Too much of a good thing? Entrepreneurial orientation and the non-linear governance effects of SaaS platforms

A new academic paper by Jacopo Ballerini, Magali Pino, Michal Kuděj, and Alberto Ferraris investigates the complex relationship between Software-as-a-Service (SaaS) adoption and strategic performance in small and medium-sized enterprises (SMEs). The study, titled "Too much of a good thing? Entrepreneurial orientation and the non-linear governance effects of SaaS platforms," applies transaction cost theory to position SaaS as a hybrid governance model. Through a multi-study design analyzing survey data from 180 entrepreneurs and a secondary dataset of 238 European startups, the research uncovers a critical non-linear effect: the connection between SaaS strategic alignment and long-term governance performance follows an inverted U-shape.

This finding suggests that initial SaaS adoption improves strategic alignment and performance, but there is a tipping point. Beyond this point, over-reliance on SaaS platforms can actually diminish governance-enabled outcomes. The study also examines how a firm's Entrepreneurial Orientation (EO) moderates these effects. Specifically, a company's level of risk-taking deepens the link between specialized human assets and SaaS alignment, while proactiveness strengthens the connection to long-term success. The paper, currently under peer review, provides a crucial framework for understanding the strategic double-edged sword of digital technology adoption in modern business.