IDEAS home Printed from https://ideas.repec.org/a/spr/manint/v60y2020i1d10.1007_s11575-019-00397-4.html
   My bibliography  Save this article

Entrepreneurial Orientation in Multinational Corporations: Antecedents and Effects

Author

Listed:
  • Li Chen

    (University of Missouri)

  • Shaoming Zou

    (University of Missouri)

  • Hui Xu

    (Nankai University)

  • Yiwen Chen

    (University of Missouri)

Abstract

Despite its importance to business performance, the role of Entrepreneurial Orientation (EO) in multinational corporations (MNCs) is under-researched. This study investigates the drivers of EO and its performance outcome in the context of large MNCs. The authors theorize that an MNC’s organizational characteristics drive the formation of its EO and an MNC’s EO affects its performance in the global market under certain contingency conditions. Based on a survey of large MNCs, the authors find that an MNC’s EO is positively affected by its technological flexibility and subsidiary cooperation, and negatively influenced by centralization of its organizational structure. In addition, EO’s positive effect on an MNC’s performance is weakened by its international experience. This study advances the literature by developing and empirically supporting a theory of EO in large MNCs. The results also have significant implications for MNCs that consider adopting EO to improve their performance in the global market.

Suggested Citation

  • Li Chen & Shaoming Zou & Hui Xu & Yiwen Chen, 2020. "Entrepreneurial Orientation in Multinational Corporations: Antecedents and Effects," Management International Review, Springer, vol. 60(1), pages 123-148, February.
    • Handle: RePEc:spr:manint:v:60:y:2020:i:1:d:10.1007_s11575-019-00397-4
    DOI: 10.1007/s11575-019-00397-4
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s11575-019-00397-4
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s11575-019-00397-4?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Jeffrey G. Covin & G.T. Lumpkin, 2011. "Entrepreneurial Orientation Theory and Research: Reflections on a Needed Construct," Entrepreneurship Theory and Practice, , vol. 35(5), pages 855-872, September.
    2. Sumantra Ghoshal & Nitin Nohria, 1989. "Internal differentiation within multinational corporations," Strategic Management Journal, Wiley Blackwell, vol. 10(4), pages 323-337, July.
    3. Gupta, Anil K. & Govindarajan, V., 1994. "Organizing for knowledge flows within MNCs," International Business Review, Elsevier, vol. 3(4), pages 443-457, December.
    4. Dirk De Clercq & Dimo Dimov & Narongsak (Tek) Thongpapanl, 2013. "Organizational Social Capital, Formalization, and Internal Knowledge Sharing in Entrepreneurial Orientation Formation," Entrepreneurship Theory and Practice, , vol. 37(3), pages 505-537, May.
    5. Rita Gunther McGrath & Ian C. Macmillan & S. Venkataraman, 1995. "Defining and developing competence: A strategic process paradigm," Strategic Management Journal, Wiley Blackwell, vol. 16(4), pages 251-275.
    6. Per Davidsson & Frédéric Delmar & Johan Wiklund, 2006. "Entrepreneurship and the Growth of Firms," Books, Edward Elgar Publishing, number 3971.
    7. Keith D. Brouthers & George Nakos & Pavlos Dimitratos, 2015. "SME Entrepreneurial Orientation, International Performance, and the Moderating Role of Strategic Alliances," Entrepreneurship Theory and Practice, , vol. 39(5), pages 1161-1187, September.
    8. Williams, Christopher & Lee, Soo Hee, 2011. "Entrepreneurial contexts and knowledge coordination within the multinational corporation," Journal of World Business, Elsevier, vol. 46(2), pages 253-264, April.
    9. Semrau, Thorsten & Ambos, Tina & Sascha Kraus,, 2016. "Entrepreneurial orientation and SME performance across societal cultures: An international study," Journal of Business Research, Elsevier, vol. 69(5), pages 1928-1932.
    10. Jeffrey G. Covin & William J. Wales, 2012. "The Measurement of Entrepreneurial Orientation," Entrepreneurship Theory and Practice, , vol. 36(4), pages 677-702, July.
    11. Anil K. Gupta & Vijay Govindarajan, 2000. "Knowledge flows within multinational corporations," Strategic Management Journal, Wiley Blackwell, vol. 21(4), pages 473-496, April.
    12. Bruce Kogut & Udo Zander, 1993. "Knowledge of the Firm and the Evolutionary Theory of the Multinational Corporation," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 24(4), pages 625-645, December.
    13. John L Naman & Dennis P. Slevin, 1993. "Entrepreneurship and the concept of fit: A model and empirical tests," Strategic Management Journal, Wiley Blackwell, vol. 14(2), pages 137-153, February.
    14. Zeng, Rong & Grøgaard, Birgitte & Steel, Piers, 2018. "Complements or substitutes? A meta-analysis of the role of integration mechanisms for knowledge transfer in the MNE network," Journal of World Business, Elsevier, vol. 53(4), pages 415-432.
    15. Bradley A. George, 2011. "Entrepreneurial Orientation: A Theoretical and Empirical Examination of the Consequences of Differing Construct Representations," Journal of Management Studies, Wiley Blackwell, vol. 48, pages 1291-1313, September.
    16. Kendall Roth & David M Schweiger & Allen J Morrison, 1991. "Global Strategy Implementation at the Business Unit Level: Operational Capabilities and Administrative Mechanisms," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 22(3), pages 369-402, September.
    17. Armstrong, J. Scott & Overton, Terry S., 1977. "Estimating Nonresponse Bias in Mail Surveys," MPRA Paper 81694, University Library of Munich, Germany.
    18. Kevin Zheng Zhou & Fang Wu, 2010. "Technological capability, strategic flexibility, and product innovation," Strategic Management Journal, Wiley Blackwell, vol. 31(5), pages 547-561, May.
    19. Ari Jantunen & Kaisu Puumalainen & Sami Saarenketo & Kalevi Kyläheiko, 2005. "Entrepreneurial Orientation, Dynamic Capabilities and International Performance," Journal of International Entrepreneurship, Springer, vol. 3(3), pages 223-243, September.
    20. Dimitratos, Pavlos & Lioukas, Spyros & Carter, Sara, 2004. "The relationship between entrepreneurship and international performance: the importance of domestic environment," International Business Review, Elsevier, vol. 13(1), pages 19-41, February.
    21. Williams, Christopher & Lee, Soo Hee, 2009. "Resource allocations, knowledge network characteristics and entrepreneurial orientation of multinational corporations," Research Policy, Elsevier, vol. 38(8), pages 1376-1387, October.
    22. Wiklund, Johan & Shepherd, Dean, 2005. "Entrepreneurial orientation and small business performance: a configurational approach," Journal of Business Venturing, Elsevier, vol. 20(1), pages 71-91, January.
    23. Jeffrey G. Covin & Danny Miller, 2014. "International Entrepreneurial Orientation: Conceptual Considerations, Research Themes, Measurement Issues, and Future Research Directions," Entrepreneurship Theory and Practice, , vol. 38(1), pages 11-44, January.
    24. Suk Bong Choi & Christopher Williams, 2016. "Entrepreneurial orientation and performance: mediating effects of technology and marketing action across industry types," Industry and Innovation, Taylor & Francis Journals, vol. 23(8), pages 673-693, November.
    25. María Ripollés-Meliá & Martina Menguzzato-Boulard & Luz Sánchez-Peinado, 2007. "Entrepreneurial orientation and international commitment," Journal of International Entrepreneurship, Springer, vol. 5(3), pages 65-83, December.
    26. Andreas Rauch & Johan Wiklund & G.T. Lumpkin & Michael Frese, 2009. "Entrepreneurial Orientation and Business Performance: An Assessment of past Research and Suggestions for the Future," Entrepreneurship Theory and Practice, , vol. 33(3), pages 761-787, May.
    27. Ikujiro Nonaka, 1994. "A Dynamic Theory of Organizational Knowledge Creation," Organization Science, INFORMS, vol. 5(1), pages 14-37, February.
    28. Anupama Phene & Paul Almeida, 2008. "Innovation in multinational subsidiaries: The role of knowledge assimilation and subsidiary capabilities," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 39(5), pages 901-919, July.
    29. Danny Miller, 1983. "The Correlates of Entrepreneurship in Three Types of Firms," Management Science, INFORMS, vol. 29(7), pages 770-791, July.
    30. Yadong Luo & Rosalie L Tung, 2007. "International expansion of emerging market enterprises: A springboard perspective," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 38(4), pages 481-498, July.
    31. Man Zhang & Patriya Tansuhaj & James McCullough, 2009. "International entrepreneurial capability: The measurement and a comparison between born global firms and traditional exporters in China," Journal of International Entrepreneurship, Springer, vol. 7(4), pages 292-322, December.
    32. Martin, Silvia L. & Javalgi, Rajshekhar (Raj) G., 2016. "Entrepreneurial orientation, marketing capabilities and performance: The Moderating role of Competitive Intensity on Latin American International New Ventures," Journal of Business Research, Elsevier, vol. 69(6), pages 2040-2051.
    33. Johan Wiklund & DEAN Shepherd, 2003. "Knowledge‐based resources, entrepreneurial orientation, and the performance of small and medium‐sized businesses," Strategic Management Journal, Wiley Blackwell, vol. 24(13), pages 1307-1314, December.
    34. Zahra, Shaker A. & Garvis, Dennis M., 2000. "International corporate entrepreneurship and firm performance: The moderating effect of international environmental hostility," Journal of Business Venturing, Elsevier, vol. 15(5-6), pages 469-492.
    35. K Kim & J-H Park & J E Prescott, 2003. "The global integration of business functions: a study of multinational businesses in integrated global industries," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 34(4), pages 327-344, July.
    36. Birgitte Grøgaard & Helene Loe Colman, 2016. "Interpretive Frames as the Organization’s “Mirror”: From Espoused Values to Social Integration in MNEs," Management International Review, Springer, vol. 56(2), pages 171-194, April.
    37. Frédéric Delmar & Johan Wiklund & Per Davidsson, 2006. "Entrepreneurship and the Growth of Firms," Post-Print hal-01892801, HAL.
    38. Frédéric Delmar & Johan Wiklund & Per Davidsson, 2006. "Entrepreneurship and the Growth of Firms," Post-Print hal-01892798, HAL.
    39. Jeffrey G. Covin & Dennis P. Slevin, 1989. "Strategic management of small firms in hostile and benign environments," Strategic Management Journal, Wiley Blackwell, vol. 10(1), pages 75-87, January.
    40. Solano Acosta, Alexandra & Herrero Crespo, Ángel & Collado Agudo, Jesús, 2018. "Effect of market orientation, network capability and entrepreneurial orientation on international performance of small and medium enterprises (SMEs)," International Business Review, Elsevier, vol. 27(6), pages 1128-1140.
    41. Zahra, Shaker A. & Covin, Jeffrey G., 1995. "Contextual influences on the corporate entrepreneurship-performance relationship: A longitudinal analysis," Journal of Business Venturing, Elsevier, vol. 10(1), pages 43-58, January.
    42. Jeffrey G. Covin & Dennis P. Slevin, 1988. "The Influence Of Organization Structure On The Utility Of An Entrepreneurial Top Management Style," Journal of Management Studies, Wiley Blackwell, vol. 25(3), pages 217-234, May.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Riviere, Monica & Romero-Martínez, Ana M., 2021. "Network embeddedness, headquarters entrepreneurial orientation, and MNE international performance," International Business Review, Elsevier, vol. 30(3).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Jörg Freiling & Christoph Lütke Schelhowe, 2014. "The Impact of Entrepreneurial Orientation on the Performance and Speed of Internationalization," Journal of Entrepreneurship, Management and Innovation, Fundacja Upowszechniająca Wiedzę i Naukę "Cognitione", vol. 10(4), pages 169-199.
    2. Samuel Adomako, 2018. "The Moderating Effects Of Adaptive And Intellectual Resource Capabilities On The Relationship Between Entrepreneurial Orientation And Financial Performance," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 22(03), pages 1-35, April.
    3. Hernández-Perlines, Felipe & Covin, Jeffrey G. & Ribeiro-Soriano, Domingo E., 2021. "Entrepreneurial orientation, concern for socioemotional wealth preservation, and family firm performance," Journal of Business Research, Elsevier, vol. 126(C), pages 197-208.
    4. Gupta, Rakesh & Pandey, Ritesh & Sebastian, V.J., 2021. "International Entrepreneurial Orientation (IEO): A bibliometric overview of scholarly research," Journal of Business Research, Elsevier, vol. 125(C), pages 74-88.
    5. Wales, William J. & Kraus, Sascha & Filser, Matthias & Stöckmann, Christoph & Covin, Jeffrey G., 2021. "The status quo of research on entrepreneurial orientation: Conversational landmarks and theoretical scaffolding," Journal of Business Research, Elsevier, vol. 128(C), pages 564-577.
    6. D’Angelo, Alfredo & Presutti, Manuela, 2019. "SMEs international growth: The moderating role of experience on entrepreneurial and learning orientations," International Business Review, Elsevier, vol. 28(3), pages 613-624.
    7. Bradley A. George & Louis Marino, 2011. "The Epistemology of Entrepreneurial Orientation: Conceptual Formation, Modeling, and Operationalization," Entrepreneurship Theory and Practice, , vol. 35(5), pages 989-1024, September.
    8. Jan Lampe & Priscilla Sarai Kraft & Andreas Bausch, 2020. "Mapping the Field of Research on Entrepreneurial Organizations (1937–2016): A Bibliometric Analysis and Research Agenda," Entrepreneurship Theory and Practice, , vol. 44(4), pages 784-816, July.
    9. Yen-Chun Chen & Ya-Hui Lin & Hsien-Tung Tsai, 2020. "Toward Greater Understanding of the Relationship Between Entrepreneurial Orientation and International Performance," Management International Review, Springer, vol. 60(2), pages 211-245, April.
    10. Agnes Asemokha & Jackson Musona & Lasse Torkkeli & Sami Saarenketo, 2019. "Business model innovation and entrepreneurial orientation relationships in SMEs: Implications for international performance," Journal of International Entrepreneurship, Springer, vol. 17(3), pages 425-453, September.
    11. Jeffrey G. Covin & Danny Miller, 2014. "International Entrepreneurial Orientation: Conceptual Considerations, Research Themes, Measurement Issues, and Future Research Directions," Entrepreneurship Theory and Practice, , vol. 38(1), pages 11-44, January.
    12. Lim Euncheon & Kim Dohyeon, 2020. "Entrepreneurial Orientation and Performance in South Korea: The Mediating Roles of Dynamic Capabilities and Corporate Entrepreneurship," Entrepreneurship Research Journal, De Gruyter, vol. 10(3), pages 1-18, July.
    13. Farhad Uddin Ahmed & Louis Brennan, 2019. "Performance determinants of early internationalizing firms: The role of international entrepreneurial orientation," Journal of International Entrepreneurship, Springer, vol. 17(3), pages 389-424, September.
    14. Michael Sheppard, 2020. "The relationship between discretionary slack and growth in small firms," International Entrepreneurship and Management Journal, Springer, vol. 16(1), pages 195-219, March.
    15. Lavlu Mozumdar & Valentina C. Materia & Geoffrey Hagelaar & Mohammad Amirul Islam & Gerben van der Velde & S. W. F. (Onno) Omta, 2022. "Contextuality of Entrepreneurial Orientation and Business Performance: The Case of Women Entrepreneurs in Bangladesh," Journal of Entrepreneurship and Innovation in Emerging Economies, Entrepreneurship Development Institute of India, vol. 8(1), pages 94-120, January.
    16. Vishal K. Gupta & William J. Wales, 2017. "Assessing Organisational Performance Within Entrepreneurial Orientation Research: Where Have We Been and Where Can We Go from Here?," Journal of Entrepreneurship and Innovation in Emerging Economies, Entrepreneurship Development Institute of India, vol. 26(1), pages 51-76, March.
    17. Engelen, Andreas & Kube, Harald & Schmidt, Susanne & Flatten, Tessa Christina, 2014. "Entrepreneurial orientation in turbulent environments: The moderating role of absorptive capacity," Research Policy, Elsevier, vol. 43(8), pages 1353-1369.
    18. Katharina Fellnhofer, 2019. "The Complementary Effects Of Firms’ And Team Leaders’ Entrepreneurial Orientation On Innovation Success And Performance," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 23(05), pages 1-32, June.
    19. Natasha Evers & Gabriela Gliga & Alex Rialp-Criado, 2019. "Strategic orientation pathways in international new ventures and born global firms—Towards a research agenda," Journal of International Entrepreneurship, Springer, vol. 17(3), pages 287-304, September.
    20. Tânia Gonçalves & Mário Sérgio Teixeira & José G. Dias & Sofia Gouveia & Ricardo Jorge Correia, 2021. "Commitment to exporting as an antecedent of organizational skills and firm performance," Journal of Business Economics, Springer, vol. 91(7), pages 1063-1084, September.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:manint:v:60:y:2020:i:1:d:10.1007_s11575-019-00397-4. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.