Proactive entrepreneurial behaviour, market orientation, and innovation outcomes

Abstract

Purpose Drawing from resource-based theory, the authors aim to study how and under what conditions small- and medium-sized enterprises (SMEs) capitalise on their proactive entrepreneurial behaviour (PEB) to achieve new product development (NPD) performance. Design/methodology/approach The authors’ data were drawn from a cross-sectional questionnaire survey of 401 UK-based SMEs in the manufacturing sector. Findings The authors identify an upward curvilinear relationship between PEB and NPD performance. Taking a step further, the authors propose and confirm that this curvilinear association arises from, in part, SMEs’ innovation capability, which in turn translates into NPD performance. The authors also find that this upward curvilinear relationship between PEB and innovation capability flips to a downward curvilinear relationship when firms pursue a customer and competitor orientation. Originality/value This paper looks beyond the linear relationship that exists among entrepreneurial behaviour, market orientation and innovation outcomes.