Entrepreneurial Orientation: The Dimensions’ Shared Effects in Explaining Firm Performance

Abstract

We shed new light on the structure of the relationship between entrepreneurial orientation (EO) and firm performance and how this relationship varies across contexts. Using commonality analysis, we decompose the variance in performance—in terms of the effects of innovativeness, proactiveness, and risk taking—into parts that are attributable to unique variations in these dimensions (unique effects) and those attributable to covariation between these dimensions (shared effects). By demonstrating the empirical relevance of unique, bilaterally shared, and commonly shared effects in a heterogeneous sample of low–tech, high–tech, and multi–sector firms, we consolidate existing conceptualizations of EO and propose an extension of the extant theoretical views of the construct.