Investigating the relationship between Entrepreneurial and Market Orientations within French SMEs and linking it to Performance

Abstract: This study empirically investigates the levels of entrepreneurial orientation (EO) and market orientation (MO), and their links to performance within the context of French Small and Medium Sized Enterprises (SMEs). SMEs represent today the heart of the European strategy and account fro 99% of the total companies in France. The current study argues that SMEs and especially French ones deserve a particular attention. Besides, even though many studies have been conducted in the fields of entrepreneurial orientation and market orientation, when combining both, only a few included performance in their empirical analyses. Moreover, most relied on large established companies or MNE. Little concern has been put in SME and none have been done on the case of French SMEs. The current study propose a cross-sectional analysis to investigate the combination of EO and MO and its impact on performance through a quantitative research method. Based on existing theories and previous studies, three hypotheses have been formulated : H1 : Companies that are entrepreneurial oriented outperform companies that are not. H2 : Companies that are market oriented outperform companies that are not. H3 : Companies that are both entrepreneurial and market oriented outperform companies that are either one or none. In order to test those hypotheses, a online 24 questions survey has been administrated to a sample of 338 French SMEs. All questions were based on the works of Covin and Slevin (1989), Narver and Slater (1990), Lumpkin and Dess (1996), and Blois and Carson (2000). The results show that all hypothesis are verified. However, if no correlation was found between EO and MO, the combination of both enables SMEs to achieve higher performance.