Abstract:
Small and medium enterprises (SMEs) play a vital role in driving economic growth
and innovation. However, their capacity to adopt new technologies and practices
largely depends on the resilience of their entrepreneurs. Understanding how
entrepreneurial resilience shapes innovation adoption is, therefore, essential. This
study examines the impact of entrepreneurial resilience on innovation adoption
among SMEs in the Kandy District of Sri Lanka, while examining the moderating
effect of entrepreneur age. Entrepreneurial resilience was conceptualised through four
dimensions namely adaptability, optimism, risk management, and persistence. A
quantitative research design was employed using the data collected from a sample of
372 SME owners representing different age groups, selected through stratified
random sampling from a population of 42,895 registered SMEs in Kandy district.
Descriptive statistics, correlation, regression, and moderation analyses were
conducted to test the proposed hypotheses. The findings revealed that entrepreneurial
resilience significantly influences innovation adoption across product, process, and
market domains. Adaptability and optimism were found to be stronger predictors
among younger entrepreneurs, while risk management was more dominant among
older entrepreneurs. Middle-aged SME owners demonstrated a balanced combination
of all resilience dimensions. The moderating effect of entrepreneur age demonstrates
the need to tailor resilience-building and innovation strategies to generational
characteristics. This study contributes to existing knowledge by addressing a
contextual gap in the Sri Lankan SME literature and provides empirical evidence for
policymakers, SME development agencies, and entrepreneurs to strengthen resilience
capabilities that foster sustainable innovation and regional economic growth.
