Linking entrepreneurial orientation to SMEs’ performance - Implications for entrepreneurship universities

Purpose.The objective of this paper is to measurethe relationship between Entrepreneurial Orientation (EO) and Performance of Small and Medium-sized Enterprises (SMEs) in order to provide recommendations aimed to integrate EO practices into organisations’ business strategiesas well as to identify implications that can inform knowledge-based initiatives of entrepreneurial universities that focus on the development of entrepreneurial capacity of SMEs. Design/methodology/approach. This research paper adopts a quantitative approach to investigate a conceptual framework linking EO to SME’s Performance. The central postulated hypothesis is that EO positively affects Performance of SMEs. To verify this hypothesis, the proposed framework was tested using a system of partial least squares (PLS-SEM) of structural equations modelling,adopting the SmartPLS® 3.0 software(Ringle, Wende, & Becker, 2015). The empirical context analysed 170 SMEsoperating in the Bajio Region (México) in the leather-footwear sector. Findings.The results provide evidence that Mexican companies with EO have a positive effect on itsfirm performance. Similarly, findingsemphasisethatboth Risk-Taking and Innovativenessare currently the central axes of EO,aboutthe analysedcompanies.Accordingly, entrepreneurial universities can support the development of entrepreneurial capacity by focusing on knowledge-based actions that can foster the improvement of some specific features of the EO. Practical implications.The resultsprovide insights about the relationships between EO and the Performance of SMEs indicating that potentials initiatives of entrepreneurial universities aimed to support the development capacity of SMEs should focus their attention on the critical distinguishing dimensions of EO. Originality/value of paper.This paper provides evidence of four central EO’s insights. Firstly, derived from literature research, it proposes a working definition of EO. Secondly, these research findings support an understanding of therelationship between EO and Mexican SMEs Performance and propose a multiple and reflective dimension of EO’s model. And finally, this research attempts to provide some implications for entrepreneurship universities aiming to support the integration of entrepreneurial strategies in SMEs particularly in developing countries