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The effects of self-regulatory mechanisms on business success in a randomized control group experiment
This study examines the influence of self-regulatory mechanisms on entrepreneurial success through action-oriented training. It finds that procedural knowledge and self-efficacy significantly mediate the relationship between such training and entrepreneurial actions. The research suggests that effective entrepreneurship education should focus on action and self-regulation to enhance business outcomes.
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The effects of self-regulatory mechanisms on business success in a randomized control group experiment
- 1. STEP Student Trainingfor Entrepreneurial Promotion The Effect of Self-Regulatory Mechanisms on Business Success In a Randomized Control Group Experiment Kim Marie Bischoff Dr. Michael Gielnik Prof. Dr. Michael Frese Leuphana University of Lüneburg
- 2. The effect ofself-regulatory mechanisms on business success in a randomized control group experiment What is this study about? We study the effect of self-regulatory factors in the relationship between an action-oriented entrepreneurship training and entrepreneurial action / entrepreneurial success. The effects of self-regulatory mechanisms on business success in a randomized control group experiment 2 Kim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
- 3. Action Training andEntrepreneurship Action is essential in the field of entrepreneurship • Action plays a major role in entrepreneurship. “(…) entrepreneurship implies that people act to change the world (…)” (Frese, 2009, p.436). • Literature assumes that an action training approach leads to improvements in the field of entrepreneurship (Barr, Baker, & Markham, 2009; Fiet, 2001) Promoting entrepreneurship by action training is useful. The effects of self-regulatory mechanisms on business success in a randomized control group experiment 3 Kim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
- 4. Self-regulation and Entrepreneurship Self-regulation is essential for promoting entrepreneurship • Self-regulation has an important impact on performance (Lord, Diefendorff, Schmidt, & Hall, 2010) • Entrepreneurs are able to affect the success of their businesses by means of self-regulatory mechanisms (Frese, 2009; Frese et al., 2007) Self-regulatory mechanisms may have an impact on entrepreneurial action & success. The effects of self-regulatory mechanisms on business success in a randomized control group experiment 4 Kim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
- 5. Promoting entrepreneurship byaction training and self-regulatory mechanisms • We base our theoretical model on action regulation theory (Frese, 2009; Frese & Zapf, 1994; Karoly, 1993) theory of planned behavior (Ajzen, 1991) The effects of self-regulatory mechanisms on business success in a randomized control group experiment 5 Kim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
- 6. Promoting entrepreneurship byaction training and self-regulatory mechanisms T1 T2 T3 H5: Mediation Procedural Knowledge H1 H2 Entrepreneurial Action- Self-Efficacy Oriented Entrepreneurial Entrepreneur Action Strength of ship Training Entrepreneurial H4 Intentions H3 Action Planning The effects of self-regulatory mechanisms on business success in a randomized control group experiment 6 Kim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
- 7. Promoting entrepreneurship byaction training and self-regulatory mechanisms T2 T4 Business Owner H6 Success (Sales, H7 Growth) Entrepreneurial Self-Efficacy Subjective H8 Success Satisfaction with H9 work as business owner The effects of self-regulatory mechanisms on business success in a randomized control group experiment 7 Kim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
- 8. STEP Student Training forEntrepreneurial Promotion
- 9. Action: The focalpoint of the STEP training Unsuccessful Successful Entrepreneurship Action Entrepreneurship 1 Knowledge / Skills 2 Confidence / Self-efficacy • Knowledge what to do • Believing that “I can do it” • Skills how to do it The effects of self-regulatory mechanisms on business success in a randomized control group experiment 9 Kim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
- 10. STEP’s two generalprinciples: Action Knowledge and Action Training 1 Knowledge / Skills • The STEP training teaches knowledge what to do in a way that the trainees know how to do it. • Principle I: Action Knowledge (Principles of Action) 2 Confidence / Self-fficacy • The STEP training creates a mastery experience to strengthen trainees’ belief of “I can do it”. • Principle II: Action Training The effects of self-regulatory mechanisms on business success in a randomized control group experiment 10 Kim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
- 11. The STEP trainingis an Action Training • The STEP training comprises 12 weeks, including 12 sessions (3 hours each). • The trainees form start-up teams in the first session and engage in the start-up process of a real venture during the 12 weeks. • They identify and evaluate new real-life business opportunities. • They plan and prepare the start-up of a their venture. • Making real money means getting real experience which is the basis for developing mastery and a belief of “I can do it”. Trainees get real experience in starting and running a venture; real experience is invaluable for future start-ups. The effects of self-regulatory mechanisms on business success in a randomized control group experiment 11 Kim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
- 12. Teaching entrepreneurial skillsrequires an interdisciplinary approach • Entrepreneurship is a multifaceted field. • 12 modules cover three relevant domains: business administration, entrepreneurship, and psychology. Business Entrepreneurship Psychology • Finding Starting • Identifying • Leadership Capital Opportunities • Planning • Book-keeping • Writing a Business • Overcoming Barriers • Marketing Plan • Persuasion & • Managing Finances • Registering a Negotiation Business • Strategic Management • Networking The effects of self-regulatory mechanisms on business success in a randomized control group experiment 12 Kim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
- 13. Method: Data Collection T1 Training T2 T3 T4 Feb 2009 Feb-May 2009 Jun 2009 Jan – Mar 2010 Aug – Nov 2011 395 students 352 students 319 students 227 students Interview T1 Interview T2 Interview T3 Interview T4 • Procedure: face-to-face interviews & questionnaires The effects of self-regulatory mechanisms on business success in a randomized control group experiment 13 Kim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
- 14. Method: Design andSample T1 Training T2 T3 T4 Feb 2009 Feb-May 2009 Jun 2009 Jan – Mar 2010 Aug – Nov 2011 395 students 352 students 319 students 227 students Interview T1 Interview T2 Interview T3 Interview T4 • Randomized control group design: 197 students in training group and 198 students in waiting control group • Trainees: Non-business students of Makerere University and Uganda Christian University (Kampala, Uganda), who were in their last semester The effects of self-regulatory mechanisms on business success in a randomized control group experiment 14 Kim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
- 15. Results T1 T2 T3 H5 sign. Mediator H1 Procedural Knowledge β=0.13* H2 Entrepreneurial n.s. Action- Self-Efficacy Oriented Entrepreneurial Entrepreneur Action Strength of ship Training Entrepreneurial Intentions H4 β = 0.12 * H3 Action Planning n.s. Note. n= 319, * p <. 05 The effects of self-regulatory mechanisms on business success in a randomized control group experiment 15 Kim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
- 16. Results T2 T4 H6 Business Owner β=0.15*a Success (Sales, H7 Growth) Entrepreneurial n.s. Self-Efficacy H8 Subjective β=0.34**b Success H9 Satisfaction with β=0.26*b work as business owner Note. an=227. bn=90, * p <. 05, ** The effects of self-regulatory mechanisms on business success in a randomized control group experiment 16 Kim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
- 17. Conclusions Action-oriented training inentrepreneurship affects self- regulation and enhances entrepreneurial action. • Procedural knowledge geared towards action, mediates the relationship between the action oriented entrepreneurship training and entrepreneurial action. Thus, learning what to do and how to do it is essential for undertaking entrepreneurial actions. • The interaction of strength of entrepreneurial intentions and action planning predict entrepreneurial action. Only in combination with action planning can entrepreneurial intentions lead to entrepreneurial action. The effects of self-regulatory mechanisms on business success in a randomized control group experiment 17 Kim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
- 18. Conclusions Self-regulation affects entrepreneurialstart-ups and success. • Self-efficacy predicts: • the start-up of entrepreneurial businesses • subjective success • satisfaction with being and working as a business owner Entrepreneurship trainings should be action- oriented and train self-regulatory mechanisms The effects of self-regulatory mechanisms on business success in a randomized control group experiment 18 Kim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
- 19. Acknowledgements • Thanks tomy colleagues at the Leuphana University of Lüneburg and National University of Singapore Business School • Prof. Dr. Michael Frese • Dr. Michael Gielnik • to the students, who supported us in data collection and rating: • Melanie von der Lahr, Thorsten Dlugosch, Marie-Luise Lackhoff, Kristina Zyla, Eike Hedder, Andreas Heese, Diana Breé, Svenja Haskamp, Mona Mensmann • and to our cooperation partners at the Makerere University Business School (MUBS), Kampala, Uganda The effects of self-regulatory mechanisms on business success in a randomized control group experiment 19 Kim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
- 20. STEP Student Training forEntrepreneurial Promotion Thank you very much for your attention