Strategic Entrepreneurial Orientation:Development of a Multi-Dimensional Construct Based on Literature Review

Research in the field of entrepreneurship and strategy has largely developed independent of each other. While entrepreneurship has focused on opportunity seeking approach, strategic management has focused on advantage seeking behavior increasingly researchers have highlighted some overlapping areas in these two disciplines. This study talks about inter-linkage of entrepreneurship and strategy and the emergence of strategic and entrepreneurial orientation construct (EO). Increasingly entrepreneurship is considered as making a new entry and the process of making this new entry is called firm’s strategic orientation. This led to development of firm’s strategic and entrepreneurial orientation (EO) construct which talks about entrepreneurship as a firm level phenomenon and highlights the process of making new entry through its strategic approach. Most of the studies in this field tend to examine firm’s strategic and entrepreneurial construct through three most commonly used dimensions of innovativeness, pro-activeness and risk-taking and put them together into a gestalt or uni-dimensional construct where these three dimensions co-vary. Prior research highlights that EO contributes positively to business performance but some studies have found the opposite or insignificant influence. This study tries to overcome this inconsistency by building on literature highlighting that EO construct is better explained by five dimensions rather than three by the addition of competitive aggressiveness and autonomy to the existing three dimensions and these dimensions vary independently rather than co-varying. This study argues the need to consider EO as a multidimensional construct rather than a uni-dimensional one and highlights that some of these dimensions may have a positive influence on firm performance whereas some may have a negative or insignificant influence and further this influence may vary across firm life-cycle.