Abstract

Innovation has been accepted as a key stimulus for growth. This is more so with SMEs which are widely acknowledged as being a significant driver in economic growth. In a review of over 90 peer reviewed journal articles and conference papers; this paper brings together different arguments that have been made in explaining the antecedents for innovativeness. This is a critical review of the literature with respect to innovativeness of manufacturing SMEs. Whereas it is acknowledged that the discussions around innovation are continually evolving, existing literature has shown that there are internal and external factors that affect innovativeness in firms. In addition to this, there is a need to have research that applies universally and hence the need to study this phenomenon in manufacturing SMEs in Kenya and the gaps therein. Even though entrepreneurial orientation, technological capability and environmental dynamism have been identified as variables affecting firm innovativeness, there is no common consensus across various approaches. A need to empirically explore this area further effectively contributing to knowledge in this area has been identified.

Key words: SMEs, Innovativeness, Entrepreneurial Orientation, Technological Capability, Environmental Dynamism.