Exploring the Innovation-Based Capabilities on Innovation Performance: A Case Study of Small and Medium Tourism Enterprises (TSMEs) in Malaysia

The continuous expansion and competitiveness of Malaysia's Small and Medium Tourism Enterprises (TSMEs) are greatly influenced by innovation. We explore the complex dynamics of how TSMEs create and use innovation-based capabilities to improve their innovation performance. We identify the crucial elements that shed light on this relationship using survey. Purposive sampling was used in this study's methodology, with 213 TSME chosen from the Ministry of Tourism and Culture (MOTAC) list as samples. The study's findings provide insight into how TSME view innovation-based capabilities and their top priorities. Notably, it was found that they correctly recognize the importance of factors associated to innovation capabilities and performance. These components are seen to be crucial for encouraging an innovative culture in Malaysian SMEs. The study intends to offer insightful information for TSMEs, decision-makers, and business professionals who are trying to harness innovation for long-term growth in Malaysia's vibrant business environment.