Entrepreneurial Orientation as a Determinant of Oil and Gas Service Firm Performance in Nigeria: The Moderating Role of External Environment

Abstract

Oil and gas service sector is one of the major sectors of the oil and gas industry that contributes to and enhances economic functions across the globe. This industry in Nigeria was plagued with problems of unstable global oil prices, absence of entrepreneurial mindset, poor entrepreneurship ideas and mis-match of entrepreneurial orientation strategies with local and international business environmental conditions. Due to these problems, the oil and gas service firms recorded declining market performance and profitability. This study therefore examined the effect of entrepreneurial orientation components on overall performance. The study adopted cross-sectional survey research design with a target population of 14,038 owners and managers of oil and gas service companies operating in Nigeria. A mixed sampling technique was adopted to select the sample size of 576 using the Cochran (1997) formula. The data was analyzed using descriptive statistics and multiple and hierarchical regression methods of analyses. Findings revealed that entrepreneurial orientation components (proactiveness, innovativeness, risk taking propensity, autonomy and competitive aggressiveness) had significant effect on market performance (Adj.R² = .538, F-stat = 92.142, p<0.05). Entrepreneurial orientation components significantly affected profitability (Adj. R² = .626, F-stat = 76.584, p<0.05); while external environment significantly moderated the relationship between entrepreneurial orientation and firm performance (Δ Adj.R² = .593, ΔF = 25.451; F-stat = 47.215, p<0.05) all at 5% level of significance. Implications of the findings and recommendations were made.