Effect of Entrepreneurial Orientation on SMEs’ Innovation Performance in Sri Lanka

Abstract

The critical phenomenon that SMEs' innovativeness denotes has growing interest from developing country researchers from multiple fields over the last decades. Thus, the study's objective is to examine the Entrepreneurial Orientations' effect on SMEs' innovativeness in Sri Lanka. Risk-taking, proactiveness, autonomy, innovativeness, and Competitiveness have been used to operationalize the Entrepreneurial Orientation concept, and SMEs' innovation performance was conceptualized based on three dimensions. A self-administrated questionnaire is distributed to the SEM owners and collected seventy-six completed questionnaires. Descriptive statistics and multiple regression analysis were used to analyze the data. Results of the study shown that OE as a whole significantly impacts innovative performance. Specifically, while the four dimensions of EO, namely, risk-taking, proactiveness, innovativeness, and autonomy, significantly impact SMEs' innovative performance. But, Competitiveness does not have a significant influence on SMEs' innovation performance. The study focuses only on OE that influences SMEs innovation performance. The most considerable significant portion of enterprises in Sri Lankan business sector represents SMEs. It is anticipated that Sri Lankan policy makers, SME owners, and business decision-makers will help SMEs better understand policymakers' significant impact on SMEs' innovation performance.

Entrepreneurial orientation and funding decisions on the financial performance of small and medium industries

“…Entrepreneurial orientation is explained by three dimensions, namely innovativeness, proactiveness and risk taking (Corrêa et al, 2022;Perera & Samarakoon, 2021). The company's performance is explained by financial perceptions related to revenue growth and asset growth (Barauskaite & Streimikiene, 2021;Pramesti et al, 2021).…”

ENTREPRENEURSHIP ORIENTATION, ORGANIZATIONAL LEARNING AND INNOVATION PERFORMANCE (STUDIES ON SMEs IN WEST JAVA)

“…Organizations that have a high level of entrepreneurial orientation tend to want to continue to develop new products, are more proactive in developing strategies and are willing to take risks that can increase profitability (Tang et al, 2015). Entrepreneurial orientation cannot directly influence innovation performance (Perera & Samarakoon, 2021;Tang et al, 2015), because other factors are needed to be able to describe the impact of entrepreneurial orientation on the organization as a whole. Nonetheless, entrepreneurial orientation can improve a company's innovation performance.…”

“…Of course, companies that are reluctant to learn will avoid this and maintain long sales. The research gap in this study is that there is a research suggestion to link entrepreneurial orientation with innovation performance (Perera & Samarakoon, 2021;Tang et al, 2015). Tang et al (2015) conducted research on entrepreneurial orientation on innovation performance, while Perera & Samarakoon, (2021) conducted research on learning organizations on innovation performance.…”

“…The research gap in this study is that there is a research suggestion to link entrepreneurial orientation with innovation performance (Perera & Samarakoon, 2021;Tang et al, 2015). Tang et al (2015) conducted research on entrepreneurial orientation on innovation performance, while Perera & Samarakoon, (2021) conducted research on learning organizations on innovation performance. These two studies suggest combining the two studies in order to obtain more comprehensive results.…”