sustainability Article Strategies for Sustainable Business Development: Utilizing Consulting and Innovation Activities Yoo Hwan Lee 1 and Young Wook Seo 2,* 1 Business Consulting Research Center, Daejeon University, 62 Daehak-ro, Dong-gu, Daejeon 34520, Korea; [email protected] 2 Department of Business Consulting, Daejeon University, 62 Daehak-ro, Dong-gu, Daejeon 34520, Korea * Correspondence: [email protected]; Tel.: +82-42-280-4185 Received: 16 October 2018; Accepted: 7 November 2018; Published: 9 November 2018 Abstract: This study explores strategies for sustainable business development via the process and performance of business consulting by using 200 samples of different industry sectors in South Korea. The main purposes of this paper are to build the consulting model framework and to analyze the relationships between consulting factors and consulting performance for establishing strategies for sustainable business development. First, the findings show that the support of CEOs for consulting projects and the innovation activities via exploration and exploitation (and ambidexterity) have higher impacts on the contribution to business performance than other consulting factors. Similarly, according to the results of IPMA, these variables are placed in a group of high importance and performance, so the findings indicate that the support of CEO and innovation activities play a central role in the consulting model. Second, the competency of CEOs for recognizing the awareness of newly changing market conditions and the importance of utilizing business consulting can serve as an engine to reach their sustainable business development. Moreover, the firms’ innovation activities via business consulting can increase their ability to utilize and absorb the external resources and knowledge for establishing strategies for sustainable business development. These abilities are used not only to induce their business innovation internally but also to pioneer new market opportunities amid a rapidly changing market environment. Keywords: sustainable business development; business consulting; innovation; exploration; exploitation; IPMA 1. Introduction In recent years, a business ecosystem has been changed rapidly by the new era like an information society and knowledge economy. Since the numerous information and knowledge exist all around our society and economy, consumers can easily gather and access their own customized information for buying goods and services. Moreover, amid the accelerated development of information and communication technologies (ICTs), the boundary of a market for goods and services is no longer limited in the off-line and online marketplaces, but it has extended to the mobile market [1–3]. In this situation, firms are required to establish new management strategies for their sustainable business development [4]. The general strategies for firms’ sustainable business development or sustainable growth can be recognized by several definitions and concepts such as making certified business purposes, utilizing collaborations with external partnerships, enhancing innovation activities, etc. However, the most important matter is how the firm can realize the strategies for their sustainable business models amid the enormous and irregularly scattered information. Especially for the case of small and medium-sized enterprises (SMEs), they generally cannot afford to build a system or organization for responding new market conditions and facilitating strategy management. For that Sustainability 2018, 10, 4122; doi:10.3390/su10114122 www.mdpi.com/journal/sustainability Sustainability 2018, 10, 4122 2 of 19 reason, SMEs usually handle and solve their business problems through advising services from external experts, in which situation is called business or management consulting. One of the main issues in business consulting, in which the topic areas include business strategies, management of human resources, finance and accounting, improvement of production and process, IT system, total quality management (TQM), and so on, concerns what are the effective factors for the completion of consulting projects and how the results affect the business performance of the consulting client firms. In recent years, numerous studies have explored the structure of the consulting process and the methodology of consulting models [5–11]. These studies have contributed to the understanding that consulting leads to the positive business performance and commercial innovation as well as sustainable business development. The importance of business consulting has been addressed by researchers for only a few decades. Of particular importance in this regard is the potential of business consulting as knowledge-based activities and services to affect both revitalization of small and medium-sized enterprises directly and preparation of the new industrial revolution indirectly [12–14]. In a variety of circumstances, however, the effect of consulting results on business performance is hard to evaluate by a one-dimensional analysis, which focuses on one-sided perspective such as either details of consultant competency or environments of consulting client firms. In order to analyze the consulting models without loss of generality, one should take into account consultant competency, consulting environment of client firms, and innovation activities of client firms simultaneously. From the previous studies, consultant competency generally has a positive impact on the completion of consulting projects [5,8–10,15] and is positively related to the business performance of client firms [9,11,16]. Moreover, the consulting environment of client firms, such as institutional conditions, commitment and willingness of CEOs to participate, and so on, are also important to the completion of consulting projects and the contribution to the business performance [16–18]. Furthermore, with regard to the innovation systems of consulting client firms, understanding the effects of their innovation activities on business performance improves the sophistication of analysis of consulting models [19,20]. Although the innovation activities, which consists of knowledge-based activities and capabilities, can neither be codified nor standardized (a.k.a. tacit knowledge), it has been much paid attention to by many researchers, industrial stakeholder, and even policy makers for understanding the importance of research and development (R and D) and creating a new technology and process [21,22]. In general, the proxy variables of innovation activities such as exploration and exploitation for seeking new knowledge and utilizing existing knowledge, respectively [23–25] are the most useful indicators for solving the puzzle of the consulting process and evaluating a firm’s innovation system that contributes to the business performance [26–29]. However, due to the innovation ambidexterity, it is highly probable that the relationships between innovation activities and consulting factors have somewhat different impacts on the consulting performance. In other words, firms should consider not only to utilize and refine their existing knowledge and resources but also to seek new knowledge and future changing demand in the market [23,27,28,30–34], so it requires to establish the different consulting strategies and plans across the different innovation activities like exploration and exploitation. Moreover, this innovation ambidexterity can be also used to establish sustainable business development strategies for firms, but the two components of innovation ambidexterity, exploration and exploitation, have different impacts on the firm’s strategies. While exploration makes it possible to establish the firm’s long-term and distant search strategies, exploitation is to provide the firm’s short-term and local search strategies [35]. In this study, we explore the strategies for sustainable business development via the process and performance of business consulting by using a survey with 200 samples across the different industries in South Korea. In so doing, we build upon the structural equation model for the consulting model framework and attempt to analyze the relationships between consulting factors and consulting performance via the characteristics of innovation activities such as exploration and exploitation (and ambidexterity). There are several research questions in this paper: what are the relationships between the consultant competency and the innovation activities; how do these relationships differ Sustainability 2018, 10, 4122 3 of 19 for the different types of innovation activities; also what are the relationships between the consulting environment of client firms and innovation activities via the role of CEOs and their institutional conditions for consulting projects; how do these relationships differ for the different types of innovation activities; how do the innovation activities affect the business performance through the consulting process and performance; which consulting factors have higher impact on the contribution to business performance; if so how do the factors affect the strategies for sustainable business development? Moreover, this paper has the following research purposes: (1) to build the consulting model framework, which will be used for establishing strategies for sustainable business development; (2) to analyze the relationships between consulting factors and consulting performance through innovation activities for finding the key variables in the model, which might affect the firms’ business performance