The Role of Strategic Entrepreneurship
Globalization and the rapid pace of development, combined with intense competition, have pushed firms to seek ways to survive and thrive in today’s highly volatile business environment. As such, entrepreneurs are primarily concerned with building competitive advantage and creating value for their firms.
Recent studies point out the significance of strategic entrepreneurship as a way for businesses to develop a ‘more entrepreneurial orientation for sustained competitive advantage’ (Olusola, 2012). Strategic entrepreneurship essentially involves concurrent opportunity-seeking and advantage-seeking behaviors, which result in better performance of the firm (Ireland, Hitt & Sirmon, 2003).
This research is interested in conducting a similar investigation and seeks to analyze the role of strategic entrepreneurship in forming temporary competitive advantage, which leads to the creation of value for the firm.
This dissertation is interested in determining whether firms, which engage in strategic entrepreneurship, are able to establish temporal competitive advantage in a dynamic environment, especially whilst competing with other firms and within the context of creating value for the firm.
Below are the specific questions to be addressed in this dissertation:
What benefits would a firm obtain by successfully employing strategic entrepreneurship in the current competitive market
What temporary competitive advantage results from employing strategic entrepreneurship
Does strategic entrepreneurship create value
Aims and Objectives
The primary aim of this research is to analyze the role of strategic entrepreneurship in building competitive advantage and creating value for the firm. Based on the research questions given above, the objectives of this dissertation are as follows:
To find out the benefits of employing strategic entrepreneurship
To understand what competitive advantages are the result of utilising strategic entrepreneurship
To investigate whether strategic entrepreneurship creates value for the firm
This dissertation will provide insights on the significance of strategic entrepreneurship, especially within the context of forming temporary competitive advantage, in pursuit of creating value for the firm. This research seeks to address some of the gaps in literature, such as understanding the balance between the opportunity-seeking behavior associated with entrepreneurship and the advantage-seeking behavior of strategic management (Hitt et al., 2011). Moreover, a Strategic Entrepreneurship Theoretical Tree will be utilized in order to analyze the various components of strategic entrepreneurship. The theoretical tree is created based from the different studies conducted on the subject.
Literature Review (Preliminary)
Strategic entrepreneurship is associated with firm’s objective of achieving superior performance through the simultaneous application of both opportunity-seeking and advantage-seeking activities (Ketchen, Ireland, & Snow, 2007). Various researchers have identified different components of strategic entrepreneurship, which can lead to superior performance of the firm. Ireland, Hitt & Sirmon (2003) proposes four dimensions for the successful implementation of strategic entrepreneurship: (a) entrepreneurial mindset; (b) entrepreneurial culture and leadership; (c) strategic management of resources; and (d) applying creativity to develop innovations.
At the business level, value creation is usually reflected in the expansion and growth of a firm. Welter & Smallbone (2004) found that Institutional Economic Theory highlights the institutional embeddedness and path dependence of entrepreneurial behavior. This, in turn, influences the degree and nature of value creation for the firm.
A number of authors have identified the factors that influence value creation and competitive advantage. Pongpearchan (2011, p.5) found that ‘operational innovation efficiency and business practice effectiveness have a significant positive effect on value creation excellence.’ On the other hand, Rindova & Fombrun (1999) argue that competitive advantage is a systemic outcome which develops as firms engage in processes that involve the use and exchange of resources, as well as the communication that occurs in these exchanges. Therefore, the fluctuations on the interpretations and evaluations of a firm affect its resources and its competitive advantage in the marketplace.
Below is the model of the Strategic Entrepreneurship Theoretical Tree which will be used as the main theoretical framework of this research. Each of the components of this model is based on different studies. These will be discussed in more detail during the full dissertation document.
This research will use quantitative research methodology in addressing the objectives of the study. Quantitative survey will be used in gathering data from respondents. Quantitative methodology is chosen for this study because it will allow the researcher to utilize the opinions of respondents in explaining the phenomena being studied.
The survey will be administered to employees and managers of SMEs and large commercial firms in the UK to find out their views on the subject. The survey will asks questions such as how respondents perceive the role of strategic entrepreneurship in forming creative temporary competitive advantage; what are the benefits of strategic entrepreneurship; how can firms create value; etc.
The target number of respondents for the survey is 100. In anticipation of the fact that some potential respondents might refuse to participate in the survey, around 175 to 200 questionnaires will be distributed to ensure that 100 responses will be gathered. The survey will be administered face-to-face, via post, though emails, and online. This is done to allow respondents to choose how they want to answer the survey.
After data gathering is completed, statistical analysis will be used in analyzing the data. SPSS and Excel will be used as the primary software for analysis.
Hitt, M, Ireland, D, Sirman, G, & Trahms, C. (2011). Strategic Entrepreneurship: Creating value for individuals, organizations and society. Academy of Management Perspective. p.57-75.
Ireland, D, Hitt, M, & Sirmon, D. (2003). A Model of Strategic Entrepreneurship: The Construct and its Dimensions. Journal of Management. 29(6), p.963-989
Ketchen, D, Ireland, D, & Snow, C. (2007). Strategic entrepreneurship, collaborative innovation, and wealth creation. Strategic Entrepreneurship Journal. 1(3-4), p.371-385.
Olusola, A. (2012). Strategic Entrepreneurial Skills’ Influence on Small Businesses’ Performance in Oyo and Osun Western States-Nigeria. Research Journal in Organizational Psychology and Educational Studies.1 (6), p.345-352.
Pongpearchan, P. (2011). Strategic entrepreneurship management competency and firm success: a comparative study of SMEs in auto and electronic parts in Thailand. International Journal of Business Strategy. 11(2).
Rindova, V & Fombrun, C. (1999). Constructing competitive advantage: the role of firm-constituent interactions. Strategic Management Journal. 20(8), p.691-710.