Proactive Strategy and Financial Performance of SMEs: The moderating role of Environment

The objective of this study is to provide an investigation into the connection that exists between the proactive aspect of entrepreneurial attitude and the performance of individual businesses. This study also investigates the moderating influence that crucial contextual qualities, such as dynamism and hostility, have on the link between the two variables. This area of literature was investigated, which ultimately led to the formulation of a theory. For the purpose of measuring this construct, measurements were taken using a measurement instrument that was based on scale items that had been published in the literature by researchers in the past. These scale items have also been shown to be reliable and valid, as demonstrated by earlier research. Only businesses in Kano state, Nigeria, that met the following criteria were included in the investigation: (a) they were small and medium-sized enterprises, (b) they had at least ten employees and a maximum of three hundred workers, (c) they were independent and not a subsidiary or branch company, and (d) they were situated in Kano. 352 owners and managers of small and medium-sized enterprises (SMEs) took part in the research. An application of the statistical program SPSS called Hierarchical Moderated Regression Analysis was utilised in order to do the analysis on the data that was collected. According to the findings, proactive behaviour has a good and significant association with the success of the company, which indicates that the theoretical framework is supported when observed. Additionally, it was shown that contextual variables such as antagonism and dynamism have a role in this association to some extent. The findings presented here indicate that proactiveness is not a significant factor in determining the performance of a company on its own; rather, it is partially influenced by the features of the environment. Another topic that was covered was the consequences that this result has for researchers as well as for managers. In addition to making a contribution to the growing field of research on entrepreneurial orientation, this study offers a deeper understanding of the strategic behaviour of businesses in a wide range of environmental settings.