ORGANIZATIONAL KNOWLEDGE AND ENTREPRENEURIAL ORIENTATION: PERFORMANCE IMPLICATIONS
Johan Wiklund, Stockholm School of Economics
Principal Topic
Resource-based theory holds that differences in organizations’ resource endowments explain performance differences. Recent conceptualizations suggest that to achieve competitive advantage firms must also fit their resources to their organizational orientation. This has led to the development of the VRIO framework. Knowledge-based resources play a particularly important role for firms’ ability to discover and exploit new opportunities, something which has become increasingly important for long-term performance. But firms must also have a suitable strategic orientation to be able to seize the new opportunities. Research has indicated that an entrepreneurial strategic orientation (EO) is particularly suitable for pursuing new opportunities. This suggests that there should be a fit between the firm’s knowledge-based resources and its degree of EO. Therefore, this paper examines the performance outcomes of configurations of knowledge-based resources and EO.
Method
A longitudinal database of 500 Swedish firms of different sizes and in different industrial sectors, and hierarchical multiple regression analysis, was used to test tests how interactions of knowledge-based resources and EO affect performance.
Results and Implications
Results indicate that technological knowledge has a direct positive effect on performance, whereas EO moderates the positive impact of market knowledge. This suggests that firms with superior technological knowledge can achieve high performance regardless of organizational orientation, but that market knowledge should be accompanied with an innovative, risk-taking and proactive organizational orientation (EO). This paper makes several contributions to the entrepreneurship and RBV literatures. First, scholars have recently drawn our attention to the inadequacy of main-effects-only models for investigating the RBV framework (i.e., VRIO). This paper provides a confirmatory test of these suggestions. Second, a focus on organizational resources complements the large body of research investigating the EO-performance relationship. Third, while cross-sectional studies have increased our knowledge about the effects of EO, longitudinal designs are better suited to capture the lag between knowledge, and strategic orientation and their subsequent affect on performance.
CONTACT: Johan Wiklund, Stockholm School of Economics, P.O. Box 6501, SE-113 83 Stockholm, Sweden; (T) +46 8 736 93 97; (F) +46 8 31 27 85; johan.wiklund@.hhs.se
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