Entrepreneurial Orientation and Strategic Learning: Quadratic Relationship and Performance Effects in Highly Uncertain Environment

Abstract:<RV>This study tests an organizational inertia-based framework claiming that small established companies require high levels of entrepreneurial orientation (EO) to trigger the revitalizing strategic learning processes needed for high firm performance. Data collected from 206 software companies suggest that although EO is important, only very high levels of EO are beneficial for strategic learning and that established companies gain more benefit from learning than younger ones do. The effect is significant for objective performance measures both in terms of growth and profitability. Findings suggest that being just a little entrepre-neurial does not appear to be enough for established companies, and that strategic learning is a key mechanism for the EO-performance relationship.