Entrepreneurial Orientation, Strategic Networking, and Croatian SMEs Performance: A Configurational Approach

Abstract Background: Many studies on entrepreneurship indicate an affirmative entrepreneurial orientation (EO) and small firm performance interrelationship. However, the empirical results are inconclusive, especially when firms face certain contingencies. Objectives: Strategic networking and environmental dynamism are important to SMEs’ performance; therefore, the goal of this study is to apply a configurational approach for developing a model that promotes the roles of strategic networking and environmental dynamism as moderating variables in the EO-performance relationship. Methods/Approach: For determining which model fits the data best, a moderated linear regression analysis was used as an analytical method to test the proposed hypotheses. Specifically, configurational, contingency and universal models were examined. Results: Results reveal that a configurational model provides a statistically better explanation of variance in performance compared to both contingency and universal models. Conclusions: By adding strategic networking to the EO-performance relationship, our study helps explain why some firms, although restrained with internal resources, can still achieve entrepreneurial projects since required resources can be acquired from external network partners. Limitations of this study encompass the sample size, the use of a subjective scale, questioning of only one representative of the firm, and the short-term aspect of the study.