Small and Medium-sized Enterprises’ Resilience to Socioeconomic Challenges in Emerging Economies: The Impact of Entrepreneurial Orientation on Organisational Ambidexterity

Abstract

In today’s rapidly evolving business landscape, small and medium-sized enterprises in emerging economies face mounting socioeconomic challenges that compel them to innovate while sustaining operational efficiency. This study investigates the impact of entrepreneurial orientation on organizational ambidexterity within small and medium-sized enterprises operating in the industrial sector in Egypt. In an increasingly dynamic and competitive environment, small and medium-sized enterprises must balance exploratory and exploitative activities – an ability defined as organizational ambidexterity – to sustain innovation, adaptability, and performance. Drawing on the resource-based view and the dynamic capabilities perspective, this research explores how the dimensions of entrepreneurial orientation – namely innovativeness, proactiveness, and risk-taking – contribute to the development of ambidextrous capabilities. A quantitative research design was adopted, employing a structured questionnaire administered in 2025 to a sample of 392 employees working in small and medium-sized enterprises in the construction sector in Egypt. Data were analyzed using structural equation modeling to test the hypothesized relationships between the dimensions of entrepreneurial orientation and the two facets of organizational ambidexterity: exploration and exploitation. The findings demonstrate that most dimensions of entrepreneurial orientation – except for autonomy and risk-taking – positively influence ambidexterity, with risk-taking showing a negative effect and autonomy proving statistically insignificant. These results highlight the differentiated yet complementary roles of entrepreneurial orientation attributes in fostering ambidextrous behavior in resource-constrained environments such as small and medium-sized enterprises. The study contributes theoretically by extending the understanding of the role of entrepreneurial orientation in organizational learning and adaptability in emerging economies, and practically by offering strategic insights for leaders and policymakers seeking to enhance innovation and operational performance in response to ongoing socioeconomic challenges.