Government regulations and stakeholders entrepreneurial orientation in achieving organizational performance: An empirical study on private hospitals in Indonesia

The purpose of this study is to measure the impact of institutional environment as government regulation and managers’ capabilities to maintain the relationship between the stakeholder networks and the entrepreneurial orientation within the context of the hospital industry in Indonesia. The results of data analysis from 105 small and medium private hospitals in the Jakarta city and surrounding areas show that the hospital entrepreneurial orientation was significantly influenced by government policies reflected by the legal certainty and bureaucratic attitudes that assist the implementation of the policies. Besides, it is proven that management capabilities to establish the relationships with many stakeholders, consisting of all existing partners and employees, also affect the growth of entrepreneurial orientation. Finally, the performance of the hospital is proven to be significantly influenced by the entrepreneurial orientation directly and also mediated by business model innovation. The results of this study become paradoxical because it is different from the opinion that the healthcare industry would not have accepted the concept of entrepreneurship.