This study explores the implications of CEO entrepreneurial orientation for firm performance through corporate dynamic capabilities. It explores the moderating effects of firm industry type on the above indirect effect. Based on 188 matched sample data collected from vice chief executive officers (CEOs) of Chinese firms, this study found that CEO entrepreneurial orientation was positively related to corporate dynamic capabilities and firm performance and that corporate dynamic capabilities mediated the positive relationship between CEO entrepreneurial orientation and firm performance. Firm industry type moderated the direct effect of CEO entrepreneurial orientation on corporate dynamic capability, and the indirect effect of CEO entrepreneurial orientation on firm performance through corporate dynamic capability. Both direct and indirect effects were stronger in manufacturing enterprises. The findings enrich the CEO entrepreneurial orientation literature by extending the existing knowledge on its underlying mechanism and its impact on firm performance, as well as its boundary conditions.
Social information processing theory suggests that the chief executive officer’s entrepreneurial orientation (CEO EO) is an organisational signal that influences the members’ innovativeness. Middle management teams (MMTs) are expected to be more innovative as they connect senior managers with frontline managers in the dynamic competitive environment of the digital economy. How CEOs guide MMT innovations through EO becomes critical in the process of capturing opportunities and creating value. However, previous research has failed to adequately identify distinct CEO EO manifestations with organisational contexts configurations that influence MMTs innovation. Thus, based on differences in organisational contexts and MMTs’ cognition, this study thoroughly investigates how the vertical manifestation of CEO EO impacts the innovativeness of MMTs. We used fuzzy-set qualitative comparative analysis (fsQCA) on a sample of 117 organisations to determine which configurations of CEO EO vertical penetration within an organisation can stimulate MMT innovativeness. The study discovered four first-level configurations that support stimulating MMT innovativeness respectively when the CEO EO is fully or partially manifested, and without the CEO EO. Moreover, we found the internal reasons for MMTs’ information interpretation heterogeneity, which is critical for realising the coordination and unity of entrepreneurial cognition and behaviours. Finally, these findings’ theoretical and practical implications are discussed.
Purpose
Corporate entrepreneurship is an important way for organizations to gain competitive advantages and achieve sustainable development. However, few studies pay attention to the influence of CEO strategic leadership on corporate entrepreneurship. Drawing on social identity theory and uncertainty-identity theory, this study aims to investigate whether CEO relationship-focused leadership impacts corporate entrepreneurship through middle managers’ (MMs’) organizational identification and whether the indirect effect is moderated by environmental uncertainty.
Design/methodology/approach
Using 192 Chinese samples with 192 firm-level and 716 department-level observations, this study uses multilevel structural equations modeling by Mplus 8.0 to test the theoretical model.
Findings
This study finds that CEO relationship-focused leadership positively predicts MMs’ organizational identification and corporate entrepreneurship, and MMs’ organizational identification mediates the relationship between CEO relationship-focused leadership and corporate entrepreneurship. In addition, environmental uncertainty moderates not only the relationship between CEO relationship-focused leadership and MMs’ organizational identification but also the indirect effect of CEO relationship-focused leadership on corporate entrepreneurship through MMs’ organizational identification.
Research limitations/implications
This study enriches the understanding of process and contextualization of CEO strategic leadership influencing on corporate entrepreneurship.
Originality/value
To the best of the authors’ knowledge, this study is among the first to explore the influence of CEO relationship-focused leadership on corporate entrepreneurship.
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