Skip to main content
SpringerLink
Log in

Integrated framework of strategic orientation, value offerings and new venture performance

  • Research Article
  • Published:
DECISION Aims and scope Submit manuscript

Abstract

The paper provides an integrated framework to study new venture performance by integrating types of strategic orientation, competition and choice of value offerings of the new venture. The relationship between new venture performance, strategic orientation, value offerings and moderating role of competition is analyzed through structural equation modeling (SEM). The sample of 300 entrepreneurs/founders of new ventures provides the necessary information to the model. The study found entrepreneurial orientation is more likely associated with the choice of new value offerings and has a higher impact on new venture performance in the presence of competition. The results indicate the strongest effect of new value offerings compared to incremental value offering on venture performance is useful for policy making at multiple levels of individual, regional and national start-ups policies.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Log in via an institution

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Fig. 1

Similar content being viewed by others

References

  • Abernathy W, Clark K (1993) Innovation: mapping the winds of creative destruction. Res Policy 22(2):102

    Google Scholar 

  • Aldrich HE, Fiol CM (1994) Fools rush in? The institutional context of industry creation. Acad Manag Rev 19(4):645–670

    Google Scholar 

  • Amason AC, Shrader RC, Tompson GH (2006) Newness and novelty: relating top management team composition to new venture performance. J Bus Ventur 21(1):125–148

    Google Scholar 

  • Andersén J (2010) A critical examination of the EO-performance relationship. Int J Entrep Behav Res 16(4):309–328

    Google Scholar 

  • Anderson BS, Eshima Y (2013) The influence of firm age and intangible resources on the relationship between entrepreneurial orientation and firm growth among Japanese SMEs. J Bus Ventur 28(3):413–429

    Google Scholar 

  • Atuahene-Gima K (1996) Market orientation and innovation. J Bus Res 35(2):93–103

    Google Scholar 

  • Atuahene-Gima K (2005) Resolving the capability—rigidity paradox in new product innovation. J Mark 69(4):61–83

    Google Scholar 

  • Atuahene-Gima K, Ko A (2001) An empirical investigation of the effect of market orientation and entrepreneurship orientation alignment on product innovation. Organ Sci 12(1):54–74

    Google Scholar 

  • Avlonitis GJ, Salavou HE (2007) Entrepreneurial orientation of SMEs, product innovativeness, and performance. J Bus Res 60(5):566–575

    Google Scholar 

  • Barrett P (2007) Structural equation modelling: adjudging model fit. Personal Individ Differ 42(5):815–824

    Google Scholar 

  • Basso O, Fayolle A, Bouchard V (2009) Entrepreneurial orientation: the making of a concept. Int J Entrep Innov 10(4):313–321

    Google Scholar 

  • Bhuian SN, Menguc B, Bell SJ (2005) Just entrepreneurial enough: the moderating effect of entrepreneurship on the relationship between market orientation and performance. J Bus Res 58(1):9–17

    Google Scholar 

  • Boso N, Cadogan JW, Story VM (2012) Complementary effect of entrepreneurial and market orientations on export new product success under differing levels of competitive intensity and financial capital. Int Bus Rev 21(4):667–681

    Google Scholar 

  • Boso N, Story VM, Cadogan JW (2013) Entrepreneurial orientation, market orientation, network ties, and performance: Study of entrepreneurial firms in a developing economy. J Bus Ventur 28(6):708–727

    Google Scholar 

  • Boz Semerci A, Volery T (2018) Entrepreneurs as parents: the antecedents and consequence of parenting stress. Int J Entrep Behav Res 24(1):41–58

    Google Scholar 

  • Cadogan JW (2012) International marketing, strategic orientations and business success: reflections on the path ahead. Int Market Rev 29(4):340–348

    Google Scholar 

  • Cano CR, Carrillat FA, Jaramillo F (2004) A meta-analysis of the relationship between market orientation and business performance: evidence from five continents. Int J Res Mark 21(2):179–200

    Google Scholar 

  • Chaganti R, Chaganti R, Mahajan V (1989) Profitable small business strategies under different types of competition. Entrep Theory Pract 13(3):21–36

    Google Scholar 

  • Chang W, Franke GR, Butler TD, Musgrove CF, Ellinger AE (2014) Differential mediating effects of radical and incremental innovation on market orientation-performance relationship: a meta-analysis. J Mark Theory Pract 22(3):235–250

    Google Scholar 

  • Chen M-H, Yang Y-J (2009) Typology and performance of new ventures in Taiwan: a model based on opportunity recognition and entrepreneurial creativity. Int J Entrep Behav Res 15(5):398–414

    Google Scholar 

  • Chen MJ, Lin HC, Michel JG (2010) Navigating in a hypercompetitive environment: the roles of action aggressiveness and TMT integration. Strateg Manag J 31(13):1410–1430

    Google Scholar 

  • Chen Y-C, Li P-C, Evans KR (2012) Effects of interaction and entrepreneurial orientation on organizational performance: insights into market driven and market driving. Ind Mark Manag 41(6):1019–1034

    Google Scholar 

  • Christensen CM, Bower JL (1996) Customer power, strategic investment, and the failure of leading firms. Strateg Manag J 17:197–218

    Google Scholar 

  • Clausen T, Korneliussen T (2012) The relationship between entrepreneurial orientation and speed to the market: The case of incubator firms in Norway. Technovation 32(9–10):560–567

    Google Scholar 

  • Covin JG, Slevin DP (1988) The influence of organization structure on the utility of an entrepreneurial top management style. J Manag Stud 25(3):217–234

    Google Scholar 

  • Damanpour F (1991) Organizational innovation: a meta-analysis of effects of determinants and moderators. Acad Manag J 34(3):555–590

    Google Scholar 

  • Darroch J (2005) Knowledge management, innovation and firm performance. J Knowl Manag 9(3):101–115. https://doi.org/10.1108/13673270510602809

    Article  Google Scholar 

  • Darroch J, McNaughton R (2002) Examining the link between knowledge management practices and types of innovation. J Intellect Cap 3(3):210–222

    Google Scholar 

  • Day GS (1994) The capabilities of market-driven organizations. J Mark 58:37–52

    Google Scholar 

  • de Villiers Scheepers M, Verreynne M-L, Meyer D (2014) Entrepreneurial configurations of small firms. Int J Entrep Behav Res 20(6):562–583

    Google Scholar 

  • Ebben JJ (2007) Product offering, operational strategy, and performance of small firms. J Small Bus Entrep 20(3):245–255

    Google Scholar 

  • Eggers F, Kraus S, Hughes M, Laraway S, Snycerski S (2013) Implications of customer and entrepreneurial orientations for SME growth. Manag Decis 51(3):524–546

    Google Scholar 

  • Fisher G, Kotha S, Lahiri A (2016) Changing with the times: An integrated view of identity, legitimacy, and new venture life cycles. Acad Manag Rev 41(3):383–409

    Google Scholar 

  • Fornell C, Larcker DF (1981) Structural equation models with unobservable variables and measurement error: algebra and statistics. J Mark Res 18:382–388

    Google Scholar 

  • Forsman H, Rantanen H (2011) Small manufacturing and service enterprises as innovators: a comparison by size. Eur J Innov Manag 14(1):27–50

    Google Scholar 

  • González-Benito Ó, González-Benito J, Muñoz-Gallego PA (2009) Role of entrepreneurship and market orientation in firms' success. Eur J Mark 43(3/4):500–522

    Google Scholar 

  • Hair JF, Black WC, Babin BJ, Anderson RE (2010) Applications of SEM Multivariate data analysis. Pearson, Upper Saddle River

    Google Scholar 

  • He Z-L, Wong P-K (2004) Exploration vs exploitation: an empirical test of the ambidexterity hypothesis. Organization science 15(4):481–494

    Google Scholar 

  • Hughes M, Hughes P, Morgan RE (2007) Exploitative learning and entrepreneurial orientation alignment in emerging young firms: implications for market and response performance. Br J Manag 18(4):359–375

    Google Scholar 

  • Hurley RF, Hult GTM (1998) Innovation, market orientation, and organizational learning: an integration and empirical examination. J Mark 62(3):42–54

    Google Scholar 

  • Irwin KC, Landay KM, Aaron JR, McDowell WC, Marino LD, Geho PR (2018) Entrepreneurial orientation (EO) and human resources outsourcing (HRO): a “HERO” combination for SME performance. J Bus Res 90:134–140

    Google Scholar 

  • Jaworski B, Kohli AK, Sahay A (2000) Market-driven versus driving markets. J Acad Mark Sci 28(1):45–54

    Google Scholar 

  • Kasabov E (2015) Start-up difficulties in early-stage peripheral clusters: the case of IT in an emerging economy. Entrep Theory Pract 39(4):727–761

    Google Scholar 

  • Keh HT, Nguyen TTM, Ng HP (2007) The effects of entrepreneurial orientation and marketing information on the performance of SMEs. J Bus Ventur 22(4):592–611. https://doi.org/10.1016/j.jbusvent.2006.05.003

    Article  Google Scholar 

  • Kerin, R. A., Varadarajan, P. R., & Peterson, R. A. (1992). First-mover advantage: A synthesis, conceptual framework, and research propositions. J Mark, 56, 33–52

  • Khandwalla PN (1976) Some top management styles, their context and performance. Organ Adm Sci 7(4):21–51

    Google Scholar 

  • Kirca AH, Jayachandran S, Bearden WO (2005) Market orientation: a meta-analytic review and assessment of its antecedents and impact on performance. J Mark 69(2):24–41

    Google Scholar 

  • Kirzner IM (1997) Entrepreneurial discovery and the competitive market process: an Austrian approach. J Econ Lit 35(1):60–85

    Google Scholar 

  • Kline RB (2005) Principles and practice of structural equation modeling, 2nd edn. Guilford Press, New York

    Google Scholar 

  • Kocak A, Carsrud A, Oflazoglu S (2017) Market, entrepreneurial, and technology orientations: impact on innovation and firm performance. Manag Decis 55(2):248–270

    Google Scholar 

  • Kohli AK, Jaworski BJ (1990) Market orientation: the construct, research propositions, and managerial implications. J Mark 54:1–18

    Google Scholar 

  • Kollmann T, Stöckmann C (2014) Filling the entrepreneurial orientation–performance gap: the mediating effects of exploratory and exploitative innovations. Entrep Theory Pract 38(5):1001–1026

    Google Scholar 

  • Kreiser PM, Marino LD, Weaver KM (2002) Assessing the psychometric properties of the entrepreneurial orientation scale: A multi-country analysis. Entrep Theory Pract 26(4):71–93

    Google Scholar 

  • Kumar N, Scheer L, Kotler P (2000) From market driven to market driving. Eur Manage J 18(2):129–142

    Google Scholar 

  • Kwak H, Jaju A, Puzakova M, Rocereto JF (2013) The connubial relationship between market orientation and entrepreneurial orientation. J Mark Theory Pract 21(2):141–162

    Google Scholar 

  • Laforet S (2011) A framework of organisational innovation and outcomes in SMEs. Int J Entrep Behav Res 17(4):380–408

    Google Scholar 

  • Lee C, Lee K, Pennings JM (2001) Internal capabilities, external networks, and performance: a study on technology-based ventures. Strateg Manag J 22(6–7):615–640

    Google Scholar 

  • Li Y, Liu Y, Zhao Y (2006) The role of market and entrepreneurship orientation and internal control in the new product development activities of Chinese firms. Ind Mark Manage 35(3):336–347

    Google Scholar 

  • Luger MI, Koo J (2005) Defining and tracking business start-ups. Small Bus Econ 24(1):17–28

    Google Scholar 

  • Lumpkin GT, Dess GG (1996) Clarifying the entrepreneurial orientation construct and linking it to performance. Acad Manag Rev 21(1):135–172

    Google Scholar 

  • Martens CDP, Lacerda FM, Belfort AC, Freitas HMRD (2016) Research on entrepreneurial orientation: current status and future agenda. Int J Entrep Behav Res 22(4):556–583

    Google Scholar 

  • Martin SL, Javalgi RRG (2016) Entrepreneurial orientation, marketing capabilities and performance: the moderating role of competitive intensity on Latin American international new ventures. J Bus Res 69(6):2040–2051

    Google Scholar 

  • Matsuno K, Mentzer JT, Özsomer A (2002) The effects of entrepreneurial proclivity and market orientation on business performance. J Mark 66(3):18–32

    Google Scholar 

  • Miller D (1983) The correlates of entrepreneurship in three types of firms. Manag Sci 29(7):770–791

    Google Scholar 

  • Morgan NA, Vorhies DW, Mason CH (2009) Market orientation, marketing capabilities, and firm performance. Strateg Manag J 30(8):909–920

    Google Scholar 

  • Morgan T, Anokhin S, Kretinin A, Frishammar J (2015) The dark side of the entrepreneurial orientation and market orientation interplay: A new product development perspective. Int Small Bus J 33(7):731–751

    Google Scholar 

  • Narver JC, Slater SF (1990) The effect of a market orientation on business profitability. J Mark 54:20–35

    Google Scholar 

  • Narver JC, Slater SF, MacLachlan DL (2004) Responsive and proactive market orientation and new-product success. J Prod Innov Manag 21(5):334–347

    Google Scholar 

  • Nasution HN, Mavondo FT (2008) Organisational capabilities: antecedents and implications for customer value. Eur J Mark 42(3/4):477–501

    Google Scholar 

  • Palmer C, Niemand T, Stöckmann C, Kraus S, Kailer N (2017) The interplay of entrepreneurial orientation and psychological traits in explaining firm performance. J Bus Res 94:183–194

    Google Scholar 

  • Pettigrew AM, Fenton EM (2000) The innovating organization. Sage, Thousand Oaks

    Google Scholar 

  • Rauch A, Wiklund J, Lumpkin GT, Frese M (2009) Entrepreneurial orientation and business performance: an assessment of past research and suggestions for the future. Entrep Theory Pract 33(3):761–787

    Google Scholar 

  • Saris WE, Satorra A, Van der Veld WM (2009) Testing structural equation models or detection of misspecifications? Struct Equ Model 16(4):561–582

    Google Scholar 

  • Schindehutte M, Morris MH, Kocak A (2008) Understanding market-driving behavior: the role of entrepreneurship. J Small Bus Manage 46(1):4–26

    Google Scholar 

  • Schumpeter, J. A. (1934). The schumpttr: theory economic development. Harvard University Press.

  • Sethi R, Smith DC, Park CW (2001) Cross-functional product development teams, creativity, and the innovativeness of new consumer products. J Mark Res 38(1):73–85

    Google Scholar 

  • Slater SF, Narver JC (1994) Does competitive environment moderate the market orientation-performance relationship? The Journal of Marketing 58:46–55

    Google Scholar 

  • Song M, Xie J (2000) Does innovativeness moderate the relationship between cross-functional integration and product performance? J Int Mark 8(4):61–89

    Google Scholar 

  • Stam W, Elfring T (2008) Entrepreneurial orientation and new venture performance: the moderating role of intra-and extraindustry social capital. Acad Manag J 51(1):97–111

    Google Scholar 

  • Su Z, Xie E, Li Y (2011) Entrepreneurial orientation and firm performance in new ventures and established firms. J Small Bus Manage 49(4):558–577

    Google Scholar 

  • Venkatraman N (1989) The concept of fit in strategy research: toward verbal and statistical correspondence. Acad Manag Rev 14(3):423–444

    Google Scholar 

  • Vora D, Vora J, Polley D (2012) Applying entrepreneurial orientation to a medium sized firm. Int J Entrep Behav Res 18(3):352–379

    Google Scholar 

  • Wales WJ, Gupta VK, Mousa F-T (2013) Empirical research on entrepreneurial orientation: an assessment and suggestions for future research. Int Small Bus J 31(4):357–383

    Google Scholar 

  • Wang T, Thornhill S, De Castro JO (2017) Entrepreneurial orientation, legitimation, and new venture performance. Strateg Entrep J 11(4):373–392

    Google Scholar 

  • Webb JW, Ireland RD, Hitt MA, Kistruck GM, Tihanyi L (2011) Where is the opportunity without the customer? An integration of marketing activities, the entrepreneurship process, and institutional theory. J Acad Mark Sci 39(4):537–554

    Google Scholar 

  • Wiklund J, Shepherd D (2005) Entrepreneurial orientation and small business performance: a configurational approach. J Bus Ventur 20(1):71–91

    Google Scholar 

  • Yang W, Meyer KE (2015) Competitive dynamics in an emerging economy: competitive pressures, resources, and the speed of action. J Bus Res 68(6):1176–1185

    Google Scholar 

  • Zhou KZ, Yim CK, Tse DK (2005) The effects of strategic orientations on technology-and market-based breakthrough innovations. J Mark 69(2):42–60

    Google Scholar 

Download references

Author information

Authors and Affiliations

  1. Business Policy and Strategy, Indian Institute of Management Raipur, Atal Nagar, P. O. - Kurru (Abhanpur), Raipur, (C.G.), 493 661, India

    Sushil Kumar & Satyasiba Das

Authors
  1. Sushil Kumar
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. Satyasiba Das
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Sushil Kumar.

Additional information

Publisher's Note

Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.

Rights and permissions

Reprints and permissions

About this article

Check for updates. Verify currency and authenticity via CrossMark

Cite this article

Kumar, S., Das, S. Integrated framework of strategic orientation, value offerings and new venture performance. Decision 47, 3–17 (2020). https://doi.org/10.1007/s40622-020-00232-y

Download citation

  • Published:

  • Issue Date:

  • DOI: https://doi.org/10.1007/s40622-020-00232-y

Keywords

Search

Navigation