Thriving in turbulence: How market dynamism influences business model innovation: The roles of entrepreneurial orientation and strategic flexibility in Ghanaian SMEs

This study investigates the associations between market dynamism and business model innovation, focusing on the roles of strategic flexibility and entrepreneurial orientation. Based on dynamic capability theory, data were gathered using a closed-ended questionnaire distributed to 370 Ghanaian small and medium-sized enterprises (SMEs) via the Ghana Enterprise Agency. SmartPLS was used for the data analysis and path modeling. Findings suggest that market dynamism has a significantly impact on business model innovation. Entrepreneurial orientation has a full mediating effect on the relationship, while strategic flexibility partially moderates it. This study highlights entrepreneurial orientation and strategic flexibility as key mechanisms that enable SMEs to navigate market dynamism and drive innovation. Integrating dynamic capability theory provides insights into how these capabilities influence innovation outcomes in dynamic environments. This study recommends that policy makers prioritize frameworks that support the development of entrepreneurial orientation and strategic flexibility to enhance business model innovation, thereby ensuring resilience and long-term success.