The Genesis of the Entrepreneurial Orientation and the Proposed Model

Abstract

­Entrepreneurial Orientation (EO) today has graduated from being a small construct to the much researched construct in the research domain. Many academicians have penned down their research on the basis of their understanding about the construct. From earlier researchers who started to coin about the concept of entrepreneurship to later theorists, all have added to some extension to the existing legacy of literature. This article throws light on the literature status of EO and also proposes a proposed model of EO which is a slight extension on the previous model.­ Entrepreneurial orientation (EO) has received substantial conceptual and empirical attention, representing one of the few areas in entrepreneurship research where accumulative body of knowledge is developing. The time is therefore ripe to document, review, and evaluate the cumulative knowledge on the relationship between EO and business performance. This paper develops a theoretical model of the relationship between firm-level entrepreneurship and firm performance. This model is intended to further clarify the consequences of an ‘entrepreneurial orientation,' paying particular attention to the differential relationship that exists between the three sub-dimensions of entrepreneurial orientation and firm performance. Included in the theoretical model are other important variables (such as organizational structure and environmental characteristics) that may impact the EO-performance relationship. Propositions are developed regarding the various configurations of the sub-dimensions of EO and organizational structure that would be most appropriate in a given environmental context. Future research may also benefit from considering the important role that organizational strategy and life cycle stage play in this model. The implications of this model for both researchers and managers are discussed.