Building competitive advantages and business success: the role of learning orientation, reward systems and entrepreneurial orientation

Ricardo Jorge Correia · José G. Dias · Mário Sérgio Teixeira · Susana Campos

36 citations0/0 files storedEuropean Business Review

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Entrepreneurship Studies and Influences Human Resource and Talent Management Management and Organizational Practices

Abstract

Purpose The complexity of the firm’s external environment, with its constant changes, forces managers to develop novel strategies that can meet new strategic needs. The purpose of this study is to examine the role of reward systems (RSs) in strategic management, as well as their relationship to learning and entrepreneurial orientation (EO), commonly referred to as the driving force behind growth, competitive advantages (CAs) and improved performance. It also focuses on the study of the relationship between EO and business performance (BP), the introduction and testing of the possible antecedents of this relationship and potential mediating factors. Design/methodology/approach A conceptual model was tested on a sample of 1,190 Portuguese firms using a structural equation model. Findings It is shown for the first time that learning orientation (LO) is an antecedent of the RSs and, subsequently, of EO. Additionally, the CAs of differentiation and cost leadership play a mediating role in the relationship between EO and BP. Furthermore, RSs are also a driving force behind both CAs. Originality/value This study makes several empirical and theoretical contributions, addressing the gap in the literature about the role of RSs in strategic management. It tests the relationship between LO and the firm’s performance by taking the mediating effects of RSs, EO and CAs into account. Additionally, we discuss LO as an antecedent strategic variable of human resources practices, in particular, RSs. Finally, we broaden the scope of our research by examining these issues in the context of Portuguese SMEs from different industries.

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References

1981Evaluating Structural Equation Models with Unobservable Variables and Measurement Error 1999Cutoff criteria for fit indexes in covariance structure analysis: Conventional criteria versus new alternatives 1991Firm Resources and Sustained Competitive Advantage 1997Organizational Learning: A Theory of Action Perspective 1996Clarifying the Entrepreneurial Orientation Construct and Linking It To Performance 1993Strategic assets and organizational rent 1989Strategic management of small firms in hostile and benign environments 1983The Correlates of Entrepreneurship in Three Types of Firms

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