Determinant or moderator? Exploring the role of the external environment in the relationship between dimensions of entrepreneurial orientation and firm performance. Evidence from the hotel industry

This study focuses on analyzing the role of the external environment in shaping entrepreneurial orientation (EO) and its key dimensions: innovativeness, proactiveness, and risk-taking, as well as its influence on the relationship between EO, its dimensions, and firm performance. Two distinct models are examined: one positioning the external environment as a determinant of EO, and the other viewing it as a moderator in the relationship between EO and firm performance. Four traditional dimensions of the external environment are considered: complexity, dynamism, hostility, and munificence. The sample consists of small and medium-sized independent hotels in Poland, representing a sector particularly affected by the pandemic crisis. Data were collected through surveys conducted in May and June 2023. The hypotheses were tested using statistical analyses and Partial Least Squares Structural Equation Modeling. The findings reveal that the external environment appears more often as antecedent than moderator in the tested models. This observation indicates that the external environment’s role as a determinant is more pronounced than its moderating function. Furthermore, the analysis provides a deeper understanding of how external conditions shape EO, indicating that the most influential dimensions of the external environment are complexity and dynamism. This study adopts a novel and comprehensive approach by analyzing the external environment both as a determinant and as a moderator of EO, while also examining EO as a unidimensional and multidimensional construct. By examining firm performance from the perspectives of competitiveness and growth, this study provides insights into the interplay between the external environment, EO, and firm performance. Such an approach not only advances the theoretical and methodological frameworks in entrepreneurship research, filling critical gaps in the literature, but also provides practical guidance for managers in navigating the challenges of the contemporary business environment.