Exploration/exploitation innovation and firm performance: the mediation of entrepreneurial orientation and moderation of competitive intensity

2019 ◽  
Vol 13 (4) ◽  
pp. 489-506 ◽  
Author(s):  
Bojun Hou ◽  
Jin Hong ◽  
Ruonan Zhu
Keyword(s):  
Firm Performance ◽  
Entrepreneurial Orientation ◽  
Competition Intensity ◽  
Competitive Intensity ◽  
Content Type ◽  
Start Ups ◽  
The Impact ◽  
Exploration Exploitation ◽  
The Relationship

Purpose Although many scholars have found that exploration and exploitation innovation have significantly positive effects on firm performance, it remains to be resolved whether the relationship between the two is still established at different stages of enterprise development and in different competitive contexts. This paper aims to clarify the effect of exploration/exploitation innovation on firm performance in start-ups, and in particular, the mediation role of entrepreneurial orientation (EO) and the moderation role of competitive intensity are tested to explore their disturbing effects on above relationship. Design/methodology/approach The authors construct a theoretical framework to analyze and verify the relationship between innovation, EO and firm performance. The hypotheses of this paper are put forward by theoretical inference. In addition to test the hypotheses, 143 questionnaires are collected from technology-oriented start-ups in Hefei National University Science Park. Findings The empirical results show that consistent with previous findings, exploration innovation and exploitation innovation both have positive impact on firm performance; meanwhile, the EO partially mediates the relationship between both innovations and firm performance. What cannot be ignored is that the competition intensity plays a moderation role between EO and firm performance. Originality/value The findings reveal that the impact of innovation activities on corporate performance has been disrupted by EO and competition intensity in start-ups. The work of this paper deepens the understanding of the relationship between innovation, EO, external environment and firm performance, which is of guiding significance to the entrepreneurship management of emerging economies.

The role of internationalization in entrepreneurial orientation-performance link: empirical study of SMEs in a developing nation perspective

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Zaynab Dadzie ◽  
Ahmed Agyapong ◽  
Abdulai Suglo
Keyword(s):  
Firm Performance ◽  
Empirical Study ◽  
Entrepreneurial Orientation ◽  
Developing Nation ◽  
Content Type ◽  
Mediating Role ◽  
And Performance ◽  
The Impact ◽  
The Relationship

Purpose This study aims to examine the mediating role of internationalization in the relationship between the dimensions of entrepreneurial orientation (EO) and performance, empirical study of small and medium scale enterprises (SMEs) in a developing nation. Design/methodology/approach The study uses a sample of 158 exporting SMEs based in the sub-Saharan developing economy, Ghana. The use of hierarchical regression (ordinary least square analysis) was used by the researcher to assess the suggested model of the study. Findings Largely supporting the conjectural predictions, the study indicates that EO positively and significantly influences performance; internationalization fully mediates the relationship between innovativeness and performance of export firms; internationalization fully mediates the relationship between risk-taking and performance of export firms; and finally, internationalization partially mediates the relationship between competitive aggressiveness and performance of export firms. Managers are, therefore, encouraged to strategically develop both their EO and internationalization, as the study has confirmed that EO has both a direct and indirect relationship with performance. Originality/value This study integrated a resource-based view of the firm and international entrepreneurship theory as a theoretical foundation. Theoretically, internationalization’s mediating role reveals the relevance of this construct in the linkage between entrepreneurial orientation and firm performance. Furthermore, the study extends the entrepreneurial orientation concept to the international business literature by estimating and testing models of the mediating link between entrepreneurial orientation and performance. Moreover, the study seeks to broaden the knowledge of entrepreneurial orientation and its relationship with performance in small and medium businesses. The study further extends the limited studies on performance, driven by entrepreneurial orientation and internationalization in a developing nation (Ghanaian) context. This paper besides seeks to highlight the impact of entrepreneurial orientation on performance when channeled through internationalization. The study also reveals the dimensions of entrepreneurial orientation to be important antecedents of internationalization, in attempts at unearthing the critical predictors of firm performance, especially those of international characteristics.

The role of firm-specific factors in the strategy-performance relationship

2018 ◽  
Vol 41 (1) ◽  
pp. 46-73 ◽  
Author(s):  
Prodromos Chatzoglou ◽  
Dimitrios Chatzoudes ◽  
Lazaros Sarigiannidis ◽  
Georgios Theriou
Keyword(s):  
Firm Performance ◽  
Strategic Orientation ◽  
Organisational Structure ◽  
Research Model ◽  
Manufacturing Companies ◽  
Content Type ◽  
Specific Factors ◽  
The Impact ◽  
The Relationship

Purpose This paper aims to attempt to bring together various organisational aspects that have never been collectively investigated before in the strategic management literature. Its main objective is to examine the relationship between “strategic orientation” and “firm performance”, in the light of two firm-specific factors (“distinct manufacturing capabilities” and “organisational structure”). The proposed research model of the present study is built upon the resource-based view (RBV) of the firm and the organisational aspect of the VRIO framework (the “O” from the VRIO model). Design/methodology/approach The study proposes a newly developed research model that adopts a four-factor approach, while examining a number of direct and indirect effects. The examination of the proposed research model was made with the use of a newly developed structured questionnaire that was distributed on a sample of Greek manufacturing companies. Research hypotheses were tested using the structural equation modelling technique. The present study is explanatory (examines cause and effect relationships), deductive (tests research hypotheses), empirical (collects primary data) and quantitative (analyses quantitative data that were collected using a structured questionnaire). Findings The empirical results suggest the coexistence of three distinct categories of effects on “firm performance”: strategy or “utility” effects, depending on the content of the implemented strategy; firm-specific effects, depending on the content of the organisational resources and capabilities; and organisational effects, depending on the implemented organisational structure. More specifically, the statistical analysis underlines the significant mediating role of “strategic orientation” and the complementary role of “organisational structure”. Finally, empirical results support the argument that “strategy follows structure”. Research limitations/implications The use of self-reported scales constitutes an inherent methodological limitation. Moreover, the present study lacks a longitudinal approach because it provides a static picture of the subject under consideration. Finally, the sample size of 130 manufacturing companies could raise some concerns. Despite that, previous empirical studies of the same field, published in respectable journals, were also based on similar samples. Practical implications When examining the total (direct and indirect) effects on “firm performance”, it seems that the effect of “organisational structure” is, almost, identical to the effect of “distinct manufacturing capabilities”. This implies that “organisational structure” (an imitable capability) has, almost, the same contribution on “firm performance” as the manufacturing capabilities of the organisation (an inimitable capability). Thus, the practical significance of “organisational structure” is being highlighted. Originality/value There has been little empirical research concerning the bundle of firm-specific factors that enhance the impact of strategy on business performance. Under the context of the resource-based view (RBV) of the firm, the present study examines the impact of “organisational structure” on the “strategy-capabilities-performance” relationship, something that has not been thoroughly investigated in the strategic management literature. Also, the present study proposes an alternate measure for capturing the concept of business strategy, the so-called factor of “strategic orientation”. Finally, the study adopts a “reversed view” in the relationship between structure and strategy. More specifically, it postulates that “strategy follows structure” and not the opposite (“structure follows strategy”). Actually, the empirical data supported that (reversed) view, challenging the traditional approach of Chandler (1962) and calling for additional research on that ongoing dispute.

Drivers of supply chain integration and the role of organizational culture

2016 ◽  
Vol 22 (1) ◽  
pp. 89-115 ◽  
Author(s):  
Erlinda N. Yunus ◽  
Suresh K. Tadisina
Keyword(s):  
Organizational Culture ◽  
Supply Chain ◽  
Firm Performance ◽  
Manufacturing Firms ◽  
Supply Chain Integration ◽  
Equation Modeling ◽  
Content Type ◽  
The Impact ◽  
The Relationship

Purpose – Supply chain integration (SCI) is a set of practices driven by many factors and circumstances. The purpose of this paper is to examine firms’ internal and external drivers of SCI, evaluate the impact of the integration on firm performance, and further investigate the moderating role of organizational culture in strengthening the relationships between firms’ drivers and SCI. Design/methodology/approach – For the purpose of this study, manufacturing firms were identified as the focal firms in supply chains, and thus data were collected through a survey of 223 Indonesian-based manufacturing firms. Two informants from each firm became the respondents. Structural equation modeling was used to analyze the data. Findings – This study confirmed the positive relationship between SCI and firm performance. The results also indicated that internal driver, or specifically firms’ customer orientation (CO), triggered the initiation of SCI. Organizational culture, in terms of external focus, positively influenced the relationship between CO and SCI. Research limitations/implications – This study illustrates the important role of organizational culture in determining the shape of the relationship between firms’ drivers and SCI. The results of this study enhance the understanding of SCI, especially related to types of organizational culture that could promote the integration. Originality/value – This study brings a different dimension of SCI as this study provides evidence from a developing country, which might implement different practices as compared those of developed countries. This study provides a measure of internal drivers, which has not been empirically investigated. The new measure was tested and validated using a rigorous process, and thus could be employed in other studies with different settings.

Capital structure, competitive intensity and firm performance: an analysis of Indian pharmaceutical companies

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Neeti Mathur ◽  
Satish Chandra Tiwari ◽  
T. Sita Ramaiah ◽  
Himanshu Mathur
Keyword(s):  
Firm Performance ◽  
Capital Structure ◽  
Financial Performance ◽  
Market Competition ◽  
Competitive Intensity ◽  
Content Type ◽  
Relationship Of ◽  
The Relationship ◽  
Moderating Role

PurposeThis research paper aims to explore the relationship of financial performance and capital structure of Indian pharma firms of BSE 500, the impact of research and development (R&D) expenditure on financial performance and also explore the moderating role of competitive intensity between the existing relationship of capital structure and firm performance.Design/methodology/approachThe balanced panel data of listed pharma firms of BSE 500 are used for the research study, and the present study adopts both the panel and ordinary least square (OLS) estimation techniques to draw the results.FindingsThe results exhibit that the high debt ratio is harmful for the accounting performance of the selected sample of pharma firms of BSE 500. Besides, market competition negatively moderates the relationship between capital structure and firm performance.Research limitations/implicationsThe research findings provide evidence for the policymakers/regulators that the sample firms should discourage the high debt financing in the presence of competitive intensity in the product marketplace.Originality/valueThe core contribution of the current research is to examine impact of R&D expenditure on financial performance and the moderating role of market competition on the relationship of capital structure and firm performance to the best of the authors' knowledge, and no single study has previously explored this relationship in the context of BSE 500 pharma firms.

scholarly journals Moderating Role Of Entrepreneurial Orientation On The Relationship Between Information Technology Competence And Firm Performance In Kenya

2017 ◽  
Vol 2 (2) ◽  
pp. 1
Author(s):  
Stanley Ndungu ◽  
Kenneth Wanjau ◽  
Robert Gichira ◽  
Waweru Mwangi
Keyword(s):  
Information Technology ◽  
Firm Performance ◽  
Entrepreneurial Orientation ◽  
Superior Performance ◽  
Cross Sectional Survey ◽  
Technology Competence ◽  
The Impact ◽  
The Relationship ◽  
Moderating Role

This study explored moderating role of entrepreneurial orientation on the relationship between Information Technology Competence and firm performance in Kenya. The impact of IT on FP remains debatable to-date because some results of previous studies have had high variations resulting from diversities in the conceptualization of the key constructs and their interrelationship, coupled with the exclusion of intangible effect of IT on performance. In Kenya, SMEs employ about 85 percent of the workforce. The need to link ITC with FP has become vital for firms striving to achieve superior performance. However, limited attention has been paid to the link and more so to the moderating role of EO on ITC- FP relationship model. To better understand this relationship, this paper adopted a mixed methods research guided by cross-sectional survey design. Quantitative and qualitative techniques were employed to analyze the collected data using SPSS, Ms-Excel, AMOS, SmartPLS, STATA, R-GUI and ATLAS.ti analytical softwares. Analyses were conducted using a two-phase process consisting of CFA and SEM models. The theoretical models and hypotheses were tested based on empirical data gathered from 94 SMEs in the 2013 Top 100 Survey. The study found that ITC had a positive relationship with FP. The results also revealed that EO did not significantly moderate the relationship between ITC and FP in Kenya. However, when run with the interaction term, the Technical (ITC and ISRA)*EO was statistically significant at 10% α-level. This study will enhance the skill set in Kenyan SMEs and produce a more sustainable solution.

scholarly journals The role of 4PL provider as a mediation and supply chain agility

2020 ◽  
Vol 2 (2) ◽  
pp. 99-111
Author(s):  
Macide Berna Çağlar Kalkan ◽  
Kenan Aydın
Keyword(s):  
Supply Chain ◽  
Firm Performance ◽  
Survey Data ◽  
Service Providers ◽  
Equation Modeling ◽  
Content Type ◽  
Supply Chain Agility ◽  
The Impact ◽  
The Relationship

PurposeThe aim of this study is to examine the role and capabilities of fourth party logistics (4PL) in the supply chain agility and firm performance. In addition to this, the relationship between supply chain agility and firm performance is also examined. This study aims to fulfill the gap in the literature about the studies on the relationship between 4PL capability dimensions, supply chain agility and business performance.Design/methodology/approachThe study uses survey data from 58 senior executives and managers in the logistics and supply chain functions from 4PL service providers' customer firms in Turkey. The results are structural equation modeling using SmartPLS software. Snowball sampling method was used to collect survey data.FindingsThis study shows that integrator and supply chain infomediary are appropriate practices for mediating the impact of agile supply chain strategies, on firm performance. For supply chain practitioners, results indicate that firms benefit greatly if they consider the outsourcing, such as a 4PL partnership, in conjunction with their supply chain strategy.Research limitations/implicationsTime, cost and the presence of businesses located in different cities across Turkey in the sample of study and the existence of the tendency of enterprises not to participate in the research can be stated as the limitations of this study.Originality/valueIn the literature, studies on 4PL have been conducted in different fields which can be categorized as follows: 4PL solution development, reasons that facilitate and prevent the design and implementation of 4PL, scope of 4PL service delivery and profit and risk sharing from the structure of 4PL networks. Briefly, the studies focus on conceptualizing and differentiating of 4PL from 3PL before reaching a common definition. Motivation of this study is to fulfill the gap of literature about supply chain agility, firm performance relationship and mediation role of 4PL skill dimensions.

scholarly journals Divestiture strategy, CEO power and firm performance

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Rayenda Khresna Brahmana ◽  
Hui-Wei You ◽  
Xhin-Rong Yong
Keyword(s):  
Firm Performance ◽  
Generalized Method Of Moments ◽  
Strategic Decision ◽  
Ceo Power ◽  
Content Type ◽  
And Performance ◽  
The Impact ◽  
The Relationship ◽  
Moderating Role

Purpose This study aims to examine the moderating role of chief executive officer (CEO) power on the relationship between divestiture strategy and firm performance by framing the relationship under the agency and power circulation theories. Design/methodology/approach This study focuses on a sample of 319 non-financial public-listed companies in Malaysia from the year 2012–2016 and estimates the model under two-step generalized method of moments panel regression to eliminate the endogeneity issue. Findings The results show that divestiture strategy decreased the firm performance. Meanwhile, greater CEO power changed that divestiture effect but still failed to increase the performance. This study also indicates the CEO power strengthens the relationship between firm performance and divestiture. Research limitations/implications The overall findings show that the positive moderating role of CEO power on the relationship between divestiture and performance. This research confirmed the agency and power circulation theories by showing that CEO power can make divestiture strategy works. However, the moderating plot tells different. CEO power may strengthen the relationship between divestiture and performance; it fails to boost up the performance in overall. Therefore, this study is about CEO power on the strategic decision and gives a good implication for corporate governance concerning the impact of CEO power on the organization’s alignment process. Originality/value This study examines the effect of CEO power on the performance of divestiture strategy implementation by contesting the agency and power circulation theories within an emerging country context.

scholarly journals Innovative low-cost strategy and firm performance of restaurants

2019 ◽  
Vol 13 (3) ◽  
pp. 266-281 ◽  
Author(s):  
Collins Kankam-Kwarteng ◽  
Barbara Osman ◽  
Jacob Donkor
Keyword(s):  
Firm Performance ◽  
High Performance ◽  
Low Cost ◽  
Competitive Intensity ◽  
Content Type ◽  
Interaction Terms ◽  
Cost Strategy ◽  
Low Cost Strategy ◽  
The Relationship

Purpose The purpose of this paper is to improve the appreciation of the moderating role of competitive intensity on the relationship between low-cost strategy and firm performance of restaurants. Design/methodology/approach The study uses empirical data collected from 118 restaurants operators, Ghana. The effects of relationships and the interaction of low-cost strategy and competitive intensity were tested using regression analysis. Findings The findings indicate the existence of a significant positive relationship between low-cost strategy and firm performance. The effect of competitive strategy on firm performance was found to be partially significant. The findings revealed that competitive intensity does moderate the relationship between low-cost strategy and firm performance of restaurants. Practical implications Implications of the findings for restaurant operators suggest that effective application of low-cost strategy and monitoring and managing competitive intensity results in high performance. Originality/value This study contributes to the existing literature on low-cost strategy, competitive intensity and firm performance. More specifically, the interaction terms of low-cost strategy and competitive intensity have been explored in this study and can be used for further investigations.

Implications of strategic flexibility in small firms: the moderating role of absorptive capacity

2019 ◽  
Vol 8 (3) ◽  
pp. 370-386 ◽  
Author(s):  
Sanjay Chaudhary
Keyword(s):  
Firm Performance ◽  
Empirical Evidence ◽  
Absorptive Capacity ◽  
Entrepreneurial Orientation ◽  
Small Firms ◽  
Dynamic Capabilities ◽  
Strategic Flexibility ◽  
Content Type ◽  
The Relationship

Purpose Guided by the theory of dynamic capabilities and the knowledge-based view of an organization, the purpose of this paper is to examine the crucial role played by entrepreneurial orientation and absorptive capacity in the relationship between strategic flexibility and firm performance, with a specific focus on small firms. Design/methodology/approach The study uses survey data collected from owners of 272 small businesses in India and follows the linear regression method to establish the link between strategic flexibility and firm performance. It hypothesizes that the strategic flexibility of a small firm impacts entrepreneurial orientation, and subsequently its performance, while absorptive capacity further enhances this relationship. Findings The conclusions drawn from the study provide empirical evidence on the mediating role of entrepreneurial orientation in the relationship between strategic flexibility and firm performance. The findings also point out that the potential absorptive capacity of a firm strengthens the relationship between its strategic flexibility and entrepreneurial orientation. Research limitations/implications The empirical findings of the study are limited to small firms from the automotive service industry. Practical implications The study contributes to the existing knowledge on managerial practice by pointing out the importance of strategic flexibility as a dynamic capability and illustrating its impact in the case of a small firm’s performance. Originality/value As yet, there is a dearth of empirical evidence derived from large samples of small firms. The study supplements available literature on dynamic capabilities and knowledge management.

Does family matter? The moderating role of family involvement on the relationship between CSR and firm performance

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Jihwan Yeon ◽  
Michael S. Lin ◽  
Seoki Lee ◽  
Amit Sharma
Keyword(s):  
Firm Performance ◽  
Family Involvement ◽  
Firm Value ◽  
Family Ownership ◽  
Content Type ◽  
Founding Family ◽  
The Impact ◽  
The Relationship ◽  
Moderating Role

Purpose The purpose of this study is to investigate the moderating role of family involvement on the corporate social responsibility (CSR)-firm performance (FP) relationship in the US hospitality industry. Building on agency theory, this study examines how family ownership, management and board control influence the relationship between CSR and FP. Design/methodology/approach To examine the moderating effect of family ownership, family management and family board control, this study adopts the two-way fixed-effects model and performs a panel regression analysis with robust standard errors. The sample period spans 1994–2018 and 565 firm-year observations are included. Findings This study finds that the impact of CSR on FP is positively moderated by the extent of a firm’s family member involvement. In specific, all three aspects of corporate governance (i.e. ownership, management and board control) positively moderate the relationship between CSR and FP. Research limitations/implications Findings of this study yield several recommendations for hospitality managers, including shaping strategic decisions for implementing CSR, by providing a unique perspective that the involvement of founding family members can be helpful in enhancing firm value through CSR activities. Originality/value This study sheds light on the further understanding of the CSR-FP link in the hospitality literature. In addition, this study provides practical guidelines for hospitality firms in the context of CSR by revealing possible advantages of strengthened founding family involvement.

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