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Entrepreneurial Dimensions: The Relationship of Individual, Venture, and Environmental Factors to Success.

Entrepreneurship, a complex phenomenon, exhibits a rich history of theoretical contributions, but lacks a unifying theory. This research operationalizes a multidimensional framework for exploring the complexities of entrepreneurship based upon the synthesis of diverse disciplinary perspectives. Expanding upon Lumpkin and Dess's (1996) proposal for a contingency framework, entrepreneurship is modeled as an economic phenomenon, with elements for the individual, the firm, and the environment, each of which influences success. The individual element expands upon and refines Robinson (1989) and Shanthakumar's (1992) entrepreneurial attitudinal orientation (EAO) framework, assessing attitudinal and behavioral orientations in ten dimensions. The element of the firm integrates theoretical contributions from the fields of economics, strategy, and entrepreneurship to assess firm-specific characteristics in four aspects: competitive attitude, strategic orientation, level of technology, and the utilization of networks f or information exchange. Environmental influences are also assessed in four dimensions: turbulence, hostility, complexity, and munificence. Success is measured in terms of sales growth, income, employment trends and satisfaction. Success is found to have two distinct dimensions: economic success and the entrepreneur's satisfaction.

Empirical data from 370 entrepreneurs is analyzed by a combination of MANOVA analyses and linear path modeling using structural equation modeling (SEM). Different individual and firm profiles are manifested for differing levels of success in each of its dimensions.

The usefulness of the proposed multidimensional framework is supported. All three of the principle elements of entrepreneurship (the individual, the firm, and the environment) are shown to be interrelated and to significantly differentiate the more from the less successful entrepreneurs. Articulating two distinct domains of success reveals uniquely different profiles for economic success than for entrepreneurial satisfaction. The data further reveals that a venture's transition from entrepreneurial to organizationally driven requires distinctly individual behavioral orientations to be institutionalized (e.g. aggressive achievement to competitive aggression), while also requiring the firm to develop specific processes in strategy, technology, and the utilization of networks. Furthermore, the relationships between individual attitudinal orientations and economic success display non-monotonic patterns. Highest levels of economic success do not correspond to the highest levels of entrepreneurial behavior. The in dividual's attitudes have twice the effect upon the economic success of the venture as do the firm's characteristics. Conversely, the firm's characteristics have twice the influence upon the satisfaction of the entrepreneur as do the individual's attitudes.

Environmental influences are relatively minor. While interpretation of environmental effects are tentative due to the homogeneity of the sample, both the individual and the firm exhibit higher levels of success under perceptions of higher stress and complexity. Increased turbulence, while not meaning less successful, corresponds to the firm's being less competitively aggressive, having lower levels of strategy, using less networking, and exhibiting lower levels of technology. A munificent environment provides a slightly positive influence, but appears to benefit the individual, not the firm.

This research contributes to entrepreneurship theory by integrating, operationalizing and rigorously testing a multidimensional framework, and by then analyzing it with methodological rigor. In addition to supporting the overall framework, the EAO's framework and scale's precision is improved, resulting in the ability to differentiate entrepreneurs as opposed to differentiating between entrepreneurial and non-entrepreneurial individuals.

This research has implications for academics, policymakers, and practitioners. The EAO scale and its increased precision has implications for educators as well as practitioners. Attitudes are dynamic and subject to change. Focusing on those attitudes that impact the success of the venture will assist training and development programs to be more effective. The validation of a framework to model and measure the effects of multiple contingencies presents a challenge to entrepreneurship scholars for increased research rigor. The potentially most significant implication from this study is within the realm of environmental influence. Environmental munificence or generosity appears to impact the individual, not the firm. The data suggest that growing firms may succeed regardless of their perception of the environment. Limitations to the study are discussed and suggestions are made for future research, including a call to refine the framework by applying it to multi-environment/multi-country research.
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Author:Solymossy, Emeric
Publication:Entrepreneurship: Theory and Practice
Article Type:Brief Article
Geographic Code:1USA
Date:Jun 22, 2000
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