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Entrepreneurial Opportunity Exploitation for New Venture Performance
Luleå University of Technology, Department of Business Administration, Technology and Social Sciences, Business Administration and Industrial Engineering.ORCID iD: 0000-0001-9654-8561
2018 (English)Doctoral thesis, comprehensive summary (Other academic)
Abstract [en]

New ventures drive innovation and economic growththrough commercializingideas, products and businesses when the market has a need for it and create the market need to bring about socioeconomic development. However, most new ventures struggle with survival and achieving early stage financial performance. Therefore, this dissertation investigates the influencing factors related to entrepreneurial opportunity exploitation for new venture performance. Specifically, the overarching purpose of this dissertation is addressed through five unique studies with the following focus:

Paper I Entrepreneurial Opportunity Recognition: A Review.This paper addresses the status of the existing research on the prominent factors that influence entrepreneurial opportunity recognition toward successful exploitation of opportunities and discusses what can be anticipated from future research in this domain.

Paper II Moderating effect of subjective strategic perceptions of environmental conditions. This paper investigates the way in which an entrepreneur’s subjective interpretation of strategically relevant cues in the venture environment affects the likelihood of applying causation or effectuation to influence initial venture sales.

Paper III Moderating effect of entrepreneurial alertness. This paper investigates the influence of entrepreneurial alertness on new venture performance in relation to causation and effectuation approaches.

Paper IV Information Processing Capability. This paper examines how founders engage in strategic diagnosis in lower development stages of venture information processing structures.

Paper V Strategic Alliances.This studyinvestigates the effect of imitative opportunities on technological advancement experienced by industry incumbents.

This dissertation is based upon a systematic literature review and two empirical studies. First, a survey study was conducted with 1,000 Swedish new ventures. The data for this study came from two sources: 1) perceptual data from a survey of founders (2012)and 2) objective first-sale performance data from an archival source (2012–2014). Second, the study compiled a dataset of public companies across 26 different industries that varied in terms of their technological prowess and strategies employed to exploit imitation opportunities between 1998 and 2001. Most variables were gathered from Compustat. The information on partnerships between incumbents and startups as well as the information on connections between incumbents that could facilitate imitation was accessed via the SDC Platinum dataset and the directories published by Asset Alternatives.

These studies make numerous contributions to the entrepreneurship literature. First, this research emphasizes the factors that influence opportunity exploitation processes for new venture performance. For example, decision-making approachesin relation to capability and environmental conditions t are important for new ventureperformance. The capability of the founding entrepreneur to consider strategic challenges asopportunities increases the odds of commercialization.We also find that those entrepreneurs who interpret the environment as having potential gain also prefer and benefit from effectuation more than those who interpret the environment as having potentialloss.Second, this study explores influencing role of entrepreneurial alertness in new venture performance. When an entrepreneur with greater alertness follows a causation approach, this has a higher effecton performance than following an effectuation approach. Third, this study shows that strategic alliances exert a direct impact on new venture performance. This means that the new venture’s ability to connect to the right ally boosts performance; otherwise, the choice of ally can cost the new venture itsposition in the market and affect its performance. Hence, entering into a new market with the right entrepreneurial action enables a new venture to enhance performance.

The dissertation is a compilation dissertation consisting of five articles. Each individual paper offers deep insight into each entrepreneurial opportunity exploitation factor related to new venture performance.

Place, publisher, year, edition, pages
Luleå: Luleå University of Technology, 2018.
Series
Doctoral thesis / Luleå University of Technology 1 jan 1997 → …, ISSN 1402-1544
National Category
Business Administration Other Engineering and Technologies not elsewhere specified
Research subject
Entrepreneurship and Innovation
Identifiers
URN: urn:nbn:se:ltu:diva-69170ISBN: 978-91-7790-161-7 (print)ISBN: 978-91-7790-162-4 (electronic)OAI: oai:DiVA.org:ltu-69170DiVA, id: diva2:1214728
Public defence
2018-09-03, A109, Luleå, 09:30 (English)
Opponent
Supervisors
Available from: 2018-06-07 Created: 2018-06-07 Last updated: 2018-08-28Bibliographically approved
List of papers
1. Strategic diagnosis of information processing structures and commercialization in new ventures
Open this publication in new window or tab >>Strategic diagnosis of information processing structures and commercialization in new ventures
2018 (English)In: Journal of Business Research, ISSN 0148-2963, E-ISSN 1873-7978, Vol. 85, p. 83-90Article in journal (Refereed) Published
Abstract [en]

Both the strategic management and entrepreneurship literatures provide limited guidance on strategic diagnosis in the commercialization stage when the information processing structures of ventures are gestating. This study focuses on how founders engage in strategic diagnosis in lower development stages of venture information processing structures. A procedure using archival sales data from 90 entrepreneurs who founded their firms in 2012, serves to assess sales achievement in the first three years of the venture. Using logistic regression with robust standard errors for the analysis, this study shows that more developed information processing structures increase the likelihood of realizing sales. Labeling strategic challenges as controllable instead of uncontrollable or as lower positive-gain increases the likelihood of sales after founding.

Place, publisher, year, edition, pages
Elsevier, 2018
National Category
Other Engineering and Technologies not elsewhere specified
Research subject
Entrepreneurship and Innovation
Identifiers
urn:nbn:se:ltu:diva-67136 (URN)10.1016/j.jbusres.2017.12.018 (DOI)000428227100008 ()2-s2.0-85038637792 (Scopus ID)
Note

Validerad;2018;Nivå 2;2018-01-02 (svasva)

Available from: 2018-01-02 Created: 2018-01-02 Last updated: 2018-06-07Bibliographically approved
2. Influence of subjective interpretation, causation, and effectuation on initial venture sale
Open this publication in new window or tab >>Influence of subjective interpretation, causation, and effectuation on initial venture sale
2016 (English)In: Journal of Business Research, ISSN 0148-2963, E-ISSN 1873-7978, Vol. 69, no 11, p. 4815-4819Article in journal (Refereed) Published
Abstract [en]

This study investigates the influence of subjective interpretations of strategy-relevant cues, specifically, perceived control/uncontrol and perceived gain/loss, on the relationship between causation or effectuation approach and the likelihood of initial venture sales. The results support the greater likelihood of initial sales when the entrepreneur increasingly relies on causation (albeit at low to medium levels) and has a greater perception of control. Similarly, perceived gains (instead of losses) strengthen the positive relationship between effectuation and initial sales. These results extend previous research on influence of the perceptions of control/uncontrol and gain/loss by supporting the influence of such subjective interpretations for strategic decision making. Furthermore, this study responds to recent calls for research on the different interpretations of the same environmental conditions and the resulting consequences for entrepreneurs.

National Category
Other Engineering and Technologies not elsewhere specified
Research subject
Entrepreneurship and Innovation
Identifiers
urn:nbn:se:ltu:diva-9657 (URN)10.1016/j.jbusres.2016.04.036 (DOI)000383936800016 ()2-s2.0-84969581168 (Scopus ID)85296350-2717-47c8-ab89-f014339572ef (Local ID)85296350-2717-47c8-ab89-f014339572ef (Archive number)85296350-2717-47c8-ab89-f014339572ef (OAI)
Note

Validerad; 2016; Nivå 2; 2016-10-26 (andbra)

Available from: 2016-09-29 Created: 2016-09-29 Last updated: 2018-07-10Bibliographically approved
3. A Systematic Literature Review of Entrepreneurial Opportunity Recognition: Insights on Influencing Factors
Open this publication in new window or tab >>A Systematic Literature Review of Entrepreneurial Opportunity Recognition: Insights on Influencing Factors
2016 (English)In: The International Entrepreneurship and Management Journal, ISSN 1554-7191, E-ISSN 1555-1938, Vol. 12, no 2, p. 309-350Article in journal (Refereed) Published
Abstract [en]

In the last three decades, research studies investigating how individuals recognize entrepreneurial opportunities have advanced rapidly and have become a key topic in the modern entrepreneurship literature. To advance this important concern further, we present a systematic literature review of the entrepreneurial opportunity research field and its status. Contrary to conventional wisdom, this research suggests that the field is fragmented and empirically underdeveloped. A comprehensive literature analysis shows that only a handful of authors have contributed specifically to developing dialogues related to opportunity recognition and that the topic is considered primarily as an ancillary issue by many authors and academic journals. Based on analyzing 180 articles, we classify existing contributions into six influential factors: prior knowledge, social capital, cognition/personality traits, environmental conditions, alertness, and systematic search. Moreover, by developing a framework, we communicate critical insights regarding the opportunity recognition process. The contribution of individual articles to the proposed factors is presented in a research synthesis table. We conclude by presenting several directions for future research related to opportunity recognition.

National Category
Other Engineering and Technologies not elsewhere specified
Research subject
Entrepreneurship and Innovation
Identifiers
urn:nbn:se:ltu:diva-2862 (URN)10.1007/s11365-014-0347-y (DOI)000376095900001 ()2-s2.0-84912550493 (Scopus ID)093d85ca-02dc-45cb-8220-0eb984667689 (Local ID)093d85ca-02dc-45cb-8220-0eb984667689 (Archive number)093d85ca-02dc-45cb-8220-0eb984667689 (OAI)
Projects
CiiR-Centre for Inter-Organizational Innovation Research
Note
Validerad; 2016; Nivå 2; 20141023 (vinpar)Available from: 2016-09-29 Created: 2016-09-29 Last updated: 2018-07-10Bibliographically approved
4. Causation, effectuation and entrepreneurial alertness on initial venture sale
Open this publication in new window or tab >>Causation, effectuation and entrepreneurial alertness on initial venture sale
(English)In: Article in journal (Refereed) Submitted
National Category
Business Administration
Identifiers
urn:nbn:se:ltu:diva-69169 (URN)
Available from: 2018-06-07 Created: 2018-06-07 Last updated: 2018-06-07
5. Technological Advancement through Imitation by Industry Incumbents in Strategic Alliances
Open this publication in new window or tab >>Technological Advancement through Imitation by Industry Incumbents in Strategic Alliances
2015 (English)In: Innovation and Entrepreneurship in the Global Economy: Knowledge, Technology and Internationalization / [ed] Charlie Karlsson, Urban Gråsjö and Sofia Wixe, Cheltenham: Edward Elgar Publishing, 2015, p. 65-88Chapter in book (Refereed)
Abstract [en]

Contrary to the conventional wisdom, this study demonstrates that technological laggards and not industry front-runners are most likely to experience high rates of technological advancement in strategic alliances. We further suggest that imitation and not innovation is the primary source of such advancement based on the fact that technological progress by laggards is most visible in industries that lack strong appropriability regimes. Finally, we present empirical evidence suggesting that lagging established corporations prefer to imitate from startups and not from fellow-incumbents. These results are derived from a careful analysis of a longitudinal sample of over 150 incumbents with varying degree of technological prowess who engage in partnerships with both startups and fellow-incumbents across a wide representation of industries. Our paper contributes to technological innovation, strategic alliance, entrepreneurship, and imitation literatures and provides non-trivial implications for startups.

Place, publisher, year, edition, pages
Cheltenham: Edward Elgar Publishing, 2015
National Category
Business Administration Other Engineering and Technologies not elsewhere specified
Research subject
Entrepreneurship and Innovation
Identifiers
urn:nbn:se:ltu:diva-68977 (URN)10.4337/9781783477326.00010 (DOI)9781783477319 (ISBN)
Available from: 2018-05-30 Created: 2018-05-30 Last updated: 2018-06-07Bibliographically approved

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