ENTREPRENEURIAL ORIENTATION AND HOSPITALITY PERFORMANCE: THE MEDIATING EFFECT OF MARKET ORIENTATION

Abstract

Entrepreneurial orientation (EO) and market orientation (MO) are universally applicable concept, and previous scholarly studies have concluded the EO and MO positively relate to firm performance. Empirical research, however, scarcely addresses the role of EO and MO in service firms, although the service sector has become the growing industry sector. Therefore, the purpose of this study is to investigate the impact of EO and MO on hospitality performance among homestay operators. In particular, the goal is to understand and determine to what extent EO influence hospitality performance directly, and to what extent EO connected to performance via MO. The developed conceptual model is analysed using Partial Least Square Structural Equation Modelling (PLS-SEM) from a sample of 116 homestay operators in Selangor. The result of the PLS-SEM model showed that EO act as a basis for improved business performance among homestay operators. However, the performance impact of EO is not that straightforward that EO requires MO to more fully unlock their value-creating potential among homestay operators. This study has provided new insights regarding the impact of EO and MO on hospitality performance in the context of the homestay industry. The homestay industry differs from other sectors, and this paper discusses the implications of these findings for researchers and managers in the homestay industry. The results also contributed to a better understanding of when the individual dimensions of EO and MO help or hinder entrepreneurial firms in enhancing their services and performance. In particular, the research has contributed to the literature by indicating the routes through which EO and MO impact on performance.