Entrepreneurial Bricolage and Innovation SelfEfficacy on Innovation Performance in SMEs: Role of Divergent Thinking in Exploiting Resources for Innovation Performance

Abstract Purpose: Small and medium-sized enterprises (SMEs) are central to economic growth and employment, yet they frequently innovate under resource constraints that hinder implementation. This study examines how entrepreneurs’ innovation self-efficacy (ISE) translates into innovation performance (IP) through entrepreneurial bricolage (EB). It also theorises divergent thinking (DT) as a cognitive capability that strengthens bricolage behaviour in resource-constrained settings. Methodology/Design/Approach: Grounded in Self-Efficacy Theory and Bricolage perspective, this study tests a process model using crosssectional survey data from 352 Sri Lankan SMEs. Data obtained through a self-administered questionnaire were analysed using variance-based structural equation modelling (SEM), and estimated using PLS SEM (Smart PLS) Findings: Results illustrate that ISE has a significant positive effect on IP and that EB mediates the relationship between ISE and IP, indicating that entrepreneurs with high ISE convert confidence into innovation outcomes primarily through resource recombination behaviours. Crucially, the findings position bricolage as the implementation mechanism that converts capability beliefs into realised innovation. The study additionally finds that divergent thinking (DT) enables entrepreneurial bricolage (EB), suggesting that creative cognitive styles help entrepreneurs identify alternative resource uses and overcome constraints. Originality/Value: This study contributes to entrepreneurship and innovation literature by integrating ISE, DT, and EB into a single model explaining how constrained SMEs achieve IP. It extends bricolage theory by highlighting DT as a cognitive antecedent, providing empirical evidence from a developing-country context, offering practical implications for SME development policies.