Risk Taking, Innovation and Proactiveness in the Age of AI: The Mediating Role of Entrepreneurial Motivation in Driving Business Success
DOI:
https://doi.org/10.55737/rl.2025.42096Keywords:
Risk Taking, Innovation, Proactiveness, AI, Entrepreneurial Motivation, Business SuccessAbstract
This study examined how three entrepreneurial traits—risk-taking, innovation, and proactiveness—affected business success in the evolving business environment influenced by artificial intelligence (AI). It further investigated the mediating role of entrepreneurial motivation in translating these traits into improved performance among small and medium-sized enterprises (SMEs) in Lahore, Pakistan. A quantitative survey design was employed, collecting data from 350 SME owner-managers operating in the retail, service, and manufacturing sectors of Lahore. Standardized questionnaires measured entrepreneurial traits, entrepreneurial motivation, AI adoption level, and business success. Structural equation modeling (SEM) was applied to test the hypothesized mediation model, and bootstrapping with 5,000 resamples was used to assess the significance of indirect effects. The study found that risk-taking, innovation, and proactiveness significantly enhanced entrepreneurial motivation among SMEs. In turn, entrepreneurial motivation positively influenced business success. The analysis also confirmed that entrepreneurial motivation acted as a partial mediator, linking these entrepreneurial traits to improved business outcomes. The findings suggested that programs designed to enhance entrepreneurial motivation, alongside AI and digital skills training, could substantially improve SME performance in emerging economies. Policymakers, incubators, and entrepreneurship support agencies should integrate personality development, motivational strategies, and technology adoption training into SME development initiatives. This study contributed to the entrepreneurship and technology adoption literature by demonstrating how entrepreneurial traits and motivation interact within an AI-driven context to influence business success. It provided empirical evidence from an emerging market setting, highlighting the importance of both human and technological capabilities in achieving sustainable performance.
References
Al-Mamary, Y. H. (2024). A comprehensive model for AI adoption: Analysing key characteristics affecting user attitudes, intentions and use of ChatGPT in education. Human Systems Management, 01672533251340523. https://doi.org/10.1177/01672533251340523
Breit, L. A., & Volkmann, C. K. (2025). Navigating start-ups: a qualitative exploration of causal and effectual decision-making in entrepreneurial marketing. Journal of Research in Marketing and Entrepreneurship, 27(2), 206–231. https://doi.org/10.1108/jrme-12-2023-0215
Carayannis, E. G., Dumitrescu, R., Falkowski, T., & Zota, N.-R. (2024a). Empowering SMEs “harnessing the potential of gen AI for resilience and competitiveness.” IEEE Transactions on Engineering Management, 71, 14754–14774. https://doi.org/10.1109/tem.2024.3456820
Celestin, M., & Gidisu, J. A. (2025). AI in accounting policy formation: Challenges for regulators and corporate boards in Ghana. Sciences and Technology (BJBST), 9(1), 145–159. https://doi.org/10.5281/zenodo.15115584
Chooset, N., & Sukhabot, S. (2025). Developing entrepreneurial marketing dimensions for SMEs in the digital era: a grounded theory approach. Cogent Business & Management, 12(1). https://doi.org/10.1080/23311975.2025.2480748
Diéguez-Soto, J., Martínez-Romero, M. J., Corten, M., & Michiels, A. (2021). The impact of the CEO’s financial literacy on family SMEs’ growth: the moderating role of generational stage. Baltic Journal of Management, 17(1), 89–106. https://doi.org/10.1108/bjm-01-2021-0003
Gunawan, A. F. (2024). The impact of entrepreneurial characteristics and competencies on business performance in the creative industry in Indonesia. Asia Pacific Journal of Innovation and Entrepreneurship, 18(3), 300–317. https://doi.org/10.1108/apjie-09-2023-0172
Huber, T. L., & Lyytinen, K. (2025). Continuous Contracting in Software Outsourcing: Towards A Configurational Theory. JAIS. https://aisel.aisnet.org/jais_preprints/203/
Ivasciuc, I.-S., & Ispas, A. (2023). Exploring the motivations, abilities and opportunities of young entrepreneurs to engage in sustainable tourism business in the mountain area. Sustainability, 15(3), 1956. https://doi.org/10.3390/su15031956
Kuik, S., Kumar, A., Diong, L., & Ban, J. (2023). A systematic literature review on the transition to circular business models for small and medium-sized enterprises (SMEs). Sustainability, 15(12), 9352. https://doi.org/10.3390/su15129352
Kyal, H., Mandal, A., Kujur, F., & Guha, S. (2022). Individual entrepreneurial orientation on MSME’s performance: the mediating effect of employee motivation and the moderating effect of government intervention. IIM Ranchi Journal of Management Studies, 1(1), 21–37. https://doi.org/10.1108/irjms-07-2021-0041
Land, A., Gruchmann, T., Siems, E., & Beske-Janssen, P. (2022). Dynamic capabilities theory. In Handbook of Theories for Purchasing, Supply Chain and Management Research (pp. 378-398). Edward Elgar Publishing.
Melo, I. C., Queiroz, G. A., Junior, P. N. A., de Sousa, T. B., Yushimito, W. F., & Pereira, J. (2023). Sustainable digital transformation in small and medium enterprises (SMEs): A review on performance. Heliyon, 9(3). https://doi.org/10.1016/j.heliyon.2023.e13908
Önaçan, M. B. K., & Önel, T. (2025). Game Journey: Smart Scepter Design With. Human-Centric, Sustainable, and Resilient Organizations in the Digital Age, 353.
Paul, M. (2020). Organisational readiness for Artificial Intelligence adoption. Turku School of Economics, 1-65.
Prouska, R., Nyfoudi, M., Psychogios, A., Szamosi, L. T., & Wilkinson, A. (2023). Solidarity in action at a time of crisis: The role of employee voice in relation to communication and horizontal solidarity behaviour. British Journal of Management, 34(1), 91–110. https://doi.org/10.1111/1467-8551.12598
Querbach, S., Kammerlander, N., Singh, J., & Waldkirch, M. (2022). Pragmatic learning in family SMEs: a qualitative study of functional overload among family SME owner-managers. Journal of Knowledge Management, 26(2), 375–402. https://doi.org/10.1108/jkm-08-2020-0657
Rathee, V., Mittal, P., & Kumar, A. (2025). A contribution towards developing a sustainable model for enhancing entrepreneurial performance: identifying the mediating role of innovative work behaviour. Journal of Entrepreneurship in Emerging Economies, 17(4), 1060–1082. https://doi.org/10.1108/jeee-04-2024-0166
Renko, M., Bullough, A., & Saeed, S. (2021). How do resilience and self-efficacy relate to entrepreneurial intentions in countries with varying degrees of fragility? A six-country study. International Small Business Journal, 39(2), 130–156. https://doi.org/10.1177/0266242620960456
Upadhyay, N., Upadhyay, S., Al-Debei, M. M., Baabdullah, A. M., & Dwivedi, Y. K. (2023). The influence of digital entrepreneurship and entrepreneurial orientation on intention of family businesses to adopt artificial intelligence: examining the mediating role of business innovativeness. International Journal of Entrepreneurial Behaviour & Research, 29(1), 80–115. https://doi.org/10.1108/ijebr-02-2022-0154
Vrontis, D., Chaudhuri, R., & Chatterjee, S. (2022). Adoption of digital technologies by SMEs for sustainability and value creation: Moderating role of entrepreneurial orientation. Sustainability, 14(13), 7949. https://doi.org/10.3390/su14137949
Wamba-Taguimdje, S.-L., Fosso Wamba, S., Kala Kamdjoug, J. R., & Tchatchouang Wanko, C. E. (2020). Influence of artificial intelligence (AI) on firm performance: the business value of AI-based transformation projects. Business Process Management Journal, 26(7), 1893–1924. https://doi.org/10.1108/bpmj-10-2019-0411
Williams, A. M., Rodríguez Sánchez, I., & Škokić, V. (2021). Innovation, risk, and uncertainty: A study of tourism entrepreneurs. Journal of Travel Research, 60(2), 293–311. https://doi.org/10.1177/0047287519896012
Yang, S., Li, M., Yue, L., Yu, L., & Li, W. (2022). From farmers’ entrepreneurial motivation to performance—the chain mediating effect of entrepreneurial learning and entrepreneurial ability. Sustainability, 15(1), 726. https://doi.org/10.3390/su15010726
