Assessing the influence of entrepreneurial orientation on the performance of South African construction business

Abstract

Literature is full of studies conducted to unravel the effect of entrepreneurial orientation on organisations' performance, which highlights the importance of entrepreneurial orientation on the way businesses are organised. One sector that is still to be fully explored as far as Entrepreneurial Orientation (EO) and organisational performance are concerned is the construction industry. In this study, we investigate how the entrepreneurial orientation dimensions, namely innovativeness, pro-activeness, risk-taking, competitive aggressiveness, and autonomy, influence the success of South African SMEs in the construction sector, where success is measured through business growth and business development. A quantitative research methodology was adopted. The empirical research was conducted with the aid of questionnaires addressed to the South African SMEs in the construction sector within the provinces of Gauteng and Mpumalanga. A convenient sample was chosen to engage SMEs in the construction sector and a total of 43 SMEs responded. The collected data was analysed with the assistance of statistical professionals, utilising multiple regressions and hierarchical multiple regression analysis. The study found some positive links between the business development component of perceived business success and two constructs of entrepreneurial orientation, namely Autonomy and innovation. Recommendations in line with the results and conclusions were proposed. The objective of the recommendations was to identify constructs that require improvement within both the dependent (perceived business success) and independent (entrepreneurial orientation) variables analysed and discussed in the study. Recommended measures should be implemented for improvement, and to enhance entrepreneurship within SMEs in the construction sector.