Entrepreneurial orientation, sustainability practices and performance of small and medium enterprises: evidence from an emerging economy

Abstract

PurposeDespite the growing scholarly interest in examining entrepreneurial orientation (EO)-performance link, the results have been inconsistent. However, studies have not explored firm-level and external factors that may serve as mechanisms or boundary conditions to explain this relationship. Therefore, the purpose of the study is to examine how and when EO influences performance by incorporating sustainability practices as a mechanism and competitive intensity as an important contingent factor.Design/methodology/approachUsing primary data obtained from 323 chief executive officers/entrepreneurs, the authors analyzed the data using structural equation modeling in LISREL and Hayes PROCESS in SPSS.FindingsThe authors found that sustainability practices serve as a mechanism through which EO influences small and medium enterprises' (SMEs) performance. The study further revealed that the relationship between EO and sustainability practices is weakened at high levels of competitive intensity. Still, the relationship between EO and performance through sustainability practices remains strengthened when competitive intensity is present at high levels.Originality/valueThis study contributes to the literature by examining how SMEs who are less endowed with resources can engage in sustainability practices that can match large firms with stronger EO to achieve increased performance. Additionally, the study contributes to the literature by examining the mediating effect of sustainability practices in the EO-performance relationship. Finally, the study contributes to the body of literature by testing how competitive intensity presents as a boundary condition to leverage the relationship between EO and performance.

The role of Tri Hita Karana-based business strategy and digital marketing to improve sustainable business performance

“…This study also strengthens the results of previous research conducted by Ismail (2023), which states that environmental orientation variables have a positive and significant effect on sustainable business performance. The results of this study are reinforced by the research of Akomea et al (2022), Souto (2022, and Danso et al (2022), who found the results of environmental orientation variables have a positive and significant effect on sustainable business performance that it can be concluded that high environmental orientation has a positive and significant influence on sustainable business performance.…”

Driving Success: Unveiling the Synergy of E-Marketing, Sustainability, and Technology Orientation in Online SME

“…Third, unlike previous studies [95,136], it is demonstrated that TO, following SO, has a strong positive impact on OBP. It is observed that enterprises are becoming interested in implementing technology and innovation policies and practices.…”

Mediating effect of entrepreneurial passion in the relationship between entrepreneurial orientation and innovative work behavior

“…Entrepreneurship orientation is a psychological construct that reflects the intention toward entrepreneurial opportunities in light of risks and uncertainty (Makhloufi et al , 2021). Previous studies have shown that entrepreneurial orientation positively influences family firm performance (Hernández-Linares et al , 2020) and affects the performance of SMEs (Akomea et al , 2022). Entrepreneurial orientation reflects the methods, practices and decision-making styles used by owners or founders to act entrepreneurially (Adam et al , 2022).…”