepreneurship in Greece, this technique was much favored and used. The research’s sample frame consisted of the following businesses. For the research plan, manufacturers, textile companies, supermarkets, and consulting firms were approached for the study.

3.5. Study sample

The population was only partially examined. A sample is a subset of a population that is analyzed to make generalizations about the entire population. So, choosing a sample of the universe or population to portray the full population or universe may be regarded as sampling. The ultimate objective of sampling is to accurately represent the target audience for the research [10]. Therefore, sampling allows for a better level of accuracy overall while conserving resources, labor, and time. For this study, the simple random selection method’s purposive sampling methodology was much more wanted to obtain a suitable sample size of 420 from the projected population sample of 500. The population to be examined, which has a wealth of knowledge on entrepreneurial development, digital skills, creativity and innovation, company performance, survival, and reputation, was represented by the purposive sampling approach. This made it possible to get the precise information needed for the investigation. The correct depiction of the stratification factors is ensured via sampling that strengthens the depiction of other variables, in other words [39].

For establishing an estimated sample, numerical formulae will be preferred [10] of 444, of which 420 were legitimate. To support the necessary sample size needed for a reliable analysis of social phenomena, the equations provide a standardized error margin and level of confidence per a particular population.

The mathematical formulas shown in Eq. (1) were used to determine the sample size for this investigation.

S a m p l e s i z e, s = \frac{T}{1 + T {(a)}^{2}}

(1)

Where s denotes the desired sample size; T indicates the total population; a determines the margin error and the value is default determined as 0.05.

3.6. Measurement scale

In this poll, we used a Likert scale, with points ranging from 1 (I strongly disagree) to 5 (I strongly agree). Participants filled out questionnaires to assess recent developments in comparison, entrepreneur development, innovation creativity, digital capabilities, business performance, business survival, and business reputation. Each variable was measured using five items using a rating system.

3.7. Data analysis

In some circumstances, the analysis uses several strategies to interpret data gathered through a variety of techniques. Quantitative information was gathered by self-administered questionnaires and the responses and input evaluation for SPSS. Not all qualitative results, nevertheless, were given numbers.Information retrieval is made easier by coding [22].

4. Result and discussion

4.1. Demographic profile analysis

The necessary data for this study project was gathered from both male and female respondents. According to the research, 44% of respondents were women, leaving 56% of respondents to be men. Also, roughly 47% of respondents gave their ages as 25 to 30 years old, 37% gave their ages as 31 to 40 years old, and 16% gave their ages as 41 years or older. Analysis of the applicants’ educational backgrounds revealed that 50% of respondents were college graduates undergone basic education, 22% of the respondents were qualified with secondary education, and 18% of respondents were qualified with territory education. From the analysis, we found that 41% of respondents were entrepreneurs and managers of different manufacturing firms. Furthermore, 33% of respondents were the owners and managers of textile industries, 15% of respondents were from the supermarket, and 11% of respondents were the owners and managers of different consultancies. Table 2 illustrates the respondent’s demographic profile.

Table 2.
Analysis of demographic profile.

Frequency Percent Valid percent

Gender Male 236 56 56

Female 184 44 44

Age 25–30 yr 199 47 47

31–40 yr 153 37 37

41 and more 158 16 16

Education qualification Basic education 111 50 50

Secondary education 43 22 22

Tertiary education 34 18 18

None 22 10 10

Years of experience 1–2 yr 87 45 45

2–3 yr 33 32 32

3 yr and more 28 23 23

Business type Manufacturers 70 41 41

Textiles 37 33 33

Supermarket 39 15 15

Consultancy 30 11 11

		Frequency	Percent	Valid percent
Gender	Male	236	56	56
Female	184	44	44
Age	25–30 yr	199	47	47
31–40 yr	153	37	37
41 and more	158	16	16
Education qualification	Basic education	111	50	50
Secondary education	43	22	22
Tertiary education	34	18	18
None	22	10	10
Years of experience	1–2 yr	87	45	45
2–3 yr	33	32	32
3 yr and more	28	23	23
Business type	Manufacturers	70	41	41
Textiles	37	33	33
Supermarket	39	15	15
Consultancy	30	11	11

4.2. Descriptive statistics

According to Table 3, the mean value for entrepreneur development is 2.3771 and the maximum value is 4.60. 0. Also, the entrepreneur development of standard deviation value is 0.84392. The average results show that the biggest element determining the development of entrepreneurship is considered innovation and creativity and digital. Also, the innovation and creativity of entrepreneurs impact business survival, reputation, and performance.

Table 3.
Analysis of descriptive statistics.

Descriptive statistics

Minimum Maximum Mean Std. deviation

Entrepreneur development 1.00 4.60 2.3771 .84392

Innovation creativity 1.00 4.20 2.4210 .79540

Digital capabilities 1.00 4.60 2.4448 .70085

Business performance 1.00 4.00 2.3781 .74916

Business survival 1.00 4.00 2.3562 .70404

Business reputation 1.00 4.40 2.3971 .73530

	Descriptive statistics
Entrepreneur development	1.00	4.60	2.3771	.84392
Innovation creativity	1.00	4.20	2.4210	.79540
Digital capabilities	1.00	4.60	2.4448	.70085
Business performance	1.00	4.00	2.3781	.74916
Business survival	1.00	4.00	2.3562	.70404
Business reputation	1.00	4.40	2.3971	.73530

4.3. SEM-analysis

Structural equation modeling was used to analyze the responses collected from an organization’s pertinent officials and human resource managers. (SEM). The structural correlations between the variables are usually examined using SEM, a thorough statistical analysis method. It examines linear causal interactions between variables and simultaneously takes measurement error into account.

4.3.1. Measurement model

The measuring model’s coverage validity has been evaluated before the testing of hypotheses relating to entrepreneurs, digital abilities, and innovative and creative business models. The initial step in this direction was applying explanatory factor analysis to the collected data. KMO and Bartlett tests have been used to determine if the data set is consistent with factor analysis. The results showed that the data set is appropriate for factor analysis (KMO = .871 and Barlett test $X^{2} = 4125.919$ , p < .000). The measuring models for entrepreneurs’ digital capabilities, business model innovation, and creative factors have all been put to testing in the Explanatory Factor Analysis (EFA). The factor load must be at least 0.50, the factor’s eigenvalues of the EFA must be at least 1, and the factor weights of the expressions that fall under the two factors must differ by at least .10. The investigation led to the collection of social media marketing efforts under 5 categories, which account for 78.487% of the overall variation. All components in the factor structure have factor loadings that range from .654 to .915. All of the dimensions that make up the EFA measurement model have reliability levels that range from .718 to .976. The EFA findings have demonstrated that the measuring model and the implemented structure are compatible.

Following this stage, Confirmatory Factor Analysis (CFA) was conducted on the data set following the EFA results to verify and test the findings of the EFA [18]. Entrepreneurship development has been taken into account as a latent component in five different aspects of the measurement model. As a result, the acquired data has been subjected to second-order CFA. In the second-level CFA, the parameters (first-level components) derived from the variables that were observed have been classified as endogenous variables, while the structure these factors (second-level components) generated has been classified as an exogenous variable. The CFA findings are reported in Table 4.

Table 4.
Results of the confirmatory factor analysis.

Measured variable Cronbach alpha AVE CR Factor loadings

Entrepreneurship development ED1 .874 .714 .824 .738

ED2 .915

ED3 .891

ED4 .654

ED5 .727

Business model innovation and creativity BIC1 .773 ..533 .739 .754

BIC2 .812

BIC3 .609

BIC4 .734

BIC5 .816

Digital capabilities DC1 .718 .549 .538 .670

DC2 .885

DC3 .924

DC4 .851

DC5 .821

Business performance BP1 .826 .796 .585 .845

BP2 .771

BP3 .858

BP4 .789

BP5 .812

Business survival BS1 .907 .766 .863 .830

BS2 .722

BS3 .772

BS4 .944

BS5 .819

Business reputation BR1 .815 .695 .976 .874

BR2 .719

BR3 .755

BR4 .808

BR5 .969

Measured variable	Cronbach alpha	AVE	CR	Factor loadings
Entrepreneurship development	ED1	.874	.714	.824	.738
ED2	.915
ED3	.891
ED4	.654
ED5	.727
Business model innovation and creativity	BIC1	.773	..533	.739	.754
BIC2	.812
BIC3	.609
BIC4	.734
BIC5	.816
Digital capabilities	DC1	.718	.549	.538	.670
DC2	.885
DC3	.924
DC4	.851
DC5	.821
Business performance	BP1	.826	.796	.585	.845
BP2	.771
BP3	.858
BP4	.789
BP5	.812
Business survival	BS1	.907	.766	.863	.830
BS2	.722
BS3	.772
BS4	.944
BS5	.819
Business reputation	BR1	.815	.695	.976	.874
BR2	.719
BR3	.755
BR4	.808
BR5	.969

The reliability of every framework and the validity of every factor constituting the measurement model with CFA have both been tested using Cronbach’s alpha. According to Table 4, each observable variable’s factor load in the measurement model ranges from .609 to .969. Additionally, the AVE values for the model’s variables are higher than the 0.50 threshold suggested by [1]. The measurements of the models’ included factors have relatively good reliability ratings (>0.7). It has also been confirmed that the latent factors become indifferent to one another by performing Pearson correlation analysis to the association among the research’s latent factors. The correlation findings between the variables are displayed in Table 5.

Table 5.

Correlation matrix of each construct.

	Entrepreneurship	Innovation	Digital	Business	Business	Business
	development	creativity	capabilities	performance	survival	reputation
Entrepreneurship development	1
Innovation creativity	.269	1
Digital capabilities	.271	.701	1
Business performance	.099	.442	.088	1
Business survival	.709	.252	.044	.209	1
Business reputation	.452	.064	.021	.441	0.39	1

After completing this process, the model fit values were checked, and the measurement model revealed a good level of conformity. SRMR, or Standard Mean Residual Root Square: The difference between the direct experimental correlation and the typical indirect matrix of correlations is how the SRMR is generally described. A complete method that compliance criterion may be made using the average amount of the difference between the observed and expected correlations. In contrast to SRMR, which gauges the full degree of fit, a result of zero denotes the suitable fit. Because of the model’s level of complexity, there was no SRMR impact. The factors are deemed to be well-fit when the result is less than 0.08. A measure of actual fit known as the Standard Mean Residual Root Square is sometimes described as the constant gap between observed and expected correlations. It is a constructive step. Moreover, the SRMR threshold value of 0.08 is selected. In this investigation, the SRMR score was 0.078, which is lower than the cutoff threshold. The results of the SRMR are displayed in Table 6.

Table 6.

Analysis of SRMR.

Methods	Score
SRMR Model	0.078

Tucker and Lewis Measure (TLI) analysis:

TLI is also known as a non-normalized index of fitness. This determines a proportionate eccentric minimization based on the degree of freedom.

NFI evaluation:

The NFI (Normalized Fit Index) is a measure of the goodness of fit that is incremental and unaffected by the model’s parameter count.

Table 8 displays the outputs of TLI and NFI. The TLI score is poor when there is a weak mean relationship between the variables. The minimal outputs of TLI when there is no discernible relationship between each factor, and the same is true for NFI evaluation [34]. The cutoff scores for the NFI and TLI are both set to 0.9. In this study, the TLI and NFI numbers are greater than the cut-off figure. As shown in Table 7, the model is seen to fit well.

Table 7.

TLI and NFI analysis.

Models	TLI	NFI
Scores	0.927	0.914

4.3.2. Structural model

Table 8 provides the values of R² and R²adj. The value of R² for innovation and creativity is 0.1018, which denotes the higher degree of correlation. What percentage of the dependent variable’s overall fluctuation may be accounted for by the R² value, innovation & creativity, digital capability, business performance, business survival, and business reputation.

Table 8.
Path analysis.

R² R²adj

Innovation creativity 0.1061 0.1018

Digital capabilities 0.0960 0.0916

Business performance 0.0221 0.0173

Business survival 0.0396 0.0350

Business reputation 0.0304 0.0258

	R²	R²adj
Innovation creativity	0.1061	0.1018
Digital capabilities	0.0960	0.0916
Business performance	0.0221	0.0173
Business survival	0.0396	0.0350
Business reputation	0.0304	0.0258

In path analysis and structural models, a route coefficient is the partial correlation analysis between the dependent and independent variables, corrected for extra independent factors. A route factor illustrates the direct effect of one variable assumed to be a source on another variable assumed to be an effect. Path coefficients are normalized because they are derived from correlations. A path factor describes the undeviating effect of a particular variable supposed to be a cause on another variable assumed to be an outcome. Similarly, Table 9 lists the research on how business model creativity and innovation affect small- to medium-sized businesses in Greece.

Table 9.

Path coefficient analysis.

	Path coefficient	Total effect
Innovation creativity	0.3257	0.3257
Digital capabilities	−0.3096	−0.3096
Business performance	0.1485	0.1485
Business survival	0.199	0.199
Business reputation	0.1745	0.1745

Table 10 describes that the entrepreneurs and business model innovativeness is effectively correlated, according to the findings ( $β = .327$ , $sign = .038$ ), which confirms hypothesis 1. There is an association between digital capabilities and entrepreneurship ( $β = .425$ , $sign = .045$ ), which confirms hypothesis 2. The outcomes show that digital capabilities have an effective relation to the innovation and creativity of entrepreneurs ( $β = .443$ , $sign = .046$ ), which confirms hypothesis 3. The inventiveness and creativity of entrepreneurs’ company models have no improvement in business performance, according to the findings ( $β = - .047$ , $sign = .463$ ) which do not confirm hypothesis 4. There is an association between innovation and creativity of entrepreneurs’ business models and business survival ( $β = .535$ , $sign = .039$ ), which confirms hypothesis 5. The outcomes show that innovation and creativity of entrepreneurs’ business models have no effective relation on the business reputation ( $β = - .152$ , $sign = .547$ ), which does not confirm hypothesis 6.

Table 10.

Hypothesis testing.

Hypothesis	Standard error	β	Sign.	Opinions
H1	.043	.327	.038	Supported
H2	.051	.425	.045	Supported
H3	.036	.433	.046	Supported
H4	.044	−.047	.463	Not supported
H5	.051	.535	.039	Supported
H6	.068	−.152	.547	Not supported

4.4. Discussion

The study’s primary goal is to comprehend the efficacy of business model innovation and creativity as well as the growth of entrepreneurship in Greek SMEs. According to the results of the analysis, it was discovered that there was a strong correlation between entrepreneurs and business model innovation (p =.038), digital capabilities have an effective relation to the originality and creativity of entrepreneurs (p =.046), there is a link between digital capabilities and entrepreneurship (p =.045), the inventiveness and creativity of entrepreneurs’ business models do not improve business performance (p =.463), there is a correlation between the inventiveness and creativity of entrepreneurs’ business models and business survival (p =.039), the business reputation of entrepreneurs’ business models is unaffected by innovation and creativity (p =.547). Therefore, these findings revealed that the H1, H2, H3, and H5 are accepted.

From this, it was found that the effect of digital technology on the expansion of new ventures abroad in light of the rising significance of entrepreneurial businesses in international markets [46]. Additionally, it suggests that digital technology aids business owners in their attempts to enhance their creativity and invention [43]. The success of a business depends on its ability to seamlessly blend entrepreneurship with innovation. Innovation is the answer to paradigm-shifting discoveries. Innovation and creativity provide a novel approach to solving a practical or business problem. Small and medium-sized firms are crucial for promoting economic growth, job creation, and sustainable development [6]. As a result, the entrepreneur, who is mostly in control of the business’s survival and growth, must have the ability to solve problems and must also have the confidence to overcome challenges, adaptive aggressiveness, and entrepreneurial self-efficacy [16]. Finally, it was discovered that by embracing creativity and innovation, small and medium-sized enterprises might reach new heights in terms of product quality, ongoing development, efficiency, marketing effectiveness, and internal harmony [42]. The creative process may lead to the emergence of fresh concepts and ideas. Customers are more likely to give their products higher ratings, engage with them more frequently, and remain loyal to a firm they consider creative [2]. This increases client retention and inevitably boosts the business’s survival.

5. Conclusion

To prevent the sector’s sluggish growth, additional study is still needed on the crucial issues of creativity, innovation, and entrepreneurial development [32]. The study’s primary goal is to comprehend the efficacy of business model innovation and creativity as well as the growth of entrepreneurship in Greek SMEs. Therefore, it is crucial to thoroughly evaluate key factors that have both good and negative influences on the growth of entrepreneurship. Using SEM analysis the proposed hypothesis was verified. The hypothesis testing outputs defined that entrepreneurship has a significant connection between business model innovation & creativity and digital capabilities. The test results also indicate that digital capabilities have a favorable impact on the business model innovation & creativity. They also found that the creativity and innovation of business models have a favorable impact on entrepreneurs’ business survival. However, the creativity and innovation of business models have no favorable impact on entrepreneurs’ business performance and reputation.

5.1. Implications

As a result, managers and owners of SMEs lack a comprehensive understanding of how their company generates, captures, and provides value for both their networked firms and their clients. This could result in less competition, ineffective decision-making, and general inefficiency. SMEs must thus employ the BM techniques and resources that are now accessible more methodically and thoroughly if they hope to successfully reinvent their BM. Businesses must understand that making thoughtful, methodical adjustments to each component of BMs is not just about satisfying customers; it’s also about standing out from the competition and gaining an edge [35].

To increase SMEs’ capacity for innovation, the government must create a favorable environment. An ecosystem of diverse stakeholders, including universities, research institutes, chambers of commerce and craft, regional development agencies, and other possible partners, should make up the environment. Priorities include education and training initiatives about BM and BMI methodologies, techniques, and resources. Governments can also encourage and assist the innovativeness of SMEs by offering tax breaks or using different funding sources. Lastly, but just as critically, SMEs ought to prioritize ongoing education and the advancement of digital skills [25].

The results of this study imply that business managers should know that entrepreneurial business performance, survival, and reputation are effective and play an important role in applying innovative business models. The role of these three factors in entrepreneurial development is significant, and three factors are influential in shaping the entrepreneur’s business growth. Investigating the impact of these innovative business model factors on entrepreneurial development is one of the differences between this study and other studies, and it is one of the main novelty of this study. By forming the proper organization processes to implement business model innovation capabilities, businesses can create value and survive their business using the proper growth. This study also, suggests that entrepreneurs who encourage creativity and innovation in their company strategies will advance and succeed more than those who stick to the conventional business strategy, which is only focused on trading.

5.2. Limitations and future recommendations

The following research constraints were found by the researcher:

Since the data were gathered concurrently via a questionnaire, the relationships shown in the structural model were first looked at statically. As a result, longitudinal case studies can be used to conduct further investigations. The current study also looked at the owners and managers of knowledge-based businesses who had to properly manage these businesses in the constantly shifting environment of today. It did not, however, look at topics like employee views and traits, key resources in businesses or organizations, or their efficiency and efficacy in fostering entrepreneurship. Future research may be done to find out how human resource views and attributes affect entrepreneurship growth in any organization or business. Third, the current study looked at how the innovation model affected the growth of fresh startups. Future research can pinpoint other factors that may mediate or moderate the relationship.

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	Descriptive statistics
	Minimum	Maximum	Mean	Std. deviation
Entrepreneur development	1.00	4.60	2.3771	.84392
Innovation creativity	1.00	4.20	2.4210	.79540
Digital capabilities	1.00	4.60	2.4448	.70085
Business performance	1.00	4.00	2.3781	.74916
Business survival	1.00	4.00	2.3562	.70404
Business reputation	1.00	4.40	2.3971	.73530

Business model innovation and creativity impact on entrepreneurship development: An empirical study

Abstract

Keywords

1. Introduction

2.2. Research hypothesis and conceptual framework

3.1. Variable definition

3.2. Research design

3.3. Data collection

3.4. Population of the study

3.5. Study sample

3.7. Data analysis

4. Result and discussion

4.1. Demographic profile analysis

4.3.1. Measurement model

Table 8. Path analysis. R2 R2adj Innovation creativity 0.1061 0.1018 Digital capabilities 0.0960 0.0916 Business performance 0.0221 0.0173 Business survival 0.0396 0.0350 Business reputation 0.0304 0.0258

5. Conclusion

5.1. Implications

5.2. Limitations and future recommendations

References

Table 8.
Path analysis.

R² R²adj

Innovation creativity 0.1061 0.1018

Digital capabilities 0.0960 0.0916

Business performance 0.0221 0.0173

Business survival 0.0396 0.0350

Business reputation 0.0304 0.0258