Small and medium enterprises and the effectiveness of technology business incubators in Saudi Arabia
Multiple studies have examined incubators in developed countries. However, as the literature review illustrates, there is a dearth of research concerning Technology Business Incubators (TBIs) in developing countries. This research presents two theoretical perspectives arrived at while investigating the effects of TBIs on technology small and medium-sized enterprises (SMEs) in Saudi Arabia (SA). SMEs are important to the success of economies. Many governments have thus used various initiatives to support SME growth. Business incubators are one such mechanism, identified as a successful tool for promoting development of SMEs worldwide. TBIs is to support technology SMEs by providing them with both tangible and intangible services. This research adopts a case study approach to investigate the effects of TBIs on technology SMEs. Data was collected from nineteen participants using semi-structured interviews and documentation; all participants were Saudi with a range of links to TBIs and SMEs. They included incubator managers, incubated technology business owners, and non-incubated business owners. Data was then analysed using hermeneutics and other qualitative techniques. Research findings include that the ‘ecosystem’ for SMEs in SA is weak, and that there is a general lack of awareness regarding TBIs in SA. A further discovery is that TBIs have a positive impact on SA SMEs incubatees. This finding was based on the comparative study of incubated technology businesses and non-incubated technology businesses. Results also show that TBIs in SA have an impact on the scale of new business startups, they reduce start up and operational costs, and heighten the development of technology SMEs and their credibility in the marketplace. Furthermore, the findings identify obstacles that SMEs encounter when attempting to join TBIs. To offer a grounding to the phenomena under investigation, the researcher applied institutional theory, and found that SA TBIs and SMEs are subject to four types of isomorphic pressure. This research puts forward two novel theoretical contributions. First, it presents a way of understanding pressures on SMEs and how SMEs are related to isomorphism and competitive pressure by showing different timeframes for different kinds of isomorphic pressures on SA SMEs. Second, the research looks at the impact of the ‘ecosystem’ on the isomorphism pressure stages. Additionally, this research addresses the knowledge gap regarding the effects of TBIs in developing countries, specifically in SA. It also offers a comparative study between incubated and non-incubated technology SMEs.
- PhD