Contents

Summary............................................................................................................................ 3
I. Methodology...............................................................................................................3
1. Research approach...................................................................................................3
2. Sampling and data collection.....................................................................................3
2.1 Sample description................................................................................................3
2.2 Data processing.....................................................................................................6
II. Result descriptive........................................................................................................6
1. Multicollinearity test................................................................................................7
2. Regression statistics...................................................................................................7
Final result......................................................................................................................8
III. Discussion................................................................................................................8
IV. Limitation and futher recommendation..................................................................10
1. Limitation...............................................................................................................10
2. Futher recommendation..........................................................................................10
V. Conclusion................................................................................................................. 11
Reference.........................................................................................................................11
 Research On The Impacts Of Innovations On Business Performance Of Enterprises
Post Covid-19 in Sweden

Summary
This research paper is focused on examining the impact of innovations on business
performance of enterprises in the context of COVID-19 specifically in Sweden. The
innovations focused on analysis here are product innovation, process innovation, spending on
R&D. The results hypothesize that product innovation has a positive impact on business
performance, as measured by sales increase over the same period. However, the study found
that process innovation had no association with sales increase during covid, and that R&D
spending had a negative impact on the company's business. The research is based on reliable
World bank data, with the aim of contributing to the literature by shedding light on what
aspects can help the company improve sales, and recover from the COVID-19 passing.

I. Methodology
1. Research approach

The study uses Sweden data between December 2019 and June 2021 collected from the
World bank. This is the most comprehensive data file on businesses during the two years of
the COVID-19 crisis in Sweden. The qualitative method is used to examine the relationship
between the variables mentioned in the article.

In order to have full analytical data on business resilience, it is necessary to collect a large
number of samples from different enterprises to prove the hypothesis, so this is a barrier for
group 43. Therefore, the members decided to use secondary data with data available from the
world bank, a reliable data source. With the number of samples of enterprises participating in
the survey is quite high in each country, moreover, the sample is also collected on many
different scales and geographical regions, so it is comprehensive and objective to better serve
the customers in this research paper.

2. Sampling and data collection

2.1 Sample description

Secondary data is available data, collected by large organizations and widely available
to the public. Secondary data from World Bank were used for this study. The research
question was researched by a group of 43 and reviewed by the coach.

The details for the research questions h2, h5, h8 and COVb2b are shown in the
appendix.
 Sampling Size Freq. Percent Cum.
Small 208 35.19 35.19
Medium 225 38.07 73.27
Large 158 26.73 100.0
0
Total 591 100.00

During the survey period, the World Bank collected 208 small enterprises, 225 large
enterprises and 158 large enterprises in Sweden, The total survey collected was 581
samples.

Tabulation of h2
New Products/Services Also Freq. Percen Cum.
New For The Establishment'S t
Main Market
Yes 276 69.70 69.70
No 120 30.30 100.00
Total 396 100.00

69.70% (276 enterprises) introduced new products to the market out of 396 enterprises.

Tabulation of h5
During Last 3 Yrs, Establishment Fre Percen Cum.
Introduced New/Significantly q. t
Improved Process
Yes 374 63.39 63.39
No 216 36.61 100.00
Total 590 100.00

The above table shows that 374 enterprises (63.39%) have Introduced
New/Significantly Improved processes .

Tabulation of h8
During Last Fiscal Year, Freq. Perce Cum.
Establishment Spent On R&D (Excl nt
Market Research)?
Yes 182 30.95 30.95
 No 406 69.05 100.00
Total 588 100.0
0

And out of a total of 588 enterprises, only 183 firms (30.95%) invested in R&D during
the covid period. This is a relatively low rate.

Summary statistics

N Mean SD Min Max

Product 396 1.303 0.460 1 2
innovation
Process 590 1.366 0.482 1 2
innovation
R&D 588 1.69 0.463 1 2
spending
Sales increase 186 25.156 40.685 1 400

According to the above analysis, with a total of nearly 600 businesses, but those that
invest in innovation are not the majority, and there are 186 businesses ready to answer the
question COVb2b – sales of the business increase compared to 2019.

Tabulation of sale
Change in sales for last completed Freq. Percent Cum.
month compared with the same month in
2019
Increase 192 34.41 34.41
Remain the same 131 23.48 57.89
Decrease 235 42.11 100.00
Total 558 100.00

The above table shows that out of a total of 55 businesses that answered the question
about revenue, there were 192 businesses that answered the question of percentage of
sales increase.

For the convenience of data statistic purposes, in this research, newly created variables
with value Increase to 3 and change decrease to 1. Besides, this study is analyzed based
on variables COVb2b- sales increase.
 Because the variable COVb2b- sale increase is a continuous variable, regression
analysis is applied for this study.

On the other hand, to make the analysis and presentation easier to understand, the
variables are renamed as follows:h2: Product innovation
- h5: Process innovation
- h8: R&D Spending
- COVb2b : Sale increase
Control variable : In this study, my control variables will be size, industrywhich
influence the results of our analysis.

2.2 Data processing

The data for this study comes from nearly 600 samples. The samples were selected using
stratified random sampling.

Stratified random sampling is a type of probability sampling in which a population is first

divided into mutually exclusive (homogeneous) subgroups, and then a subject is randomly
selected from each group. (layer), which is then combined to form a single pattern. A stratum
is nothing but a homogeneous subset of the population, and when all strata are combined, it is
called a stratum. At the World bank this method is used because there is no bias for the
population components.

In this study, members in particular and group 43 in general used the Stata tool to analyze
data. Where the methods used for analysis are the tabstat function to describe the mean, min
max and SD of the variables; Multicollinearity test aims to test the correlation between
independent variables, making the study more objective, and regression to test the correlation
between variables from which to test the proposed hypothesis.

II. Result descriptive

 1. Multicollinearity test

Pairwise correlations
Variables (1) (2) (3)
(1) Product innovation 1.000

(2) Process innovation 0.092 1.000

(0.067)
(3) Spending on R&D 0.162 0.145 1.000
(0.001) (0.000)

Multicollinearity is a statistical term that usually occurs when there is a high correlation
between two or more independent variables in a regression model. Multicollinearity
represents the degree of independence between variables. This coefficient takes values from 1
to -1 provided the relationship is < 0.4 or >= 0.4. Besides that, The coefficients are also
significant in the positive direction between the variables if the result is positive and in the
opposite direction when the result is negative. To evaluate the independence between
variables, in the resulting data there are 2 rows, the upper row is the sig coefficient measuring
the independence between variables and the lower coefficient is the pearson coefficient,
measuring the independence between the variables.

When looking at the table above, it can be consider that all variables are independent
variables, which have no effect on statistical significance.

2. Regression statistics
 R1. Linear regression

Sale increase Coef. St.Err. t-value p-value [95% Interval Sig

Conf ]
Product innovation 20.116 11.237 1.79 0.076 -2.146 42.377 *
Process innovation 15.471 10.33 1.50 0.137 -4.993 35.934
Spending on R&D -16.977 8.024 -2.12 0.037 -32.872 -1.081 **
Constant 9.796 26.826 0.37 0.716 -43.345 62.938

Mean dependent var 27.636 SD dependent var 46.474

R-squared 0.083 Number of obs 118
F-test 2.920 Prob > F 0.037
Akaike crit. (AIC) 1237.563 Bayesian crit. (BIC) 1248.646
*** p<.01, ** p<.05, * p<.1

R2. Linear regression with control variable

Sale increase Coef. St.Err. t-value p-value [95% Conf Interval] Sig
Product 19.558 11.875 1.65 0.102 -3.975 43.091
innovation
Process 10.069 8.899 1.13 0.26 -7.567 27.704
innovation
Spending on -17.074 8.172 -2.09 0.039 -33.27 -.879 **
R&D
Industry 0 . . . . .
Retail -14.467 9.455 -1.53 0.129 -33.205 4.272
services
Other 2 11.125 0.18 0.858 -20.047 24.046
services
Size 0 . . . . .
Medium -11.712 10.609 -1.10 0.272 -32.736 9.311
Large -21.473 8.731 -2.46 0.015 -38.776 -4.17 **
Constant 31.871 22.374 1.42 0.157 -12.469 76.212

Mean dependent var 27.636 SD dependent var 46.474

R-squared 0.130 Number of obs 118
F-test 1.567 Prob > F 0.153
Akaike crit. (AIC) 1239.385 Bayesian crit. (BIC) 1261.550
*** p<.01, ** p<.05, * p<.1

Linear regression result nhớ sưaar

Dependent variable: Sales growth

R1 R2
Independent variables

Product innovation 0.076 (*) 0.102

Process innovation 0.137 0.26

R&D spending 0.037 (**) 0.039 (**)

Control variables

Industry No Yes
Size No Yes

Note: *** p<.01, ** p<.05, * p<.1

The above Regression table with 118 respondents shows the relationship between the
variables product innovation, process innovation, spending on R&D to sales increase.
There are coefficients that need attention such as P value: significance level of the test,
coefficient. Acceptable values at P-value with P< 0.01 to P<0.1 are decisive values for
acceptance or rejection drop hypothesis. The relationship between Product innovation
and sales increase with a P-value <0.1 is hypothetically acceptable and has a positive
regression coefficient. That is, H1 will have an effect on the sales increase of the business
and at a low level; this result confirms that H1 is support.

Next is Process innovation and sale increase with P-value > 0.1 this shows that Process
innovation variables are not relate to sales increase because P-value > 0.1 has no
statistical significance to the variables, this result is not supportedH2.

Finally, it can be seen from the table above that the coefficients show that the variable
has a P-value < 0.05 and has a negative sign coefficient. That is, Spending on R&D has a
relationship with sales increase and it is a negative relationship. If the enterprise invests
more in R&D, sales will not increase but may decrease revenue, so this result is not
support H3.

Final result
Hypothesis Result
H1: Product/services innovation positively influenced Supported
business performance
H2: Process innovation positively influenced business Not Supported
performance
H3: Spending on R&D positively influenced business Not Supported
performance

III. Discussion

With three hypotheses proposed, only one that H1 is supported. That means product
innovation will have a positive effect on business performance.
This analysis supported H1: Product/services innovation positively influenced
business performance

Theoretically, product innovation could allow the innovator to at least earn monopoly
profits in the short term (Lieberman and Montgomery, 1988; Schumpeter, 1950). When
innovative new products are brought to market, they initially face little direct competition
and are likely to generate high profits.

Cho and Pucik (2005) argue that corporate innovation is positively relate to firm
growth and firm profitability. Their empirical examination of Fortune 1000 companies
backs up their argument. More recently, Hua and Wemmerlov (2006) examined the
relationship between new product introduction rates and performance. Their examination
of the personal computer industry confirmed a positive relationship between new product
introduction rates and performance, thus providing support for the argument those firms
introduce a single product line. Consistent products innovative products to market that
can achieve sustained high levels of performance.

H2 Process innovation positively influenced business performance, which is not

supported
 Generations of managers have been taught that process innovation, especially at a time
when information technology is concerned to support and follows an agreed strategy. Six
months or so after defining the strategy, management leaves responsibility for designing
the process to their engineering staff, who embark on a comprehensive design and build
cycle. During a year of systems analysis - the method on which most software and
process redesigns are still based - engineering was tasked with generating ideas for
computerized, improved processes. After two to three years of implementation, at that
time, innovative ideas that have struggled from such a lengthy process are likely to be
outdated (Richard, Heygate, 1996).

Instead of investing in process innovation, Companies will look for innovation led by
highly qualified, specialized research scientists, working in the most complex R&D
facilities or acquired through acquisition of small, high-tech, start-ups that have disrupted
key product areas. Although senior managers recognize the support of process innovation
as crucial to the bottom-line of the business.

Monika and Piotr's research paper on Innovation in the COVID-19 Pandemic

concluded that, in times of the threat of COVID, the majority of companies have
abandoned innovation. The biggest barrier to this result is the lack of suitable knowledge
and skills of the candidates as well as the lack of capital. Besides, the impact of COVID
is also very high, because it directly affects economic life around the world. In addition,
this survey when collected in Sweden shares this opinion with 28.3% of the companies in
Sweden surveyed.

As listed above, taking care of process innovation is a long process, during COVID
many companies have to switch to a remote mode of operation, so the company can
disrupt processes. The company is a mechanism of complementary elements that
cooperate with each other. Implementing innovation in one space may force another
factor to be changed in order to fully utilize the new potential or maintain the desired
level of compatibility (Monika and Piotr, 2022).

H3 Spending on R&D negatively influenced business performance - hypothesis is

not supported

Innovation – introducing new products, services and ways of doing business – will be a
key factor in the post-COVID-19 recovery. However, the implementation of R&D and
innovation is always risky with uncertain technical and commercial outcomes (Rhaiem
and Amara, 2019) so during a recession, it is important to maintain a deficit in capital to
continue. Continuing to operate is already difficult for businesses, to maintain R&D
operations requires expenses with 3-5% of sales or higher to ensure long-term growth,
During a recession, sales. This is not the case for technology companies (Dugal and
Morbey 1995). This period is similar to businesses in Sweden during the pandemic, so
maintaining spending on R&D is the hard work for businesses can continue until the
economy recovers (Monika and Piotr, 2022). In addition, there is a certain length between
the results and the time lag (Guilloches, 1998). Therefore, Spending on R&D in the year
of COVID cannot be measured by exact revenue.

IV. Limitation and futher recommendation

1. Limitation

This study has some limitations, including that the data is analyzed based on all
enterprises in Sweden, the sample number is not divided by size, industry of enterprises,
so there are still weaknesses latent factors have not been fully exploited from the data set
in particular. For example, Campello et.al, (2010) gives data showing that during a crisis,
large companies are more aggressive process innovation innovators than small firms and
they still profit from change there. In addition, a deficit in survey responses can skew the
results (Lefever, Dal and Matthasdóttir, 2017). Since specific questions such as sales
percentage increase in sales are the part that many people survey participants want to
avoid.
When the control variable was included in the analysis results, it can be seen that apart
from the negative effect as the general analysis results, there is no relationship between
product innovation and sales growth. Therefore, the combination of the variables
"industry" and "size" also has some influence on the research results.
2. Futher recommendation

It is recommended with future research papers that researchers can analyze more
specifically with process innovation at large enterprises and spending on R&D at
different business sizes, industries, to find out more points new among types.

For enterprises Although the hypotheses have been tested, there is a positive
relationship between product innovation and business performance, but enterprises can
test themselves based on the company's business situation before making a decision to
invest in product innovation. For the disproved hypotheses, Enterprises and the board of
directors may consider more carefully the cost investment in this type of innovation.

V. Conclusion

This study aims to clarify the relationship between product innovation, process
innovation and spending on R&D to business performance, specifically measured by
sales volume of enterprises in 2019-2021, in order to point out factors that can help
businesses resilience industry. After analyzing available data from the World Bank in
Sweden, it can be seen that investing in product innovation can help businesses grow
revenue. Although the study has many limitations, there are some recommendations that
can be discussed based on previous studies.

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