Market-orientation, entrepreneurial-orientation and SMEs' performance: the mediating roles of marketing capabilities and competitive strategies

PurposeAppealing to the resource-based view and the resource advantage theory, this research aims to ascertain the complementarity of entrepreneurial and market orientation in enhancing the performance of small and medium enterprises.Design/methodology/approachFollowing a survey design, a self-administered questionnaire containing scales adapted from leading previous studies was used to collect data from 400 executives working in small and medium enterprises in Pakistan. Partial least squares-based structural equation modeling was performed to analyze the measurement and the structural models and test the significance of the hypothesized relationships.FindingsIt has been found that market orientation and entrepreneurial orientation enhance firm performance directly and indirectly with marketing capabilities and competitive strategies (partially or fully) mediating these causes and effects relationships.Practical implicationsThe study adds to the literature on entrepreneurship, marketing and strategy and has significant ramifications for managers and public policymakers desiring to boost the performance of small and medium enterprises, which is crucial to the economic growth of developing nations, through nurturing and leveraging intangible resources such as market orientation, entrepreneurial orientation and marketing capabilities.Originality/valueIt is one of the rare attempts to investigate the complementarity of entrepreneurial orientation and market orientation, channeled through marketing capabilities and competitive strategies to boost SME performance, that too in the context of a developing country.