c+ritical review of the article by nathaniel boso, vicky m. story and john w. cadogen: entrepreneurial orientation, market orientAtion, network ties and performance: study of entrePRENEURIAL FIRMS IN A DEVELOPING ECONOMY, JOURNAL OF BUSINESS VENTURING 28(2013) Page 708-727

ADISA AFOLARIN O, PRID 1303094 BE 951, MASTER OF FINANCE AND MANAGEMENT

TABLE OF CONTENT
INTRODUCTION…………………………………………………………………1.O
MOTIVATION OF THE RESEARCH………………………………………......1.1
RESEARCH QUESTION………………………………………………………..2.0
THEORETICAL APPROACH…………………………………………………...2.1
EMPIRICAL APPROACH……………………………………………………….3.1
APPROPRIATENESS OF EMPIRICAL METHOD…………………………...3.2
FINDINGS AND CONCLUSION………………………………………………..4.0
FURTHER RESEARCH PROJECTS…………………………………………..4.1
MAIN CONTRIBUTION………………………………………………………….4.2

1.0 INTRODUCTION. This research studies how entrepreneurial firms evaluate performance benefit by simultaneously aligning high level of both entrepreneurial orientation (EO) and manager orientation (MO). It is relevant for firms operating in a developing economy context where these potentials are enhanced for business with strong social and business network ties. Entrepreneurial orientation refers to firms procluivity to explore new market opportunities and as such it manifest itself through a firms tendency to accept innovation, risk-taking, pro-activeness, competitive aggressiveness and autonomy (Lumpkin and Dess, 1996). Market orientation is defined as the implementation of the marketing concept in firms target market (Kohli and Jaworski, 1990) and reflects a firm’s orientation towards customers, competitors and other exogenous factors. The research implies that high level of entrepreneurial orientation are required for great innovation and new market creation and high level of market orientation are critical for a rapid response to current market needs and preferences. Entrepreneurial orientation also entails some significant uncertainty and risks (in developing economies) where business infrastructure such as chain arrangement, commercial law enforcement, and energy and transportation facilities are under developed. Market orientation carries risk of structural inertia and a tendency for firms to de-emphasize greater innovativeness. Thus, the combination of both orientation will counter the risk associated with both in developing countries The research also indicates that social processes outside the borders of the firm further maximises the performance benefits of aligning high level of both orientation. Social processes occurs at the level of relationship between an entrepreneur and local community leaders, government as well as local social peers on the form of social network ties, relationships entrepreneurs develop with customers, suppliers and competitors in an industry in the form of business network ties. This increases the impact of complementary strategic orientation on firm’s performance among entrepreneurial organisations operating in a developing economy. The author uses both theoretical and empirical methods to discuss the literature and need to better understand and show significance of aligning high entrepreneurial and market orientation. There was further study on social and business network ties to improve both orientation on firms’ performance in a developing economy. These leads him to formulate three hypotheses.
1.1 MOTIVATION FOR THE RESEAECH.
The author is motivated by the goal to clarify the doubt regarding a firm’s ability to invest in either orientations in challenging situations such as those found in developing countries. Regarding payback of leverages complementarity between EO and MO activities are not well understood in the context of alignment with social and business networks. The author explain these effects on firms performance in developing economies.

2.0 RESEARCH QUESTION.
The main research question in the study is on how entrepreneurial orientation and manager orientation affect performance of firms in developing economies. It also questions how social and business network ties influences manager and entrepreneurial orientation on performance of firms in developing economies. 2.1 THEORETICAL APPROACH
The author uses established literature on how entrepreneurial orientation and market orientation combine to enhance firms’ performance. He then examines the influence of entrepreneurial and market orientation on exposure to social network ties and then on business network ties. He developed the hypotheses based on these criteria to test for significance in sale performance and profitability of firms in developing countries. The hypotheses are as follows:

H1 Comparing entrepreneurial orientation, market orientation performance on organisation in developing economies
H2 Comparing social network ties on performance of entrepreneurial orientation, market orientation H3 Comparing business network ties on performance of entrepreneurial orientation, market orientation.
Control variables used are Environment munificence Environment complexity Firm size Industry Firm experience Lower-order interaction.

3.0 EMPIRICAL METHOD
The author used a survey research strategy by employing a cross sectional design to conduct a survey of entrepreneurial business operating in Ghana to test his hypotheses
Survey data Data where developed from Ghana Company register database (available at the register general department) and the Ghana business directory (Acquaah, 2007: Appiah-Adu, 1998). Initially 789 firms where selected, in addition the author ensure that the sample comprised only firms that employed a minimum of 5 and a maximum of 500 full-time staff ( Goedhuys and Sleuwaegen, 2010) and firms that had complete contact information on the entrepreneur or CEO (Khavul et al., 2010). 312 firms (40%) agreed to participate in the study Survey procedure Data were collected in two phase, with a one-year time lag, were the author used telephone calls and hand delivered questionnaire to entrepreneurs and CEOs of firms (April,2010). Complete response were received from 229 firms (73.4%).
To reduce common method bias (Podsakoff et al., 2003) financial managers in the 229 firms were contacted in person with another questionnaire to capture the performance of the firm and compare with those of the CEOs. After two reminders complete and matched response were received from 221 of the 229 firms (95%).
Finally a follow-up study on the firms’ entrepreneurial profile was undertaken with the CEOs/entrepreneurs of the 221 firms (April, 201 ( Palich and Bagby, 1995). 18 firms were dropped from the list of 221 to make the final sample size 203 firms (60%)
Measure of construct The study relied on previous study for items to measure key constructs examined. Specifically, items were adapted from previous works on similar study and the author made changes to words and sentences to enhance understanding in the Ghanaian context (Acquaah, 2007).

3.1 APPROPRIATENESS OF METHOD USED. In the research there was a good response rate (65%) for the survey size as it is a known fact that CEOs/entrepreneurs have busy schedules. Also in choosing to use previous research construct measures for the study the author made changes to words and sentences to enhance understanding in the Ghanaian context (a developing economy). Common method bias was reduced by the application of comparative design, i.e. giving another set of questionnaires to firm manager’s to capture firms performance compared with that of the CEOs/entrepreneurs. However, this method only offers a snapshot of a single moment in time, it does not consider what happens in the future.

4.0 FINDINGS AND CONCLUSION. The author findings suggest that there is positive and significant relationship between combination of entrepreneurial orientation and market orientation and performance of firms in developing countries.
H₁ is supported to be true because (EO×MO) is positive and significant for both sales performance (y=0.26; p<0.01) and profitability (y=0.15; p<0.05)
H₂ is supported to be true because (EO×MO× social network ties) is positive and significant for both sales performance (y=0.25; p<0.01) and profitability (y=0.26; p<0.10)
H₃ is supported because (EO×MO× Social network ties× business network ties) are positive and significant for sale performance (y=0.13; p<0.05) and profitability (y=0.10; p<0.10)
(EO represents entrepreneurial orientation while MO is market orientation.)
The argument for the findings of the research is justified because test where carried out on the reliability and validity of the measures used for the study to examine the scales (LIREL) avoid risk of violating minimum sample size (Cadogen et al.,2006) to examine the fitness of the model (chi-square) . All the results were positive and significant to the test of the hypothesis. Also there was a test on common method bias problems (Cote and Buckley, 1987) which showed that common bias is not a concern in the study. There was significant correlation among the study constructs and the positive and significant values for hypotheses tested on sales performance and profitability. The research concludes that alignment of high level of entrepreneurial orientation, market orientation, social network ties and business network ties produces improved performance outcome for entrepreneurial firms in a developing economy. However the study excludes very small firms from the sampling frame. The notion of entrepreneurial orientation, market orientation are not without meaning in micro business contexts because the idea of both orientation may well be relevant for small scale micro businesses. Another question that needs answering concerns the generalizability of the findings, especially the importance that network ties may have in economies that are at different stages in the development of their legal and regulatory institutions. The research was undertaken in Ghana which is a single and relatively small developing country that share characteristics with other developing countries, however other developing countries my possess unique and varied contextual element that allows for additional insight and theory development.

4.1 FURTHER RESEARCH PROJECTS.
Other research project that could be derived include; How interaction between entrepreneurial activities, institutions and communities impart on the performance of firms in a developing country. In this context the research will study inter-relationship between entrepreneurial business activities, political ties, channel networking and interaction with local community leaders on performance. How national culture factors like the future orientation, performance orientation, risk aversion level of the entrepreneurs affect the relationship between strategic orientation and entrepreneurs business success. This research will explore the impact of cultural factor on the success of strategic orientation across a range of developing countries in order to incorporate into strategic orientation theory additional variables that vary at the national level.

4.2 MAIN CONTRIBUTION.
The main contribution of the research is to directly provide assistance to businesses in developing countries to overcome the barriers of entrepreneurial orientation, market orientation, social network ties, business network ties as they are not necessarily straightforward or intuitive, takes time and come at a cost. The research considers the trade-offs that entrepreneurs will need to make when considering how best to invest in different strategic orientations and organisational capabilities. The research is at the heart of the idea of helping developing countries to grow and improve sales performance and profitability.

REFERENCES.
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