Entrepreneurial Orientation and Business Performance : The Mediating Role of Organization Agility

Arief Budiman, Suryana Suryana, Vanessa Gaffar, Heny Hendrayati

Abstract


Despite growing scholarship on entrepreneurial orientation (EO) and startup performance, the mechanism through which EO translates into multidimensional, balanced competitive outcomes remains theoretically underspecified in emerging economy contexts. This study addresses this gap by examining organizational agility (OA) as a mediating mechanism between EO and business performance measured via the Balanced Scorecard (BSC) — a formative higher-order construct capturing financial, customer, internal process, and learning & growth dimensions. Using a quantitative cross-sectional design with proportional stratified purposive sampling, data were collected from 100 startup founders and senior managers across four key West Java startup hubs: Kota Bandung (n=50), Kota Bogor (n=19), Kota Bekasi (n=20), and Kota Depok (n=11). PLS-SEM (SmartPLS 4.0) with 5,000-resample bootstrapping was employed. Common method variance was assessed via Harman's single-factor test and full collinearity VIF. Findings: EO was positively associated with OA (β=0.47, p<.001, f²=0.284), OA was positively associated with BSC performance (β=0.41, p<.001, f²=0.196), and OA significantly mediated the EO–BSC relationship (indirect β=0.193, 95% CI [0.121, 0.274]), indicating partial mediation (direct β=0.29, p<.01). Model fit was acceptable (SRMR=0.063), and predictive relevance was confirmed (Q²(BSC)=0.218). OA explained 22.1% of OA variance and 38.7% of BSC variance (R²=0.387). This study advances dynamic capability theory by positioning OA as a digitally-enabled operational mechanism that amplifies EO's impact across all four BSC perspectives — not merely financial performance — within West Java's regionally heterogeneous startup ecosystem.


Keywords


Entrepreneurial Orientation; Business Performance; Organization Agility; SMEs; Startup

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References


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DOI: https://doi.org/10.17509/asset.v6i1.102050

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