Stakeholder orientation’s contribution to firm performance

Ekawee Vaitoonkiat and Peerayuth Charoensukmongkol

Management Research Review, 2020, vol. 43, issue 7, 863-883

Abstract: Purpose - This study aims to investigate stakeholder orientation’s influence on firm’s performance and analyze four types of stakeholder orientations: customer, competitor, employee and shareholder. Moreover, this research extended the previous literature by examining perceived market uncertainty’s moderating effect, which can influence the effects of the orientation to all four stakeholder groups’ effects on firm performance. Design/methodology/approach - The study collected questionnaire data from 370 small and medium-sized enterprises in the steel fabrication industry in Thailand, and hierarchical regression analysis was used to test the hypotheses. Findings - The results of the main effect analysis indicated that customer, competitor and employee orientation affected firm’s performance positively and significantly; however, the analysis did not support shareholder orientation’s significant contribution. Moreover, the analysis of the moderating effect showed that perceived market uncertainty moderated customer and competitor orientation’s effect on firm’s performance positively and significantly. However, perceived market uncertainty moderated employee and shareholder orientation’s effects on firm’s performance negatively and significantly. Originality/value - This study advances prior research by showing that stakeholder orientation’s role in firms’ performance may be contingent on the nature of market conditions that firms experience. In particular, this research demonstrated that not all aspects of stakeholder orientation may be beneficial for firms to maintain high performance under high market uncertainty.

Keywords: Small and medium enterprises; Thailand; Firm performance; Stakeholder; Strategic management; Market uncertainty; Entrepreneurship and small business management (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eme:mrrpps:mrr-07-2019-0296

DOI: 10.1108/MRR-07-2019-0296

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