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A New Foundation for Entrepreneurship Education
The Entrepreneurial Mind
Michiel Karssen
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This study proposes a new intellectual foundation on which entrepreneurship education should be built: the Entrepreneurial mind. This mind is constructed by following the approach of Howard Gardner (2009) and is intended as an additional sixth mind to the five minds of the future of Gardner. Following this approach, the Entrepreneurial mind is based on the emerging research on cognitive skills as the distinguishing factor of successful
entrepreneurs. This research highlighted that this mind can be defined by three characteristics: the opportunity recognition-, effectuation and resiliency characteristic. In addition to the approach of Gardner (2009) this study has tested each characteristic by doing a multiple case study on a sample of five successful serial entrepreneurs. Results from the case study show the existence of each characteristic in the minds of the interviewed entrepreneurs.
Furthermore, the experience of all interviewed entrepreneurs indicates the ability to master the characteristics and hence the Entrepreneurial mind by experience or study. Consequently, unlike the five minds of Gardner for general education, the Entrepreneurial mind is proposed as the intellectual foundation for entrepreneurship education and entrepreneurial curriculum design and should serve those facing the challenge of teaching others how to become successful entrepreneurs.
Keywords: entrepreneurial mind, entrepreneurship, education, cognitive approach, opportunity recognition, effectuation, resiliency
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Michiel Karssen - 10264329 August 2016
MSc Business Administration – Entrepreneurship & Innovation University of Amsterdam
Master Thesis
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Statement of originality
This document is written by Student Michiel Karssen who declares to take full responsibility for the contents of this document.
I declare that the text and the work presented in this document is original and that no sources other than those mentioned in the text and its references have been used in creating it.
The Faculty of Economics and Business is responsible solely for the supervision of completion of the work, not for the contents.
3 Acknowledgements
First and foremost, I would like to thank my thesis supervisor, Roel van der Voort. I am especially thankful for the available time, advice, confidence and great guidance during the writing of this thesis. I enjoyed our meetings and experienced these meetings and discussions as very instructive and as an essential contribution to the quality of this thesis.
Furthermore, I would really like to express my gratitude to my parents and girlfriend for their support and patience throughout this journey. Without their support and confidence it would have been far more difficult to reach this point.
With the accomplishment of this master thesis my career as a student has come to an end. Therefore, I would like to express my gratitude to all professors who helped me shape my view on entrepreneurship and business economics during my study. However, without the support and resources of my parents I wouldn´t have finished my studies like I did. I´m very grateful for the ability they gave me to study and will do my best to repay this generosity.
4 Table of Contents
Title and Abstract 1
Statement of Originality 2
Acknowledgements 3
Table of Contents 4
List of tables and figures 7
Chapter 1: Introduction 8
Chapter 2: Literature Review 11
2.1. A brief history of the uniqueness of the successful entrepreneur 11
2.1.1. The Trait approach 11
2.1.2. The Behavioral approach 16
2.1.3. The Cognitive approach 17
2.2. Howard Gardner‟s „Five Minds for the Future‟ 19
2.3. The Theoretically based Entrepreneurial mind 21
2.3.1. Becoming an entrepreneur: Opportunity recognition 22
2.3.2. Being successful as an entrepreneur: Effectuation and Resiliency 25
Chapter 3: Conceptual model 30
Chapter 4: Methodology 31
4.1. Research design 31
4.2. Sample 32
4.2.1. Unit of Analysis 32
5 4.2.3. Sample description 35 4.2.3.1. Case A 35 4.2.3.2. Case B 36 4.2.3.3. Case C 36 4.2.3.4. Case D 36 4.2.3.5. Case E 37 4.3. Data collection 37
4.3.1. Hypothesis 1: Opportunity recognition 38
4.3.2. Hypothesis 2: Effectuation 38
4.3.3. Hypothesis 3: Resiliency 39
4.4. Data analysis 40
Chapter 5: Research Analysis 42
5.1. Opportunity recognition 42
5.2. Effectuation 48
5.3. Resiliency 55
Chapter 6: The (theoretically and empirically based) Entrepreneurial mind. 59
Chapter 7: Implications for Entrepreneurship education 61 7.1. The need for an intellectual foundation for Entrepreneurship education 61 7.2. Ability to develop the characteristics of the Entrepreneurial mind 62
7.3. Suggestions for Entrepreneurship curriculum design 63
7.3.1. Opportunity recognition 63
7.3.2. Effectuation 64
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Chapter 8: Conclusion and Limitations 67
8.1. Conclusion 67
8.2. Limitations of the study 69
8.3. Implications for future research 69
References 71
7 List of tables and figures
Tables
Table I: Contrasting Frameworks of Novice and Experienced Entrepreneurs 24
Table II: Causation and Effectuation Decision making logic of Entrepreneurs 27
Table III: Description of the cases 35
Table IV: Opportunity recognition quotes 46
Table V: Effectuation & Causation quotes 52
Table VI: Resiliency quotes 58
Figures
Figure I: Focus of the research 30
Figure II: Opportunity recognition; amount of quotes per code 42
Figure III: Resiliency; amount of quotes per code 55
Appendices 80
Appendix I: Interview protocol 80
Appendix II: Instructions and Detailed Description of the Start-Up Experience. 83
Appendix III: Consent Form 85
Appendix IV: Codes used for Data analysis 86
8 1. Introduction
Entrepreneurship plays a more prominent role than ever in our society. The last 25 years, entrepreneurship has changed the economic landscape of the Netherlands significantly. The emergence of this particular field of business has contributed to the competitiveness, innovativeness, job creation and job satisfaction of the Dutch and even the world‟s society (EIM, 2011). For example, the amount of entrepreneurs in the Netherlands increased from a low point of about 0.5 million in 1983 to nearly 1.1 million in 2010 (Hartog et al., 2011). During the same years, comparable growth occurred in the field of entrepreneurship education and especially in the design of entrepreneurship curricula (Kuratko, 2005). This was mostly induced by the increased intention from policy makers who started to value entrepreneurship as a policy tool for economic growth and job creation.
Nevertheless, little is known about how to design entrepreneurship education most effectively. Furthermore, (barely) no empirical evidence exists about effective
entrepreneurship education and the foundations on which it is build. Hence, new insights in this field of interest are welcome to those academics who teach others how to become
successful entrepreneurs. Among these academics and other entrepreneurship theorists exists the conformity that in the entrepreneurial process, the entrepreneur plays the central role and should be the key unit of analysis for entrepreneurship research and curriculum design
(Shane, 2000; Gartner, 1988; Kuratko, 2005). The underlying assumption of this approach is the uniqueness of entrepreneurs. However, even though entrepreneurship scholars agree on the existence of the uniqueness of entrepreneurs, no universal agreement exists on what exactly distinguishes entrepreneurs (Duening, 2010).
The different approaches vary from a focus upon „who the entrepreneur is‟ (the entrepreneur owns a unique set of personality traits and characteristics (Gartner, 1988)), to „what the entrepreneur does‟ (the entrepreneur has learned to behave different and how to undertake certain activities most successful (Gartner, 1988)). Despite these attempts to identify the nature of the uniqueness of entrepreneurs and to serve as a basis for
entrepreneurship education, the results of the trait- and behavioral approach turned up empty, especially for the purpose of entrepreneurship curriculum design (Baron, 2004; Duening, 2010). Consequently, these previous approaches left the development of entrepreneurship curricula without a solid intellectual foundation (Adcroft et al., 2004). One recent proposed approach, which seems to be more fruitful, is the cognitive approach. This approach assumes that successful entrepreneurs think differently and own certain cognitive capabilities that distinguish them from non-entrepreneurs or unsuccessful entrepreneurs (Baron, 2004). This
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approach especially opens up a promising new perspective for entrepreneurship education since, in contrast to characteristics; cognitive skills can be taught and learned (Duening, 2010). Therefore, in order to fill this named gap of an intellectual foundation of
entrepreneurship education, this dissertation proposes a new foundation on which entrepreneurship education should be build founded upon the emerging research of the cognitive skills successful entrepreneurs are assumed to possess. More specifically, this new foundation will be formed following the approach of Howard Gardner (2009).
Howard Gardner‟s book: Five Minds for the Future (2009) intends to be an intellectual foundation for general education. In his book, Gardner provides detailed descriptions of five specific minds that he argues are more than theoretical constructs. These minds are essential capabilities which people will need to be effective in the future and that these minds should be used as an intellectual foundation for general education and curriculum design. He states that:
„One cannot even begin to develop an educational system unless one has in mind the knowledge and skills that one values, and the kinds of individuals one hopes will emerge at the end‟ (Gardner, 2009). Hence, the new intellectual foundation suggested for
entrepreneurship education is that of an additional sixth mind: The Entrepreneurial Mind. On the characteristics of this mind, the design of entrepreneurship education should be based. The entrepreneurial mind is, as in terms used by Howard Gardner (2009), a characteristic of the mind that an entrepreneur should aim to develop in order to‟ be well equipped to deal with
what is expected, as well as what cannot be anticipated, in the future‟. Or in general; a mind
or being needed to be successful as an entrepreneur. This study will provide a description of this mind by seeking to answer the following research question:
How does the Entrepreneurial Mind look like?
Before this main research question will be answered a description of the different approaches to explaining the uniqueness of the successful entrepreneur will show why the development of this entrepreneurial mind is needed. Hence, this study will start with a review of the existing academic research regarding the uniqueness of the successful entrepreneur followed by an elaboration of the five minds of Howard Gardner and finally a theoretical-based first identification of the entrepreneurial mind. However, beside the theoretical
verification of the entrepreneurial mind, empirically more evident is the analysis of the mind of expert entrepreneurs (Krueger, 2007). Krueger (2007) argues that we need a strong understanding of what an expert entrepreneurial mind comprises to form an intellectual foundation about what distinguishes successful entrepreneurs from non- and unsuccessful ones. Therefore, in order to strengthen the theory-building nature of this study, empirical
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support is collected by doing a multiple case study, where expert entrepreneurs serve as the selected cases. This methodology will be explained after the literature review. In the
subsequent section, the results of the multiple case studies will be presented and discussed where after, in the form of a conclusion, the proposed research question will be answered. Finally, suggestions for future research and the limitations and implications of this research will be presented.
11 2. Literature Review
In the literature there are many definitions given to entrepreneurship which have led to vague definitions and the lack of a common understanding what precisely entrepreneurship is and what is important for entrepreneurship curricula design (Davidsson, 2004). In addition, in the research field of the entrepreneur is also no unambiguous definition of what distinguishes successful entrepreneurs from non-entrepreneurs. Therefore, before reviewing the minds of Howard Gardner and explaining the entrepreneurial mind, it is useful to develop a solid understanding of previous approaches and their inability to form a basis for entrepreneurship education.
Several studies have investigated what or who the entrepreneur is by using different kinds of approaches; the trait approach, the behavior approach (Gartner 1985, 1988) and the cognitive approach (Keh et al., 2002; Baron, 2004). These approaches contain the line of research that has attempted to discover the uniqueness of entrepreneurs and entrepreneurship. The desire or motivations for the search and assumption that successful entrepreneurs are unique vary, but is mostly induced by two major motivations. The first motivation is a
universal „gut feel‟ that there are things successful entrepreneurs own or can that distinguishes them from non-entrepreneurs and unsuccessful ones (Duening, 2010). The second motivation is the, as Kuratko (2005) calls; „desire for an intellectual foundation upon which to build
credible and legitimate entrepreneurship curriculum‟. Entrepreneurship has happened and is
happening in the absence of academic research and education. Hence, it is necessary to find a scientific justification for curricular involvement. Exploration of the unique variables of successful entrepreneurs will provide useful insights for the curriculum design of
entrepreneurship education (Ericcson et al., 1993). A description of the different approaches to explaining the uniqueness of the successful entrepreneur will show why the development of an entrepreneurial mind is needed. This brief history will be provided in the subsequent section.
2.1. A Brief History of the uniqueness of the Successful Entrepreneur
2.1.1. The Trait approach
The first attempt in the search for distinguishing variables of the successful
entrepreneur started with the trait approach. This approach defines an entrepreneur as a set of personality traits and characteristics and explains the successful entrepreneur as one with unique characteristics (Gartner, 1988).
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Research on whether entrepreneurship is a function of characteristics owned by certain people dates back to 1961. McClelland‟s (1961) analysis of the „Need for achievement and entrepreneurship‟ provides one of the six most common traits mentioned in the literature. People with a high need of achievement set challenging goals and compete with their own standards of excellence to continuously improve their performance. According to
McClelland‟s theory, individuals with this strong need to achieve are more likely to become entrepreneurs and are more likely to succeed better than others as an entrepreneur
(McClelland, 1961). Furthermore, in studies of successful entrepreneurs this need of achievement behavior is regularly present (Sexton and Bowman, 1985).
The other five traits commonly used in the literature to define the entrepreneur are: locus of control, risk taking propensity, tolerance of ambiguity, need for autonomy and creativity or innovativeness (Begley and Boyd, 1987; Sexton and Bowman, 1985).
Locus of control refers to an individual‟s perceived ability to influence events in their
lives (Rotter, 1966). Rotter (1966) divides this locus in persons having some degree of either internal locus of control or an external locus of control. Internal persons believe in the efficacy of their own behavior instead of giving credence to external forces such as luck or destiny. In contrast, external people expect that forces outside their control determine
outcomes instead of believing in their own abilities, effort or skills. Rotter (1966) also stated that having an internal locus of control correspondents with a high need of achievement. This link seems logical, since the need to achieve encourages people to believe in their own actions.Moreover, this makes it even clearer that people with an internal locus of control are more likely to be entrepreneurs (Brockhaus and Horwitz, 1986). Furthermore, an internal locus protects against submission to authority. Internal people are more resistant to others influence which leads to another often named personality trait of entrepreneurs; the need for autonomy.
The Need for autonomy of people refers to the desire or need to the ability to be
independent and self-directed in the pursuit of opportunities (Lumpkin and Dess, 1996). Some of the main drivers of self-employment are the desire to run a business on their own instead of working for someone else and decisional freedoms. These drivers are based on the idea that larger firms suppress personal freedom and the potential for entrepreneurial initiative. Also the earlier mentioned internal locus of control of entrepreneurs influences this need for autonomy because independency and autonomy offer the opportunity to work in accordance with one‟s goals and own working efforts (Timmons and Spinelli, 2007). According to several studies entrepreneurs possess a strong need for this autonomy, independency and power
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(McClelland, 1987; Timmons and Spinelli, 2007; Vecchio, 2003). However, given the
uncertainty inherent in the entrepreneurial environment, this independency is accompanied by the carrying of and dealing with one‟s own risk. The degree to which one is willing to take chances with respect to risk in a decision-making situation is often referred to as one‟s risk-taking propensity (Begley and Boyd, 1987).
Risk-taking propensity; More risk-tolerant individuals are more likely to pursue an
entrepreneurial career than risk-averse people who are more likely to choose for contractual employment (Stewart and Roth, 2001). This is the case because entrepreneurs have to deal with more uncertain possibilities, less structured situations and are bearing the ultimate responsibility for their decisions. Therefore, entrepreneurs are believed to exhibit moderate risk-taking propensities (Begley and Boyd, 1987). However, Vecchio (2003) concluded that entrepreneurs judge equivocal business opportunities more positively than non-entrepreneurs and have therefore not a higher risk-taking propensity but only perceive risks and
uncertainties different. Furthermore, two studies compared the risk-taking propensity of entrepreneurs and managers and found no significant evidence that this differs among the two groups (Brockhaus 1980). Following up on this, a later study from Sexton and Bowman (1983) using a different testing instrument showed significant differences between entrepreneurship students and other business students, indicating that there is perhaps a
difference in risk-taking propensity between entrepreneurs and non-entrepreneurs (Sexton and Bowman, 1985). Accordingly, the entrepreneur will be assumed to be more risk-tolerant. However, as already mentioned, there is a difference in risk-taking and the dealing with ambiguous situations. People can be risk-tolerant but still perceive ambiguous situations as undesirable. Therefore, Budner (1962), argued that, so-called, tolerance of ambiguity is a separate personality variable. Because the entrepreneurial function entails quite often these ambiguous situations (Schere, 1982), the next personality trait discussed is this tolerance of ambiguity.
Tolerance of ambiguity is best described as ´the tendency to perceive ambiguous situations as desirable‟ (Budner, 1962). Ambiguous situations are defined as situations which
cannot be sufficiently structured or categorized because of the lack of sufficient cues. Or in short, situations characterized by novelty, complexity, or insolvability. People with a high tolerance of ambiguity perceive ambiguous situations as a desirable and challenging goal. On the other hand, individuals who have a intolerance of ambiguity view ambiguous situations as undesirable, threatening and stressful (Sexton and Bowman, 1985). The tolerance of
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ambiguity tolerance between managers and entrepreneurs. His founding indicated that entrepreneurs are significantly more tolerant than managers. Accordingly, Sexton and Bowman (1985) concluded that high ambiguity tolerance seems to be a unique personality trait of entrepreneurs.
Creativity or Innovativeness was first emphasized in the entrepreneurial process by
Schumpeter (1934). According to his theory, the entrepreneur is a disrupter of existing market structures by introducing innovative „new combinations‟. Drucker (1985) further elaborated the role of innovation in the context of the entrepreneur. He concluded that all successful entrepreneurs are more likely to systematically practice innovation than non-entrepreneurs. Furthermore, other studies support this claim that entrepreneurs, especially those successful growing a business, are more innovative and creative than non-entrepreneurs (Carland et al., 1984; Bhide, 1984).
In summary, the findings of the trait approach during these years indicated that entrepreneurs are assumed to have a higher or stronger need of achievement, tolerance of
ambiguity and need for autonomy. Furthermore, they have an internal locus of control and are more risk-tolerant, creative and innovative than non-entrepreneurs.
However, reflecting the state of personality research at the time, Gartner (1988) argued that these studies included a confusing variety of personality variables, sometimes with a lack of reliability and validity and often with little theoretical explanation and empirical evidence. By the late 1980s, inconsistent results from the empirical studies directed several scholars to the conclusion that there is no significant relationship between personality and entrepreneurship and that future research using the trait approach should therefore be abandoned (Brockhaus & Horwitz, 1986; Gartner, 1988; Robinson, Stimpson, Huefner, & Hunt, 1991). Gartner (1988) even stated that he believed „that a focus on the traits and personality characteristics of
entrepreneurs will never lead us to a definition of the entrepreneur nor help us to understand the phenomenon of entrepreneurship.‟ Nevertheless, Gartner (1989) provided one year later
some suggestions for research on entrepreneurial traits and characteristics by stating that „an
entrepreneurship study of psychological traits is first and foremost a psychological study, and secondarily an entrepreneurship study and must follow the same „rules of the game‟ as other studies of psychological traits found in the mainstream of the discipline of psychology.‟
Accordingly Johnson (1990) argued that a valid and reliable instrument was needed to measure psychological characteristics because the ability to generalize from past empirical research on personalities, whether entrepreneurial or in general, was limited.
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One development that answered this call for a needed instrument was the five factor model of personality (Costa and McCrae, 1992; Digman, 1990). The five factor model (FFM) or „Big five‟ measure of personality provides a comprehensive classification of personality characteristics. Each personality dimension describes a broad domain of psychological functioning that is derived from a set of more specific traits. The FFM is constructed out of the extensive research on the enduring emotional, social, experimental, attitudinal, and motivational styles of an individual. This model is proved to be a valid and reliable measure of personality (Barrick and Mount, 1991; Hurtz and Donovan, 2000). The work of Costa and McCrea (1992) has provided probably the most developed construct of the FFM. Generally agreed upon are their provided „Big five‟ personality dimensions: extraversion, agreeableness, conscientiousness, neuroticism (or emotional stability), and openness to experience as a robust indicator of personality (Digman, 1990; Goldberg, 1990). Accordingly, using the five factor model (little) evidence was found for the relation between personality and venture survival (Ciavarella et al., 2004), entrepreneurial status (Zhao and Siebert, 2007) and entrepreneurial intentions and performance (Zhao, Siebert, Lumpkin, 2010).
Underlying the relative success of these new studies on personality characteristics of entrepreneurs was what Rauch and Frese (2007) called the „matching of traits to tasks of
entrepreneurs‟, which in a later paper is referred to as „evidence- based entrepreneurship‟
(Frese et al. 2012). Hence, these studies argue that, contrary to the early conclusion of the late 1980s, the abandonment of the trait approach seems premature and may restrain theory
development in the field of entrepreneurship by excluding personality variables. However, one major bad feature of all studies using the FFM is that the big five dimensions are broad dimensions constructed out of more detailed personality traits. The comprehensiveness makes the FFM a good estimator of personality but a worse predictor of relationships between personality and entrepreneurship (Markman & Baron, 2003),
Moreover, regarding the design of entrepreneurship education, if it was the case that entrepreneurs were special in one or more specific personality characteristics, the goal of education would be to help students who own such characteristics to use these characteristics in entrepreneurial ways as best as possible. This would mean that some people would
automatically be excluded for entrepreneurship education since they would lack the required characteristics to become a successful entrepreneur (Duening, 2010). The successful
entrepreneur would be a fixed state of being; „once an entrepreneur, always an entrepreneur‟ and accordingly the unsuccessful entrepreneur or non-entrepreneur; „not once an entrepreneur, never an entrepreneur.‟ This would raise the question whether entrepreneurship can be taught
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anyway or whether entrepreneurship education programs should have characteristic
screenings. Therefore, despite the possible relation of personality traits and entrepreneurship, this would still not offer a foundation for entrepreneurial curriculum design.
2.1.2. The Behavioral approach
After the proposed abandonment of the trait approach Gartner (1988) suggested the behavior approach as an alternative candidate in search for unique entrepreneur variables. He argued that „entrepreneurship is the creation of new organizations‟. Therefore, the research should focus on what the entrepreneur does, and not on who the entrepreneur is in terms of personality characteristics (Gartner, 1988). Successful entrepreneurs have learned to behave different instead of being different than non-entrepreneurs. This behavioral approach treats the organization as the primary level of analysis and the individual is viewed in terms of activities undertaken to enable the organization to come into existence. The personality of the entrepreneur is serving the entrepreneur‟s behavior but is not what defines an entrepreneur (Gartner, 1988). The article of Gartner (1998) has been broadly cited in the entrepreneurship literature. Many academic researchers have used Gartner‟s definition to simplify and define the constructs of „entrepreneurs‟ and „entrepreneurship‟ in empirical studies (Chrisman et al., 1990; Cooper et al., 1997; Gatewood et al., 1995). However, not much literature can be found about which behavior is unique for successful entrepreneurs. In addition, this line of research also resulted in confusing variables (Duening, 2010).
In spite of the lack of profound research regarding the behavioral approach, the paper of Shane and Venkataraman (2000), that discussed entrepreneurial behavior, provides useful implications for entrepreneurship education. In their paper, Shane and Venkataraman (2000) identified different activities regarding entrepreneurship: the discovery and exploitation of opportunities. However, even though their paper discusses entrepreneurship in terms of
activities, Shane and Venkataraman‟s (2000) approach finds a parallel in economic theory and also focuses on the individual‟s ability to identify opportunities for entrepreneurial activity rather than on the characteristics of the individual or the solely individual‟s behavior (Marvel, 2012). This focus on ability rather than behavior or being of an entrepreneur is more fruitful for curriculum design of entrepreneurship education (Duening, 2010).
In conclusion, the trait approach and behavioral approach were eliminated before they could be fully exploited and were also not very likely to explain the difference between successful entrepreneurs and non-successful or non-entrepreneurs. Furthermore, neither of these approaches seems very useful for entrepreneurship education since it discusses a fixed
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state (trait approach) or is hardly connected to specific entrepreneurial activities (behavioral approach). Fortunately, a new approach to the understanding entrepreneurs and their
uniqueness emerged; the cognitive approach.
2.1.3. The Cognitive approach
The relatively new cognitive approach states that the way entrepreneurs think distinguishes them from non-entrepreneurs. This approach emphasizes that everything one thinks, says, or does as human being is influenced by mental processes. Entrepreneurial cognitive
mechanisms are defined as „The knowledge structures that people use to make assessments,
judgments, or decisions involving opportunity evaluation and venture creation and growth‟
(Mitchell et al, 2002). Baron (2004) suggests that this perspective can help the field of entrepreneurship to answer three basic questions it has long addressed: (1) Why do some persons but not others choose to become entrepreneurs? (2) Why do some persons but not others recognize opportunities for new products or services that can be profitably exploited? And (3) Why are some entrepreneurs more successful than others? The academic literature regarding the cognitive approach indicates several specific cognitive factors relevant to each of these questions.
Regarding the first issue, one factor which is assumed to influence the decision to become an entrepreneur is self-efficacy. This is the belief in one‟s ability to make good decisions (Krueger and Dickson, 1994). Krueger and Dickson (1994) state that the higher an entrepreneur‟s self-efficacy, the more likely an entrepreneur is to start a new venture. The decision to become an entrepreneur may also be influenced by several cognitive biases. For example, many entrepreneurs suffer an optimistic bias; believing that their likelihood of experiencing positive outcomes is much higher than the objective data suggests (Baron, 2004). These entrepreneurs underestimate the risk involved in starting a business. Other cognitive biases are: confirmation bias; information that confirms current beliefs is noticed, processed, and remembered more readily than information that disconfirms current beliefs,
planning fallacy; the tendency to believe that one can complete more in a given period of time
than one actually can, and affect infusion; the tendency for affective states to strongly influence perceptions and decisions. According to Baron (2004), entrepreneurs, in
comparison to other people, may be more susceptible to such biases. These various forms of cognitive bias play a role in the decision to become an entrepreneur (Baron, 2004).
The second issue, opportunity recognition, has long been a central concept among entrepreneurship scholars (Eckhardt and Shane, 2003). Reviewing it from a cognitive
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perspective provides useful additional insights (Baron, 2004). According to Sarasvathy, Simon and Lave (1998) perception plays a role in recognizing an opportunity. They show in their paper that successful entrepreneurs see opportunities in situations in which other people tend to see risks. Baron (2004) adds to this that entrepreneurs may possess better-developed prototypes for opportunities than do other persons. Prototypes comprise basic ideas of what a specific object or pattern is like (Matlin, 2002). Applying prototype models to opportunity recognition; it may be the case that entrepreneurs compare ideas for new products or services with their existing prototype for „opportunity‟; a mental abstraction they have acquired
through experience. The closer the match, the more likely would entrepreneurs be to conclude than an idea for a new product or service would be an opportunity worth pursuing. Another important cognitive factor regarding opportunity recognition is entrepreneurial alertness (Gaglio and Katz , 2001). They suggest that entrepreneurs, and especially successful entrepreneurs, may possess a specific schema they call entrepreneurial alertness. This is indicated as a cognitive framework that assists such persons in being alert to opportunities. They hypothesize that persons who possess such a schema show a tendency to search for and notice change and market disequilibria, to respond to information that does not match their current schemas, and to adjust existing schemas on the basis of such nonmatching
information. In addition, entrepreneurs possessing well-developed alertness schemas seek to be objectively accurate, and possess more complex information concerning the nature of change, the nature of industries, and specific social environments (Gaglio and Katz, 2001). In sum, a cognitive approach to opportunity recognition is an important way in which this approach can contribute to the field of entrepreneurship.
The third issue, why some entrepreneurs are more successful than others, can also benefit from reviewing the way entrepreneurs think. Successful entrepreneurs are assumed to be better able than unsuccessful entrepreneurs to make an objective assessment about the risk associated with various strategies and as a result, are more adept at choosing appropriately between them (Simon et al., 2000). Another aspect that may distinguish successful and unsuccessful entrepreneurs is counterfactual thinking; the tendency to imagine different outcomes in a given situation than what actually occurred (Baron, 2000). Successful
entrepreneurs are better than less successful ones at using counterfactual thinking to formulate task strategies. It is also assumed that successful entrepreneurs, as compared with
unsuccessful ones, may less subject to a wide range of cognitive errors or biases (mentioned in the previous paragraph) than can serve to distort information processing and lead to less-than-optimal decisions (Baron, 2004).
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In conclusion, the cognitive approach to the uniqueness of successful entrepreneurs shows new hope that an intellectual foundation for entrepreneurial curricula design can be formed. The way people think, instead of behave or are, is better applicable for educational purposes (Duening, 2010; Krueger, 2007). However, to date, the emerging academic field of cognitive research for entrepreneurship has not been translated into curriculum design. Duening (2010) argues that this is due to the relatively wide gap between those scholars interested in discovering cognitive elements of entrepreneurship and those interested in entrepreneurship curriculum design. Furthermore, he argues that a suitable translation is needed to utilize the cognitive entrepreneurship research because it would not be useful for entrepreneurship students to know that they have to develop a cognitive bias of
„over-optimism‟. And besides that, how can an optimistic bias be taught?
For general education, Howard Gardner (2009) provides far-reaching implications of cognitive foundations in education and curriculum development (Duening, 2010). He describes five minds that should function as the foundation on which curriculum design should be build. Therefore, this approach seems feasible to use to form a basis for
entrepreneurship curriculum design and to form the entrepreneurial mind. To best identify this entrepreneurial mind, first, Gardner‟s five minds for the future and how they are developed will be described in the next section.
2.2. Howard Gardner‟s Five Minds for the Future
Gardner‟s (2009) „Five Minds for the Future‟ are, what he believes, the essential minds that are necessary for a person to be most effective in the future. These minds are, instead of a description, a prescription of competencies which young people and the society need in the twenty first century and are no less than intended to be intellectual foundations for general education and curriculum development.
Gardner‟s minds are constructed based on a synthesis of different research. Since Gardner is speaking about minds he argues that he mainly draws upon what we know about the operation of the human mind from a scientific point of view. Or in other words Gardner‟s minds are based on cognitive skills. When identifying which cognitive skills would be
important, he started by reviewing history, because: „humans differ from other species in that
we possess history as well as prehistory‟ (Gardner, 2009). By reviewing historical research
and occasions Gardner was able to indicate the minds which were important in the past. In combination with his view of the future he argued about the following five minds that: „Each
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has been important historically, each figures to be even more crucial in the future‟. These five
minds Gardner (2009) describes are named the disciplined-, synthesizing-, creating-,
respectful-, and ethical mind.
The Disciplined Mind: Gardner observes that to deal with the future one has to master at least one way of thinking; a distinctive mode of cognition that characterizes a specific scholarly discipline, a craft, or a profession. Disciplinary thinking is the deeply different ways in which scientists or historians or artists approach their daily work rather than knowing all the facts and information of one discipline. The disciplined mind builds on and extends its capability; it knows how to work steadily over time to improve skill and
understanding. It also knows how to distinguish useful contributions to a field of knowledge from useless ones. Regarding the disciplined mind, Gardner (2009, p. 18) states: „Individuals
without one or more disciplines will not be able to succeed at any demanding workplace and will be restricted to menial tasks.‟
The Synthesizing Mind: This mind describes the capability to take information from disparate sources, understand and evaluate that information objectively, and to put it together in ways that make sense to the synthesizer and also to other persons. In the modern world, individuals are exposed to far more knowledge and information each day. Therefore, the capacity to synthesize becomes ever more crucial. Or as Gardner (2009, p. 18) puts it:
„Individuals without synthesizing capabilities will be overwhelmed by information and unable to make judicious decisions about personal or professional matters.‟
The Creating Mind: Building on discipline and synthesis, the creating mind is able to break new ground by combining information and ideas in novel ways; it poses unfamiliar questions, conjures up fresh ways of thinking and comes up with unexpected answers. Since the call for more and better innovations rises in our globally competitive economy, the creating mind becomes even more important than ever. The creating mind should seek to remain at least one step ahead of even the most sophisticated computers and robots or otherwise: „individuals without creating capacities will be replaced by computers and will
drive away those who do have the creative spark.‟(Gardner, 2009, p.18)
The Respectful Mind: Gardner argues that this mind is critical in a world where we are all interlinked. The respectful mind describes the ability to cope with differences among human individuals and groups, and to understand these others, and seek to work effectively with them. „Individuals without respect will not be worthy of respect by others and will
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The Ethical Mind: One who possesses an ethical mind considers the nature of one‟s work and the needs and desires of the society in which one lives. This mind conceptualizes how work can serve purposes beyond self-interest and how members of a society can work unselfishly to improve the entire society or world. Gardner states that people need to develop their own ethical system and values. He thinks that the ethical mind is an important goal for curriculum designers because „individuals without ethics will yield a world devoid of decent
workers and responsible citizens: none of us will want to live on that desolate planet‟
(Gardner, 2009, p. 19).
As mentioned earlier, these minds are, according to Gardner (2009), very important for developing an educational system. He literally states that: „One cannot even begin to develop
an educational system unless one has in mind the knowledge and skills that one values, and the kinds of individuals one hopes will emerge at the end‟ (Gardner, 2009: 30). This is also the
case for an educational system for entrepreneurship. However, while Gardner‟s approach is considered as a good contribution to the field of education, his five minds for the future merely focus on general education. Therefore, when developing an educational system for a particular field one would miss important elements of an effective education in one‟s own respective field. This is especially true for those who focus on educating entrepreneurship (Duening, 2010). Gardner‟s minds do not contain cognitive factors dealing with opportunity recognition, risk managing, resiliency and many other things that are crucial for successful entrepreneurship. Hence, especially the field of entrepreneurship is interesting as an exploration for an additional sixth mind. An individual who wants to be a successful
entrepreneur and owns all of Gardner‟s minds would still miss certain cognitive skills to deal with what is expected from a successful entrepreneur, as well as what cannot be anticipated by a successful entrepreneur in the future (Duening, 2010). With the emergence of the cognitive approach to entrepreneurship research, these missing entrepreneurial cognitive factors could be formed into an additional sixth mind; ‘The Entrepreneurial Mind’ by following the approach of Gardner (2009).
2.3. The Theoretically based Entrepreneurial Mind
As mentioned in the previous section, to identify an additional mind, it is important to
consider the approach Gardner used when he identified his minds. Likewise the description of each characteristic of the entrepreneurial mind is based on a historical review of the academic research and the usefulness and importance for the future of each of these characteristics of
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the entrepreneurial mind. Additionally, a hypothesis will be formed for each characteristic based on this review. Finally, a brief description of the comprehensive entrepreneurial mind will be provided.
When identifying the entrepreneurial mind, there is one important distinction which should be made; several scholars argue that during the entrepreneurial process there exist two critical, but distinct, factors: becoming an entrepreneur and entrepreneurial firm performance (Baron, 2007; Venkataraman, 1997). The intention and ability to find and manage one‟s own business is widely recognized as the first critical step in the process of becoming an entrepreneur (Bird, 1988; Krueger et. al., 2000). The second outcome, entrepreneurial firm performance, is
induced by the individual‟s ability to continue as an entrepreneur. Even though some
successful entrepreneurs may choose to no longer continue as the owner and manager of their own business, nearly all unsuccessful entrepreneurs will eventually be forced to abandon entrepreneurship. These two critical factors are the two parts of the entrepreneurial mind one must develop and master. Therefore, in order to construct the entrepreneurial mind, first the literature regarding the factor of becoming an entrepreneur in relation with cognitive skills will be deliberated. Here after, factors determining the ability to successfully manage an entrepreneurial company will be discussed.
2.3.1. Becoming an Entrepreneur; Opportunity Recognition
„To have entrepreneurship, you must first have entrepreneurial opportunities‟ (Shane and Venkataraman, 2000, p. 220).
Entrepreneurship has always been a vague field of research in history with perhaps the biggest problem in this field; the lack of a uniform definition. (Davidsson, 2004; Shane and
Venkataraman, 2000). Nevertheless, despite the lack of this definition, there is one factor fundamentally concerning entrepreneurship scholars; the existence, discovery and exploitation of entrepreneurial opportunities (Shane and Venkataraman, 2000). As several scholars argue: entrepreneurial opportunities are often the starting point of entrepreneurial activities (e.g., Shane and Venktaraman, 2000; Baron, 2007) and are therefore crucial in becoming an entrepreneur. Also, with the emergence of technological features in many different industries and the fast flow of information in the near future (Gardner, 2009), more opportunities will arise. Recognizing entrepreneurial opportunities will be an even more important factor in
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becoming a successful entrepreneur. Hence, the ability to recognize entrepreneurial opportunities is the first part of the entrepreneurial mind one must master.
Entrepreneurial opportunities are situations in which new services, raw materials, goods and organizing methods can be invented and sold at greater cost than their production costs and which will therefore induce the creation of new entrepreneurial companies (Casson, 1982). These entrepreneurial opportunities are objective occurrences that are not known to all parties at all time. They are often there for anyone to notice, but ten s of thousands or even millions of persons fail to recognize these opportunities (Shane and Venkataraman, 2000). Consequently, the question widely involving the academic literature is: why do some and not others recognize these opportunities?
Factors that are found to influence opportunity recognition are prior knowledge of a field or industry (e.g., Shane, 2000), social networks of entrepreneurs (e.g., Ozgen and Baron, 2006), and a wide range of cognitive factors, including perceptions and intentions (e.g., Sarasvathy, Simon and Lave , 1998; Krueger, 2003). While this previous research has
improved the understanding of opportunity recognition it does not address the crucial question for the mastery of the entrepreneurial mind: how does opportunity recognition actually occur in the minds of these persons? (Baron, 2007). As mentioned earlier, in order to think like an expert entrepreneur and to become an entrepreneur one must at first master the ability to recognize opportunities.
Research on this issue suggests that there exist one distinct opportunity recognition capability; a cognitive process named pattern recognition (Baron & Ensley, 2006). Baron (2007, p.171) describes this process as following: „Pattern recognition involves noticing
meaningful patterns in complex events, trends, or changes. In essence, it includes (1) recognizing links between trends, changes, and events that appear, at first glance, to be unconnected, and (2) noticing that these connections form an identifiable pattern.‟ He argues
that both of these phases are influenced by so-called cognitive frameworks, frameworks people have developed by experience. Thus, experience make entrepreneurs develop better frameworks which will serve as guides or templates to identify certain patterns in economic conditions, consumer behavior or other factors linked to profitable opportunities. The study of Baron and Ensley (2006), confirms this role of pattern recognition in the identification of novel business opportunities. They found that the cognitive frameworks for „business
opportunity‟ controlled by highly experienced serial entrepreneurs were significantly different from those of novice entrepreneurs.
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Table I: Contrasting Frameworks of Novice and Experienced Entrepreneurs
Discriminant profile:
Novice Entrepreneurs
Discriminant profile:
Experienced entrepreneurs
How novel is the idea Solving a customer‟s problem Extent to which idea is based on new
technology
Ability to generate positive cash flow
Superiority of product or service Speed of revenue generation Potential to change industry Manageable risk
Intuition or gut feel Others in their network with whom to work
Source: Baron and Ensley, 2006
The differences are presented in Table I (derived from the study of Baron and Ensley, 2006), and show a more focused framework of the expert entrepreneurs; they tend to focus more on factors and conditions directly relevant to starting and running a new venture (Baron and Ensley, 2006).
This difference is consistent with the involvement of pattern recognition in the
opportunity recognition process and the role experience plays in the development of cognitive frameworks (Baron, 2007). Furthermore, it can be argued that non-entrepreneurs have not learned to recognize these patterns because they lack the experience or academic study necessary to develop the needed framework. Therefore, they will be less likely to recognize the business opportunities the patterns represent (Duening, 2010).
On the basis of the previous research of Baron (2007), Baron and Ensley (2006) and the reasoning of Duening (2010) the following hypothesis is formulated:
Hypothesis 1: The Entrepreneurial Mind has a unique opportunity recognition cognitive
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2.3.2. Being successful as an entrepreneur: Effectuation and Resiliency
Effectuation
Successful entrepreneurship certainly requires an orientation towards action from the entrepreneurs (Duening, 2010). To claim success as an entrepreneur one must learn to translate the recognized opportunity into a creation or acquisition of something of value and learn to deliver that value to a market willing to pay a profitable price for it. Naturally, this involves continuously taking actions and more importantly: making decisions. Effective decision making is therefore a crucial factor in entrepreneurship and is assumed to be a characteristic of the entrepreneurial mind.
Decisions in the entrepreneurial setting are prone to an unknown future (Sarasvathy, 2001). However, as Sarasvathy (2001) argues, classes to deal with business decisions usually assume the existence of central, known contexts of business within which the decisions take place. For example, pricing decisions will involve the equaling of marginal costs to the marginal revenues or doing market research to discover how the demand function is shaped. This historic view assumes that the future, although unknown, is predictable to some degree and decision makers know what they want (Sarasvathy, 2008). The decision making logic associated with this view is a causal logic (Sarasvathy, 2001). By logic is meant, an internally consistent set of ideas that forms a clear basis for action upon the world.
Sarasvathy (2001) was one of the first to name and discuss two types of decision-making logic people and specifically, entrepreneurs‟ use. She introduced the two opposing types of logic called causation and effectuation. Causation assumes that the future can be acceptably predicted and follows a logic of „to the extent we can predict future, we can
control it‟ (Sarasvathy, 2001). Causation processes take goals or effects as given, based on
predictions, and focus on selecting between means to achieve the goal or effect. This will induce an entrepreneur who uses causal logic, to choose between its means (resources) based on expected return and the calculation of the upside potential of the opportunity, the conduct of market research and strategic planning, and the analysis on its competitive environment.
In contrast, Sarasvathy (2001) discovered the phenomena of effectuation. She argues (Sarasvathy, 2001; 2008) that expert entrepreneurs have learned that the most interesting ventures are built in a space in which the future is not only unknown, but unknowable. Still yet, entrepreneurs do shape this unpredictable future. They use techniques which minimize the use of prediction and allow them to shape the future. Effectual logic happens in the mind of an individual, where it provides a way of thinking about making decision .In order to
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master the entrepreneurial mind, therefore one must master effectuation as its decision making logic.
Effectuation is best described as a logic of thinking that uniquely serves entrepreneurs in starting businesses. It mainly involves decision making logic and a cognitive process that assumes means, instead of goals as starting point and focuses on the decision concerning the effect that can be created given these means. It starts by evaluating the means itself and asking the questions what I know, whom I know and who I am rather than setting goals upfront (Sarasvathy, 2001, 2003; Wiltbank et al., 2006). The selection between these means is based on controlling an unpredictable future rather than predicting an uncertain one, affordable loss instead of expected return and follows the logic of „to the extent we can control future, we do
not need to predict it‟ (Sarasvathy, 2001). Effectuation, contrary to causation, does not focus
on the core of the market. Instead, it focuses on the outline, where flexibility, playfulness, experimentation, and mistakes are tolerated. A short summary of effectuation and the difference with causation is provided in Table II.
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Table II: Causation and Effectuation Decision making logic of Entrepreneurs
Effectuation Causation
Means are defined (Who am I, What do I know, Whom do I know?), given are the basis for decisions and opportunities therefore:
Goal, effect is defined or given (based on predictions) therefore:
Choose between possible goals, effects that can be achieved with given means
Selection is based on acceptable risk & affordable loss
Selection criteria are actor dependent – based on calculating downside risk of the max. one can afford to lose
Choose between means to achieve the goal, effect.
Selection is based on expected return
Selection criteria are goal and effect
dependent – based on calculating the upside potential of the best
opportunity
Outcome:
New markets through alliances and cooperation strategies.
Collaboration based attitude
Outcome:
Increased market share in existing market through competitive strategies
Competition based attitude Logic:
To the extent we can control (adapt
to) the future we do not need to predict it.
Leverage surprise, the unexpected.
Non-predictive logic: based on controllable aspects of uncertain future
Logic:
To the extent we can predict the
future we can control it.
Avoid surprises, the un-expected.
Predictive logic: based on predictable aspects of uncertain future
Concluding upon the research of Sarasvathy (2001, 2003, and 2008), the following hypothesis is formed regarding the decision making characteristic of the entrepreneurial mind:
Hypothesis 2: The Entrepreneurial Mind uses an effectual decision making logic which can be
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Resiliency
No one escapes pain, fear and suffering. Yet from pain can come wisdom, from fear can come courage, from suffering can come strength - if we have the virtue of resilience
(Greitens, 2015)
Resiliency is a term that is best described as the ability to survive and even flourish under conditions of turbulence, change or trauma. Overall, it refers to the ability to absorb and/or defeat negative occasions without losing the focus on goals (Mangurian, 2007). This
characteristic is especially useful for entrepreneurs since entrepreneurship is well known as a lifestyle which is very likely to face failure (Timmons, 1986). The ability to deal with
entrepreneurial failure and continue the entrepreneurial activities is a textbook example of what is referred to as resilience. Therefore, in order to think like an expert entrepreneur and master the entrepreneurial mind one must be able to think as a resilient individual. This means that one must have a natural ability to learn from failure and recognize negative situations and emotions and deal with it effectively. Coutu (2002, p.47) strengthens this statement by citing Dean Becker, the president and CEO of Adaptive Learning Systems:
„More than education, more than experience, more than training, a person‟s level of
resilience will determine who succeeds and who fails. That‟s true in the cancer ward, it‟s true in the Olympics, and it‟s true in the boardroom.‟
However, despite the wide ranging theories about what resilience entails Coutu (2002) argues that almost all the theories about resilience overlap in three ways; resilient individuals have 1) a strong acceptance of reality, 2) a deep belief that life is meaningful and 3) and an
ability to improvise. A strong acceptance of reality means that resilient people do not slip into
denial and even though the reality is emotionally negative, they face the reality and seek continuously ways to deal with it effectively. The second characteristic of a resilient individual, a deep meaning making capability, is closely related to the ability to see the reality. As Couto (2002, p. 50) points out: „we all know people who, under duress, throw up
their hands and cry: “How can this be happening to me”‟. These people see themselves as
victims and powerless during negative occasions. In contrast, resilient individuals invent ideas about their misery to create some sort of meaning for themselves and others. The third
characteristic of resilience is the ability to make something of whatever comes at hand. Hence, when negative situations appear, resilient people deal with it by inventing possibilities where others are confused.
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Beside the theoretical clarification of resilience as a driver of success, statistically a resilient mind also has a greater chance of succeeding, when it is referred to as a mind which doesn‟t stop at failure. According to a study from the Harvard Business School on
performance persistence (Gompers et al., 2008), serial-entrepreneurs are more likely to succeed when they start a new venture than when novice entrepreneurs start a venture. Gompers et al. (2008) state that: „All else equal, an entrepreneur who succeeds in a venture
(by our definition, starts a company that goes public) has a 30% chance of succeeding in his
next venture. By contrast, first-time entrepreneurs have only an 18% chance of succeeding
and entrepreneurs who previously failed have a 20% chance of succeeding.’
One argument which can explain this statistic is the lessons resilient entrepreneurs learn from entrepreneurial failure (McGrath, 1999). Researchers have attached different meanings to the word entrepreneurial failure in their studies. Zacharakis, Meyer and DeCastro (1999) define failure as the bankruptcy and insolvency of a venture. However, Everett and Watson (1998) stated that failure is often broader than only bankruptcy because it excludes many factors which are commonly regarded as failure. Therefore, McGrath (1999) names failure as the termination of an initiative that has fallen short of its goals. This seems also a better explanation when considering resiliency in terms of dealing with conditions of
turbulence, change or trauma since it also refers to the management of an entrepreneurial
firm.
Furthermore, Burgelman (1983) stated that there is a systematic bias toward underestimating the true benefits of entrepreneurial activities, even if they turn out to be failures. The focus is usually on the financial cost of such failures, without concerning the hidden benefits. In addition, according to Jeffrey Pfeffer, author of Power, and Jim Collins, author of Good to Great, resilience is one of the defining skills and behaviors of successful entrepreneurs. They state that: „becoming a successful entrepreneur is never a straight line.
There are lots of ups and downs along the way. As it turns out, how you emotionally handle the downs is key‟ (Brosseau, 2014).
Therefore, it is assumed that a successful entrepreneur must master the ability of resilient thinking. Based on this assumption the following hypothesis is formed:
Hypothesis 3: The Entrepreneurial Mind is of a resilient nature. It naturally has the
capability to recognize negative occasions and emotions and deal with it effectively. This can be developed by experience or study.
30 3. Conceptual Model
From the literature review outlined in the previous section, one can suggest the existence of an entrepreneurial mind. The entrepreneurial mind is positioned as an additional sixth mind to the five minds of Howard Gardner (2009) and is suggested to consist of three main
characteristics; an opportunity recognizing ability, an effectuation decision making logic and a
resilient character. The following conceptual model shows a clear overview of this content of
this research and its complementarity to the academic literature.
Building upon the existing literature (Baron, 2007; Baron and Ensley, 2006; Sarasvathy, 2001; 2003; 2008; Mangurian, 2007; Duening, 2010), it is assumed that when one masters the entrepreneurial mind one is more likely to succeed as an entrepreneur and is well equipped to
deal with what is expected, as well as what cannot be anticipated, in the future. Nevertheless,
anyone who intends to succeed as an entrepreneur should also need to master a foundation of Gardner‟s (2009) minds (Duening, 2010). Gardner‟s minds should, as he intends them to be, form the basis of general education. However, for entrepreneurial curriculum design it is suggested that curriculum designers must, beside Gardner‟s minds, use the entrepreneurial
Figure I: Focus of the research
Foundation for Entrepreneurship Education Gardner‟s five minds for General Education
1. The Disciplined mind 2. The Synthesizing mind 3. The Creating mind 4. The Respectful mind 5. The Ethical mind
6. The Entrepreneurial Mind H1: Opportunity recognition H2: Effectuation
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mind as their most important foundation. How this conceptual model will be tested and analyzed will be described in the subsequent sections.
4. Methodology
The aim of this study is to construct a comprehensive entrepreneurial mind. The
entrepreneurial mind is a characteristic of the mind that an entrepreneur should aim to develop in order to be successful as an entrepreneur, and which should be used as a starting point for entrepreneurial curriculum design. This mind is assumed to be the distinction between an expert entrepreneur and a non- or novice- entrepreneur. Therefore, to be able to answer the research question this thesis will use a multiple case study to collect primary data from semi-structured interviews with expert entrepreneurs.
In this chapter the research method is elaborated. This chapter will start with further explaining why multiple case studies will be used and why this research method is best suitable to answer the research question. Next, the sample will be described and how and why the cases were selected. Here after, the data collection will be outlined. It is described how the data was collected and the reasoning behind this data collection. Finally, this section will highlight how the data was analyzed.
4.1. Research Design
This research uses an explorative and theory-building approach to construct the
entrepreneurial mind. Accordingly, the qualitative research method known as multiple case studies will be used since this research method provides several advantages to collect and analyze the characteristics of one‟s mind. In general, the selection of this research strategy and the use of a qualitative data collection method have the strength to provide insights that a quantitative methodology could not possibly offer. Moreover, a qualitative research method is aligned with an inductive approach to construct theory and answer the proposed research question. As mentioned earlier in this dissertation, it was argued by Krueger (2007) that in order to become a successful entrepreneur we need a strong understanding of what an expert entrepreneurial mind comprises. Furthermore, Chi et al., (1982) argue that expertise in any area entails certain common cognitive processes among the experts who solve problems within the given area. Hence, it seems feasible to investigate the mind of expert entrepreneurs in order to test whether an entrepreneurial mind exists and how it will look like. Different
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reasons justify the use of the qualitative method of a multiple case study to investigate these minds of expert entrepreneurs.
First, in the existing literature there is no unambiguous understanding of a unique entrepreneurial mind and there exists no empirical research regarding a comprehensive
entrepreneurial mind (Duening, 2010). Therefore, this dissertation requires an explorative and theory building approach. For explorative and theory building research qualitative research methods can help researchers understand people and what they say and do (Myers, 2009). More specifically, for research addressing the type of research question that typically seeks to answer questions like ‟how‟ or „why‟ the qualitative case study method is most appropriate (Yin, 1994). Consequently, since this research seeks to address „how‟ successful
entrepreneurs think, a case study seems best suited.
Second, regarding the theory building character of this study, Yin (1994) argues that the case study method typically provides a strong base for theory building and increases the validity of the research in comparison to other research methods since this method holds a focus on depth and detail.
At last, case study research can be separated in two categories: single case design and multiple case design. When resources and time are available an advantage is the replication logic of multiple cases which increases the external validity (Yin, 1994). Multiple cases enable comparisons that clarify whether an emergent theory finding is simply idiosyncratic to a single case or consistently replicated by several cases (Eisenhardt, 1991). Furthermore, the theory is also better grounded and generalizable when it is based on multiple case studies compared to a single case study (Eisenhardt & Graebner, 2007). Within this research the resources and time are available to research multiple interesting cases, which will be described in the next section.
4.2. Sample
This section describes the use sample. It will start with the unit of analysis, describing the used definition of the investigated expert entrepreneur. Afterwards, it is described how the multiple cases were selected ending with the description of the used cases
4.2.1. Unit of Analysis
The unit of analysis is the entrepreneur. In this analysis, the most widely accepted definition of the entrepreneur (Ciavarella et al., 2009) is used. The entrepreneur is defined as someone
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who is the founder, owner, and manager of a business, whose aim is to create something new and whose principal purpose is growth.
This study is seeking to identify the mind of the expert entrepreneur. The expert entrepreneur is assumed to have adopted some extent of expertise in the field of
entrepreneurship (Krueger, 2007). Therefore, habitual entrepreneurs will be investigated. Habitual entrepreneurs are individuals with prior business ownership experience. They are people who start new businesses and enjoy the excitement and challenges associated with the creation of new ventures (McGrath & MacMillan, 2000). In addition, McGrath and
MacMillan (2000) declare that these habitual entrepreneurs with multiple business ownership experience might have an „entrepreneurial mindset‟.
Habitual entrepreneurs can be divided in serial- and portfolio entrepreneurs (Westhead & Wright, 1998). Serial entrepreneurs are entrepreneurs who exit one venture before entering into a subsequent one. Portfolio entrepreneurs are individuals in which the owners own more than one business at a time. Both are used as unit of analysis since they both never quit being an entrepreneur and can therefore be considered as true entrepreneurs. The required amount of ventures started is three, so habitual entrepreneurs with minor experience are excluded.
Furthermore, entrepreneurs who show entrepreneurial activity over a length of 10 years or more are used to establish the expertise in the field of entrepreneurship of the interviewed subjects. More than three decades of research in the field of expertise has somewhat confirmed the ‟10-year rule‟ first mentioned by Simon and Chase (1973). Even though this rule is never proved empirically the rule suggests that a minimum of 10 years deliberate practice is required to become an expert in any field.
Therefore, in line with the used definitions of an entrepreneur and a habitual entrepreneur, the definition of the investigated expert entrepreneur for this research is:
An entrepreneur who enjoys the excitement and challenges associated with the creation of new ventures, who has prior business ownership experience of at least three ventures and 10 years of entrepreneurial activity and whose aim is to create something new.
4.2.2. Sample selection
Yin (1994, pp. 46) argues that „Each case must be carefully selected so that it either (a)
predicts similar results (a literal replication) or (b) produces contrasting results but for predictable reasons (a theoretical replication)‟.The cases of this research are chosen for the
