Strategic entrepreneurial orientation: Configurations, performance, and the effects of industry and time

• Author: Jeremy C. Short,David J. Ketchen,G. Tyge Payne,Todd W. Moss,Aaron F. McKenny
• Published date: 01 December 2018
• DOI: http://doi.org/10.1002/sej.1291
• Date: 01 December 2018

RESEARCH ARTICLE

Strategic entrepreneurial orientation:

Configurations, performance, and the effects of

industry and time

Aaron F. McKenny

1

| Jeremy C. Short

2

| David J. Ketchen Jr.

3

|

G. Tyge Payne

4

| Todd W. Moss

5

1

UCF College of Business Administration,

Orlando, Florida

2

University of Oklahoma, Norman, Oklahoma

3

Auburn University, Auburn, Alabama

4

Texas Tech University, Lubbock, Texas

5

Syracuse University, Syracuse, New York

Correspondence

Aaron F. McKenny,UCF College of Business

Administration, PO Box 161400, Orlando, FL

32816-1400.

Email: aaron.mckenny@ucf.edu

Research Summary: Strategic entrepreneurship research has

sought to understand how firms' entrepreneurial behaviors and

decision making influence firm performance. Generally this

research has treated entrepreneurial orientation (EO) as consisting

of dimensions that independently influence firm performance. This

approach conflicts with conceptual and empirical work suggesting

that managers embrace complex knowledge structures. Taking a

configurational perspective that accounts for relations among the

EO dimensions, we analyze a longitudinal sample of 399 firms in

four technology industries to reveal how different EO patterns—

identified using fuzzy-set qualitative comparative analysis—lead to

higher or lower firm performance based on industrial-, temporal-,

and measurement-related factors.

Managerial Summary: A firm's entrepreneurial orientation consists

of its relative emphasis on autonomy, competitive aggressiveness,

innovativeness, proactiveness, and risk taking. Do companies inten-

tionally emphasize different aspects of entrepreneurship? Our anal-

ysis suggests that they do and that different patterns developed by

companies have implications for their performance. Our work sug-

gests managers should develop a profile of entrepreneurial dimen-

sions that fit well in their industry. For instance, firms in growing

yet stable industries tend to perform well when they emphasize

autonomy and competitive aggressiveness and focus less on inno-

vativeness, proactiveness, and risk taking. In contrast, this approach

would not lead to high performance in more hostile industries

where innovativeness is essential.

KEYWORDS

configurations, content analysis, entrepreneurial orientation,

equifinality, firm performance, fuzzy-set analysis

Received: 27 August 2015 Revised: 9 January 2018 Accepted: 11 January 2018 Published on: 5 June 2018

DOI: 10.1002/sej.1291

Copyright © 2018 Strategic Management Society

504 wileyonlinelibrary.com/journal/sej Strategic Entrepreneurship Journal. 2018;12:504–521.

Configurations richly describe organizations, revealing their complex, gestalt, and systematic nature. They

also draw important distinctions among organizations, avoiding confusions born of excessive aggregation

and aiding prediction

Danny Miller (1987, p. 686)

Entrepreneurial orientation (EO) refers to a family of constructs concerned with the entrepreneurial behavior,

decision making, and processes of organizations (George & Marino, 2011; Lumpkin & Dess, 1996). EO has been

shown to influence many business-level outcomes, including distinctive marketing competencies (Smart & Conant,

1994), strategic alliance portfolios (Marino, Strandholm, Steensma, & Weaver, 2002), and technology commercializa-

tion (Li, Guo, Liu, & Li, 2008). Of particular interest to strategic entrepreneurship scholars is the relationship between

EO and firm performance (Stam & Elfring, 2008); a meta-analysis of 51 studies found that this relationship is signifi-

cant (Rauch, Wiklund, Lumpkin, & Frese, 2009).

Progress in unveiling the linkage between EO and performance has generally come from two related, yet distinct,

conceptualizations of EO. The three-dimensional conceptualization is concerned with the strategic posture of the

firm as emphasizing risk taking, innovativeness, and proactiveness (Covin & Slevin, 1989; Miller, 1983); it is operatio-

nalized as a latent construct reflecting the covariance among these dimensions (Covin & Wales, 2012; George &

Marino, 2011). Other work has leveraged a five-dimensional conceptualization (e.g., Short, Payne, Brigham, Lump-

kin, & Broberg, 2009). This version of EO incorporates two additional dimensions—autonomy and competitive

aggressiveness—and hypothesizes that engagement in the five activities will be associated with new entry

(Lumpkin & Dess, 1996). The five dimensions are thought to be related but independent, and each may have a dis-

tinct relationship with firm performance (Covin & Lumpkin, 2011). While related to the three-dimensional conceptu-

alization, recent research indicates that these two conceptualizations may capture different phenomena

(e.g., George & Marino, 2011). Accordingly, to distinguish the two conceptualizations, we refer to the five faceted

conceptualization as a firm's strategic EO.

While research examining the strategic EO-performance relationship has provided insights into firms' entrepre-

neurial behavior and decision making, most studies examine the dimensions as independent without considering how

relations among the dimensions constitute part of the firms' overall entrepreneurial strategy (e.g., Kreiser, Marino,

Dickson, & Weaver, 2010). However, as our opening quote suggests, adopting a configurational perspective on EO

has the potential to “richly describe organizations, revealing their complex, gestalt, and systematic nature”as well as

avoiding “excessive aggregation”and “aiding prediction”of important outcomes such as firm performance (Miller,

1987, p. 686). Indeed, examining configurations allows researchers to move beyond examining variables' independent

effects to examine how multiple variables interact in potentially complex and nonlinear ways to influence firm perfor-

mance (Fiss, 2007). Consistent with this approach, research on managers' knowledge structures suggests that man-

agers tend to view multidimensional concepts such as EO holistically rather than as a discrete, but related, set of

dimensions (Kabanoff & Brown, 2008).

Despite the promise of configurations for understanding how managers build patterns of strategic EO to influ-

ence performance, the relevant work has generally examined how EO can be configured with external and internal

contingencies to identify when an entrepreneurial strategy is more or less important to performance (e.g., Engelen,

Gupta, Strenger, & Brettel, 2015; Wiklund & Shepherd, 2005). While valuable, this approach does not tap potentially

interesting insights regarding patterns of the strategic EO dimensions and their performance implications.

In response, we examine three research questions. The first two consider whether successful patterns of strate-

gic EO differ based on (1) industry characteristics and (2) over time. Organizational ecology research indicates that

environmental forces that vary by industry and over time may influence the strategies and structures that will be suc-

cessful (Hannan & Freeman, 1977, 1984). Accordingly, the demands of different environments may influence which

strategic EO patterns will be successful. Our third research question asks whether the success of strategic EO pat-

terns differ based on conceptualization of firm performance. Like EO, firm performance is a family of related, but dis-

tinct dimensions. These dimensions are united in their concern with a firm's achievements, but diverse in what

MCKENNY ET AL.505