Inductive Modelling of an Entrepreneurial System Dr Mike Yearworth Reader in Systems, Systems Centre, Faculty of Engineeri...
<ul><li>Research Question </li></ul><ul><li>What are the characteristic behaviors of the equity funded start-up environmen...
<ul><li>Grounded Theory </li></ul><ul><li>Glaser & Strauss (1967) Inductive approach to generating theories about “what is...
<ul><li>Coding – The development of categories from the data </li></ul><ul><li>“ in vivo”  concepts: – name of concept is ...
<ul><li>Data </li></ul>(C) Dr Michael Yearworth 2010
<ul><li>Coding in CAQDAS </li></ul>(C) Dr Michael Yearworth 2010
<ul><li>Axial Coding </li></ul><ul><li>110 Categories </li></ul><ul><li>Purpose </li></ul><ul><ul><li>Initiation, first st...
<ul><li>The Matrix Query in NVivo </li></ul>(C) Dr Michael Yearworth 2010
<ul><li>Before Application of Heuristics </li></ul>(C) Dr Michael Yearworth 2010
<ul><li>Heuristics </li></ul><ul><li>Significance   </li></ul><ul><ul><li>number words simultaneously coding both concepts...
<ul><li>Results </li></ul>(C) Dr Michael Yearworth 2010 Solution Opportunity Testing & Validation  (SOTV) Loop
<ul><li>Results </li></ul>(C) Dr Michael Yearworth 2010 Realistic Equity  Position (REP) Loop
<ul><li>Results </li></ul>(C) Dr Michael Yearworth 2010 Scale Up & Exit (SUE) Loop
<ul><li>Towards a normative theory </li></ul>(C) Dr Michael Yearworth 2010
<ul><li>Dynamic theories </li></ul><ul><li>The SOTV loop suggests a causal, time ordered relationship between concepts tha...
<ul><li>Dynamic theories </li></ul><ul><li>As entrepreneurial drive increases  ceteris paribus  the initial impact on Equi...
<ul><li>Discussion </li></ul><ul><li>combining  an inductive theory generating approach with system dynamics raises a numb...
<ul><li>Conclusions </li></ul><ul><li>A step towards meeting the expressed need for normative theory in studying entrepren...
<ul><li>Thank you </li></ul>(C) Dr Michael Yearworth 2010
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Inductive Modelling of an Entrepreneurial System

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Presented at the 28th International System Dynamics Conference 26th July 2010 http://bit.ly/cmB8Fo

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  • July 26th 2010 (C) Dr Mike Yearworth 2010 Inductive Modelling of an Entrepreneurial System
  • From Arborisation to Reticulation Inductive Modelling of an Entrepreneurial System July 26th 2010 (C) Dr Mike Yearworth 2010
  • Inductive Modelling of an Entrepreneurial System July 26th 2010 (C) Dr Mike Yearworth 2010
  • Inductive Modelling of an Entrepreneurial System

    1. 1. Inductive Modelling of an Entrepreneurial System Dr Mike Yearworth Reader in Systems, Systems Centre, Faculty of Engineering 26 th July 2010
    2. 2. <ul><li>Research Question </li></ul><ul><li>What are the characteristic behaviors of the equity funded start-up environment and how might inductive modelling contribute to a better understanding of it and to theory development in entrepreneurial research generally? </li></ul><ul><ul><li>Entrepreneurial profit (Schumpeter 1934, Chapter 4). </li></ul></ul><ul><ul><li>Monopoly profit that can be earned by capital that has been invested into an entrepreneur’s innovative, creative, actions in a particular, or new, market for as long as the entrepreneur’s advantage can be sustained over competitors </li></ul></ul><ul><ul><li>Current state of entrepreneurial research reveals much complexity, arising from trying to understand how to generate practical, actionable (normative) theories </li></ul></ul>(C) Dr Michael Yearworth 2010
    3. 3. <ul><li>Grounded Theory </li></ul><ul><li>Glaser & Strauss (1967) Inductive approach to generating theories about “what is going on” </li></ul><ul><li>Mostly qualitative research data e.g. semi-structured interviews </li></ul><ul><li>Analysis proceeds through a process of coding </li></ul><ul><li>Continues until we have theoretical saturation </li></ul>(C) Dr Michael Yearworth 2010
    4. 4. <ul><li>Coding – The development of categories from the data </li></ul><ul><li>“ in vivo” concepts: – name of concept is a word or words taken directly from respondents </li></ul><ul><li>open coding: breaking data into parts that could be “ compared for similarities and differences” , and then grouped together into “ more abstract concepts termed categories” </li></ul><ul><li>axial coding: which relates categories to their sub categories, the process to “ Systematically develop and relate categories” </li></ul>(C) Dr Michael Yearworth 2010
    5. 5. <ul><li>Data </li></ul>(C) Dr Michael Yearworth 2010
    6. 6. <ul><li>Coding in CAQDAS </li></ul>(C) Dr Michael Yearworth 2010
    7. 7. <ul><li>Axial Coding </li></ul><ul><li>110 Categories </li></ul><ul><li>Purpose </li></ul><ul><ul><li>Initiation, first steps </li></ul></ul><ul><ul><li>Attitudes and motivations </li></ul></ul><ul><ul><li>Financing </li></ul></ul><ul><ul><li>Ensuring success </li></ul></ul><ul><ul><li>Environment </li></ul></ul><ul><ul><li>Sense making and perceptions </li></ul></ul>(C) Dr Michael Yearworth 2010
    8. 8. <ul><li>The Matrix Query in NVivo </li></ul>(C) Dr Michael Yearworth 2010
    9. 9. <ul><li>Before Application of Heuristics </li></ul>(C) Dr Michael Yearworth 2010
    10. 10. <ul><li>Heuristics </li></ul><ul><li>Significance </li></ul><ul><ul><li>number words simultaneously coding both concepts </li></ul></ul><ul><li>Direction of Causality </li></ul><ul><ul><li>coded text corresponding to significant correlations extracted from Nvivo and re-analysed to confirm significance and direction </li></ul></ul><ul><li>Elimination of Variables </li></ul><ul><ul><li>c hains of category links were shortened where the intermediate categories would have led to an overabundance of intermediate variables </li></ul></ul><ul><li>Selection of Text </li></ul><ul><ul><li>originating text which illustrates important influences for inclusion in report </li></ul></ul>(C) Dr Michael Yearworth 2010
    11. 11. <ul><li>Results </li></ul>(C) Dr Michael Yearworth 2010 Solution Opportunity Testing & Validation (SOTV) Loop
    12. 12. <ul><li>Results </li></ul>(C) Dr Michael Yearworth 2010 Realistic Equity Position (REP) Loop
    13. 13. <ul><li>Results </li></ul>(C) Dr Michael Yearworth 2010 Scale Up & Exit (SUE) Loop
    14. 14. <ul><li>Towards a normative theory </li></ul>(C) Dr Michael Yearworth 2010
    15. 15. <ul><li>Dynamic theories </li></ul><ul><li>The SOTV loop suggests a causal, time ordered relationship between concepts that together have a positive impact on the rate of crossing Gap 2. This suggests that a survey of entrepreneurial experience on attempting to cross Gap 2 will reveal a significant positive correlation between the success rate and both the execution and causal dependency of the variables in the SOTV loop. </li></ul>(C) Dr Michael Yearworth 2010
    16. 16. <ul><li>Dynamic theories </li></ul><ul><li>As entrepreneurial drive increases ceteris paribus the initial impact on Equity Funding Success Rate will be that the number of companies crossing Gap 2 will increase. However, this increase in drive will also mean that entrepreneurs will seek even higher equity stakes in their companies. At some point the balancing feedback on Equity Funding Success Rate will exceed the reinforcing feedback and the rate of companies achieving equity funding will go down </li></ul>(C) Dr Michael Yearworth 2010
    17. 17. <ul><li>Discussion </li></ul><ul><li>combining an inductive theory generating approach with system dynamics raises a number of questions about contribution to methodology development </li></ul><ul><ul><li>Adding “dynamic coherence” (Lane & Oliva 1998) i.e. absence of structural means to account for dynamics in GT </li></ul></ul><ul><ul><li>Aligns with model-based theory building (Schwaninger & Grösser 2008) </li></ul></ul><ul><ul><li>Grounded theory adds “enrichment” and “formality” to SD model formulation process (Luna-Reyes & Andersen 2003) </li></ul></ul><ul><ul><li>Similarities in mathematical, matrix-based methods (Warfield 1973) </li></ul></ul><ul><ul><li>Contradictory to ‘normal’ system dynamics use (Sterman 2000 etc), purely inductive approach to generating dynamic hypotheses </li></ul></ul><ul><ul><li>Makes a contribution to “thick analysis”. Not shown in paper but closest example is “Start and Fizzle…” PhD thesis (Morrison 2003) </li></ul></ul>(C) Dr Michael Yearworth 2010
    18. 18. <ul><li>Conclusions </li></ul><ul><li>A step towards meeting the expressed need for normative theory in studying entrepreneurial research </li></ul><ul><li>Dynamic hypotheses expressed that can be tested through appropriately designed longitudinal studies </li></ul><ul><li>Examples of this combination exist, but dynamic coherence to grounded theory is perhaps the most pressing? </li></ul><ul><li>Important step in the use of binary matrices. What is the relationship to ISM? </li></ul>(C) Dr Michael Yearworth 2010
    19. 19. <ul><li>Thank you </li></ul>(C) Dr Michael Yearworth 2010

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