The Impact Of Korean SMEs' Entrepreneurial Orientation On Firm Performance

Recently,South Korean SMEs are in a difficult period due to the economic recession and rapid changes in the external environment,such as the global economic recession,rising interest rates,and Chinese&U.S.trade negotiations.According to a survey of small and medium-sized manufacturing companies in South Korea in January 2019,39% of SMEs said that the economic development prospects in 2019 are not optimistic,and only 6.6% of respondents believe that “the future will improve”,This means that the economic conditions faced by Korean SMEs are not very good.In the case of management problems expected in 2019,57.9% of respondents indicated that domestic demand is not good,followed by rising labor costs(52.5%),excessive competition between companies(29.5%)and shortened working hours(13.2%).In order to solve these problems,the Korean government has actively taken measures to support the development of SMEs,but the survival and development of SMEs is still not satisfactory.What are the core abilities of SMEs to overcome these problems or the core competencies they need? In order to find out the answer,this study uses entrepreneurial orientation as an entry point to study the mechanism of entrepreneurial orientation affecting Korean SMEs.Entrepreneurship orientation includes three aspects: proactiveness,risk-taking and innovation.Entrepreneurial orientation is one of the factors that SMEs with relatively weak resources must have in order to survive in a highly uncertain and changing environment.In addition,all entrepreneurial-oriented enterprises can achieve high firm performance,so this paper studies the mediating role of marketing ability on entrepreneurial orientation and firm performance.This study believes that the choice of entrepreneurial orientation is not only the ability of entrepreneurs,but also the ability of the entire organization.Therefore,the research object of this paper is the entrepreneurs,managers and employees of Korean SMEs.Through the analysis of relevant literature,the model of entrepreneurial orientation and firm performance is established.Based on this model,the theoretical hypothesis of this paper is put forward,and through empirical research.The hypothesis presented in this paper was verified.Through reference to previous research literature,this paper chooses proactiveness,risk-taking and innovation to measure entrepreneurial orientation,using customer relationship management,product relationship management and supply chain management to measure marketing capabilities,firm performance and environmental turbulence were measured in three dimensions.The scales referenced in this paper are all scales with reliability and validity,and the questionnaires are revised to make the scales suitable for the Korean scene.After the questionnaire was issued and recycled,the data was analyzed using SPSS(descriptive statistics,reliability and validity analysis,correlation and regression analysis),and the following conclusions were obtained: First,for small and medium-sized enterprises with lack of resources,entrepreneurial orientation is realized.One of the important factors of firm performance,the positive influence of entrepreneurial orientation on firm performance is established.Secondly,it proves that entrepreneurial orientation has a positive impact on marketing ability.Enterprises with entrepreneurial orientation are more likely to continue to develop,but the impact of the proactiveness dimension on marketing capabilities is not significant.Thirdly,with the improvement of marketing ability of SMEs,firm performance also increases;Fourth,marketing ability plays a part in mediating role between entrepreneurial orientation and firm performance of SMEs;Fifth,the results show that environmental dynamics plays a moderating role in the positive relationship between entrepreneurial orientation and firm performance.The results of this study show that SMEs should establish their own marketing capabilities and strive to strengthen entrepreneurial orientation to improve firm performance.In addition,due to the greater environmental turbulence,the stronger the relationship between entrepreneurial orientation and firm performance,SMEs need to pursue entrepreneurial orientation in an uncertain environment,and develop into a small and medium-sized enterprise by creating competitive advantage to survive in a crisis.