Influence of Innovative Decisions on Financial and Economic Indicators of Small Business

The research is devoted to the study of the role of innovative solutions in improving the sustainability and financial and economic performance of small businesses in Russia. Despite the recognized importance of innovation, the mechanisms of its impact on the financial and economic viability of small businesses remain insufficiently studied, especially in the context of external shocks. The purpose of the study is to identify the mechanisms of the impact of innovative solutions on the sustainability and financial and economic performance of small businesses, and to examine the role of entrepreneurial orientation and self-efficacy in this process. Analysis of the SMBiz FOM longitudinal survey and semi-structured interviews with small business owners revealed, innovative businesses show higher profitability as well as resilience to economic downturns. The study emphasizes that it is more important not just to bring a new product to market, but to innovate the company's internal processes. However, in established multi-regional firms, over-innovation can upset the balance and lead to instability. In the face of market shocks, a low level of innovation activity may be necessary to maintain resilience. In addition, a strong link has been established between innovative decisions and high entrepreneurial self-efficacy and orientation, which are key success factors in innovation.