DOI: https://doi.org/10.14710/dijb.5.2.2022.158-173

A critical role of the explorative relational capability to enhance business performance: Empirical study in the Indonesia fashion industry

1Department of Management, Universitas Ciputra Surabaya, Indonesia

2Department of Management, Universitas Muhammadiyah Purworejo, Indonesia

3Department of Management, Sekolah Tinggi Ilmu Ekonomi Ciputra Makassar, Indonesia

Open Access Copyright 2022 Diponegoro International Journal of Business under http://creativecommons.org/licenses/by-sa/4.0.

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Abstract
A recent study proposes the concept of explorative relational capability (ERC) and examines ERC's importance in improving business performance. This study used 218 respondents. The research respondents were owners or managers of SMEs in the furniture industry. The analysis used is structural equation modeling. After developing the concept of explorative relational capability, this study examines its effects on product innovation, advantages of new value creation, and business performance. The results show that ERC can improve product innovation, the advantages of new value creation, and business performance in the fashion industry. Other results show that ERC can mediate the gap between entrepreneurial orientation-business performance. This research contribution is aimed at a resource-based view (RBV). Companies must have resources that can provide new solutions, develop new perspectives, and create creative ideas to drive maximum business performance
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Keywords: entrepreneurial orientation; explorative relational capability; product innovation; advantages of new value creation; business performance

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