SME Entrepreneurial Orientation, Performance, and the Moderating Role of Firm Resources

Abstract

The effects of entrepreneurial orientation on firm performance are grounded and well established. However, when accounting for potential factors having a moderating effect on this relationship, most scholarly attention has been given environmental factors, thus consequently, potential organizational implications on this relationship have been neglected. In response, this article discusses what role specific organizational factors play in moderating the relationship between entrepreneurial orientation and performance. Representing firm resources, data on intellectual and financial resources are analyzed. A conceptual framework explaining the relationships between EO, performance and firm resources is introduced and explained. Findings presented suggests that a firm’s intellectual capital, in terms of professional employees and skilled workers, positively and significantly influences the EO-performance relationship in SMEs. Noteworthy, however, is that although intellectual capital seems to play a key moderating role, merely increasing the level of employees’ education does not show similar traits. Finally, and surprisingly, no relationship of significance was found delegating predictive powers to financial resources in light of the EO-performance relationship.