<![CDATA[This study aims to analyze the influence of Innovation in Human Resource Practice and Innovation Capabilities This study examines how Innovative Human Resource Practices (IHRPs) and Innovation Capabilities contribute to the performance of Food and Beverage SMEs in Bogor City through Competitive Advantage. The specific gap concerns how these two internal resources and capabilities are translated into performance, as prior research has commonly positioned them in a sequential relationship rather than as parallel antecedents of Competitive Advantage and performance. A quantitative explanatory design with a cross-sectional approach was employed. Data were collected from 100 SME owners or managers selected through purposive sampling and analyzed using PLS-SEM with SmartPLS 4. The direct effects show that Competitive Advantage had the strongest effect on SME performance (β = 0.386), followed by Innovation Capabilities (β = 0.346) and IHRPs (β = 0.212). Both IHRPs and Innovation Capabilities also significantly strengthened Competitive Advantage. More importantly, Competitive Advantage partially mediated the effects of IHRPs (β = 0.145) and Innovation Capabilities (β = 0.159) on SME performance, indicating complementary direct and indirect pathways. The study contributes by positioning IHRPs and Innovation Capabilities as parallel internal antecedents and identifying Competitive Advantage as their shared conversion mechanism. These findings clarify how internal resources and capabilities are transformed into stronger business performance by first being translated into a distinctive competitive position.]]>
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