The roles of social capital, entrepreneurial orientation and competitive intensity in managerial capability and performance relationship: evidence from an emerging market economy

Abstract

PurposeThis paper sought to investigate the conditional indirect relationship between managerial capabilities (MCs) and performance amongst small and medium-sized enterprises (SMEs) in the sub-Saharan African economy. The study considered social capital (SC) and entrepreneurial orientation (EO) as parallel mediating mechanisms and competitive intensity as boundary conditions within this relationship. The purpose of this paper is to address this issue.Design/methodology/approachData were obtained from SMEs (n = 206) in a sub-Saharan African nation. Bootstrapping (Process Macro) and hierarchical regression in statistical package for social sciences (SPSS) were used to analyse the data.FindingsThe results demonstrate that whereas EO presents a mechanism through which MC influences performance, SC does not mediate the MC–performance relationship. The results further demonstrate that competitive intensity provides various interaction effects such that at high levels of competitive intensity the indirect effect of MC on performance through SC is weakened and strengthened through EO. The study, therefore, provides clarity to the intricate power of interactions of external factors with firm-specific resources.Originality/valueThe study demonstrates that varying combinations of resources influence performance differently. The authors consider the influence of these mediators simultaneously in attempts to extend theory by buttressing the bundling effect of MC on SC and EO in driving performance. They also highlight the impact of the boundary conditions created by competitive intensity (CI) on these mediated relationships.