When does formalization contribute to entrepreneurial orientation? The moderating role of industry life cycle

Aleksandra Wasowska, Krzysztof Obloj and Mariola Ciszewska-Mlinaric

Journal of East European Management Studies, 2018, vol. 23, issue 3, 377-403

Abstract: The paper aims to analyse how formalisation, as a key component of organisational structure, influences entrepreneurial orientation and how this relationship is moderated by the industry life cycle. The hypothesised relationships are tested on a sample of 271 small and medium-sized enterprises (SMEs). The study uses regression models and controls for individual-level (i.e. respondent’s status within the company), firm-level (i.e. firm age, firm size) and environment-level variables (i.e. origin of key competitors, industry type). The paper suggests that formalising a company’s decision-making positively contributes to the level of entrepreneurial orientation (EO). Moreover, the positive effect of formalisation on EO is likely to be moderated by the industry life cycle such that it is stronger in young and fast-growing industries and weaker in mature industries.

Date: 2018
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DOI: 10.5771/0949-6181-2018-3-377

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