Environmental dynamism and entrepreneurial orientation

Abstract

Purpose -The purpose of this paper is to study the antecedents of entrepreneurial orientation (EO). Specifically, the authors aim to analyze how firms' capabilities influence the relationship between firm environmental dynamism and entrepreneurial orientation. The study seeks to provide a better understanding of antecedents of EO, helping to fill in the gap that exists in the EO literature and explain how certain internal and external factors, independently and jointly, influence EO. Design/methodology/approach -The empirical study is conducted on a sample of 253 firms from the information and communication technology (ICT) industry. In order to test the proposed model, a hierarchical regression analysis was developed. Findings -A positive effect of environmental dynamism, technological capabilities and marketing capabilities on EO was detected and it was possible to observe how technology capabilities improve the positive effect of environment dynamism on EO. Originality/value -The most important contribution of this paper is to demonstrate that the direction of the moderating effect of capabilities on environment dynamism changes depending on the capabilities that are analyzed. While the technology capabilities improve the positive effect of environment dynamism, the marketing capabilities worsen the effect of environment dynamism on EO.

Entrepreneurial Orientation in Different Environmental Settings: a Comparative Cross-Country Study

“…Innovative and proactive behavior helps firms better adapt to the challenges of external environment by modifying existing products and services, and creating new ones (Ruiz-Ortega et al, 2013).…”

“…On the one hand, environmental dynamism, characterized by shifts in demand and technological and competitive environments, creates difficulties for firms, while on the other hand, a dynamic environment can create new opportunities for companies to expand their businesses and develop competitive advantage (Ruiz-Ortega et al, 2013). Firms operate in an external business environment which influences the way their strategic orientations are related to performance outcomes.…”

Determinants of SMEs Performance of the Gem and Jewelry Industry in Thailand: A Pilot Study

“…The concept of EO was originally mentioned by Miller (1983), later modified by Covin and Slavin (1991), and further described by Lumpkin and Dess (1996) respectively. EO refers to the strategic process that a firm identifies new opportunities and implements entrepreneurial actions in order to generate a sustainable competitive advantage (Ruiz-Ortega et al, 2013). At first, the concept of EO identified by Miller (1983) and Covin and Slavin (1991) consists of three key dimensions, namely innovativeness, risk-taking, and proactiveness, and a five dimensional EO construct was suggested later by Lumpkin and Dess (1996) which additionally includes autonomy and competitive aggressiveness.…”

Performance in Franchise Systems : The Franchisee Perspective

“…Environmental dynamism makes current products and services quickly useless (Sørensen and Stuart, 2000), and firms will need to rapidly respond customers' new preferences (Burgers et al, 2009). However, these environmental changes can create opportunities in the market (Ruiz-Ortega et al, 2013).…”

“…EO helps firms to adapt to a changing environment and even constantly predict change, adapt (Huang and Wang, 2013) and attain sustainable competitive superiority in time (Ruiz-Ortega et al, 2013). In a dynamic environment, higher innovativeness and risk taking leads firms to stronger performance (Casillas et al, 2010).…”