Unlocking the relationship between corporate entrepreneurship and performance

Official URL: http://192.168.1.20/record=b1276351 (Table of Contents)

Corporate entrepreneurship is the implementation of a value creation process in an organizational setting. Consistent with the Schumpeterian understanding of entrepreneurship, a “new combination” that should directly affect the performance of the firm is formed; and the process of forming this new combination manifests itself as an outcome of a complex social mechanism affected by internal and external factors. However, in spite of the biasing anecdotal evidence, conventional wisdom, and tendency in favor of entrepreneurship, a “black box” between firm-level entrepreneurship and performance has pervaded the relationship. Nevertheless, the model proposed in this study brings a totally new and distinguishing line of sight into the firm-level entrepreneurship literature: rather than being an equivalent, the entrepreneurial orientation construct is treated as an antecedent of corporate entrepreneurship; moreover the behavioral construct of corporate entrepreneurship is placed in between this strategic posture and performance, to complete “the missing” link between firm-level entrepreneurship and performance. Only under this formulation of roles and meanings attached to both terms, is it possible to find a solid, conclusive, and systematic direct positive relationship between firm level entrepreneurship and performance. Empirical findings strongly confirm this proposed hypothesis, making this formulation the most important contribution of this study. In other words, parallel to resource based view of the firm, organizational culture with environmental context, does feed entrepreneurial orientation; the extent to which this disposition will be successful in turning to a new combination and good performance consequently depends upon the common and contextual variables.