Deasy Tantriana, Heri Pratikto, Puji Handayati, Cipto Wardoyo
Entrepreneurial orientation (EO), dynamic capabilities (DC), and competitive advantage (CA) have become interesting research subjects related to small and medium enterprises (SMEs) in dealing with external environmental uncertainties. This study investigated the effect of EO on firm performance by considering the roles of DC and CA. We proposed that DC and CA mediate the relationship between EO and perfomance (P). The study adopted a survey research design. Data were collected using a cluster random sampling selected sample of 248 SMEs in Surabaya, East Java, Indonesia, and the research framework was assessed using structural equation modelling (SEM). The results showed that EO positively affects SME performance, but CA and DC do not mediate the relationship between EO and SME performance. To the best of the authors’ knowledge, in the context of emerging economies like Indonesia, this study is the first to offer empirical evidence of the mediating role of competitive advantage and dynamic skills in the relationship between EO and SME performance. © 2023, Nigerian Economic Society. All rights reserved.
Faculty of Economics, Universitas Negeri Malang, Indonesia; Fakultas Ekonomi dan Bisnis Islam, UIN Sunan Ampel Surabaya, Indonesia