International Journal of Research in Business, Economics and Management

The Influence of Self-construal on Entrepreneurial Orientation and Growth of micro-enterprises

Francis A. Oni*
National University of Lesotho, P. O. Roma 180, Roma. Lesotho

Peter P. Khaola
National University of Lesotho P. O. Roma 180, Roma. Lesotho

Douglas Musiiwa
National University of Lesotho, P. O. Roma 180, Roma. Lesotho

ABSTRACT

Literature acknowledges the critical role of self-construal in shaping entrepreneurial orientation and behaviour. While explanations for societal differences in entrepreneurial behaviours vary at organisational level, limited attention has been devoted to explaining the influence of self-construal on entrepreneurial orientation (EO) and growth of micro- enterprises.  This study examined the influence of self-construal of micro-enterprises owners on their EO (risk-taking and innovativeness) and the growth of their firms. Data collected using structured interviews administered on 80 micro-enterprises owners from these cities Roma, Maseru, and Teya-Teyaneng in Lesotho were analysed using descriptive statistics, correlations, hierarchical regression analyses and partial least squares structural equation modelling (PLS-SEM). Findings show that the independent self-construal had positive and significant influence on the EO of micro-enterprises but the inter-dependent self-construal construct did not have a positive and significant effect on the EO. While independent self-construal negatively and significantly influenced enterprise growth, the interdependent self-construal did not have any influence on growth of micro-enterprises. The study recommends that universities and government departments such as Ministry of Small Business Development, Cooperatives and Marketing must provide entrepreneurial training to micro-enterprises owners on how to improve enterprise-oriented cultures and self-confidence in independent decision-making for the growth and survival of their enterprises.

Keywords: Culture, Enterprise growth, Entrepreneurial orientation, Independent self-construal, Interdependent self-construal.

REFERENCES

Agbobli, E.K. (2013). The influence of entrepreneurial and market orientations on small scale agricultural enterprises in the Vryburg Region. Central University of Technology, Free State.

Alexandrova, M. (2004). Entrepreneurship in a transition economy: The impact of environment on entrepreneurial orientation. Problems and Perspectives in Management, (2), 140-149.

Anderson, B.S., Kreiser, P.M., Kuratko, D.F., Hornsby, J.S., & Eshima, Y. (2015). Reconceptualizing entrepreneurial orientation. Strategic Management Journal, 36(10), 1579-1596.

Anlesinya, A., Eshun, P., & Bonuedi, A.F., (2015). Entrepreneurial orientation dimensions and profitability nexus: evidence from micro enterprises in the retail sector in a developing country. International Journal of Small Business and Entrepreneurship Research, 3(7), 79-87.

Ajzen, I. (1991). The theory of planned behavior. Organizational behavior and human decision processes, 50(2), 179-211.

Ajzen, I., (2019). Consumer attitudes and behavior: The theory of planned behavior applied to food consumption decisions. Rivista di EconomiaAgraria, 70(2), 121-138.

Ajzen, I., & Fishbein, M. (2005). The influence of attitudes on behavior. The handbook of attitudes, 173(221), 31.

Arbaugh, J.B., Desai, A., Rau, B., & Sridhar, B.S., (2010). A review of research on online and blended learning in the management disciplines: 1994–2009. Organization Management Journal, 7(1), 39-55.

Autio, E., Keeley, R. H., Klofsten, M., Parker, G. G. C., & Hay, M. (2001). Entrepreneurial intent among students in Scandinavia and in the USA. Enterprise Innovative Management Studies, 2, 145–160.

Aziz, R. A., Mahmood, R., Tajudin, A., & Abdullah, M. H. (2014). The Relationship between Entrepreneurial Orientation and Business Performance of SMEs in Malaysia. International Journal of Management Excellence, 2(3), 221 – 226.

Baker, W. E., & Sinkula, J. M. (2009). The complementary effects of market orientation and entrepreneurial orientation on profitability in small businesses. Journal of small business management, 47(4), 443-464.

Bakotić, D., & Kružić, D. (2010). Students’ perceptions and intentions towards entrepreneurship: the empirical findings from Croatia, The Business Review, Cambridge, 14(2), 209-215.

Becker, G.S. (1964). Human capital: A theoretical analysis with special reference to education. New York: National Bureau for Economic Research, Columbia University.

Block, J., Sandner, P., & Spiegel, F. (2015). How do risk attitudes differ within the group ofentrepreneurs? The role of motivation and procedural utility. Journal of Small Business Management, 53(1), 183–206.

Bloom, B. S., Krathwohl, D. R., & Masia, B. B. (1973). Taxonomy of educational objectives. Handbook 2: Affective domain. London. Longman Group Limited.

Bogatyreva, K., Beliaeva, T., Shirokova, G., & Puffer, S. M. (2017). As different as chalk and cheese? The relationship between entrepreneurial orientation and SMEs’ growth: Evidence from Russia and Finland. Journal of East-West Business, 23(4), 337-366.

Boskov, T., (2016). Growing the Global Economy through SMEs International Aspirations. LAPLAMBERT Academic Publishing.

Chachar, A. A., De Vita, C. F., Parveen, S., & Chachar, Z. A. (2013). The impact of cultural factors on the growth of small and medium enterprises in Hyderabad, Sindh. International Journal of Science and Research, 2(1), 83-86.

Chen, H., & Li, S. (2018). Measuring the psychological distance between an organization and its members—the construction and validation of a new scale. Frontiers in psychology, 8, 2296.

Covin, J., & Wales, W. (2012). The Measurement of Entrepreneurial Orientation. Entrepreneurship Theory and Practice, 36, 671 – 681 10.1111/j.1540-6520.2010.00432.x.

Covin J., & Slevin, D. (1991). Strategic management of small firms in hostile and benign environments. Strategic Management Journal, 10, 75–87.

Covin, J.G. & Wales, W.J. (2019). Crafting High-Impact Entrepreneurial Orientation Research: Some Suggested Guidelines. Entrepreneurship Theory and Practice, 43(1), 3 – 18. https://doi.org/10.1177/1042258718773181

Criado-Gomis, A., Iniesta-Bonillo, M.Á., & Cervera-Taulet, A., (2018). Sustainable entrepreneurial orientation within an intrapreneurial context: effects on business performance. International Entrepreneurship and Management Journal, 14(2), 295-308.

Cuesta, M., Suárez-Álvarez, J., Lozano, L.M., García-Cueto, E., & Muñiz, J. (2018). Assessmentof eight entrepreneurial personality dimensions: Validity evidence of the BEPE battery. Frontiers in Psychology, 9.

Datu, J. A. D., & Salanga, M. G. (2018). Cultural self-views influence meaning making: Self-construals as differential predictors of meaning in life among Filipino university students. Universitas Psychologica, 17(5), 1-9.

Dess, G. G., & Lumpkin, G. T. (2005). The Role of Entrepreneurial Orientation in Stimulating Effective Corporate Entrepreneurship. Academy of Management Perspectives, 19(1), 147-156.

Diabate, A., Sibiri, H., Wang, L., & Yu, L. (2019). Assessing SMEs’ Sustainable Growth through Entrepreneurs’ Ability and Entrepreneurial Orientation: An Insight into SMEs in Côte d’Ivoire. Sustainability, 11(24), 7149.

Díaz-Loving, R. (2019). Self-Construal and Identity. In Ethno psychology, 57-71. Springer, Cham.

Din, B.H., Anuar, A.R., & Usman, M., (2016). Does The Entrepreneurship Education Matters in Enhancing Entrepreneurial Skill Among Students in Malaysian Public Universities? International Review of Management and Marketing, 6(7): 107-111.

Dissanayake, D. M., & Semasinghe, D. M. (2016). Entrepreneurial Orientation and Growth: The Moderating Role of National Culture. Journal of Entrepreneurship and Organisation Management, 5, 168. doi:10.4172/ 2169-026X.1000168.

Duru, I.U., Ehidiamhen, P.O., & Chijioke, A.N. (2018). Role of entrepreneurial orientation in the performance of small and medium enterprises: Evidence from federal capital territory, Abuja, Nigeria. Asian Journal of Economics, Business and Accounting, 2, 1-21.

Egerová, D., Eger, L., & Micik, M. (2017). Does entrepreneurship education matter? Business students’ perspectives. Tertiary Education and Management, 23, 1-15. 10.1080/13583883.2017.1299205.

Eggers, J. P., & Song, L. (2014). Dealing with Failure: Serial Entrepreneurs and the Costs of Changing Industries Between Ventures. Academy of Management Journal, 58(6), 85 – 101.

Egwu, E. U., Udu, A. A., & Onu, L. O. (2019). Effects of Entrepreneurial Innovativeness on Firm Performance. Calitatea, 20(168), 62-68.

Engelen, A., Flatten, T. C., Thalmann, J., & Brettel, M. (2014). The effect of organizational culture on entrepreneurial orientation: A comparison between Germany and Thailand. Journal of small business management, 52(4), 732-752.

Emmanuel, Y. (2017). Influence of entrepreneurship education, technology and globalization on performance of SMEs in Nigeria. African journal of business management, 11(15), 367-374.

Esfandiar, K., Sharifi-Tehrani, M., Pratt, S., & Altinay, L. (2019). Understanding entrepreneurial intentions: A developed integrated structural model approach. Journal of Business Research, 94, 172-182.

Fairlie, R.W., Miranda, J., & Zolas, N. (2019). Measuring job creation, growth, and survival among the universe of start-ups in the United States using a combined start-up panel dataset. ILR Review, 72(5), 1262-1277.

Fairoz, F. M., Hirobumi, T., & Takana, Y. (2010). Entrepreneurial Orientation and Business Performance of Small and Medium Scale Enterprises of Hambantota District Sri Lanka. Asian Social Science, 6 (3), 34-46.

Farja, Y., Gimmon, E., & Greenberg, Z. (2016). The effect of entrepreneurial orientation on SMEs growth and export in Israeli peripheral regions. New England Journal of Entrepreneurship, 19(2), 3.

Farrington, S.M., & Matchaba-Hove, M.T.M. (2011). The Influence of Entrepreneurial Orientation on Small Business Success. The 23rd Annual Conference of the Southern African Institute for Management Scientists.

Fatoki, O. (2014). The Causes of the Failure of New Small and Medium Enterprises in South Africa. Mediterranean Journal of Social Sciences. 5. 10.5901/mjss. 2014.v5n20p922.

Frishammar, J., & Hörte, S. A. (2007). The Role of Market Orientation and Entrepreneurial Orientation for New Product Development Performance in Manufacturing Firms. Technology Analysis & Strategic Management, 19(6), 765-788.

Gibb, A. (2009). “The small business and entrepreneurship challenge to vocational education: Revolution or evolution?”, paper presented at the OECD Conference on SMEs, Entrepreneurship and Innovation, Udine, Italy, 22-23 October 2009, OECD LEED Programme, Paris.

Gulliford, M. N. (2019). The Link between Self-Definition and Career Interests

Gunawan, T., Jacob, J., & Duysters, G. (2016). Network ties and entrepreneurial orientation: Innovative performance of SMEs in a developing country.  International Entrepreneurship and Management Journal, 12(2), 575-599.

Hair, J. F., Ringle, C. M., & Sarstedt, M. (2011). PLS-SEM: Indeed, a silver bullet. Journal of Marketing theory and Practice, 19(2), 139-152.

Hair, J. F., Risher, J. J., Sarstedt, M., & Ringle, C. M. (2019). When to use and how to report the results of PLS-SEM. European Business Review, 31(1), 2-24.

Hasche, N., & Linton, G. (2018). The value of failed relationships for the development of a Medtech start-up. Journal of Small Business & Entrepreneurship, 30(1), 97–119.

Heidemeier, H., Otten, S., & Göritz, A. S. (2020). Non-stereotype-based threat in gender-imbalanced work groups: Mismatched self-construal erodes self-esteem and promotes performance-avoidance goals. Group Processes & Intergroup Relations, 1368430220916551.

Indarti, N., Rostiani, R., & Nastiti, T. (2016). Underlying factors of entrepreneurial intentions among Asian students. The South East Asian Journal of Management, 143-160.

Ip, C. Y., Wu, S. C., Liu, H. C., & Liang, C. (2018). Social entrepreneurial intentions of students from Hong Kong. The Journal of Entrepreneurship, 27(1), 47-64.

Ismail, M. D., & Alam, S. S. (2019). Innovativeness and Competitive Advantage among Small and Medium Enterprise Exporters: Evidence from Emerging Markets in South East Asia. The South East Asian Journal of Management.

Jackson II, R. L., & Hogg, M. A. (Eds.). (2010). Encyclopaedia of identity (Vol. 1). Sage.

Jackson, D. N. (1976). Jackson Personality Inventory Manual. Port Huron, MI: Research Psychologists Press.

Jalali, A., Jaafar, M., & Ramayah, T.  (2014).  “Entrepreneurial orientation and performance: the interaction effect of customer capital”, World Journal of Entrepreneurship, Management and  Sustainable Development, 10(1), 48-68.

Jiang, T., Canevello, A., Gore, J. S., Hahn, J. H., & Crocker, J. (2017). The association between compassionate goals and relational-interdependent self-construal. Self and identity, 16(2), 143-170.

Jones, P., Maas, G., Dobson, S., Newbery, R., Agyapong, D., & Matlay, H. (2018). Entrepreneurship in Africa, part 1: entrepreneurial dynamics in Africa. Journal of Small Business and Enterprise Development, 25(3), 346-348.

Karimi, S., Biemans, H. J., Lans, T., Chizari, M., & Mulder, M. (2016). The impact of entrepreneurship education: A study of Iranian students’ entrepreneurial intentions and opportunity identification. Journal of Small Business Management, 54(1), 187-209.

Karimi, S., Biemans, H. J., Lans, T., & Mulder, M. (2019). Understanding the Role of Cultural Orientations in the Formation of Entrepreneurial Intentions in Iran. Journal of Career Development, 0894845319880264.

Kerr, S.P., Kerr, W.R., & Xu, T. (2018). Personality traits of entrepreneurs: a review of recent literature. Foundations and Trends in Entrepreneurship,14(3), 279-356.

Kerr, S.P., Kerr, W.R., & Dalton, M., (2019). Risk attitudes and personality traits of entrepreneurs and venture team members. Proceedings of the National Academy of Sciences, 116(36), 17712-17716.

Knight, G. A. (2001). Entrepreneurship and strategy in the international SME. Journal of International Management, 7(3),155-171.

Kollmann, T., Christofor, J., & Kuckertz, A. (2007). Explaining individual entrepreneurial orientation: conceptualization of a cross-cultural research framework. International Journal of Entrepreneurship and Small Business, 4(3), 325-340.

Kraus, S., Rigtering, J. P. C., Hughes, M. & Hosman, V. (2012). Entrepreneurial orientation and the business performance of SMEs: a quantitative study from the Netherlands. Review Management Science, 6, 161–182.

Krueger, N. F. (2017). Is Research on Entrepreneurial Intentions Growing? Or… Just Getting Bigger?. In Revisiting the entrepreneurial mind (pp. 35-40). Springer, Cham.

Krueger, N. F. J., Reilly, M. D., & Carsrud, A. L. (2000). Competing models of entrepreneurial intention. Journal of Business Ventures, 15, 411–432.

Kuka, M. G. K. (2018). Product Development and Management Strategies. Product Lifecycle Management: Terminology and Applications, 11.

Lechner, C., & Gudmundsson, S.V. (2014). Entrepreneurial orientation, firm strategy and small firm performance. International Small Business Journal, 32(1), 36-60.

Lee, Y., Howe, M., & Kreiser, P.M. (2019). Organisational culture and entrepreneurial orientation: An orthogonal perspective of individualism and collectivism. International Small Business Journal, 37(2): 125-152.

Lumpkin, G. T., & Dess, G. G. (1996). Clarifying the entrepreneurial orientation construct and linking it to performance. Academy of Management Review, 21(1), 135–172.

Lyon, D. S., Lumpkin, G. T., & Dess, G. G. (2000). Enhancing Entrepreneurial Orientation Research: Operationalising and Measuring a Key Strategic Decision Making Process. Journal of Management, 26 (5), 1055-1085.

Markus, H., & Kitayama, S. (1991). Culture and the self: Implications for cognition, emotion, and motivation. Psychological Review, 98, 224-2.

Mancha, R.M., & Yoder, C.Y. (2015). Cultural antecedents of green behavioral intent: An environmental theory of planned behavior. Journal of Environmental Psychology, 43, 145 -154.

Martens, C. D. P., Lacerda, F. M., Belfort, A. C., & Freitas, H. M. R. D. (2016). Research on entrepreneurial orientation: current status and future agenda. International Journal of Entrepreneurial Behavior & Research, 22(4), 556–583.

Maslowsky, J., Jager, J., & Hemken, D., (2015). Estimating and interpreting latent variable interactions: A tutorial for applying the latent moderated structural equations method. International Journal of Behavioral Development, 39(1), 87-96.

Miller, D. (2011) Miller (1983) revisited: A reflection on EO research and some suggestions for the future. Entrepreneurship Theory and Practice, 35(5), 873–894.

Miller, D., & Friesen, P. H. (1978). Archetypes of strategy formulation. Management science, 24(9), 921-933.

Ministry of Trade and Industry, Cooperatives and Marketing. (2008). The State of Small Enterprise in Lesotho, October. Accessed 25^th September 2019 from http://www.trade.gov.ls/documents/Lesotho_State_Small_Enterprise_Survey_Oct_2008.pdf.

Nel, J., & Boshoff, C. (2019). Online customers’ habit-inertia nexus as a conditional effect of mobile-service experience: A moderated-mediation and moderated serial-mediation investigation of mobile-service use resistance. Journal of Retailing and Consumer Services, 47, 282-292.

Neneh, B. N., & Van, Z. J. (2017). Entrepreneurial orientation and its impact on firm growth amongst SMEs in South Africa. Problems and Perspectives in Management, 15(3), 166-178.

Nguyen, C. (2018). Demographic factors, family background and prior self-employment on entrepreneurial intention – Vietnamese business students are different: why? Journal of Global Entrepreneurship Research, 8(10), 1-17.

Obi, J., Ibidunni, A.S., Tolulope, A., Olokundun, M.A., Amaihian, A.B., Borishade, T.T., & Fred, P. (2018). Contribution of small and medium enterprises to economic development: Evidence from a transiting economy. Data in brief, 18: 835-839.

OECD, (2017). Enhancing the Contributions of SMEs in a Global and Digitalized Economy.

Ogunlusi, C.F., David, J.O., Atunbi, J.A., & Ajani, J.O. (2018). Employment Generation and Poverty Alleviation: The Effect of Entrepreneurship Development Programmes in Southwest Nigeria. World Journal of Entrepreneurial Development Studies, 2(3): 44-46.

Okangi, F.P. (2019). The impacts of entrepreneurial orientation on the profitability growth of construction firms in Tanzania. Journal of Global Entrepreneurship Research, 9(1), p.14.

Okurut, F., Ama, N., Mookodi, L., Okurut, M., & Ama, H. (2016). Determinants of SMMEs Growth in Botswana. International Journal of Economic Issues, 9(1), 23-44.

Oliveira Jr, A. B., Borini, F. M., Bernardes, R. C., & De Oliveira, M. J. (2016). Impact of EntrepreneurIal Orientation on Strategic Alliances and the Role of Top Management. Revista de Administração de Empresas, 56(3), 1-15.

Park, Y. C., & Pinel, E. C. (2020). Existential isolation and cultural orientation. Personality and Individual Differences, 159, 109891.

Prasad, S.H., Giridhar, K., Barkur, G., & Kiefer, N. (2018). Do Personal Traits, Creativity and Organizational Trust Influence the Innovative Skills of Technical Students an Evidence from a Private University? International Journal of Entrepreneurship, 22(2), 1-10.

Păunescu, C., Popescu, M., & Duennweber, M. (2018). Factors Determining Desirability of Entrepreneurship in Romania. Sustainability, 10(11), 3893.

Pehrsson, A. (2019). When are innovativeness and responsiveness effective in a foreign market? Journal of International Entrepreneurship, 17(1),19-40.

Rajapathirana, R.J., & Hui, Y. (2018). Relationship between innovation capability, innovation type, and firm performance. Journal of Innovation & Knowledge, 3(1), 44-55.

Rezaei, J. &  Ortt, R., (2018). Entrepreneurial orientation and firm performance: the mediating role of functional performances. Management Research Review, 41(7), 878-900.

Rumbaugh, W.D. (2014). Affective domain applications in standards-based education. PhD Thesis. Liberty University.

Sarwoko, E., & Frisdiantara, C. (2016). Growth determinants of small medium enterprises (SMEs). Universal Journal of Management, 4(1), 36-41.

Schwarzer, R., & Jerusalem, M. (1995). Generalized Self-Efficacy scale. In J. Weinman, S. Wright, & M. Johnston, Measures in health psychology: A user’s portfolio. Causal and control beliefs (pp. 35-37). Windsor, UK: NFER-NELSON.

Seng Tan B. (2004). The Consequences of Innovation: In M. Roger, The Innovation Journal: The Public Sector Innovation Journal, 9(3), 1-42.

Semrau, T., Ambos, T., & Kraus, S. (2016). Entrepreneurial orientation and SME performance across societal cultures: An international study. Journal of Business Research, 69(5), 1928-1932.

Shapero, A. (1975). The displaced, uncomfortable entrepreneur. Psychology Today, 9, 83-88.

Shapero, A., & Sokol, L. (1982). The Social Dimensions of Entrepreneurship. Encyclopedia of Entrepreneurship, 72-90. SSRN: https://ssrn.com/abstract=1497759

Siu, W. S., & Lo, E. S. C. (2013). Cultural contingency in the cognitive model of entrepreneurial intention. Entrepreneurship Theory and Practice, 37(2), 147-173.

Staniewski, M. W. (2016). The contribution of business experience and knowledge to successful entrepreneurship. Journal of Business Research, 69 (11), 5147-5152.

UNDP (United Nations Development Programme), 2018. Human Development Report. New York.

Vora, D., Vora, J., & Polley, D. (2012). Applying entrepreneurial orientation to a medium sized firm. International Journal of Entrepreneurial Behavior & Research, 18(3), 352 – 379.

Wach, K. (2015). Entrepreneurial Orientation and Business Internationalisation Process: The Theoretical Foundations of International Entrepreneurship. Entrepreneurial Business and Economics Review, 3(2), 9-24.

Wales, W., Gupta, V.K., Marino, L., & Shirokova, G. (2019). Entrepreneurial orientation: International, global and cross-cultural research. International Small Business Journal, 37(2), 95-104.

Wales, W., Wiklund, J., & McKelvie, A. (2015). What about new entry? Examining the theorized role of new entry in the entrepreneurial orientation–performance relationship. International Small Business Journal, 33(4), 351–373.

Walker, G.J., Deng, J., & Dieser, R.B. (2005). Culture, self-construal, and leisure theory and practice. Journal of Leisure Research, 37(1), 77-99.

Wambugu, A.W., Gichira, R., Wanjau, K.N., & Mung’atu, J., (2015). The relationship between risk taking and performance of small and medium agro processing enterprises in Kenya. International Journal of Economics, Commerce and Management, 3(12), 441-454.

Weinstein, A. (2020). Creating Superior Customer Value in the Now Economy. Journal of Creating Value, 2394964319898962.

World Bank Report, 2019 (retrieved 5 November, 2019). Available from   https://www.worldbank.org/en/country/lesotho/overview.

Zampetakis, L. A., Kafetsios, K., Lerakis, M., & Moustakis, V. (2015). Investigating the role of self-construal in the formation of entrepreneurial intentions. Frontiers in psychology, 6, 1085.

Zampetakis, L. A., Kafetsios, K., Lerakis, M., & Moustakis, V. S. (2017). An emotional experience of entrepreneurship: Self-construal, emotion regulation, and expressions to anticipatory emotions. Journal of Career Development, 44(2), 144-158.

Zehir, C., Can, E., & Karaboğa, T. (2015). Linking Entrepreneurial Orientation to Firm Performance: The Role of Differentiation Strategy and Innovation Performance. Procedia – Social and Behavioral Sciences. 210. 358-367. 10.1016/j.sbspro.2015.11.381.

Zellweger, T., & Sieger, P. (2012). Entrepreneurial orientation in long-lived family firms. Small Business Economics, 38(1), 67-84.

Zhang, T., Xi, S., Jin, Y., & Wu, Y. (2017). Self-construal priming modulates self-evaluation under social threat. Frontiers in psychology, 8, 1759.

Yoo, B., Donthu, N., & Lenartowicz, T. (2011). Measuring Hofstede’s Five Dimensions of Cultural Values at the Individual Level: Development and Validation of CVSCALE. Journal of International Consumer Marketing, 23: 193- 210.