The Role of Entrepreneurial Orientation and Knowledge Absorptive Capacity on Firm's Performance of Agro Industry

In dynamic business environment, that profit streams in future is unreliable, the firms continually need to search and exploit new opportunities. As a result, it is essential for firms have more attention to performance and factors affecting on it, to maintain an active presence in this field. Now a day, entrepreneurship and entrepreneurial orientation is at the central point of view of researchers and managers in theory and practice of management in organizations. The purpose of this study is examining the effect of entrepreneurial orientation and knowledge absorptive capacity on SME performance of Agro industry in Mazandaran. The sampling method is stratified random sampling and the sample size consists of 99 firms. Data have been collected thought Questionnaire that its validity confirmed according to experts opinion. Its reliability was calculated 0.95 with Cronbach's alpha formula. The results showed that entrepreneurial orientation and knowledge absorptive capacity have a positive and significant effect on the firm performance. In other words, higher levels of entrepreneurial orientation activities lead to higher level of performance. In addition, the findings has showed that continuous exploration of knowledge outside the firm, absorption and internalization of required components of them among individuals an teams can improve the firm's performance. According to findings, we have introduced that the managers can improve the firm's performance with entrepreneurial orientation, and preparation to knowledge absorptive capacity.