A constructivist approach for Technology-based Entrepreneurship


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This article examines how entrepreneurs transform technology-based ideas into entrepreneurial opportunities through an inductive field study of six ventures. The observed difficulties of entrepreneurship promotion policies to spur technology-based ventures, has opened a debate on the need of tailored support mechanisms. Dominant perspectives of entrepreneurship that assume the ability of entrepreneurs to accurately plan the opportunity exploitation process, contrast with the limited certainty of technological ideas. This research uses the constructivist view to deepen in the complementary processes that are seen to support technology-based entrepreneur’s conceptualization of the opportunity into an objective reality. The results show how the iteration with knowledgeable peers and consensus building efforts are an essential part of the emergence of the opportunity, changing both entrepreneur's and stakeholders' perception of the initial idea. Consequently, results support the suitability, regardless of the context, to take appropriate measures to introduce social construction support mechanisms to foster technology-based entrepreneurship

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A constructivist approach for Technology-based Entrepreneurship

  1. 1. A Constructivist Approach for Technology-based Entrepreneurship XXIII ISPIM Conference Barcelona – June 20thFerran Giones (1), Zhao Zhou (2), Dr. Francesc Miralles (1), Dr. Bernhard Katzy (2)(1) La Salle – Ramon Llull University(2) CeTIM – Leiden University
  2. 2. Agenda• Introduction• Background• Literature Review• Method & Data• Results• Conclusions 2
  3. 3. Introduction• Technology-based entrepreneurship driver of economic growth and social wealth.• Dominant entrepreneurship models fail to provide reliable guidelines for uncertainty-rich Tech-based entrepreneurship.• Alternative theoretical perspectives for entrepreneurial opportunities emergence aim to mitigate this gap.• This research explores through the lenses of the constructivist view how opportunities became objective in six case studies. 3
  4. 4. Background• Mechanisms to support entrepreneurial opportunities not working well with tech-based entrepreneurship: • Institutionalized view of how entrepreneurship works based on industrial era assumptions (Honig & Karlsson 2004). • Evidences of entrepreneurship promotion policies mixed results (Shane 2009).• What is different in Technology-based entrepreneurship? • A priori technology-related uncertainty conditions entrepreneur action (Teece 2010, McMullen & Shepherd 2006), in a process of plan and action (Baker et al. 2003). • Difficulties to clearly identify the objective opportunity. 4
  5. 5. Literature Review• Competing perspectives on opportunity identification: • Discovery perspective: objective opportunities exist available to those that can see them (Alvarez & Barney 2007). • Alternative perspectives: propose that opportunities emerge through entrepreneurs action in their social context (Klein 2008)• The constructivist view as an alternative perspective (Wood & McKinley 2010) to study opportunity objectification: • Opportunity origin (initial idea) description combines elements from given social context and individual perceptions. • Consensus among knowledgeable peers drives to opportunity emergence.• This research explores the social interaction processes in the opportunity objectification following the constructivist view. 5
  6. 6. Method & Data• Method: • Exploratory objective • Inductive approach based on a multiple-case study with 6 technology- based entrepreneurs.• Sample: • Cases in telecom (2), electronics (2) and software (2). • Entrepreneur profiles: novice (4) and experienced (2), academic researchers (2) and technology managers (4).• Data collection & analysis: • Interviews and secondary sources collected in 2009-2011. • Stories: from first thoughts initial idea to the objective opportunity. • Individual case stories and cross-case comparison. 6
  7. 7. Results (1/3)• Opportunity construction process in technology-based entrepreneurship seen to combine structure and individual elements (as suggested in Wood & McKinley 2010) • Idea origin in a given social structure triggers a process of iteration with knowledgeable peers using their pre-existent network. “I’ve been many years doing research on asynchronous circuits…it has began to be important as the mobile devices market has developed” (Powchip founder). • Regardless of potential mismatch between entrepreneur knowledge and experience and venture idea (not explained by “discovery perspective”) • Emergence explained entrepreneur’s social action (oriented consensus building processes) as they perceive to have the ability to make things happen (as described in “constructivist view”) : “I started working from scratch for a new technological solution, changing everything” (Winet founder). 7
  8. 8. Results (2/3)• Iteration with knowledgeable peers: • Entrepreneur relies on already existing network of direct personal ties (Newbert & Tornikoski 2010), without a planned peer selection mechanism: “talking with an entrepreneur in integrated circuits that I knew from prior research projects” Winet Founder. • Different patterns of action observed in experienced entrepreneurs: • Pre-existent network includes both technology research and market knowledge peers: “it was my previous business partner that insisted on exploring together the changes that internet and digital TV would produce” DigiTV Founder. • Experienced entrepreneurs seen to be aware of the mechanisms to accelerate idea refinement (in line with Dew et al. 2009 and Politis 2008). 8
  9. 9. Results (3/3)• Consensus building • Strategizing the social exchange (consistent with “constructivist view”): • Technology assessment: obtaining “encouraging feedback from the conversations with colleagues and experts” (Hying founder). • Market sensemaking (Weick et al. 2005): “You cannot get stuck in an idea and stop listening to the or looking at the market” (DigiTV founder). • Produces gains in social legitimacy (as in Tornikoski 2009) to further advance in the consensus building process and mitigate stakeholders’ uncertainty perception: “A third party evaluates the technology and raises the confidence level on the idea” (Powchip founder). • Resulting in a process of transformation where entrepreneurs and stakeholders perceptions evolve together to reach opportunity objectification (as suggested by Wood & McKinley 2010). 9
  10. 10. Conclusions• Institutionalized models of entrepreneurship do not hold well with Tech-based entrepreneurship.• Constructivist view (Wood & McKinley 2010) enriches the opportunity “discovery perspective” uncovering the social construction processes in the opportunity emergence.• Results suggest the need for promotion policies that take into account the “social construction” of opportunities: • Provide support to iteration & consensus building processes. • Consider the benefits of social construction processes as opportunity emergence accelerator. 10