Author(s): Erna Herlinawati, Suryana, Eeng Ahman, Amir Machmud
This study aims to analyze the effect of entrepreneurial orientation on business performance. Entrepreneurial orientation is measured through innovativeness, proactiveness, risk taking, and aggressiveness, while business performance is measured through the Balanced Scorecard perspective.
The research method uses explanatory methods with data collection techniques through questionnaires and interviews. Population is SMEs in the manufacturing industry sector in West Java, Indonesia measuring 203,181 with proportional random sampling technique obtained by sample 346 SMEs. The data that has been collected is then analyzed using a Likert scale system, descriptive syllogism analysis and Structural Equation Modeling (SEM).
The results showed that entrepreneurial orientation in all dimensions (innovativeness, proactiveness, risk taking, and aggressiveness) tended to be low. Likewise with business performance (perspective: financial, customers, internal business processes, learning and growth) are at a level that tends to be low, which illustrates entrepreneurial orientation positively influences business performance.
The implication of this research is that the lack of development of the desire of SMEs actors to seek business opportunities and become leaders in an increasingly dynamic business environment, if not allowed to hinder the growth of business performance, also weakens competitiveness so that SMEs products are not marketable. This finding implies, to improve business performance, SMEs players in running their businesses are always entrepreneurial oriented.