In order for firms to gain superior performance and competitive advantage, a firm must consider strategic orientation when developing strategies. Strategic orientation encompasses various forms that strongly vary based on its internal and external conditions and services.
The strategic orientation of a company typically represents its strategic concepts and the initiatives adopted by the firm to cultivate the necessary behaviors required to gain and sustain excellence in its business performance. It also encompasses intangible assets and competencies that become ingrained within the organization's culture. Strategic orientation is increasingly gaining enormous momentum in many organizations globally by playing a pivotal role in business strategies. Despite its growing interest in academic research, empirical research on the mediating impact of strategic orientation in the relationship between board management strategy and green innovation, remain unexplored.
To address the gap in research, this study aims to provide empirical evidence on how strategic orientation mediates and significantly impacts the relationship between board management strategy and green innovation in firms based in South Korea. This study focuses on the unique role of strategic orientation (Internal and External strategic orientation) as a mediator in exploring the link between board management strategy and green innovation. As a complex function, strategic orientation involves both internal and external factors that enhance performance and foster competitive advantage.
While prior research has examined the relationship between strategic orientation and firm performance, and little or no attention has been paid to the potential mediating effect of strategic orientation on the relationship between board management strategy and green innovation.
Through content analysis of key organizational narratives, such as sustainability reports, we investigated the influence and importance of strategic orientation. This dissertation aims to test proposed theoretical hypotheses and ascertain the mediating influence of the newly formed strategic orientations.
Additionally, this study aims to contribute to this literature by developing a measurement approach for strategic orientation and to set the trend for more research on this topic. We classified strategic orientation into two categories (Internal and External orientation) and employ content analysis coding based on this classification.
The empirical findings from the regression analysis results indicate that the relationship between board management strategy and green innovation is mediated by strategic orientation (both internal and external). In other words, the presence of strategic orientation in a company plays a crucial role in explaining the link between the board management strategy and the level of green innovation.
Furthermore, the mediation effect of only internal strategic orientation also demonstrates full mediation effect between board management strategy and green innovation. Conversely, the mediation effect of only external strategic orientation reveals partial mediation in the relationship between board management strategy and green innovation.
This study provides a discussion on the theoretical and managerial implications of strategic orientation and also provides direction and insight for future research.