Determinants of Enterprises Radical Innovation and Performance: Insights into Strategic Orientation of Cultural and Creative Enterprises

A firm's strategic orientation determine its business direction and scope of operation. Several researchers have tried to identify how strategic orientations affect business development. However, only a few scholars have explored how strategic orientations shape a firm's organizational capability. In addition, the extent to which radical innovation contributes to a firm's operations has not been well researched. Given these research shortcomings, this study explores the integration of firms' strategic orientations, radical innovation, competitive advantages, and business performance within a conceptual framework. A sample of 86 cultural and creative firms was obtained. The results of the regression analysis and of the PLS SEM model are compared in this study. Our findings suggest that factors from either market orientation or entrepreneurial orientation add to a firm's radical innovation capability and adoption. Lastly, the brand advantage is identified to be the most important factor in firms' performance after a radical innovation capability and product advantage. This paper offers several contributions to the research. First, it advances knowledge of the strategic orientations of cultural and creative firms in a developing market. Second, it demonstrates the usefulness of radical innovation capability in profiling the development of competitive advantages. Lastly, it adds to our understanding of factors that facilitate the business performance of cultural and creative entrepreneurs.