Linking Strategic Management and Corporate Entrepreneurship for Firm Value Creation: A Developing Country Perspective

Abstract

ABSTRACT The ever-increasing global business environment dynamism, change, and heterogeneity require a flexible, proactive, innovative, and aggressive managerial approach. The quest for such approaches settle strategic management and corporate entrepreneurship as a new firm‐level phenomenon that deserves scholarly attention. The subtle interaction of strategic management & corporate entrepreneurship has the potential of boosting firms’ capability to recognize, discover, and create entrepreneurial opportunities and develop them toward sustainable competitive advantages. The study followed an interpretive research philosophy, both exploratory and explanatory designs, quantitative approach, and survey method. The perceptions of corporate and strategic business unit level managers of 104 Ethiopian food processing firms established the study setting. We employed both exploratory and confirmatory factor analyses to identify a set of latent constructs underlying battery of measured variables and test if data fit the hypothesized measurement model, respectively. Results signpost locus of planning and strategic control influencing corporate entrepreneurship while environmental scanning did not. Moreover, planning flexibility, planning horizon, and financial control influenced only certain aspects of corporate entrepreneurship. We conclude a weak relationship between strategic management practice and intra-organizational entrepreneurship in conservative firms with little or no radical departure from historical and predominant structural patterns, characterized by superfluous, unplanned, and routine decisions.