Importance of Entrepreneurial Orientations
In addition to the Entrepreneurial orientations which is increasingly regarded as important to firms, but in today’s complex global economy, entrepreneurship has become even more crucial towards obtaining a sustainable competitive advantage. Due to globalization, small and medium enterprises face increasing pressure from competition from across the World. When compounded with the changing sophistication of customers worldwide it becomes apparent that SME’s face increasing difficulty in maintaining and improving business performance in time, unless they can actively manage these pressures.
Hence SME’s are encouraged to implement an entrepreneurial mind set to recognize the threats and opportunities in the environment of the firm in order to make sure that the firm will continue to exist in the future, considering proactive competitive aggressiveness and autonomy; shows that an increase in these and other dimensions will improve business performance/survival.
Typically increasing the entrepreneurial orientations of a firm is a good thing.
There are circumstances under which the pursuit of opportunities can diminish the firm’s performance/survival. If the employees are not adaptable to changes it may affect or there may be lack of flexibility in the organization, then changes may affect the employee’s productivity.
Therefore, Entrepreneurial Orientations is also not beneficial in industries that focused heavily on specific technologies and working environment, although the consequences of it depend on the nature, flexibility and adaptability of the organization.
It helps business operations to success with both external and internal factors, the external factors include economic and social conditions, political and technological factors while the internal factors like, entrepreneurial management which consist of a level of emphasis placed on strategic orientations, resources orientations, management structure, entrepreneurial culture development, reward philosophies etc.
There are always tremendous growth when Entrepreneurial Orientations are applied by the entrepreneurs. Outstanding growth can be seen in terms of financial performance of the firm and employees satisfaction.
Entrepreneurial Orientations work on the entrepreneurial thinking and behaviour as well, this is not limited to those who begin their businesses in a small shop with a new idea either financed by their family members or from their personal savings, but some people in large organisations are filled with passion for a new product or services, work with key players in the organization to build the constituency and then find the ways to acquire the needed resources to bring the idea to fruition.