Knowledge that Transforms

International audience

This paper develops a formal model of the impact of entrepreneurship on macroeconomic performance. It examines the role of entrepreneurs in creating markets for novel products. Entrepreneurs take over the coordination role that in traditional neoclassical economic models is performed by the Walrasian auctioneer. Entrepreneurs specialize in collecting information that permits them to make judgmental decisions about innovation. The quality of their judgment determines the success of innovations, and thereby impacts the long‐run performance of the economy. The model demonstrates rigorously that constraints on the supply of entrepreneurship reduce economic performance, and serves to identify the policy instruments that can improve performance by alleviating these constraints. Copyright © 2008 Strategic Management Society.

Entrepreneurs take strategic action to create value. They can do so individually or collaboratively, and currently researchers are interested in learning the extent to which collaboration can increase the total entrepreneurial value created. Taking entrepreneurial strategic action naturally involves the pursuit of self‐interest, but entrepreneurial self‐interest can only be served if it simultaneously serves collective interests, such as those of customers, investors, partners, and other relevant constituencies. Currently, researchers are also interested in identifying the most effective ways in which individual and collective interests can be jointly pursued. Copyright © 2008 Strategic Management Society.

In the organizational theory literature, two perspectives to explain the firm‐environment relationship—the ecology view and the adaptation view—are dominant. We review these perspectives and present a third, less recognized perspective—the entrepreneurial view. The entrepreneurial view recognizes the potential for top managers and firms to, on occasion, proactively shape and influence their environment. Purposeful individual top managers with their variable belief systems take primacy in the entrepreneurial model as they are motivated to engage in aspirational search and take entrepreneurial actions. Entrepreneurial actions potentially disrupt the existing belief systems of market participants by disseminating new information that causes dissonance. This dissonance and debate as part of the market process can lead to a revision in the belief systems of market participants. We show that although the multilevel entrepreneurial perspective is distinct from the ecology and adaptation perspectives, they are, in fact, complementary. Copyright © 2008 Strategic Management Society.

Questioning the underlying assumptions of the process of creative destruction, we conceptualize an alternative process of creative construction that may characterize the dynamics between entrants and incumbents. We discuss the underlying mechanism of knowledge spillover strategic entrepreneurship whereby knowledge investments by existing organizations, when coupled with entrepreneurial action by individuals embedded in their context, results in new venture creation, heterogeneity in performance, and subsequent growth in industries, regions, and economies. The framework has implications for future research in entrepreneurship, strategy, and economic growth. Copyright © 2008 Strategic Management Society.

Multidivisional firms often fail to take advantage of innovations that involve combining resources from distinct divisions. This failure of cross‐line‐of‐business innovation is a consequence of design choices employed to execute the firm's strategy: in organizing around its core businesses, the firm renders interdependence between divisions residual to the formal structure. As a result, those innovations which involve cross‐line‐of‐business interdependence are trumped by the firm's articulated strategy and structure. Social structures could, potentially, fill this coordination gap. But social structures associated with the initiation of interdependent innovation are inversely associated with their execution. We build a dynamic, corporate‐level, evolutionary model in which individuals autonomously initiate cross‐line‐of‐business projects not through the formal structure of the firm, but using contacts from their own social networks. Some of these projects are selected and actively supported by senior executives; this support sends clear signals about what collaboration is valued by the firm, which gives other actors powerful, albeit informal, incentives to connect with others across the interunit boundary. As a result, the sparse interunit social structure that was conducive to initiation changes, becoming much more cohesive (at least locally) and is able to support execution and retain these interdependent innovations. Thus, where intra‐divisional innovations are primarily driven by organizational structure, we suggest that interdivisional innovations are driven primarily by social networks. Copyright © 2007 Strategic Management Society.

Entrepreneurs are often portrayed as rugged individualists who go it alone to build new organizations and programs that maximize their self‐interests. This portrayal is incomplete, because it does not account for the fact that entrepreneurs also pursue collective interests. It fails to recognize a basic paradox in human beings of simultaneously seeking individual and collective interests. We argue that an appreciation of the dialectical nature of human beings leads to fundamentally different conceptions of entrepreneurship than those commonly found in literature on entrepreneurship theory and practice. To illustrate our central premise, we focus on entrepreneurial opportunity realization, resource mobilization, and running in packs. Copyright © 2008 Strategic Management Society.

Much research in strategic entrepreneurship has focused on the consequences of network structure for firm performance. Despite this emphasis, little is known about variation in network structure across industries, or about the antecedents of this variation. In a comparative study of alliance networks in 32 industries, we demonstrate substantial variety in network structure, and develop a typology of network structures. We then endeavor to explain this variation by focusing on dimensions of the products and technologies that characterize these industries—such as technological uncertainty and dynamism, product modularity, and architectural control—and associating them with underlying characteristics of network structure. We conclude with a discussion of implications of our findings for research in strategic entrepreneurship. Copyright © 2008 Strategic Management Society.

This study begins with a historical overview of the connection between risk and rationality. It then broadens beyond this historical trajectory by taking entrepreneurship as a point of departure for understanding risk and rationality. Drawing from the research of Littlechild (1986), Buchanan and Vanberg (1991), and Sarasvathy et al . (2003), this study considers three entrepreneurial processes: opportunity recognition, opportunity discovery, and opportunity creation. Associated with each of these processes are unique conceptualizations of risk and rationality, reflected in distinct research streams. The final section of the study considers implications of the process‐contingent nature of risk and rationality, and motivates a broadening of the research agenda from entrepreneurial decision making to practices. Copyright © 2007 Strategic Management Society