Impact of Market Orientation and Entrepreneurial Orientation on Performance: A Study of Small and Medium Scale Garment Manufacturers in Sri Lanka

Abstract

The purposes of this research was to identify relevant key performance drivers in small and medium scale business entities and to empirically examine the relationships between the identified performance drivers, using a sample of small and medium scale garment manufacturers in the Southern Province, Sri Lanka. To achieve these purposes, this study examined the following main research question: Does adopting a market orientation and an entrepreneurial orientation lead to better performance for small and medium scale business entities? The review of market orientation, entrepreneurial orientation and performance gave compelling reasons for continuing the search for relevant literature in the marketing research field and market orientation research in particular. This study used partial least squares path modeling to analyze the data collected using a structured questionnaire. The reliable and valid measurement model permits an empirical evaluation of the hypotheses in the structural path model. The results of two hypotheses in the structural model were statistically significant and all effects are in the expected direction.The current research is as such a response to the urge for more empirical studies within this novel research area in terms of surveys. It thereby added to the existing body of literature, and provided several insights for managers in retailing firms. This research also contributed to the ongoing effort within entrepreneurship research to develop valid and reliable scales. Entrepreneurial orientation is still a novel research area where researchers face measurement challenges due to the lack of sophisticated measures. The relationship between market orientation, entrepreneurial orientation and organizational performance will be an important study. Since this field of inquiry is fairly new it also offers numerous alternatives for further studies at the end of this study.