Relationship between innovation and financial performance in the global environment of exporting companies

Abstract

This research aimed to measure the impact of innovations (product innovation, technological innovation, marketing innovation, and process innovations) on the financial performance of exporting enterprises. It was based on return on assets (ROA), increase in return on sales, net profit, and increases in value per employee. The research was carried out based on primary data through the quantitative method. The study's participants were 150 Kosovo exporting companies selected randomly. Based on Pearson’s correlation analysis, it was found that there is a weak positive linear relationship between organizational innovations and product innovation, and financial performance. Additionally, a moderate positive linear relationship exists between marketing innovations, process innovations, and financial performance. Referring to the multiple linear regression, it was revealed that innovations explain 46.7% of financial performance. Process and marketing innovation had the greatest impact on financial performance, while organizational innovation had a lesser impact. The findings of this research contribute to improving the financial performance of exporting companies in Kosovo, focusing on the type of innovation that most influences performance.