The Impact Of Entrepreneurial Orientation And Market Orientation On Manufacturing Small And Medium Enterprises Satisfaction With The Moderating Effect Of E-Commerce Utilization In Malays
Loading...
Date
2016-09
Authors
Kanaan Jebna, Abdulkarim
Journal Title
Journal ISSN
Volume Title
Publisher
Abstract
Although Malaysia is a fast developing country in Southeast Asia, the literature revealed that the failure rate of Small and Medium Enterprises (SMEs) in the manufacturing sector is inevitable. This study proposes that entrepreneurial orientation and market orientation are essential to maintain business survival and satisfaction in terms of financial and non-financial performance. In addition, the study hypothesizes that e-commerce utilization (i.e., inbound communication, outbound communication, and order-taking) could further strengthen the effects of entrepreneurial and market orientations on business performance. The population of this study is SMEs in the manufacturing sector. Based on data collected from 107 responses, the results show that entrepreneurial orientation has no impact on financial performance, while it has a positive impact on non-financial performance. In contrast, market orientation affects financial and non-financial performance positively. In addition, the study shows that e-commerce utilization, i.e. order-taking, inbound, and outbound communications have no moderating effect on the relationships between entrepreneurial orientation and market orientation and business performance (financial and non-financial business performance). However, in order to get more insight on the results of this study, five interviews were conducted with owner-managers of manufacturing SMEs in Penang. The interviews have given a deeper insight and explanation to the results. Based on the results and the interviews, practical implication and guidelines are provided to the
Malaysian government, owner-managers of manufacturing SMEs, and IT researchers and developers. To maintain business survival and satisfaction, SMEs should enrich their strategic orientations with entrepreneurial and market oriented activities. Yet, the market situation should be considered as the lack of effect between EO and financial business performance could be due to the market situation: saturated or unsaturated. Many owner-managers based on the demographic information have technology knowledge, albeit not deep. This could explain why e-commerce utilization has shown no impact on the relations between entrepreneurial and market orientations and business performance. Based on resource-based view and the theory of dynamic capabilities, e-commerce is not merely a matter of web presence, but rather it is a matter of taking the valuable information it offers to guide the entrepreneurial and market oriented activities to boost business performance. As a result, because we live in a technology-oriented era, entrepreneurs should equip themselves with sufficiently updated IT knowledge in order to utilize technologies beyond superficial implementation. IT has become a widely available and inimitable tool unlike decades ago; thus, understanding the deep benefits of what e-commerce utilization can offer, could help to set a company apart from its competitors. At the end of this research, the limitation and future study suggestions are provided.
Description
Keywords
Entrepreneurial orientation and market orientation are essential to maintain business survival , and satisfaction in terms of financial and non-financial performance.