Entrepreneurial alertness: A mechanism for innovation and growth in an emerging economy

Abstract In this study, we draw from the conservation of resources theory to develop and test a model on the processes through which resiliency influences two entrepreneurial strategies, product differentiation and international diversification. Results from 226 entrepreneurs in Pakistan demonstrate that psychological resiliency predicts product diversification and international diversification through entrepreneurial alertness. Also, we find that institutional voids moderate the relationship between entrepreneurial alertness, product diversification, and international diversification. Our theorizing advances entrepreneurial alertness as a lynchpin variable for operationalizing founders’ characteristics to affect innovation and expansion efforts. Furthermore, by demonstrating the complementary effect of institutional voids on the entrepreneurial alertness–product differentiation and entrepreneurial alertness–international diversification relationships, we draw the attention of entrepreneurs to the brighter side of institutional voids. This is an important addition to international entrepreneurship literature and a critical contextual contribution to entrepreneurial alertness theory development because limited attention is devoted to examining how resiliency promotes entrepreneurial alertness for facilitating product differentiation and international diversification strategies in the Asia Pacific region.