Abstract
Integrating the institution-based view and the resource-based view, this article explores the contingent effects of national institutions and firm resource bases on the relationships between strategic orientations—i.e., entrepreneurial orientation (EO) and market orientation (MO)—and firm performance. This is accomplished through a meta-analysis of 160 independent samples reported in 154 studies drawing from 35,367 organizations in 33 countries (22 developed and 11 emerging economies). Considering combined contingent effects of institutions and resource bases, we find that strategic orientations—both EO and MO—in developed economies lead to higher performance in large firms than in small firms. In emerging economies, the effect of EO and MO on performance is, in contrast, more pronounced in small firms.
Similar content being viewed by others
Notes
The first literature search was conducted in May 2012. Moreover, we conducted three additional searches in December 2012, June 2013, and January 2017.
When studies report more than one correlation coefficient in one article, we integrated these coefficient correlations into a mean score of coefficient.
References
Alpkan, L., Yilmaz, G., & Kaya, N. 2007. Market orientation and planning flexibility in SMEs: Performance implications and an empirical investigation. International Small Business Journal, 25(2): 152–172.
Aragón-Sánchez, A., & Sánchez-Marín, G. 2005. Strategic orientation, management characteristics, and performance: A study of Spanish small firms. Journal of Small Business Management, 43(3): 287–308.
Atuahene-Gima, K., & Ko, A. 2001. An empirical investigation of the effect of market orientation and entrepreneurship orientation alignment on product innovation. Organization Science, 12(1): 54–74.
Baker, W. E., & Sinkula, J. M. 2009. The complementary effects of market orientation and entrepreneurial orientation on profitability in small businesses. Journal of Small Business Management, 47(4): 443–464.
Barney, J. 1991. Firm resources and sustained competitive advantage. Journal of Management, 17(1): 99–120.
Beard, D. W., & Dess, G. G. 1981. Corporate-level strategy, business-level strategy, and firm performance. Academy of Management Journal, 24(4): 663–688.
Bhuian, S. N., Menguc, B., & Bell, S. J. 2005. Just entrepreneurial enough: The moderating effect of entrepreneurship on the relationship between market orientation and performance. Journal of Business Research, 58(1): 9–17.
Boisot, M., & Child, J. 1996. From fiefs to clans and network capitalism: Explaining China's emerging economic order. Administrative Science Quarterly, 41(4): 600–628.
Bonaccorsi, A. 1992. On the relationship between firm size and export intensity. Journal of International Business Studies, 23(4): 605–635.
Boso, N., Story, V. M., & Cadogan, J. W. 2013. Entrepreneurial orientation, market orientation, network ties, and performance: Study of entrepreneurial firms in a developing economy. Journal of Business Venturing, 28(6): 708–727.
Bruton, G. D., & Ahlstrom, D. 2003. An institutional view of China's venture capital industry: Explaining the differences between China and the West. Journal of Business Venturing, 18(2): 233–259.
Bruton, G. D., Ahlstrom, D., & Puky, T. 2009. Institutional differences and the development of entrepreneurial ventures: A comparison of the venture capital industries in Latin America and Asia. Journal of International Business Studies, 40(5): 762–778.
Calof, L. J. 1994. The relationship between firm size and export behavior revisited. Journal of International Business Studies, 25(2): 367–387.
Cano, C. R., Carrillat, F. A., & Jaramillo, F. 2004. A meta-analysis of the relationship between market orientation and business performance: Evidence from five continents. International Journal of Research in Marketing, 21(2): 179–200.
Cao, Q., Gedajlovic, E., & Zhang, H. 2009. Unpacking organizational ambidexterity: Dimensions, contingencies, and synergistic effects. Organization Science, 20(4): 781–796.
Cao, Q., Simsek, Z., & Jansen, J. J. 2015. CEO social capital and entrepreneurial orientation of the firm bonding and bridging effects. Journal of Management, 41(7): 1957–1981.
Chan, H. H., & Ellis, P. 1998. Market orientation and business performance: Some evidence from Hong Kong. International Marketing Review, 15(2): 119–139.
Chen, M. J., & Hambrick, D. C. 1995. Speed, stealth, and selective attack: How small firms differ from large firms in competitive behavior. Academy of Management Journal, 38(2): 453–482.
China’s Press and Publication Newspaper. 2014. Tencent Weibo "shut down" and Sina Weibo "monolith". http://news.xinhuanet.com/zgjx/2014-07/31/c_133522542.htm.
Cooper, H. M., Hedges, L. V., & Valentine, J. C. (Eds.) 2009. The handbook of research synthesis and meta-analysis, 2nd ed. New York: Russell Sage Foundation.
Covin, J. G., & Slevin, D. P. 1989. Strategic management of small firms in hostile and benign environments. Strategic Management Journal, 10(1): 75–87.
Covin, J. G., & Slevin, D. P. 1991. A conceptual model of entrepreneurship as firm behavior. Entrepreneurship Theory and Practice, 16(1): 7–25.
Day, G. S. 1994. The capabilities of market-driven organizations. Journal of Marketing, 58(4): 37–52.
Donaldson, L. 2008. The conflict between contingency and institutional theories of organizational design. In R. M. Burton, B. H. Eriksen, D. D. Håkonsson, T. Knudsen, & C. C. Snow (Eds.). Designing organizations: 3–20. New York: Springer.
Drazin, R., & Schoonhoven, C. B. 1996. Community, population, and organization effects on innovation: A multilevel perspective. Academy of Management Journal, 39(5): 1065–1083.
Duran, P., van Essen, M., Huegens, P., Kostova, T., & Peng, M. W. 2018. The impact of institutions on the competitive advantage of publicly listed family firms in emerging markets. Global Strategy Journal. https://doi.org/10.1002/gsj.1312.
Ellis, P. D. 2005. Market orientation and marketing practice in a developing economy. European Journal of Marketing, 39(5/6): 629–645.
Ellis, P. D. 2006. Market orientation and performance: A meta-analysis and cross-national comparisons. Journal of Management Studies, 43(5): 1089–1107.
Farrell, M. A. 2000. Developing a market-oriented learning organization. Australian Journal of Management, 25(2): 201–222.
Foxall, G. R. 1984. Corporate innovation: Marketing and strategy. Beckenham, UK: Croom Helm.
Gatignon, H., & Xuereb, J. M. 1997. Strategic orientation of the firm and new product performance. Journal of Marketing Research, 34(1): 77–90.
Geyskens, I., Krishnan, R., Steenkamp, J. B. E. M., & Cunha, P. V. 2009. A review and evaluation of meta-analysis practices in management research. Journal of Management, 35(2): 393–419.
Hakala, H. 2011. Strategic orientations in management literature: Three approaches to understanding the interaction between market, technology, entrepreneurial and learning orientations. International Journal of Management Reviews, 13(2): 199–217.
Hart, S. L. 1992. An integrative framework for strategy-making processes. Academy of Management Review, 17(2): 327–351.
Hedges, L. V., & Olkin, I. 1985. Statistical methods for meta-analysis. New York: Academic Press.
Hitt, M. A., Dacin, M. T., Levitas, E., Arregle, J. L., & Borza, A. 2000. Partner selection in emerging and developed market contexts: Resource-based and organizational learning perspectives. Academy of Management Journal, 43(3): 449–467.
Hitt, M. A., Ireland, R. D., Camp, S. M., & Sexton, D. L. 2001. Strategic entrepreneurship: Entrepreneurial strategies for wealth creation. Strategic Management Journal, 22(6/7): 479–491.
Hoskisson, R. E., Eden, L., Lau, C. M., & Wright, M. 2000. Strategy in emerging economies. Academy of Management Journal, 43(3): 249–267.
Hou, M., Liu, H., Fan, P., & Wei, Z. 2016. Does CSR practice pay off in east Asian firms? A meta-analytic investigation. Asia Pacific Journal of Management, 33(1): 195–228.
Hult, G. T. M., & Ketchen, D. J. 2001. Does market orientation matter? A test of the relationship between positional advantage and performance. Strategic Management Journal, 22(9): 899–906.
Hult, G. T. M., Ketchen, D. J., & Slater, S. F. 2005. Market orientation and performance: An integration of disparate approaches. Strategic Management Journal, 26(12): 1173–1181.
Hunter, J. E., & Schmidt, F. L. 2004. Methods of meta-analysis: Correcting error and bias in research findings, 2nd ed. Thousand Oaks, CA: Sage.
Hurley, R. F., & Hult, G. T. M. 1998. Innovation, market orientation, and organizational learning: An integration and empirical examination. Journal of Marketing, 62(3): 42–54.
Jaworski, B. J., & Kohli, A. K. 1993. Market orientation: Antecedents and consequences. Journal of Marketing, 57(3): 53–70.
Ketchen, D. J., Hult, G. T. M., & Slater, S. F. 2007. Toward greater understanding of market orientation and the resource-based view. Strategic Management Journal, 28(9): 961–964.
Kirca, A. H., Jayachandran, S., & Bearden, W. O. 2005. Market orientation: A meta-analytic review and assessment of its antecedents and impact on performance. Journal of Marketing, 69(2): 24–41.
Kirca, A. H., Hult, G. T. M., Roth, K., Cavusgil, S. T., Perryy, M. Z., Akdeniz, M. B., Deligonul, S. Z., Mena, J. A., Pollitte, W. A., Hoppner, J. J., Miller, J. C., & White, R. C. 2011. Firm-specific assets, multinationality, and financial performance: A meta-analytic review and theoretical integration. Academy of Management Journal, 54(1): 47–72.
Kohli, A. K., & Jaworski, B. J. 1990. Market orientation: The construct, research propositions, and managerial implications. Journal of Marketing, 54: 1–18.
Kumar, V., Jones, E., Venkatesan, R., & Leone, R. P. 2011. Is market orientation a source of sustainable competitive advantage or simply the cost of competing? Journal of Marketing, 75(1): 16–30.
Langerak, F., Hultink, E. J., & Robben, H. S. 2004. The impact of market orientation, product advantage, and launch proficiency on new product performance and organizational performance. Journal of Product Innovation Management, 21(2): 79–94.
Lee, R. P., & Chen, Q. 2009. The immediate impact of new product introductions on stock price: The role of firm resources and size. Journal of Product Innovation Management, 26(1): 97–107.
Leonard-Barton, D. 1992. Core capabilities and core rigidities: A paradox in managing new product development. Strategic Management Journal, 13(S1): 111–125.
Li, Y., Chen, H., Liu, Y., & Peng, M. W. 2014. Managerial ties, organizational learning, and opportunity capture: A social capital perspective. Asia Pacific Journal of Management, 31(1): 271–291.
Li, Y., Liu, Y., & Zhao, Y. B. 2006. The role of market and entrepreneurship orientation and internal control in the new product development activities of Chinese firms. Industrial Marketing Management, 35(3): 336–347.
Li, Y., Peng, M. W., & Macaulay, C. D. 2013. Market-political ambidexterity during institutional transitions. Strategic Organization, 11(2): 205–213.
Li, Y., Wei, Z., & Liu, Y. 2010. Strategic orientations, knowledge acquisition, and firm performance: The perspective of the vendor in cross-border outsourcing. Journal of Management Studies, 47(8): 1457–1482.
Li, Y., Zhao, Y., Tan, J., & Liu, Y. 2008. Moderating effects of entrepreneurial orientation on market orientation-performance linkage: Evidence from Chinese small firms. Journal of Small Business Management, 46(1): 113–133.
Liao, S. H., Chang, W. J., Wu, C. C., & Katrichis, J. M. 2011. A survey of market orientation research (1995–2008). Industrial Marketing Management, 40(2): 301–310.
Lin, Z., Peng, M. W., Yang, H., & Sun, S. L. 2009. How do networks and learning drive M&as? An institutional comparison between China and the United States. Strategic Management Journal, 30(10): 1113–1132.
Lipsey, M. W., & Wilson, D. B. 2001. Practical meta-analysis. Thousand Oaks, CA: Sage.
Liu, H. 1995. Market orientation and firm size: An empirical examination in UK firms. European Journal of Marketing, 29(1): 57–71.
Liu, Y., Li, Y., & Xue, J. 2011. Ownership, strategic orientation and internationalization in emerging markets. Journal of World Business, 46(3): 381–393.
Liu, H., Ding, X., Guo, H., & Luo, J. 2014. How does slack affect product innovation in high-tech Chinese firms: The contingent value of entrepreneurial orientation. Asia Pacific Journal of Management, 31(1): 47–68.
Lumpkin, G. T., & Dess, G. G. 1996. Clarifying the entrepreneurial orientation construct and linking it to performance. Academy of Management Review, 21(1): 135–172.
Lumpkin, G. T., & Dess, G. G. 2001. Linking two dimensions of entrepreneurial orientation to firm performance: The moderating role of environment and industry life cycle. Journal of Business Venturing, 16(5): 429–451.
Maatoofi, A. R., & Tajeddini, K. 2011. Effect of market orientation and entrepreneurial orientation on innovation: Evidence from auto parts manufacturing in Iran. Journal of Management Research, 11(1): 20–30.
Matsuno, K., Mentzer, J. T., & Özsomer, A. 2002. The effects of entrepreneurial proclivity and market orientation on business performance. Journal of Marketing, 66(3): 18–32.
Meyer, K. E. 2001. Institutions, transaction costs, and entry mode choice in Eastern Europe. Journal of International Business Studies, 32(2): 357–367.
Meyer, K. E., & Peng, M. W. 2016. Theoretical foundations of emerging economy business research. Journal of International Business Studies, 47(1): 3–22.
Meyer, K. E., Estrin, S., Bhaumik, S. K., & Peng, M. W. 2009. Institutions, resources, and entry strategies in emerging economies. Strategic Management Journal, 30(1): 61–80.
Miles, M. P., & Arnold, D. R. 1991. The relationship between marketing orientation and entrepreneurial orientation. Entrepreneurship Theory and Practice, 15(4): 49–65.
Miller, D. 1983. The correlates of entrepreneurship in three types of firms. Management Science, 29(7): 770–791.
Mu, J., & Di Benedetto, C. A. 2011. Strategic orientations and new product commercialization: Mediator, moderator, and interplay. R&D Management, 41(4): 337–359.
Mutlu, C., Wu, Z., Peng, M. W., & Lin, Z. 2015. Competing in (and out of) transition economies. Asia Pacific Journal of Management, 32(3): 571–596.
Mutlu, C., van Essen, M., Peng, M. W., Saleh, S. F., & Duran, P. 2018. Corporate governance in China: A meta-analysis. Journal of Management Studies, 55(6): 943–979.
Narver, J. C., & Slater, S. F. 1990. The effect of a market orientation on business profitability. Journal of Marketing, 54(4): 20–35.
Newbert, S. L. 2007. Empirical research on the resource-based view of the firm: An assessment and suggestions for future research. Strategic Management Journal, 28(2): 121–146.
Noble, C. H., Sinha, R. K., & Kumar, A. 2002. Market orientation and alternative strategic orientations: A longitudinal assessment of performance implications. Journal of Marketing, 66(4): 25–39.
O’Cass, A., & Ngo, L. V. 2011. Winning through innovation and marketing: Lessons from Australia and Vietnam. Industrial Marketing Management, 40(8): 1319–1329.
Peng, M. W. 2003. Institutional transitions and strategic choices. Academy of Management Review, 28(2): 275–296.
Peng, M. W., Lebedev, S., Vlas, C. O., Wang, J. C., & Shay, J. S. 2018a. The growth of the firm in (and out of) emerging economies. Asia Pacific Journal of Management, 35(4): 829–857.
Peng, M. W., Nguyen, H. W., Wang, J. C., Hassenhuttl, M., & Shay, J. S. 2018b. Bringing institutions into strategy teaching. Academy of Management Learning and Education, 17(3): 259–278.
Peng, M. W., Sun, S. L., Pinkham, B., & Chen, H. 2009. The institution-based view as a third leg for a strategy tripod. Academy of Management Perspectives, 23(3): 63–81.
Rauch, A., Wiklund, J., Lumpkin, G. T., & Frese, M. 2009. Entrepreneurial orientation and business performance: An assessment of past research and suggestions for the future. Entrepreneurship Theory and Practice, 33(3): 761–787.
Rosenbusch, N., Rauch, A., & Bausch, A. 2013. The mediating role of entrepreneurial orientation in the task environment-performance relationship: A meta-analysis. Journal of Management, 39(3): 633–659.
Shi, W. S., Sun, S. L., & Peng, M. W. 2012. Sub-national institutional contingencies, network positions, and IJV partner selection. Journal of Management Studies, 49(7): 1221–1245.
Shoham, A., Rose, G. M., & Kropp, F. 2005. Market orientation and performance: A meta-analysis. Marketing Intelligence and Planning, 23(5): 435–454.
Slater, S. F., & Narver, J. C. 1994. Does competitive environment moderate the market orientation-performance relationship? Journal of Marketing, 58(1): 46–55.
Slater, S. F., & Narver, J. C. 1995. Market orientation and the learning organization. Journal of Marketing, 59(7): 63–74.
Soehadi, A. W., Hart, S., & Tagg, S. 2001. Measuring market orientation in the Indonesian retail context. Journal of Strategic Marketing, 9(4): 285–299.
Song, M., Droge, C., Hanvanich, S., & Calantone, R. 2005. Marketing and technology resource complementarity: An analysis of their interaction effect in two environmental contexts. Strategic Management Journal, 26(3): 259–276.
Sterne, J. 2009. Meta-analysis in Stata: An updated collection from the Stata journal. College Station: Stata Press.
Su, Z., Xie, E., & Li, Y. 2011. Entrepreneurial orientation and firm performance in new ventures and established firms. Journal of Small Business Management, 49(4): 558–577.
Sun, S. L., Yang, X., & Li, W. 2014. Variance-enhancing corporate entrepreneurship under deregulation: An option portfolio approach. Asia Pacific Journal of Management, 31(3): 733–761.
Tan, J. 1996. Regulatory environment and strategic orientations in a transitional economy: A study of Chinese private enterprise. Entrepreneurship Theory and Practice, 21(1): 31–44.
Teece, D., Pisano, G., & Shuen, A. 1997. Dynamic capabilities and strategic management. Strategic Management Journal, 18(7): 509–533.
The 21st Century Business Herald. 2017. In the first quarter Weibo’ net profit growth of 278%, monthly active users over twitter. http://m.21jingji.com/article/20170516/herald/0cf8433fdb8c556c30462c2e626692d0.html.
Tolbert, P. S., David, R. J., & Sine, W. D. 2011. Studying choice and change: The intersection of institutional theory and entrepreneurship research. Organization Science, 22(5): 1332–1344.
United Nations Development Programme 2010. Human development report 2010: The real wealth of nations: Pathways to human development. New York: UN/Palgrave Macmillan.
van Essen, M., Heugens, P. P. M. A. R., Otten, J., & van Oosterhout, H. 2012. An institution-based view of executive compensation: A multilevel meta-analytic test. Journal of International Business Studies, 43(4): 396–423.
Venkatraman, N., & Ramanujam, V. 1986. Measurement of business performance in strategy research: A comparison of approaches. Academy of Management Review, 11(4): 801–814.
Volberda, H. W., van der Weerdt, N., Verwaal, E., Stienstra, M., & Verdu, A. J. 2012. Contingency fit, institutional fit, and firm performance: A metafit approach to organization–environment relationships. Organization Science, 23(4): 1040–1054.
Wiklund, J., & Shepherd, D. A. 2003. Knowledge-based resources, entrepreneurial orientation, and the performance of small and medium-sized businesses. Strategic Management Journal, 24(13): 1307–1314.
Wiklund, J., & Shepherd, D. A. 2011. Where to from here? EO-as-experimentation, failure, and distribution of outcomes. Entrepreneurship Theory and Practice, 35(5): 925–946.
Williamson, O. E. 1985. The economic institutions of capitalism. New York: Free Press.
Wright, M., Filatotchev, I., Hoskisson, R. E., & Peng, M. W. 2005. Strategy research in emerging economies: Challenging the conventional wisdom. Journal of Management Studies, 42(1): 1–33.
Yamakawa, Y., Peng, M. W., & Deeds, D. L. 2008. What drives new ventures to internationalize from emerging to developed economies? Entrepreneurship Theory and Practice, 32(1): 59–82.
Yang, H., Dess, G. G., & Robins, J. A. 2019. Does entrepreneurial orientation always pay off? The role of resource mobilization within and across oorganizations. Asia Pacific Journal of Management. https://doi.org/10.1007/s10490-018-9584-x.
Yu, B., Hao, S., Ahsltrom, D., Si, S., & Liang, D. 2014. Entrepreneurial firms’ network competence, technological capability, and new product development performance. Asia Pacific Journal of Management, 31(3): 689–704.
Zachary, M. A., McKenny, A. F., Short, J. C., Davis, K. M., & Wu, D. 2011. Franchise branding: An organizational identity perspective. Journal of the Academy of Marketing Science, 39(4): 629–645.
Zahra, S. A., & Covin, J. G. 1993. Business strategy, technology policy and firm performance. Strategic Management Journal, 14(6): 451–478.
Zhao, Y., Li, Y., Lee, S. H., & Chen, L. B. 2011. Entrepreneurial orientation, organizational learning, and performance: Evidence from China. Entrepreneurship Theory and Practice, 35(2): 293–317.
Zhou, K. Z., & Li, C. B. 2007. How does strategic orientation matter in Chinese firms? Asia Pacific Journal of Management, 24(4): 447–466.
Zhou, K. Z., Yim, C., & Tse, D. K. 2005. The effects of strategic orientations on technology- and market-based breakthrough innovations. Journal of Marketing, 69(2): 42–60.
Zimmerman, M. A., & Zeitz, G. J. 2002. Beyond survival: Achieving new venture growth by building legitimacy. Academy of Management Review, 27(3): 414–431.
Acknowledgements
Research reported in this article is supported by the Natural Science Foundation of China (71421002 and 71711530045) and by the Jindal Chair at UT Dallas. We thank Jane Lu (Editor-in-Chief) and our two reviewers for constructive feedback.
Author information
Authors and Affiliations
Corresponding author
Additional information
Publisher’s note
Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.
Rights and permissions
About this article
Cite this article
Peng, L., Li, Y., van Essen, M. et al. Institutions, resources, and strategic orientations: A meta-analysis. Asia Pac J Manag 37, 499–529 (2020). https://doi.org/10.1007/s10490-018-09642-0
Published:
Issue Date:
DOI: https://doi.org/10.1007/s10490-018-09642-0