The role of innovation strategy in entrepreneurial venture survival: a moderated mediation analysis of organizational adaptability and environmental influences Open Access

The survival of entrepreneurial ventures in emerging economies is closely tied to how effectively innovation strategies foster organizational adaptability in response to environmental pressures. This idea anchors this study. Emerging economies are characterized by rapid growth, increasing integration into global markets, and unique regulatory challenges (Zafar, 2023; Singh, 2012), creating a context where traditional survival strategies may prove insufficient. Recent technological transformations have intensified these challenges (Egala et al., 2024), as ventures must now navigate digital disruption while building capabilities for long-term viability. While high economic growth and an expanding middle class drive sectoral demand (Chea, 2021), these same conditions create vulnerabilities as ventures struggle to build the adaptive capabilities necessary for navigating market volatility (Toledo, 2023).

Entrepreneurial ventures play a transformative role in economic development, driving innovation and job creation (Amoah et al., 2022). In Ghana, such firms contribute significantly to GDP, signaling their importance for economic growth (Agyapong et al., 2021; Asamoah, 2014). However, these enterprises face substantial survival challenges, with many failing in their nascency (Atanga, 2019; Attrams and Tshehla, 2022; Amoa-Gyarteng and Dhliwayo, 2024a). Their success depends on innovation strategies that integrate new products, services, and processes with broader business objectives.

Strategic choices, such as effective innovation strategies, have a significant impact on the outcomes of entrepreneurial ventures. Innovation strategy, as conceptualized in this study, represents a comprehensive approach that encompasses product, process, organizational, and marketing innovations, working together as an integrated strategic orientation rather than isolated activities. Organizational adaptability enables entrepreneurial ventures to adjust to challenging market conditions, identifying and responding to opportunities while managing risks (Arunga, 2023; Quansah et al., 2022). This study positions organizational adaptability as serving multiple critical roles: first, as an outcome of successful innovation strategy implementation; second, as a mediating mechanism that channels innovation investments into survival benefits; and third, as a dynamic capability that enables ventures to reconfigure resources and strategies in response to environmental changes.

Environmental factors, including market dynamics, competitive intensity, and regulatory environments, critically shape organizational activities (Rehman and Rajkumar, 2019). Market dynamism reflects the unpredictability of external influences on strategic decisions (Anning-Dorson et al., 2018). Competitive intensity drives entrepreneurial ventures to innovate and improve performance (Giachetti, 2023), while regulatory structures can either facilitate or hinder a venture's ability to compete (Anning-Dorson et al., 2018). Evidence from sub-Saharan Africa indicates that these environmental factors operate within broader socio-ecological constraints, spanning from individual skill deficits to institutional inadequacies, which fundamentally shape venture creation and sustainability (Ofosu-Appiah et al., 2025).

While existing studies have extensively explored innovation and entrepreneurial venture performance (Amoa-Gyarteng and Dhliwayo, 2024b), research on how innovation strategies translate into venture survival in challenging ecosystems remains limited (Nakara et al., 2025; Apprey, 2024). Moreover, much of the existing research on entrepreneurial venture survival has focused on developed economies; hence, there is a significant need for studies that focus on emerging economies (Soto-Simeone et al., 2020). Current studies have not explicitly explored the strategies entrepreneurial ventures in sub-Saharan Africa use to navigate innovation barriers in their contexts (Edeh et al., 2024). While recent evidence from sub-Saharan Africa highlights the performance benefits of innovation (Williams et al., 2025), the mechanisms enabling venture survival remain unclear (Pennetta et al., 2025).

Furthermore, while the importance of innovation is well-established, research has insufficiently explored the mediating role of organizational adaptability (Arunga, 2023). Few studies have examined how adaptability enables entrepreneurial ventures to better utilize innovation strategies for long-term survival (e.g., Quansah et al., 2022; Haddad et al., 2020). Studies on SMEs in emerging economies reveal that exploitative and exploratory search activities, understood as dynamic capabilities, enable firms to adapt and innovate in response to environmental pressure (Sarfo et al., 2025). Yet, the translation of these adaptive capabilities into survival outcomes warrants further investigation. Environmental factors, such as market dynamism, competitive intensity, and regulatory challenges, shape adaptability and survival (Cho, 2024); however, their moderating effects on the innovation–adaptability–survival link in emerging economies remain underexamined.

Additionally, methodological norms have led researchers to view survival as a clear-cut outcome. Prior studies, such as Zhou and Sun (2024), have treated organizational survival as a binary outcome. This view, however, overlooks distinctions like termination, acquisition, and bankruptcy, which reflect varied pathways of “survival” and “failure” (Josephy et al., 2017). Building on Josephy et al. (2017), we define survival across three dimensions: operations, ownership, and solvency, to fully understand how it manifests. This multidimensional perspective is supported by prior work that highlights alternative definitions of failure based on insolvency, discontinuity of ownership, or failure to meet personal performance thresholds (Shepherd, 2003; Coelho and McClure, 2005; Ucbasaran et al., 2010).

The theoretical foundation of this study rests on Dynamic Capabilities Theory (DCT), which explains how firms develop sensing, seizing, and transforming capabilities to navigate environmental challenges and ensure survival (Teece, 2007). The study responds to emerging calls for research on dynamic capabilities in entrepreneurship, which seek to adapt DCT to entrepreneurial aims, characteristics, contexts, and networks (Matricano, 2025). By examining the mediating role of organizational adaptability and the moderating effects of environmental factors, this study provides a comprehensive framework for understanding how entrepreneurial ventures in emerging economies can leverage innovation to survive. We extend the literature by testing a moderated mediation model that links innovation strategy to survival through organizational adaptability, specifying when this pathway holds under varying competitive intensities and a supportive regulatory context. To consolidate the issues raised above, this study addresses three critical gaps in the literature: first, the lack of empirical work on how innovation strategies influence survival in African entrepreneurial settings; second, limited theorization of adaptability as a mediating mechanism in this relationship; and third, insufficient clarity on how external environmental conditions shape when and how innovation strategies lead to survival outcomes.

Given the gaps in the literature, this study examines the relationship between innovation strategy, organizational adaptability, environmental factors, and the survival of entrepreneurial ventures, with a focus on the Ghanaian context. It addresses three key research questions:

Innovation strategy represents a systematic mechanism for building and deploying dynamic capabilities that enable firms to respond effectively to changing environments (Teece, 2007; Eisenhardt and Martin, 2000). These capabilities influence survival both directly and through organizational adaptability. While Gupta et al. (2024) emphasize dynamic capabilities as higher-order processes that underpin adaptability, Hodgson et al. (2017) examine adaptability more directly as the firm's capacity to realign resources and strategies in response to environmental pressures.

Dynamic Capabilities Theory emphasizes that the value of sensing, seizing, and transforming depends on environmental conditions (Teece et al., 1997; Day and Schoemaker, 2016). Environmental dynamism serves as a driver for firms to develop dynamic capabilities (Li and Liu, 2014), making environmental conditions critical moderators in the innovation-survival relationship.

A firm's ability to adapt and maintain long-term viability relies on its high-order dynamic capabilities, which integrate the ability to sense opportunities, seize them through new business models, and transform the organization accordingly (Teece, 2018a, b). However, DCT suggests that this mediating role is shaped by external conditions, which determine the opportunity structure for capability utilization (Breznik et al., 2019). Environmental factors, therefore, influence not only the strength of the innovation-survival link but also the effectiveness of adaptability as a mediating mechanism.

This study makes three distinct theoretical contributions. First, it positions innovation strategy as an integrated capability-building mechanism rather than isolated innovation activities, demonstrating how product, process, organizational, and marketing innovations systematically develop sensing, seizing, and transforming capabilities. Second, it establishes organizational adaptability as a meta-capability that mediates the innovation-survival relationship, clarifying how ventures translate innovation investments into survival outcomes through adaptive capacity. Third, it identifies contextual boundaries for Dynamic Capabilities Theory by demonstrating that competitive intensity and regulatory environment, but not market dynamism, moderate the deployment of capabilities in ecosystems characterized by persistent volatility. Practically, the study provides evidence-based guidance for entrepreneurs on building integrated innovation capabilities and offers policymakers empirical support for regulatory interventions that enhance venture survival in emerging economies.

Although situated in Ghana, our findings have broader implications for entrepreneurial survival strategies across emerging and transitioning economies facing similar institutional challenges. The findings offer actionable strategies for entrepreneurs to drive innovation and improve survival outcomes. Recommendations from this study can inform global policymakers on how tailored interventions can support entrepreneurial ventures, particularly in economies facing similar structural challenges to those of Ghana. The study employs a quantitative research approach, focusing on 328 entrepreneurial ventures within Accra, Kumasi, and Tema, the business centers of Ghana.

The remainder of the paper is structured as follows. The next section outlines the theoretical framework underpinning the study. It also presents a conceptual framework illustrating the relationships between the key variables. The hypotheses development is also presented. Section three details the research methodology employed in the study, including the research design, population and sampling, data collection methods, and data analysis techniques. Section four presents the study's findings, providing a detailed analysis and interpretation of the data collected. Finally, Section five summarizes the key findings, draws conclusions, and offers recommendations for practitioners and policymakers based on the study's results.

Dynamic Capabilities Theory provides the theoretical foundation for this study. It explains how firms adapt and survive in challenging environments by continuously renewing their competencies (Teece, 2011a, b). DCT posits that organizations can develop distinct dynamic capabilities, notably sensing, seizing, and transforming, that enable ongoing adaptation (Day and Schoemaker, 2016). These three components of DCT represent the underlying organizational and managerial skills that enable a firm to continuously reconfigure its internal and external environment, thereby maintaining competitive fit and ensuring survival, particularly when faced with significant shifts in market conditions (Gupta et al., 2024).

Sensing refers to identifying and assessing new opportunities or threats in the environment. It is an inherently entrepreneurial activity of scanning markets and technologies to detect shifts in customer needs, emerging technologies, or regulatory changes. Seizing is the capability to mobilize resources and take action to capture value from the sensed opportunities. This involves devising innovation strategies or business models and securing the needed resources to implement those innovations. Transforming reflects the ability to reshape processes, structures, and strategies to remain viable as markets shift (Teece, 2011a, b).

Building on recent advances in dynamic capabilities research for entrepreneurial firms, this framework is particularly relevant in entrepreneurial contexts where ventures must balance the efficient use of existing resources with the exploration of new opportunities. Such ambidexterity enables small firms to sustain efficiency while remaining innovative, a dual capability identified as critical for growth and resilience in SMEs (Chakma and Dhir, 2024). Evidence from innovative startups in Italy shows that dynamic capabilities can raise technological, collaborative, and sustainable performance. These capabilities operate as strategic levers for growth, which is informative for ventures in emerging economies that face similar constraints (Cimino et al., 2025).

Digital transformation can also help firms upgrade their ability to adapt. During the COVID-19 crisis, five digital capabilities supported resilience: virtual access, virtual collaboration, data-driven decision-making, algorithmic reprogrammability, and assisted decision-making. Such capabilities improve speed and flexibility, which are vital for venture survival (Browder et al., 2024).

In applying DCT to this study, we position innovation strategy as a systematic mechanism through which entrepreneurial ventures develop their dynamic capabilities. This aligns with recent calls to explore dynamic capabilities in entrepreneurship as a distinct domain and to emphasize the adaptation of DCs to entrepreneurial processes and contexts (Matricano, 2025). We conceptualize innovation strategy as encompassing product, process, organizational, and marketing innovation, drawing on the innovation categories established in the Oslo Manual (OECD/Eurostat, 2005). This approach reflects the view that these innovation activities can work together to form a comprehensive innovation orientation, though they may also occur independently.

Through deliberate innovation activities across product, process, organizational, and marketing dimensions, ventures build and strengthen their sensing, seizing, and transforming capabilities (Stoeber and Kanbach, 2025; Nayernia, 2025). Product innovation activities enhance sensing capabilities by requiring ventures to understand market needs and technological possibilities (Deligianni et al., 2015). Process innovation develops seizing capabilities through improved resource mobilization and operational efficiency (Strønen et al., 2017). Organizational and marketing innovations strengthen transforming capabilities by enabling ventures to reconfigure structures and market approaches (Khan and Lew, 2018).

Adaptability, a central construct in this research, emerges as a meta-capability resulting from the integration and coordination of well-developed sensing, seizing, and transforming capabilities (Nayernia, 2025). Rather than representing a single capability dimension, adaptability captures the venture's overall capacity to realign resources and pivot strategies in response to market feedback or environmental change (Desalegn et al., 2024). High adaptability signals that a firm has successfully developed and integrated its dynamic capabilities, enabling effective reconfiguration when needed (Eisenhardt and Martin, 2017). By actively sensing market changes, seizing entrepreneurial opportunities, and transforming internally through systematic innovation strategies, ventures develop the comprehensive adaptability needed to withstand environmental shocks and prolonged challenges. In summary, DCT provides a robust explanatory framework: ventures that systematically invest in innovation strategy activities develop stronger sensing, seizing, and transforming capabilities, which in turn generate superior organizational adaptability as an integrated meta-capability, thereby enhancing their likelihood of survival in the face of environmental volatility.

Innovation strategies serve as the primary mechanism through which entrepreneurial ventures develop and integrate the dynamic capabilities necessary for organizational adaptability (Stoeber and Kanbach, 2025). Rather than being isolated activities, innovation strategies contribute to the development of integrated capabilities that allow ventures to sense environmental changes, seize emerging opportunities, and transform internal structures when needed (Day and Schoemaker, 2016; Nayernia, 2025). This section focuses specifically on how innovation activities systematically build the intermediate capability of adaptability, which subsequently enables survival through enhanced environmental responsiveness.

Innovation strategy enables firms to navigate uncertain environments and establish competitive advantages. The effect is especially strong when ventures engage in a suite of innovation types such as product, process, organizational, and marketing innovations (Bogetoft et al., 2024), because these dimensions collectively enhance adaptive capacity. Product innovation activities enhance sensing capabilities by requiring ventures to systematically scan markets to shape opportunities and identify threats (Deligianni et al., 2015). When ventures engage in product innovation, they must develop sophisticated market intelligence systems and customer feedback mechanisms, strengthening their ability to detect environmental shifts and emerging opportunities (Stremersch et al., 2025). Process innovation develops seizing capabilities through improved resource mobilization, operational efficiency, and implementation capacity (Strønen et al., 2017). Ventures that invest in process improvements create stronger systems that help them turn market knowledge into practical opportunities (Migdadi, 2022).

Organizational and marketing innovations strengthen transforming capabilities by enabling ventures to reconfigure internal structures, modify strategic approaches, and adapt market positioning (Khan and Lew, 2018). These innovation activities require ventures to develop flexibility in organizational design and strategic pivoting, which are core components of the transforming capability (Helfat et al., 2009). The complementary deployment of innovation and marketing enhances the ability to reconfigure customer relationships and market approaches in response to changing competitive dynamics (Sok et al., 2013).

Organizational adaptability emerges as an integrated meta-capability when these dynamic capabilities are effectively developed and integrated through systematic innovation efforts (Eisenhardt and Martin, 2017; Teece et al., 2016). Adaptability represents the venture's overall capacity to realign resources, pivot strategies, and respond effectively to environmental feedback (Nayernia, 2025). High adaptability signals that a firm has successfully developed and coordinated its sensing, seizing, and transforming capabilities, enabling comprehensive reconfiguration when market conditions demand change (Teece, 2018a, b).

Ghomi et al. (2023) suggest that innovation investments enhance organizational flexibility and response capabilities. Bishwas (2015) suggests that systematic innovation activities enhance firms' adaptive competencies in managing market shifts. Innovation strategy is particularly crucial for developing the adaptive capabilities necessary to navigate uncertainty and maintain a competitive edge (Garrido-Moreno et al., 2024). Taken together, these findings suggest that innovation strategy plays a central role in developing the adaptive capacity needed for survival in uncertain and evolving environments. Hence, we posit that:

While an innovation strategy builds survival capacity through adaptability, Dynamic Capabilities Theory also positions innovation strategy as a mechanism through which entrepreneurial ventures develop the capabilities necessary for long-term survival, exerting direct effects independent of adaptability mechanisms (Teece, 2011a, b). According to Gupta et al. (2024), the presence or absence of specific dynamic capabilities determines whether firms fail or survive. When entrepreneurial ventures systematically invest in innovation activities across product, process, process, organizational, and marketing dimensions, they develop the dynamic capabilities portfolio necessary to navigate environmental challenges (Day and Schoemaker, 2016). Innovation strategies that combine product innovation with at least one other type of innovation are associated with considerably positive outcomes (Bogetoft et al., 2024). Ventures that continuously develop new or improved products build stronger sensing capabilities to identify market opportunities and customer preferences, creating sustainable revenue streams that support long-term viability (Destefanis et al., 2024). Process innovation enhances survival prospects by improving operational efficiency, enabling firms to attain the technology frontier, and strengthening resource mobilization capabilities (Wilson and Dobni, 2022). These process improvements enable ventures to optimize resource utilization and maintain operational stability during challenging periods (Strønen et al., 2017).

Organizational innovation contributes to survival by developing transforming capabilities that enable structural reconfiguration and strategic pivoting when market conditions change (Khan and Lew, 2018). Ventures that invest in organizational innovation develop internal flexibility and change management competencies, which support adaptation to new competitive realities (Helfat et al., 2009). Marketing innovation enhances superior outcomes by strengthening customer relationships to meet customers' changing needs and demands (Sok et al., 2013). Through marketing innovation, ventures develop a sophisticated understanding of customer segments and competitive dynamics, which enables more effective market engagement strategies.

The direct survival mechanism operates through the immediate deployment of capabilities rather than the development of adaptability. Engelen et al. (2024) provide evidence that pre-shock strategic emphasis on innovation enhances organizational resilience during crisis periods. Thus, firms that invest in innovation capabilities before shocks can activate those capabilities when threats arise, which supports survival and recovery (Browder et al., 2024). Evidence from Chinese entrepreneurial firms indicates that when environmental uncertainty is high, entrepreneurial orientation has a stronger positive effect on performance (Cheng et al., 2025), supporting the notion that capability-building strategies, such as innovation, may yield greater survival benefits under uncertain conditions. Cefis and Marsili (2019) provide longitudinal evidence that innovative firms demonstrate superior survival rates across business cycles. Destefanis et al. (2024) provide evidence that innovation activities, particularly when combined strategically, have strong positive effects on firm survival outcomes.

The theoretical mechanism works through capability development: ventures that invest in innovation strategy strengthen their ability to sense opportunities, seize them effectively, and transform when conditions change. Together, these capabilities help firms navigate volatility and maintain stability in their operations (Teece et al., 1997). Firms that succeed in building such capabilities are more likely to endure over time, as these strengths often make the difference between survival and failure (Gupta et al., 2024). Thus, we hypothesize that:

The relationship between innovation strategy and firm survival can be understood as operating through the development and deployment of adaptive capabilities, consistent with the view that dynamic capabilities enable firms to reconfigure resources and remain viable (Eisenhardt and Martin, 2000). While innovation strategy provides a systematic approach for building dynamic capabilities, organizational adaptability represents the integrated meta-capability that enables effective capability deployment for survival outcomes (Nayernia, 2025).

As a meta-capability, adaptability not only underpins survival but also mediates the effectiveness of innovation strategy in ensuring long-term viability. Innovation strategy alone is insufficient for guaranteeing survival (Roper and Xia, 2014); ventures must also develop adaptability, the capacity to adjust structures and routines in response to shocks, to convert innovation into enduring outcomes. Prior studies support this position. Hodgson et al. (2017) report that adaptability exerts a small but meaningful influence on small venture survival under specific conditions. Without such adaptability, even strong innovation initiatives may not yield lasting benefits, as ventures often lack the flexibility to respond to shifting market feedback and unforeseen disruptions. Firms that build adaptability are better able to transform innovative investments into survival benefits by navigating uncertainty, implementing timely adjustments, and sustaining competitive positioning (Wilden et al., 2016; Biswakarma and Bohara, 2025).

Conz and Magnani (2020) suggest that resilience and adaptability act as dynamic processes that enable firms to translate innovation into sustained performance. The theoretical logic suggests that innovation strategy creates the foundation for survival by building dynamic capabilities, while adaptability determines how effectively these capabilities are deployed to achieve actual survival outcomes (Khan et al., 2022). This sequential relationship positions adaptability as a critical mediating mechanism in the innovation–survival link. As a result, we propose that organizational adaptability partially mediates the relationship between innovation strategy and entrepreneurial venture survival. Specifically, innovation influences survival both directly through immediate capability effects (H2) and indirectly through adaptability-enabled capability orchestration (H1-H3). Hence, we suggest that:

Dynamic Capabilities Theory emphasizes that the effectiveness of capability development and deployment is contingent upon environmental conditions (Teece et al., 1997). Environmental factors create contextual conditions that determine how innovation strategy translates into adaptability and ultimately survival outcomes. The theory suggests that dynamic capabilities are most valuable when environmental conditions create both the need and an opportunity to leverage these capabilities effectively (Day and Schoemaker, 2016).

Market dynamism acts as a driver for firms to cultivate and deploy dynamic capabilities, enabling them to address environmental change and seize opportunities (Li and Liu, 2014). Under conditions of high dynamism, capabilities such as sensing, seizing, and transforming become essential for maintaining competitive positioning (Breznik et al., 2019). Environmental dynamism strengthens the link between dynamic capabilities and organizational outcomes, as their effect becomes stronger under unpredictable conditions (Habibullah and Kamal, 2024). Firms benefit from dynamic capabilities most when markets are fluid, as these capabilities enable timely adjustments of strategies to emerging demands (Hudson et al., 2024). From a strategic standpoint, adaptability becomes not optional but a defining requirement for aligning innovation strategies with shifting environmental conditions.

Competitive intensity reflects the level of rivalry and pressure within an industry (Grewal and Tansuhaj, 2001). High competitive intensity increases the need for both innovation and adaptability, as firms must continuously differentiate their offerings and strategic approaches to maintain market relevance (Agazu and Kero, 2024). Under intense competition, innovation strategy is particularly valuable because ventures require advanced capabilities to identify distinctive opportunities and implement differentiated responses (Otache, 2024).

This mechanism operates through greater capability utilization demands. In competitive environments, ventures must frequently deploy their sensing capabilities to detect threats and opportunities, seizing capabilities to act swiftly, and transforming capabilities to adjust strategic positioning (Turner, 2024). Such reliance on dynamic capabilities strengthens the link between innovation strategy, adaptability, and survival outcomes (Otache, 2024). Competition also raises performance thresholds, making adaptability even more critical for translating innovation investments into survival benefits (Agazu and Kero, 2024; Turner, 2024).

The regulatory environment encompasses the institutional framework of rules, policies, and government support that shapes innovation activities and outcomes (Stojčić et al., 2025). Supportive regulatory environments enhance the effectiveness of innovation strategy by lowering implementation barriers, providing resource access, and creating stability for long-term capability development (Rashid et al., 2025). By contrast, restrictive regulatory conditions can increase compliance burdens and limit the ability of ventures to effectively leverage their innovation capabilities (Stojčić et al., 2025).

Well-designed regulatory frameworks therefore amplify the innovation–adaptability–survival pathway by enabling more effective deployment of capabilities. They encourage innovation and adaptability, whereas restrictive frameworks raise costs and limit flexibility (Stojčić et al., 2025). Their effectiveness also depends on institutional conditions such as incentives and reduced bureaucratic obstacles, which foster firms' innovation capacity (Gouldson and Murphy, 2013). In this sense, supportive regulation can be seen as enabling ventures to translate innovation strategies into adaptability and survival, creating more opportunities for capability deployment and competitive advantage (Stojčić et al., 2025). However, in emerging economies, environmental factors do not always strengthen innovation–survival pathways. Broader uncertainty and weak institutional support can discourage entrepreneurial action. For instance, the Global Entrepreneurship Monitor (2025) reports that nearly half of adults globally, especially in emerging economies, cite fear of failure as a barrier to starting a business. This pattern suggests that beyond a certain threshold, uncertainty can constrain rather than enable innovation outcomes, particularly when ventures lack support structures to manage volatility.

We propose that environmental dynamism, competitive intensity, and regulatory frameworks are critical contextual conditions that may shape the strength of the innovation-adaptability-survival pathway. Specifically, we expect these environmental factors to amplify the mediating role of organizational adaptability in translating innovation strategies into venture survival outcomes. This leads to our fourth hypothesis:

Figure 1 illustrates the proposed conceptual model that integrates innovation strategy, organizational adaptability, entrepreneurial venture survival, and environmental conditions. Consistent with Hypothesis 1, innovation strategy is expected to build organizational adaptability through the systematic development of dynamic capabilities. Hypothesis 2 captures the direct survival benefits of innovation strategy, while Hypothesis 3 specifies that adaptability partially mediates the innovation–survival link, reflecting both direct and indirect pathways. Finally, Hypotheses 4a–4c position environmental factors, market dynamism, competitive intensity, and regulatory environment, as moderators of the mediated pathway, strengthening or weakening the extent to which innovation strategy translates into adaptability and ultimately survival. This framework thus specifies a partial mediation with moderated mediation model, consistent with Dynamic Capabilities Theory.

This study employs a cross-sectional quantitative design using a structured survey instrument. Data were collected from 377 entrepreneurial ventures located in Accra, Kumasi, and Tema, Ghana's primary business hubs. These ventures were drawn from a target population of 3,156 businesses registered with the Ghana Enterprises Agency (GEA). Informed by Shane and Venkataraman (2000), entrepreneurial ventures in this study are defined as formal entities with the strategic capacity to identify and exploit opportunities. Formal ventures were selected due to their stronger association with opportunity-driven entrepreneurship, as opposed to the necessity-driven motives often observed in informal enterprises (Estrin et al., 2024). This approach aligns with evidence that formal ventures have better strategic capacities to exploit opportunities (Ligthelm, 2013) and exhibit entrepreneurial phenomena and structures (Wolf et al., 2012).

Using Cochran's formula (Cochran, 1977), the minimum required sample size was calculated as 343 firms (5% margin of error). To account for potential attrition or nonresponse, common in survey-based studies (Bryman, 2016), we added a 10% buffer, resulting in a target sample of 377 firms (343 × 1.10). Stratified random sampling was employed to ensure proportional representation across manufacturing, service, and trading sectors. Study participants were provided with detailed information about the research, consent forms, and structured questionnaires.

To address common method variance concerns, data collection was conducted in two waves separated by three weeks: Wave 1 in late April 2024 and Wave 2 in mid-May 2024. This temporal separation disrupts consistency motifs and priming effects inherent in single-wave designs (Podsakoff et al., 2003). This timing aligns with common practice in entrepreneurship research, as seen in Zhou and Sun's (2024) study on SME survival, which employed a similar lag to ensure methodological rigor without compromising feasibility. In the first wave (Time 1), measures for innovation strategy and environmental factors were administered. In the second wave (Time 2), the same participants responded to items on organizational adaptability and entrepreneurial venture survival. This two-wave approach introduced temporal separation between predictor and outcome variables, helping to mitigate response consistency and priming effects (Podsakoff et al., 2003).

Data was collected via in-person interviews by the research team and trained assistants. Of the 377 questionnaires distributed, 328 valid responses were received, achieving an 87% response rate. Hierarchical regression analysis was employed to test the hypotheses, allowing for the evaluation of the unique contribution of each predictor while accounting for others (Lewis, 2007). Mediation and moderated mediation effects were assessed using bias-corrected bootstrapping with 5,000 resamples, which provided robust estimates of standard errors and confidence intervals. The moderated mediation indices further quantified the impact of environmental factors as moderators on the mediator variable. Statistical analyses were conducted using Stata version 17.

The questionnaire in this study had three sections: an introduction with guidelines and contact information, demographic and business details (e.g. gender, age, education, and business specifics), and items measuring key variables: entrepreneurial venture survival, innovation strategy, organizational adaptability, and environmental factors. All variables were measured using 5-point Likert scales. Gender, age, and education level were included as control variables based on previous research (Paeleman et al., 2023; Ismail and Naqshbandi, 2022; Amoa-Gyarteng and Dhliwayo, 2023) to account for their potential influence on venture survival.

Entrepreneurial venture survival was measured using a multidimensional framework (Josefy et al., 2017), which goes beyond binary survival to reflect operational continuity, ownership retention, and financial stability. Items included: “Has your business operated continuously over the past three years?”, “Has ownership of your business changed?” and “Is your cash flow consistently positive?”. These captured the venture's ability to maintain stability.

Innovation strategy was assessed using the OECD/Eurostat (2005) Oslo Manual's categories: product, process, organizational, and marketing innovation (Hogan and Coote, 2014; Sok et al., 2013; Deshpandé et al., 1993). Product innovation was measured with statements like “We improve products to meet customer needs.” Process innovation was evaluated with “We implement processes that enhance efficiency.” Organizational innovation was assessed with “We differentiate through unique customer experiences.” Marketing innovation was measured with “We launch industry-leading marketing initiatives.” This ensured a comprehensive view of the organization's innovation strategy.

Organizational adaptability was measured using items from Gibson and Birkinshaw (2004) and Hatum and Pettigrew (2004). Respondents rated statements like “Our management systems adapt quickly to market changes,” “Our management systems evolve to address shifting priorities,” and “We support product-market diversification with flexible systems.” Environmental factors included market dynamism, competitive intensity, and the regulatory environment. Market dynamism was measured using a two-item scale from Jap (1999), which included statements such as “Demands on our firm constantly change” and “Industry practices are in continuous flux.” Competitive intensity was assessed using a four-item scale developed by Grewal and Tansuhaj (2001) and Jaworski and Kohli (1993), which covered items such as “We face significant competition” and “Competitors regularly introduce new strategies.” The regulatory environment was measured using items from Manolova et al. (2008) and Busenitz et al. (2000), which addressed government support for entrepreneurship, such as “Government agencies help individuals start businesses” and “Support is available for entrepreneurs after business failure.”

Table 1 presents a diverse demographic, with a higher proportion of males (54.3%) than females, and a majority of participants aged 40–49 (42.7%). Most respondents are high school graduates (31.4%) or holders of a bachelor's degree (28.0%). The sample is primarily from retail (58.2%) and services (28.4%), with a few from manufacturing (5.5%).

This section begins by validating the measurement properties and addressing common method bias. It then presents hypothesis tests on how innovation strategy affects entrepreneurial venture survival, mediated by organizational adaptability and moderated by environmental factors.

To ensure that the constructs used in this study were both reliable and distinct, we assessed measurement properties using several validation techniques. Additionally, we implemented procedural and statistical remedies to mitigate the potential threat of common method bias (CMB).

We first evaluated internal consistency reliability using Cronbach's alpha (α), as shown in Table 2. All constructs exceeded the recommended threshold of 0.70 (Nunnally and Bernstein, 1994), with α values ranging from 0.876 to 0.900, indicating strong internal reliability. Standardized factor loadings ranged from 0.802 to 0.912, supporting the convergent validity of the scales.

Descriptive statistics revealed moderate to high levels of agreement across items, with mean scores ranging from 2.92 (Regulatory Environment) to 4.18 (Competitive Intensity) on a 5-point Likert scale. Constructs were organized by the timing of their measurement: Time 1 (innovation strategy and environmental factors) and Time 2 (organizational adaptability and Entrepreneurial Venture survival).

We then assessed discriminant validity using the heterotrait–monotrait (HTMT) ratio, reported in Table 3. All HTMT values were well below the conservative 0.85 threshold recommended by Henseler et al. (2015), with the highest value being 0.69, observed between organizational adaptability and entrepreneurial venture survival. This provides strong evidence that the constructs are empirically distinct.

To reduce the risk that our findings reflect methodological biases rather than genuine relationships among constructs, we implemented both procedural and statistical remedies recommended in the literature (Podsakoff et al., 2003; Craighead et al., 2011). Procedural remedies included several best practices during survey design and administration:

In addition to these design-based controls, we employed two widely accepted statistical tests to assess the presence of CMV post hoc. First, we performed Harman's single-factor test by subjecting all measured items to an unrotated exploratory factor analysis. This analysis yielded six distinct factors, with the first factor accounting for only 28.4% of the total variance. This is well below the 50% threshold commonly used to flag CMV issues, suggesting that common method bias is unlikely to dominate the observed relationships (Podsakoff et al., 2003).

Second, we applied the marker-variable technique as outlined by Lindell and Whitney (2001). We included number of siblings as a theoretically unrelated marker variable because it has no conceptual relationship with the study's core constructs: innovation strategy, organizational adaptability, or entrepreneurial venture survival. When we computed partial correlations controlling for this marker, changes among focal variable correlations were all less than 0.02, indicating that method bias was minimal and did not materially distort the results. Taken together, these procedures confirm that the observed associations among variables are unlikely to be driven by common method bias.

Table 4 provides the correlation matrix along with multicollinearity diagnostics (VIF) and tests of normality using the Shapiro–Wilk statistic. All correlations among constructs were positive and statistically significant (p < 0.01), with the strongest observed between organizational adaptability and Entrepreneurial venture survival (r = 0.58). All VIF values ranged from 1.65 to 2.22, well below the threshold of 5, confirming the absence of multicollinearity (Hair et al., 2010). The Shapiro–Wilk W statistics were non-significant for all variables (p > 0.05), indicating that the variables met assumptions of normality required for regression analysis. Importantly, the table includes a marker variable, number of siblings, which was selected as a theoretically unrelated construct (Lindell and Whitney, 2001). This variable showed negligible correlations (ranging from 0.04 to 0.08) with all substantive variables. This reinforces the claim that common method bias is not a serious concern in this study.

We used a six-step hierarchical regression model to test the study's hypotheses. This approach allowed us to examine the incremental effect of innovation strategy, organizational adaptability, and environmental moderators on entrepreneurial venture survival. The results are summarized in Table 5.

Hypothesis 1: Innovation strategy has a positive and significant effect on organizational adaptability. In Model 3, the inclusion of the four dimensions of innovation strategy (product, process, organizational, and marketing innovation) significantly improved the prediction of organizational adaptability. Each innovation dimension had a positive and statistically significant effect on adaptability (βs ranged from 0.14 to 0.23, all p < 0.001), and the addition of these variables increased the explained variance by ΔR² = 0.073. These findings provide strong support for Hypothesis 1.

Hypothesis 2: Innovation strategy positively and significantly affects entrepreneurial venture survival. In Model 2, innovation strategy was a significant predictor of entrepreneurial venture survival (R² = 0.332), with each dimension demonstrating positive and highly significant effects (β = 0.23 to 0.26, all p < 0.001). This confirms that innovation strategy is a strong driver of survival outcomes, supporting Hypothesis 2.

Hypothesis 3: Organizational adaptability partially mediates the relationship between innovation strategy and entrepreneurial venture survival. In Model 3, the inclusion of organizational adaptability revealed that its relationship with entrepreneurial venture survival was both positive and highly significant (β = 0.45, p < 0.001). Although the coefficients for the innovation strategy dimensions declined slightly, they remained statistically significant, consistent with partial mediation (see Newsom, 2025), offering empirical support for Hypothesis 3.

Hypothesis 4a: Market dynamism strengthens the indirect relationship between innovation strategy and entrepreneurial venture survival via organizational adaptability. Hypothesis 4b: Competitive intensity strengthens the indirect relationship between innovation strategy and entrepreneurial venture survival via organizational adaptability. Hypothesis 4c: A supportive regulatory environment strengthens the indirect relationship between innovation strategy and entrepreneurial venture survival via organizational adaptability. We tested these moderated mediation effects in Models 5 and 6 by examining the interaction terms between innovation strategy and environmental moderators, as well as their conditional indirect effects via organizational adaptability.

As shown in Table 6, the indirect effect of innovation strategy on entrepreneurial venture survival through adaptability was statistically significant and stronger under higher levels of competitive intensity and regulatory environment; however, it was not significant under market dynamism. Under high competitive intensity, the indirect effect increased to 0.248, compared to 0.165 under low levels. Bootstrapped 95% confidence intervals at all levels excluded zero, indicating significance. For regulatory environment, the indirect effect rose from 0.158 (low) to 0.242 (high), also significant across levels. In contrast, the indirect effect for market dynamism remained non-significant at low, mean, and high levels, with confidence intervals that included zero.

These interpretations are reinforced by the moderated mediation indices reported in Table 7. Both competitive intensity (Index = 0.090, 95% CI [0.048, 0.132]) and regulatory environment (Index = 0.088, 95% CI [0.046, 0.130]) showed significant moderated mediation effects, whereas the index for market dynamism (0.017, 95% CI [–0.025, 0.059]) was not significant. Therefore, the data provide empirical support for Hypotheses 4b and 4c, but not for Hypothesis 4a.

This study examines the influence of innovation strategies on the survival of entrepreneurial ventures in Ghana, focusing on the mediating role of organizational adaptability and the moderating effect of environmental conditions. The analysis confirms that innovation strategies have a significant influence on adaptability and survival outcomes, with some effects contingent upon competitive and regulatory environments. The findings provide comprehensive answers to all three research questions while extending the Dynamic Capabilities Theory in an emerging economy context.

RQ1: How does innovation strategy directly and indirectly (through organizational adaptability) influence entrepreneurial venture survival? The study demonstrates that innovation strategy operates through both direct and indirect pathways. Innovation strategy directly enhances survival prospects by building sensing, seizing, and transforming capabilities that enable ventures to navigate environmental challenges. At the same time, innovation strategy operates indirectly through organizational adaptability, which serves as a meta-capability that integrates these dynamic capabilities for enhanced survival outcomes. This dual-pathway mechanism supports the theoretical view that innovation strategy functions as a systematic mechanism for developing dynamic capabilities (Teece, 2007; Eisenhardt and Martin, 2000).

RQ2: What moderating effects do environmental factors have on the innovation strategy-survival relationship? The findings reveal differential moderating effects across environmental dimensions. Competitive intensity and regulatory environment significantly strengthen the innovation–survival relationship, while market dynamism shows no significant moderating effect. This suggests that environmental factors selectively influence the deployment of dynamic capabilities, with certain conditions being more conducive to the utilization of capabilities than others. This pattern aligns with DCT's boundary-condition logic: the value of dynamic capabilities increases where environmental conditions heighten both the need and the opportunity for deployment (Teece, 2007; Eisenhardt and Martin, 2000).

RQ3: How do environmental factors influence the mediation effect of organizational adaptability on entrepreneurial venture survival? The findings show that environmental factors selectively moderate the indirect pathway through adaptability. Competitive intensity and regulatory environment strengthen this mediation effect, enhancing the effectiveness of adaptability as a mechanism for translating innovation into survival benefits, whereas market dynamism does not. This aligns with the boundary condition perspective of Dynamic Capabilities Theory, which emphasizes that the value of capabilities depends on whether the environment creates genuine demand and opportunities for their deployment (Drnevich and Kriauciunas, 2011).

The findings support H1. Innovation strategies are associated with higher organizational adaptability. This aligns with evidence that innovation builds flexibility and faster response capabilities (Ghomi et al., 2023; Bishwas, 2015; Dervitsiotis, 2011). From a Dynamic Capabilities Theory perspective, innovation activities across product, process, organizational, and marketing dimensions systematically build sensing, seizing, and transforming capabilities that integrate to create organizational adaptability as a meta-capability. The results suggest that Ghanaian ventures that implement innovation across these domains develop the competencies needed to manage market shifts. Innovation fosters experimentation and continuous learning, which, in turn, enhances a venture's ability to respond to external change (Sherif, 2006). When economic conditions become unpredictable and challenging, companies turn to innovation as a way to rethink their approach, stay flexible, and adapt to changing circumstances (Garrido-Moreno et al., 2024).

The study also finds that innovation strategy significantly contributes to entrepreneurial venture survival. These results are consistent with studies showing that innovative firms are more resilient and capable of withstanding market pressures (Cefis and Marsili, 2019; Adam and Alarifi, 2021; Howell, 2015). The direct effect of innovation strategy on survival demonstrates that dynamic capabilities have immediate survival value, as they enhance responsiveness and competitive positioning. The direct effect suggests that innovation-created capabilities offer survival value even before organizational adaptability is taken into account. Innovation supports survival by enabling businesses to meet shifting customer preferences, develop new offerings, and optimize operations. This is particularly critical in restrictive ecosystems where innovation becomes a key lever for sustaining operations and relevance. Truant and Broccardo (2020) demonstrate that innovation offers a competitive advantage during periods of uncertainty. Kuzma et al. (2020) also find that innovation enhances both sustainability and longevity, further reinforcing its value.

Organizational adaptability mediates the relationship between innovation strategy and entrepreneurial venture survival. The mediation is partial. Innovation explains survival in part, with the remainder transmitted through organizational adaptability. This validates the theoretical model, positioning organizational adaptability as a meta-capability that integrates and orchestrates sensing, seizing, and transforming capabilities developed through innovation strategy. Firms with adaptable systems can adjust structures, processes, and strategies in response to external demands. This aligns with Hodgson et al. (2017) and Tejeiro Koller (2016), who suggest that organizational adaptability enhances resilience in volatile environments. Riza et al. (2020) also argue that leadership and adaptability together strengthen the effect of innovation. According to Khan et al. (2022), firms combining innovation with organizational adaptability are better positioned to survive challenging conditions.

Competitive intensity and regulatory environment were found to strengthen the indirect relationship between innovation strategy and entrepreneurial venture survival via organizational adaptability, while market dynamism had no significant moderating effect. This contributes to DCT by showing that capability deployment is more strongly conditioned by certain environmental factors than others. Competitive intensity creates heightened demands for sensing, seizing, and transforming capabilities, making the development and deployment of these capabilities through innovation strategy more critical for survival (Rubio-Andrés et al., 2024). Similarly, a supportive regulatory environment enhances the impact of innovation by enabling experimentation, reducing bureaucratic obstacles, and improving access to resources (Garcia-Murillo, 2011). Supportive regulatory frameworks lower barriers to capability deployment, allowing ventures to more effectively translate innovation into organizational adaptability and survival.

Market dynamism did not emerge as a significant moderator of the innovation-adaptability-survival pathway. In Ghana, uncertainty is part of daily business life. Entrepreneurs face so much constant change that they have learned to live with it, treating volatility as normal. Because of this, small swings in the market no longer make much difference as adapting is already built into how they run their ventures. This finding highlights a contextual boundary: when volatility becomes institutionalized, the marginal utility of additional sensing, seizing, or transforming declines. In such environments, dynamic capabilities may no longer function as contingent levers but instead operate as core capabilities that firms continuously deploy to remain viable.

This result challenges the conventional expectation within Dynamic Capabilities Theory that higher dynamism increases the value of capabilities. Teece (2007) argued that dynamic capabilities are most critical in rapidly changing markets, where opportunities and threats emerge unpredictably. However, when turbulence is persistent rather than episodic, ventures may routinize adaptability into their day-to-day functioning (Alirani et al., 2025; Shepherd and Williams, 2020), thereby muting the moderating effect of additional dynamism. Thus, the performance impact of dynamic capabilities is contingent, with diminishing returns possible in environments where environmental turbulence is constant (Schilke, 2014).

This anomaly suggests that in some emerging economies, environmental dynamism can lose its role as a differentiating contextual condition because firms are forced to operate as if high volatility were the norm. Instead of enhancing the payoff from dynamic capabilities, market turbulence becomes background noise against which capabilities are continuously deployed (Kraśnicka and Steinerowska-Streb, 2022; Li and Liu, 2014). This perspective advances boundary-condition thinking in DCT (Wilden and Gudergan, 2015; Schilke, 2014) by proposing that persistent volatility may shift dynamic capabilities from context-sensitive mechanisms into embedded organizational competencies, which are essential for everyday survival.

This study demonstrates that innovation strategy and organizational adaptability work in tandem to support the survival of entrepreneurial ventures in emerging economies. Ventures that invest in product, process, organizational, and marketing innovation build dynamic capabilities that help them sense opportunities and threats, seize them through timely action, and transform routines when required. These capability sets integrate as organizational adaptability that supports survival (Teece, 2007; Eisenhardt and Martin, 2000). Innovation is also associated with better overall firm outcomes (Amoa-Gyarteng and Dhliwayo, 2024b). Our findings show that innovation strategy significantly increases survival probability when it operates through adaptability, providing clear guidance on how ventures should allocate their limited resources. Innovation should be treated as a systematic capability-building program rather than a set of isolated activities (Duchek, 2020). Ventures should invest in innovation across all four dimensions, product, process, organizational, and marketing, rather than focusing on just one area, as integrated innovation produces substantially stronger survival effects. Firms can build market-intelligence systems to improve their sensing capabilities. They can adopt agile processes to strengthen their ability to seize opportunities and implement cloud-based data systems to support transformation at scale. They can also use scenario planning to connect sensing with timely decisions, embedding adaptability into daily routines. Practically, ventures should prioritize systematic resource allocation to integrated innovation activities across these multiple dimensions.

Capability routines mature through learning and routinization; investing in these processes improves the reliability and speed of adaptation when conditions shift (Pavlou and El Sawy, 2011). The findings show that competitive intensity and regulatory support increase the benefits of innovation and adaptability. Market dynamism shows no additional effect in this setting. Ventures in highly competitive sectors should prioritize innovation investments even when resources are scarce, as the survival penalty for not innovating is much higher in competitive environments. Therefore, in challenging environments such as Ghana, firms should build stable internal adaptive frameworks rather than react to each shock. This aligns with our moderated-mediation indices and with evidence that dynamic capabilities are valuable under demanding competitive conditions (Protogerou et al., 2012).

For policymakers, the priority is to create conditions that turn innovation into durable capabilities. Streamline regulatory processes with digital tools and one-stop platforms. Offer targeted incentives such as R&D tax credits and well-designed technology-adoption grants to lower the cost of capability building. Support hubs and partnerships that connect ventures with universities and mentors to strengthen knowledge flows and speed capability formation. Consistent with the World Bank's “Innovation Paradox,” innovation policy in developing countries should prioritize strengthening managerial and organizational practices because these foundational capabilities enable firms to recognize and adopt higher-level technologies (Cirera and Maloney, 2017).

For educators and training programs, the curriculum should emphasize building innovation orchestration capabilities, the ability to coordinate limited resources across multiple innovation types simultaneously. Programs focusing on adaptability and resilience, rather than just opportunity recognition, produce better long-term venture outcomes. When businesses operate in unstable markets and face intense global competition, long-term success comes from more than owning unique assets. It comes from the ability to sense changes, respond quickly, and adapt or transform when circumstances demand it (Teece, 2007). Hence, rather than attempting to reduce market volatility, policy should help firms operate well under constant change by prioritizing programs that build sensing, seizing, and transforming capabilities used every day in challenging markets.

This study offers important contributions to entrepreneurship research in emerging economies and to Dynamic Capabilities Theory. In relation to entrepreneurship, the results show that innovation strategy plays a central role in shaping survival pathways, with effects operating both through adaptability and through direct capability deployment. Competitive intensity and regulatory support significantly enhance these outcomes. Innovation also supports the development of adaptive routines, which help ventures remain viable in the face of persistent uncertainty. Figure 2 presents the integrated framework, showing how these mechanisms interconnect across environmental contexts.

We also conceptualize entrepreneurial venture survival using a multidimensional approach (Shepherd, 2003; Coelho and McClure, 2005; Ucbasaran et al., 2010). Unlike prior work that treats survival as a binary outcome, we consider operational continuity, ownership stability, and financial solvency (Josefy et al., 2017). This broader perspective offers a stronger foundation for future research and aligns with DCT's emphasis on continuous capability renewal and adaptation.

In effect, our study extends Dynamic Capabilities Theory in three distinct ways that respond to limitations in previous work. First, we demonstrate that in contexts with limited institutional and infrastructural support, innovation strategy operates primarily as a mechanism for developing capabilities rather than merely as a reconfiguration tool. Our findings show that innovation strategy systematically develops organizational adaptability through the building of sensing, seizing, and transforming capabilities. This pattern suggests that innovation strategy functions as a foundational capability-building process in emerging economy contexts, extending Dynamic Capabilities Theory beyond its traditional emphasis on reconfiguring and redeploying existing competences (Teece et al., 1997; Eisenhardt and Martin, 2000) to encompass contexts where ventures must first develop the foundational capabilities necessary for environmental responsiveness.

Second, we emphasize that organizational adaptability is best understood as a meta-capability. It is not just a combination of sensing, seizing, and transforming abilities, but an integrated system that allows firms to translate innovation into meaningful strategic shifts. This supports growing calls to examine how SMEs, particularly in emerging markets, organize their innovation efforts to survive in challenging conditions (Zahoor et al., 2024).

Third, we identify contextual boundaries for Dynamic Capabilities Theory by demonstrating differential moderating effects across environmental dimensions. Our findings reveal that in contexts of persistent volatility, normalized uncertainty becomes background rather than a contingent force shaping capability deployment. This contributes to an ongoing debate on whether there is a threshold beyond which volatility ceases to enhance capability deployment and instead diminishes the effectiveness of innovation-driven strategies. Heightened environmental uncertainty weakens the relationship between innovation orientation and performance, constraining firms' ability to transform innovative intent into tangible outcomes (Li et al., 2025).

This study advances Dynamic Capabilities Theory by demonstrating how innovation strategies systematically develop sensing, seizing, and transforming capabilities that enhance the survival of entrepreneurial ventures in emerging economies. The results confirm that innovation strategies influence survival through two pathways: directly by creating dynamic capabilities that provide immediate survival value, and indirectly through organizational adaptability, which functions as a meta-capability that integrates these capabilities for stronger outcomes.

The study makes three main theoretical contributions. First, it positions innovation strategy as a comprehensive capability-building mechanism rather than a set of isolated activities, showing how product, process, organizational, and marketing innovations combine to strengthen dynamic capabilities. Second, it identifies organizational adaptability as a meta-capability that mediates the innovation-survival relationship, demonstrating that innovation alone is insufficient without the ability to deploy and reconfigure capabilities. Third, it establishes contextual boundaries for Dynamic Capabilities Theory by finding that competitive intensity and the regulatory environment, but not market dynamism, moderate the deployment of capabilities.

The market dynamism non-finding is particularly important. In Ghana's persistently volatile environment, ventures appear to have normalized adaptive routines, making marginal changes in dynamism less influential on survival outcomes. This suggests that in contexts of constant volatility, dynamic capabilities may function as core rather than contingent resources, revealing potential non-linear relationships between environmental conditions and capability value. The study also validates a multidimensional approach to entrepreneurial venture survival, defined through operational continuity, ownership stability, and financial solvency. This broader perspective provides a stronger theoretical basis for understanding how survival manifests in emerging economies.

This study has several limitations that also point to directions for future research. First, the analysis focused only on formally registered entrepreneurial ventures in Ghana's main business centers (Accra, Kumasi, and Tema). This excluded informal enterprises, which constitute a significant portion of entrepreneurship in emerging economies (Amoa-Gyarteng et al., 2025). Many informal ventures innovate and build adaptive capabilities, so their absence limits the overall picture. Future studies should incorporate informal ventures, employing mixed methods such as surveys and case studies to capture their strategies more comprehensively.

Second, the geographic focus on Ghana may restrict generalization. Ghana's institutional setting, shaped by persistent volatility and specific regulatory frameworks, may produce capability patterns not seen elsewhere. Comparative research across sub-Saharan Africa and other emerging economies would help establish the boundary conditions of these findings. Third, methodological constraints limit causal claims. Although a two-wave, time-lagged design with a three-week interval was used to reduce common method bias, capability development and deployment typically unfold over longer periods. Longitudinal studies spanning a longer period of time would provide stronger causal evidence and capture the gradual process of capability building.

Fourth, despite several safeguards against common method variance, such as anonymity, counterbalancing, marker variables, and time separation, the reliance on single-respondent surveys still leaves some risk of bias. Incorporating multi-source data, including financial records, external assessments, and objective performance indicators, would improve reliability. Finally, the measurement of entrepreneurial venture survival relied on relatively few items per dimension, though it was grounded in a multidimensional framework of operational continuity, ownership stability, and financial solvency. Future research should refine and expand this measurement to capture survival more comprehensively.