The relationship between strategic entrepreneurship and performance of small and medium enterprises in Malaysia

The objective of this research is to determine the relationship between entrepreneurial
orientation (EO), entrepreneurial values (EV), knowledge creation process (KCP), and the
performance of Small and Medium Enterprises (SMEs) in Malaysia. This research analyzes these contributing variables to strategic entrepreneurship and their relationships
with the performance of SMEs. There are a number of views on strategic entrepreneurship,
which most have propensity for opportunity-seeking and advantage seeking behavior that
require combined theories in entrepreneurship and strategic management. However, a few
scholars argue that it is actually a balance of exploration and exploitation activities which
correspond to the firm's capability to explore opportunities internally plus externally, and
allow the sustaining of wealth creation. The research employs a quantitative and survey
method, and data were collected from owner/managers of SMEs throughout peninsular
Malaysia. Out of the 370 responses collected, only 335 were usable in this research. The
data were analysed using multiple regressions. The findings reveal that exploration and
exploitation depicted in entrepreneurial orientation, entrepreneurial values and knowledge creation process respectively were significant predictors in strategic entrepreneurship and exhibited positive influence to the performance of SMEs in Malaysia. This research contributes theoretically to the enhancement of the understanding as well as the analysis of the strategic entrepreneurship model in SMEs. It provides another empirical supports to the three variables of EO, EV and KCP where EO having the biggest strength and contribution to the firm performance. In managerial contribution aspect, the findings provide opportunities for the SMEs to engage strategic entrepreneurship activities and develop sustaining competitive advantages thereby shoring up their performance.