KOREASCHOLAR

Businesses today are looking for new ways to acquire and retain customers, by delivering innovative products and services, which serve each customer's individual demands. Fo- cusing on individual customer needs and addressing each request individually with a ser- vice or product that is perceived as being customized has become the focal point of Inter- action Orientation (IO), a firm-level strategic orientation developed by Ramani and Kumar (2008). Entrepreneurial Orientation (EO) is also a firm-level strategic construct, which reflects the "processes, practices, and decision-making activities" that firms use to identify and exploit new business opportunities (Lumpkin & Dess, 1996, p.136). As op- posed to IO, EO is a well-established concept, being one of the most examined topics in entrepreneurship research. However, most studies have focused on cross-sectional de- signs to assess the relationship to firm performance, leading to numerous research calls focusing on the need for more dynamic investigations (Saeed, Yousafzai, & Engelen, 2014). Based on our analysis including 247 S&P500 firms from a variety of industries over a period of three years, this longitudinal study is one of the first to assess the short-term and long-term effects of IO and EO. To establish the firm's levels of IO and EO, we ana- lyze the content of Letters to Shareholders (LtS), as LtS have been widely used to assess different strategic orientations - Market Orientation, Learning Orientation - including EO (Noble et al., 2002; Short, Broberg, Cogliser, & Brigham, 2010; Zachary, McKenny, Short, & Payne, 2011). We relied on multisource secondary data for performance indica- tors and included several control variables: past performance of the firm, firm age, firm size, as well as industry specific effects. Our results confirm that each orientation has a positive impact on the firm's financial suc- cess in the long-term but a combined IO-EO strategy reveals a negative effect on firm performance in the long-term. This study investigates the synergies between IO and EO in a longitudinal setting and using objective financial performance indicators, establish- ing the advantages and disadvantages of implementing a single or combined strategy.

• Melania Mateias(RWTH Aachen University, Germany)
• Malte Brettel(RWTH Aachen University, Germany)