Mediating effect of marketing capability and reward philosophy in the relationship between entrepreneurial orientation and firm performance

Pratono, Aluisius Hery and Mahmood, Rosli (2015) Mediating effect of marketing capability and reward philosophy in the relationship between entrepreneurial orientation and firm performance. Journal of Global Entrepreneurship Research, 5 (5). pp. 1-12. ISSN 2251-7316

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Abstract

The complex relationship between firm performance and entrepreneurial resources raises attention to development program with aim of promoting entrepreneurial mindset to the SMEs. This study has intention to determine the impact of entrepreneurial orientation on firm performance, which involves two mediating variables: reward philosophy and marketing capability. Reward philosophy and incentive system are the most under-researched area in human resource, especially in the context of small business. With SMEs data survey in Indonesia, the result reveals that reward philosophy is not sufficient to explain the relationship between entrepreneurial orientation and firm performance. It requires marketing capability, which can transform reward philosophy to performance. This study contributes to the development of resource-based theory, through discussing the role of dynamic capability. The research uses quantitative approach with the SMEs in Surabaya as unit analysis. Data analysis involves 390 SMEs taken from random sample selection process. The analysis involves descriptive, regression and structural equation modeling (SEM) approaches to test the hypotheses. The finding explains full mediating effect of employee compensation and marketing capability in converting entrepreneurial orientation to gain greater firm performance.

Item Type: Article
Uncontrolled Keywords: Firm performance; Entrepreneurial orientation; Reward philosophy; Marketing capability
Subjects: H Social Sciences > HB Economic Theory
Divisions: Faculty of Business and Economic > Department of Economic
Depositing User: Hery Pratono 31105
Date Deposited: 05 Jun 2015 02:38
Last Modified: 05 Jun 2015 02:38
URI: http://repository.ubaya.ac.id/id/eprint/24555

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