This study on the interaction between culture dimensions and entrepreneurial performance is grounded on two theories; Hofstede’s theory on cultural dimension and Shapero and Sokol theory of entrepreneurial events. The variables employed in the study have been developed primarily from these two theories.

Hofstede’s theory on cultural dimensions has extensively been used and confirmed in the study of culture and management (Singh, Kumar and Baack, 2005). Hofstede (1980) posited that there exist four main dimensions that separate one culture from another worldwide. These dimensions are ‘uncertainty avoidance’, ‘individualism’, ‘power distance’ and ‘masculinity’ (Hofstede, 1980). Time orientation came as an addition to this original theory on culture dimensions (Hofstede & Bond, 1988). Although the theory has been met with some criticisms primarily regarding the methodology and context, it has remained an effective model in detecting and analysing cultural differences (Bochner, 1994). According to Beugelsdijk, Maseland, Onrust, van Hoorn and Slangen (2015) Hofstede’s cultural dimensions framework maintains relevance in that it provides a set of common culture dimensions applicable to all societies, thereby allowing cross-cultural evaluations. This study adopts the culture dimensions suggested in the two propositions by Hofstede.

The model by Shapero and Sokol on entrepreneurial events, suggests that perceived feasibility, perceived desirability, and propensity motivate entrepreneurs to act in starting a new venture (Shapero and Sokol, 1982). The model implies that people’s beliefs about their personal capabilities in accomplishing an activity has either positive or a negative effect on their future entrepreneurial behavior (Jimenez- Moreno and Ussman, 2013). Conclusion from this model is that entrepreneurial events, which are a result of interrelated circumstances and social-cultural factors, have an influence on the individuals’ entrepreneurial behaviour (Elfving, Brännback, and Carsrud, 2009). Although several factors are expected to impact an individual’s behaviour and intention, empirical studies seem to support Shapero and Sokol’s model (Krueger, 1993). From this model, this study adopts perceived feasibility and propensity to act as significant in influencing entrepreneurial performance.

The power-distance construct defines the degree to which the less influential individuals in an institution usually expect and accept the unequal distribution of power (Hofstede, 1997). Power distance relates to the degree to which members are comfortable in approaching or challenging their superiors. Hence firms that are characterised by a large power-distance culture centralise power, and its employees work on instructions they are mostly expected to comply (Tavakoli, Keenan and Cranjak-Karanovi, 2003). In such firms, the less influential employees assume and admit to the unequal distribution of power and are submissive and respectful to higher power authorities and maintain bigger social distance (Farh, Hackett and Liang, 2007; Shi and Hoyt, 2016). On the contrary, low power distant people find it easy to approach and contradict their superiors (Ford and Kotzé, 2005). These low power distance individuals are often democratic and are less likely to succumb to authority (Lam, Schaubroeck and Aryee, 2002). In addition, low power distance employees are often not controlled by the supervisor-subordinate relationship and are more enthusiastic to try alternative social support systems, are more open-minded and may perceive more value from their informal mentors (Qian, Han, Wang, Li and Wang, 2014).

According to Tavakoli, et al., (2003) uncertainty avoidance is defined as the degree to which society members feel that there are threats from both unknown and uncertain situations. Hofstede (1997) states that individuals in uncertainty avoiding cultures have the tendency to evade unclear circumstances and look for more clear and easy ways to interpret and predict situations. This implies that members of a strong uncertainty avoidance culture find comfort “even ineffective rules satisfying people’s emotional need for formal structure” Hofstede (1997:121). In the business context, these members tend to display more brand loyalty and are suspicious of any new products (Baker and Carson, 2011). They generally view newly introduced products or services as less satisfactory but those with low uncertainty avoidance propensities tend prefer such products or services (Ann Lee, Garbarino and Lerman, 2007). Schneider and DeMeyer (1991) believe that managerial personnel in high uncertainty avoidance cultures tend to be proactive in adapting to dynamism in the environment. This is in line with Geletkanycz and Hambrick (1997) who states that high uncertainty avoidance business executives are always looking for strategic solutions in response to changes in the business environment.

As expressed by Itulua-Abumere (2013) masculinity entails the behaviors, languages, and practices, exhibited in a specific culture and organisational setups that are ordinarily associated with males. Hofstede (1980) refers to this cultural dimension as the fondness by individuals in a social order for accomplishment, heroism, confidence, and quantifiable rewards for success, while its equal, femininity relates to the fondness for collaboration, humility, care for frail members, and higher quality of life (Hofstede1980). It is often characterised by physical robustness, control, and antagonism thereby reflecting a more violent but glamourised representations (Katz, 2003). The expectation is that males are tough and engrossed with materialistic success while females are more diftdent, affectionate, and passionate about quality life (Hofstede, 1997). Members of a society that are more masculine in culture tend to value material based recognition and confidence and will always respond in a way that foster their personal desires (Wang, Peng, Sia, Tong and Ku, 2016).

Compared to the other dimensions by Hofstede the individualism dimension is regarded as the most important in explaining the differences among cultures. Beugelsdijk, Maseland, and van Hoorn (2015) posit that individualistic cultures emphasise self-suftciency and eccentricity and hence are highly unlikely to conform to group representations. Individualism explores the extent to which individuals in a society or organisations are willing to integrate themselves into groups (Hofstede, 1980). This cultural dimension focuses primarily on the individual person and level of interaction with other members of the society (Hofstede, 1991). Cultures that are more individualist tend to have several in-groups like families and clubs within bigger groups, and the behaviour of individuals is primarily aimed at meeting the objectives of the in-groups (Darwish and Huber, 2003). On the contrary, collectivism entails that members of a society generally value their involvement in group activities more than their individual activities and by so doing there is greater loyalty to the group and more desire to safeguard the interests of group members (Wang et al., 2016). While individualism and collectivism have often been defined as direct opposites, it is considered more accurate to look at them as terms that refer to self-concept from different paradigms (LeFebvre and Franke, 2013).

In the Shapero and Sokol (1982) model, perceived feasibility is defined as the degree of personal capability in starting business to success. Moghavvemi, Salleh and Abessi (2013) elaborate that the perceived feasibility variable centers around the discernment regarding an individual’s ability to undertake a specific task successfully. In entrepreneurship terms, perceived feasibility relates to the degree to which entrepreneurs consider themselves able to undertake an entrepreneurial activity (Ozaralli and Rivenburgh, 2016). Factors that influence perceived feasibility include availability of role models, financial capacity, social support, the level of education and general level of confidence in one’s ability to accomplish activities (Gasse and Tremblay, 2011). Although scholars have acknowledged the significance of factors like self-confidence in fostering perceived feasibility, self-eftcacy extensively has been identified a critical precursor to variable feasibility discernments (Krueger, Reilly and Carsrud, 2000). In line with the above, a study by Hallak, Brown and Lindsay (2012) also revealed that eftcacy is a significant predictor of entrepreneurial performance and that the higher the individual’s self-eftcacy the higher the performance.

Another important entrepreneurial event central to this study is propensity to act, which indicates a person’s tendency to act upon a decision (Shapero and Sokol, 1982). The model assumes a person’s readiness to act on his choices and in subsequent development of the model, this variable has been equated to risk taking propensity and ambiguity tolerance (Krueger, 1993; Shane, 2003). An entrepreneur’s propensity to act generally rests on his discernment of control and fondness to gain control (Krueger, Reilly and Carsrud, 2000). In the model on entrepreneurial events, propensity to act is hypothesised as a relatively constant typical behavior closely linked to the locus of control (Moghavvemi et al., 2013). In addition to the locus of control, ‘learned optimism’ is another critical conceptualisation to the propensity to act phenomenon (Krueger et al.,2000). The propensity to act variable exhibits the entrepreneur’s psychological element in entrepreneurial intentions (Yatribi, 2016).

Scholarly debate concerning the definition and measurement of entrepreneurial performance has, over the years, remained open (Leković and Marić, 2015). Performance in SMEs is relatively diftcult to measure because the parameters that are usually used to measure performance in large firms do not always apply to these SMEs, and measures of their performance are usually multi-dimensional (Chatterji, 2009; Simpson, Padmore and Newman, 2012). Fried and Tauer, (2015) argue that the diftculty in measurement has been worsened by the fact that no unanimous measure of entrepreneurial performance has surfaced. Hayton (2003) defines entrepreneurial performance in terms of the firm’s capability to innovate, manage risk, and exploit environmental opportunities. The term entrepreneurial performance refers to the financial or strategic growth of ventures and other organisations (Ng and Rieple, 2014). Growth, defined either by the net profit margins or the return on assets, has been used as a measure of entrepreneurial performance basing on the notion that it is an antecedent to long term competitive position and profitability (Markman, 2002; Fitzsimmons, Steffens and Douglas, 2005). Another recognised measure of entrepreneurial performance is profitability and it compliments growth in that no growth can be achieved without constant profits and retained earnings (Fitzsimmons et al., 2005). Entrepreneurial performance is measurable using a blend of financial and non-financial parameters that include sales growth, growth in profits, and market share growth among others (Chandrakumara, De Zoysa and Manawaduge, 2011; Alhyari, Alazab, Venkatraman and Alazab, 2013).

The notion of entrepreneurial performance has a reflection on the competence of the entrepreneur and can be useful to the entrepreneur for self-evaluation as entrepreneurs perceive their personal behavior as manifested in the venture and monitor their own performance (Baron and Henry, 2010). In addition to the above, entrepreneurial performance is demonstrated through developing new products, identification of new market opportunities and sound investor relationships (DeNoble, Jung and Ehrlich, 1999). Entrepreneurial performance, as a driver of market performance, is the essential point for the existence and the capacity to endure as an entrepreneur (Zahra and Covin, 1995; Zhao, Frese and Giardini, 2010). It is generally professed as deeply reliant on the recognition of market opportunities, vision, ingenuity, optimism, and self-eftcacy in the face of failures and hurdles (Bird and Baron, 2005). Entrepreneurial performance is measurable in two ways; subjectively and objectively. On one hand, objective performance is measured using quantitative data while on the other hand subjective performance is measured in using qualitative data obtained thorough soliciting for opinions and perceptions about performance (Sebikari, 2014). This study adopts a subjective approach to entrepreneurial performance measurement because although the method may provide a biased assessment performance (Sapienza, Smith & Gannon, 1988) gathering objective data may be diftcult mainly because owners and managers are largely reluctant to issue out company financial data to outsiders. Subjective responses were to both financial and non-financial questions, and were also used in order to echo the multi- dimensionality of the entrepreneurial performance variable.

The cultural dimensions and preferences prevalent in a society has an impact on the members’ entrepreneurship proclivity (Doepke & Zilibotti, 2013). In addition, culture and its dimensions are cause for members of a society to behave in a different manner than from other cultures; hence different cultures have different product, brand preferences (Mueller and Thomas, 2001; Keller Parameswaran and Jacob, 2011). These arguments were extended by Hayton, George and Zahra (2002) who argued that individual and organisational culture impacts on entrepreneurial decisions and the intensity of entrepreneurial activity. With regards to managerial attitudes and behaviours, Geletkanycz (1997) argued the different opinions and expectations entrenched in a culture influence the way members of an organisation undertake their duties. Hofstede’s model on cultural dimensions which provides a reliable enumeration of the variances in culture between societies is essential in studying the influence of culture on the performance of entrepreneurial ventures (Hayton and Cacciotti, 2013). The relationship between culture and entrepreneurial performance implied in the arguments above lead to the proposition of the following hypothesis.

H1 There is a positive and significant relationship between externally-oriented culture dimensions and entrepreneurial performance.

H2 There is a positive and significant relationship between externally-oriented culture dimensions and entrepreneurial events.

H3 There is a positive and significant relationship between internally-oriented culture dimensions and entrepreneurial events.

H4 There is a positive and significant relationship between internally-oriented culture dimensions and entrepreneurial performance.

H5 There is a positive and significant relationship between entrepreneurial events and entrepreneurial performance.

The following model was conceptualised to illustrate the direct and indirect causal relationships between culture dimensions and entrepreneurial performance.

Figure 1:

The main objective of this study was to investigate the influence of culture on entrepreneurial performance

To achieve the primary objectives of this study, the following secondary objectives were formulated

To determine the relationship between externally-oriented culture dimensions and entrepreneurial performance.

In SEM, model fit indices seek to determine the overall acceptability of the model and the common fit indexes are the comparative fit index (CFI), and the Root Mean Square Error of Approximation (RMSEA). The results from this model show that RMSEA = 0.039, CFI = 0.995 hence the model is fit because the CFI values are greater 0.90, and RMSEA is less than 0.08 (Hu and Bentler, 1999). To assess the reliability of the scale, the composite reliability (CR) index and the average variance extracted (AVE) were used. According to Fornell & Larcker (1981) the recommended minimum values for CR and AVE indicators are 0.7 and 0.5 respectively. The results show that both indicators were above the recommended values, with CR ranging from 0.93 to 0.96 and AVE ranging from 0.646 to 0.829, aftrming the reliability of the scale. Validity was measured by the square root of AVE and comparing the results with the inter construct correlations. The scale validity was obtained as diagonal square roots of AVE were larger than off-diagonal correlations.

Table 1

CONSTRUCT	MEAN	AVE	CR	ECD	ICD	EE	EP
ECD	4.14	0.721	0.94	0.849*
icd	3.89	0.646	0.93	0.613	0.804*
ee	3.78	0.802	0.95	0.634	0.567	0.896*
ep	4.00	0.829	0.96	0.722	0.632	0.732	0.910*

Note: χ² (df) =779.939 (211); RMSEA 0.039, CFI = 0.995; ***p<0.001.

Table 2 below shows the results of the structural equation modelling. Generally, the results from the structural equation model support the hypothesised relationships. Cultural dimensions influence entrepreneurial performance, even when mediated by entrepreneurial events in SMEs. In line with the proposition made in H1 and H2, there is a positive and significant relationship between externally-oriented culture dimensions and entrepreneurial performance and entrepreneurial events respectively. H3 and H4 are also supported in that there is a positive and significant relationship between internally-oriented culture dimensions and entrepreneurial events and entrepreneurial performance. The final hypothesis H5 is consistent with the results obtained in that there is a positive and significant relationship between externally-oriented culture dimensions and entrepreneurial performance.

Table 2

Variable	Hypothesis	Factor Loadings
ECD→EP	H1	0.901***
ECD→EE	H2	0.354***
ICD→EE	H3	0.682***
ICD→EP	H4	0.791***
EE→EP	H5	0.749***

Note: χ² (df) =779.939 (211); RMSEA 0.039, CFI = 0.995; ***p<0.001