Social media’s impact on organizational performance and entrepreneurial orientation in organizations

Abstract

Purpose Based on the system of value chain theory, the purpose of this paper is to investigate the impact of social media usage on the performance and the entrepreneurial orientation of the organizations. Design/methodology/approach A total of 174 organizations responded to the survey. Findings The result of the study showed that social media usage has a very strong positive impact on organizations’ performance, in terms of cost reduction, improved customer relations, and enhanced information accessibility. Research limitations/implications In the study, social media usage was categorized into three sub-constructs such as social media usage for marketing, social media usage for building customer relations, and social media usage for information search. This study investigated the usage of social media and its impact as a whole, considering all social media tools together. Finally, this study used a cross-sectional sample to collect data. Practical implications The result of the study benefits the managers to understand the various areas of organizational performance that can be improved by social media usage. Social implications The study also provided evidence that social media usage has strong positive influences on enhancing the entrepreneurial orientation of the organizations. Originality/value This study provides a clearer idea on the real importance of social media and its benefits. This study demonstrated the various areas of organizational performance that can be improved through social media usage.