Entrepreneurial Orientation, Interaction Orientation, and Innovation Performance: A Model of Moderated Mediation

Wenhao Song,Hongyan Yu,Xifang Ma

doi:10.1177/2158244019885143

Abstract

This research explored the relationships between entrepreneurial orientation (EO), interaction orientation (IO), and innovation performance based on resource-based theory. We used two market approaches (market-driving and market-driven) to test our research model. We collected data from the responses of 209 corporations in China. Our findings indicated that both EO and IO positively affected knowledge combination capability (KCC), which contributed to innovation performance. The results indicated that organizational collectivism moderated the link between EO and KCC. It also moderated the mediation effect of EO on firm’s innovation performance by KCC. Interestingly, we found that organizational collectivism moderated the link between IO and KCC and also moderated the mediation of IO on innovation performance by KCC. Our research contributes to the field of strategic orientation and suggests that managers should pay attention to the two market approaches and organizational culture, which can improve innovation performance. Furthermore, this research offers theoretical and practical implications to firm’s innovation capability.

Highlights

Prior research has emphasized on innovation performance because of its important contribution to a firm’s competitive advantage (Oke, Walumbwa, & Myers, 2012; Zenger & Lazzarini, 2004)
Based on the resource-based view (RBV) and market orientation theory, we investigated whether entrepreneurial orientation (EO) and interaction orientation (IO) influence innovation through knowledge combination capability (KCC) and how EO and IO affect innovation performance when considering organizational collectivism
The findings indicate that EO and IO are positively associated with KCC (β = .355, p < .001; β = .323, p < .001)

Summary

Introduction

Prior research has emphasized on innovation performance because of its important contribution to a firm’s competitive advantage (Oke, Walumbwa, & Myers, 2012; Zenger & Lazzarini, 2004). The market-driving approach proactively shapes customer behaviors through discerning and exploring new opportunities that surpass the existing market preferences and market structure (Johnson, Lee, Saini, & Grohmann, 2003), which indicated that the goal of market-driving firms is to lead the evolution of their industry rather than respond positively to their customers’ needs (Beverland, Ewing, & Matanda, 2006). Both approaches can help companies to attain the competitive advantage (Tuominen, Rajala, & Möller, 2004)

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