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Student Pjotr Peulen
Student # 11360674 (UvA) & 2535267 (VU)
Supervisor Dr. Neil Thompson
Program MSc Entrepreneurship (joint degree)
Assignment Master Thesis
Vision as a Sensemaking Device:
Entrepreneur’s Sensemaking of Vision and Failure during an
Entrepreneurial Process
Abstract
In order to shed new light on vision and failure during an entrepreneurial process, a social constructionist perspective has been applied to shift the ontology and examine
entrepreneurs’ sensemaking process. To systematically analyze ten in-depth interviews with entrepreneurs who have experience failure, a grounded theory development approach has been applied. Entrepreneurs’ sensemaking of the role of vision during the
entrepreneurial process and especially during the process of failure, suggests that
entrepreneurs see vision as a conceptual device in the sensemaking process to ‘make sense’ of important entrepreneurial events, such as creation, interactions, or failure.
Simultaneously, entrepreneurs see vision as a driving force in the sensemaking process, creating social configurations and changing the entrepreneurial world. This theoretical contribution is constructed by combining the data collected from interviews with entrepreneurs and information gathered from existing literature. However, before this study’s findings can be taught of as a transferable generality, it has to be verified by future research.
Statement of Originality
This document is written by Student, Pjotr Peulen, who declares to take full responsibility for the contents of this document:
I declare that the text and the work presented in this document are 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.
Table of contents
INTRODUCTION... 2
LITERATURE REVIEW AND CONCEPTUAL FRAMEWORK ... 3
DEFINING VISION ... 4
CONCEPTUALIZING VISION... 4
VISION AND BUSINESS SUCCESS ... 6
Table 1 – Vision: Conceptual table ... 7
DEFINING FAILURE ... 8
DETERMINATES OF FAILURE... 8
ENTREPRENEURING AND ENTREPRENEURIAL FAILURE ... 9
OPPORTUNITIES OF A CONCEPTUAL DEVELOPMENT ... 10
METHODS ... 10
RESEARCH DESIGN ... 11
SAMPLING ... 11
Table 2 – Interview participants ... 12
DATA COLLECTION... 12
DATA ANALYSIS ... 13
RESULTS ... 14
1–TRIGGER TO CREATE A VISION OR BUSINESS ... 14
2–LEARNING FROM THE EVALUATION OF FAILURE EXPERIENCE ... 16
3–IMPORTANCE OF SHARED VISION ... 17
4–EXTERNAL FACTORS AND INEXPERIENCE OF ENTREPRENEUR ARE REASONS FOR FAILURE ... 18
5–VISION CLASHES ARE PREDICTORS FOR CHANGE ... 19
VISION AS A SENSEMAKING DEVICE ... 20
DISCUSSION ... 21
THEORETICAL CONTRIBUTIONS ... 22
LIMITATIONS AND FUTURE RESEARCH ... 23
CONCLUSION ... 24
REFERENCE LIST ... 25
APPENDIX... 29
APPENDIXA ... 29
APPENDIX A.1: Data structure – Trigger to create a vision or business ... 29
APPENDIX A.2: Data structure – Learning from evaluation of failure experience ... 30
APPENDIX A.3: Data structure – Importance of shared vision ... 31
APPENDIX A.4: Data structure – External Factors or Inexperience was reason for failure ... 32
APPENDIX A.5: Data structure – Clashes of Vision are predictors for Change ... 33
APPENDIXB ... 34
APPENDIX B.1: List of 1st order categories ... 34
APPENDIX B.2: 2nd order themes ... 35
APPENDIX B.3: Codebook... 36
APPENDIX B.4: Closeup transformation categories into themes ... 37
APPENDIX B.5: Closeup transformation themes into dimensions ... 38
APPENDIXC ... 39
APPENDIX C.1: Interview Respondent A ... 39
APPENDIX C.2: Interview Respondent B ... 52
APPENDIX C.3: Interview Respondent C ... 60
APPENDIX C.4: Interview Respondent D ... 74
APPENDIX C.5: Interview Respondent E ... 96
APPENDIX C.6: Interview Respondent F ... 107
APPENDIX C.7: Interview Respondent G ... 114
APPENDIX C.8: Interview Respondent H ... 124
APPENDIX C.9: Interview Respondent I ... 137
Introduction
Within the relatively new academic field of entrepreneurship and within more mature fields of research, such as management and leadership, much research has been conducted on the mechanisms that lead to entrepreneurial success (e.g. Baron, 2000; D’Intino, Goldsby, Houghton, & Neck, 2007; Duchesneau & Gartner, 1990; Khan, 1986; Nambisan & Baron, 2013). It is well known from this research that not all new ventures survive. According to the Bureau of Labor Statistics (2016), venture survival rate in the U.S. after five years is
approximately 56%, but even then, not all surviving ventures are successful (DeTienne, Shepherd, & Castro, 2008). Given that many new ventures do not survive, a new field of research is emerging, focusing on, until recent, the unexplored phenomena of entrepreneurial failure.
This study aims to make a contribution to the field of entrepreneurship by examining the way entrepreneurs make sense of the role of vision with regard to their failed venture. Although there has been much research to what causes ventures to fail (e.g. Chandler & Hanks, 1998; Fichman & Levinthal, 1991; Haywards, Shepherd, & Griffin, 2006; Romanelli, 1989; van Gelder, de Vries, Frese, & Goutbeek, 2007) or what the consequences of failure are (e.g. Cardon, Stevens, & Potter, 2011; Jenkins, Wiklund, & Brundin, 2014), the research stream of entrepreneurial failure is still developing with many opportunities for future
research. Entrepreneurs often evoke the term vision in reference to their motivation, however, it is unclear how vision relates to failure experience. While vision has been the topic of research, most studies view it as an objective phenomenon rather than an interpretative device used by entrepreneurs to make sense of their venture and its failure. In this study, I research how entrepreneurs use the term vision to make sense of their failure.
Limited research has been conducted on how vision relates to venture failure. On the one hand, a typical response Maccoby (2000) received when asking managers to define a leader was: “A person with vision” (p. 96). Numerous quotes about vision have been repeated time after time: e.g., “where there is no vision, the people perish” (Proverbs 29:18, King James Version). Emphasizing a mysterious destructive power when vision is missing, but there also seems to be a constructive power when there is a vision. “Greatness starts with a clear vision of the future” (Simon O. Sinek). Furthermore, great leaders seem to be bursting with vision; “leadership is the capacity to change vision into reality” (Warren G. Bennis). Besides well-formulated quotes, academic research has contributed to unraveling the mystery of the power of vision. What makes a vision powerful (e.g. Kantabutra, 2008; Kantabutra &
Avery, 2010) and what are the consequences of vision (e.g. Baum, Locke & Kickpatrick, 1998; Haque, TitiAmayah, & Liu, 2016). To contribute to the current literature the following research question has been formulated: From the perspective of entrepreneurs who have failed, how does an entrepreneur make sense of the role of entrepreneurial vision during the lifespan of the failed enterprise, including the process of failure?
By answering my research question, this study will theorize in an attempt to shed new light on the two core concepts of this thesis: failure and vision. To come as close as possible to the creation of an entrepreneurial vision, ten in-depth interviews were conducted with entrepreneurs who have experienced the failure of one of their ventures. Through
entrepreneurs’ sensemaking process, this research analysis suggests that entrepreneurs use vision as a sensemaking device to understand the changing entrepreneurial world, while simultaneously, vision appears to be perceived as the driving force in the sensemaking process changing the entrepreneurial world. It seems that vision is a sensemaking device in a self-maintaining process both explaining and changing the entrepreneurial world in terms of important entrepreneurial events, such as creation, interactions, and failure.
In order to answer this question, this study is structured as follows: First, as a result of a thorough literature study, a conceptual framework is presented identifying and
conceptualizing the core concepts, namely vision, and failure. Secondly, in order to effectively theorize, the methodology will give a comprehensive overview of the research steps and approaches. Thirdly, presenting the results found from the systematic analyzing the collected data, which will serve as a stepping stone towards the social constructionist
approach theorizing process. Finally, the theorizing process will incorporate the findings from this study’s analysis which will be interpreted in light of prior research to answering the research question in the discussion. Additionally, research limitations and advise for future research will be discussed and closing it all up with a brief conclusion.
Literature Review and Conceptual Framework
In this section, prior literature will be presented on vision’s conceptualization and vision’s influence on organizational performance. Moreover, prior literature will be presented on the conceptualization of business failure and business closure, including the reasons leading to either failure or closure. Additionally, entrepreneurial failure is conceptualized by introducing a social constructionist perspective.
Defining Vision
Many researchers have contributed to conceptualizing the concept of entrepreneurial vision. Baum et al., (1998) defined vision “as the [how] the leader defined it” (p. 44), this perspective on defining vision has been adopted by many researchers (e.g. Kantabutra & Avery, 2005, 2010). Alternatively, Mumford and Strange (2005) introduced a social constructionist perspective to vision: “vision is ultimately a cognitive construction- specifically a mental model. Mental models are conceptual representations used both to understand system operations and guide actions within the system” (p. 122). Mumford and Strange suggest that the formation of a vision occurs through reconfiguring a descriptive mental model, a model describing the system as it is, into a prescriptive mental model, a model describing the system as it might be. The definition used in this study is created by Kantabutra (2009), a
combination of the Baum et al.’s and Mumford and Strange’s definitions, which has been adopted by many others (e.g. Kantabutra, 2010; Kukkurainen, Suominen, Rankinen, Härkönen, & Kuokkanan, 2012): A vision is a mental model defined by the leader. A prescriptive mental model created by the entrepreneur of how the venture might be in the future.
Conceptualizing Vision
Numerous empirical studies have been conducted enriching the literature of entrepreneurial vision and leadership (e.g. Baum et al., 1998; Kantabutra, 2005; Haque et al., 2016). In table 1, an overview is presented with the relevant literature and their findings. A selection of researches’ propositions combining five qualitative article’s propositions and nine quantitative articles’ findings to elucidate the relationships between vision and business performance attributes (see table 1).
My review suggests that vision is seen as consisting of three components: 1) vision attributes (VA), how should a vision look like, 2) vision content (VC), what should a vision contain, and vision communication (VCM), that is, how to share the vision with others. Baum et al. (1998) presented seven vision attributes, also referred to as vision characteristics, and Kantabutra (2009) has further elaborated on these seven attributes. Powerful and effective visions are characterized by these seven vision attributes (Kantabutra, 2008; Kantabutra & Avery, 2010): 1) Brevity, also referred to as conciseness, suggest that effective visions should be brief, approximately 11-22 words; 2) Clarity, effective visions can be made clear in
certain amount of vagueness, not a specific goal; 4) Challenge, suggest that an effective vision is somewhat difficult and hard to achieve; 5) Future orientation, indicates a long-term
perspective, as in a future picture of the organization; 6) Stability, suggest that an effective vision is not affected by short-term events; 7) Desirability or ability to inspire, as in attracting followers, effective visionary leaders attract followers to share their vision. Vision attributes are directly and positively related with both venture growth (Baum et al., 1998; Haque et al., 2016) and staff satisfaction (Kantabutra, 2003), while also indirectly affecting venture growth through readiness of change (Haque et al., 2016).
Besides these characteristics, a vision also consists of the actual content of the vision. The vision content could be about producing quality products for example or about venture growth (Baum et al., 1998). According to O’Brien and Meadow (2003), a vision statement often contains where an organization is heading, how they will conduct their business, and what kind of work environment will be created. The empirical evidence for vision content’s effect on organizational performance is straightforward: Vision content focused on venture growth resulted in more venture growth (Baum et al., 1998), while staff and customer satisfaction references in vision content were found to result in more staff and customer satisfaction (Kantabutra, 2003).
Vision communication, the degree to which leaders communicate their vision, is the last but has been emphasized to be the most important step for any vision to be effective (Baum et al., 1998; Haque et al., 2016; Kantabutra, 2008; Kantabutra & Avery, 2007). The indirect effects of vision attributes and vision content through vision communication were found to be the most import effects on venture growth (Baum et al., 1998). However, communicating a well-formulated vision is not enough. Companies need to “walk the talk”, by sharing a vision also non-verbally (Baum et al., 1998). A shared vision, matching leader’s vision attributes and vision content with follower’s vision attributes and vision content
(Kantabutra, 2005), will occur when the vision is successfully communicated. A shared vision affects staff and customer satisfaction both directly and indirectly through vision guiding, empowerment, and motivation (Kantabutra, 2005; Kantabutra & Avery, 2007). Vision guiding, or staff personal factor, is the extent to which an employee is guided by the leader’s vision in their daily activities and the degree to which an employee is emotionally committed to the leader’s vision (Kantabutra & Avery, 2007; Kantabutra, 2005; Kantabutra &
Vimolratana, 2010). Empowerment is the extent to which a leader delegates work to
employees, providing resources and support while encouraging them to make more decisions (Kantabutra 2005; Kantabutra & Avery, 2007). Motivation is the extent to which a leader acts
as a role model for employees, build staff’s self-confidence, creates challenges for staff, and rewards staff for behaving consistently with the vision (Kantabutra 2005; Kantabutra & Avery, 2007). Followers, or employees, can play an important role in enhancing
organizational performance when leaders share their vision properly through staff and customer satisfaction (Kantabutra, 2005).
Vision and Business Success
Numerous studies have implied, argued or shown that vision leads to business success, as in financially well-performing businesses. Empirical research shows that vision positively relates to organizational or venture growth, either directly or through readiness for change. Venture or organizational growth has been defined as in terms of sales, employment, and profit (Baum et al. 1998; Haque et al., 2016). Other empirical research shows that vision positively relates to both staff and customer satisfaction, either directly or through vision guiding, empowerment, or motivation. Customer satisfaction leads to customer loyalty and finally profitability in the long run (Anderson, Fornell, & Lehmann, 1994; Bernhardt, Donthu, & Kennett, 2000). Vision is positively associated with an organizational financial
performance both directly and indirectly through staff and customer satisfaction.
However, if we accept that a powerful vision leads to business success, can we then conclude that a lack of vision or a poor vision leads to failure? In other words, if an
entrepreneur or leader does not follow the seven vision attributes or shares the vision among co-founders or followers, would this lead to business failure? In the next section, I turn towards this question by looking at definitions of business failure and failure in general, and finally reviewing literature that hints toward vision with regard to failure.
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Table 1 – Vision: Conceptual table
Qualitative research Propositions
Kantabutra, 2008 A vision in line with the seven vision attributes create an emotional commitment by followers, which increases performance. Kantabutra, 2010 Vision communication is positively affected by both vision attributes and vision content. Vision content leads to alignment and
empowerment. Both alignment and vision communication lead to motivation. Both motivation and empowerment lead to faculty (staff) satisfaction, which leads to process improvement, which leads to student (customer) satisfaction and growth, which leads to financial stability (performance).
Kantabutra & Avery, 2010
A powerful and effective vision is in line with the seven vision characteristics (attributes) and leaders share this vision with their followers (employees), this results in customer and staff satisfaction, resulting in financial performances.
Piper, 2005 Vision leads to staff loyalty, which leads to patient loyalty. Waddock & Steckler,
2014
Two different paths: 1) Deliberate path: aspiration à vision à action; and 2) Emergent path: aspiration à action à developmental vision or inadvertent vision.
Quantitative
Research All quantitative effects are positive affects
Baum et al., 1998 Vision attributes and vision content subsequent affect venture growth both directly and indirectly through vision communication. Haque et al., 2016 Vision attributes and vision content affect organizational growth directly. Additionally, vision attributes also affect
organizational growth indirectly through readiness for change.
Kantabutra, 2005 Shared vision (match between leader’s and follower’s vision attributes & vision content) directly affects customer and staff satisfaction. Shared vision indirectly affects customer satisfaction through empowerment and motivation, and staff satisfaction through vision guiding and empowerment. Vision guiding, empowerment, and motivation all affect staff satisfaction.
Kantabutra, 2008 Vision communication indirectly affects staff and customer satisfaction through motivation. Kantabutra & Avery,
2007
Empowerment and staff personal factor affect customer and staff satisfaction, and motivation only affects staff satisfaction. Kantabutra &
Vimolratana, 2008
Store manager’s passion motivates staff and vision guiding leads to staff satisfaction.
Masuda et al., 2010 Students who set a challenging and vivid personal vision are also setting more difficult and specific college goals. Students who conceptualized a vivid personal vision were more committed to semester goals.
Slack et al., 2010 Vision communication and commitment affect staff satisfaction. Anderson et al., 1994 Customer satisfaction affects loyalty and return on investment.
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Defining Failure
Shepherd (2003) defined business failure in terms of insolvency that ends in bankruptcy or selling a business to avoid bankruptcy. Many studies whom adapted Shepherd’s definition and used it interchangeable for entrepreneurial failure (e.g. Cardon et al., 2011; Jenkins et al., 2014; van Gelder et al., 2007). Those researchers made contributions to the field of business
failure, however, we will elucidate the need for a distinction between business or firm failure
and entrepreneurial failure. Headd (2002) and Bates (2005) called for a separation of negative terms, such as failure, and neutral terms, such as closure or exit. They mention that some business closures are perceived as positive. Wennberg, Wiklund, DeTienne, and Cardon (2010) mention that well-performing firms can have successful exits through either harvest sale or liquidation, and underperforming firms can have unsuccessful exits through distress sale or distress liquidation. For the latter, however, we would rather speak of business failure as it fits Shepherd’s definition and will define business closure, or business exit, in this study as successful exiting the business.
Determinates of Failure
To fully be able to conceptualize entrepreneurial failure, existing research has established three determinants, which each lead to either business failure, business closure, or
entrepreneurial failure. First, the financial performance of an organization is a commonly
referenced determinant for business failure, business failure as defined by Shepherd (2003)
“involves an involuntary change in both the ownership and management of the business owing to poor performance.” (p. 319). Numerous studies have contributed to what factors are
potential predictors for business failures: reactive business strategies (van Gelder et al., 2007); insufficient experience of entrepreneur (Chandler & Hanks, 1998); over-confidence
(Haywards, Shepherd, & Griffin, 2006); and firm age or “liability of newness” (Stinchcombe, 1965) - young firms tend to fail in greater number than older firms (Fichman & Levinthal, 1991; Romanelli, 1989).
Second, human capital is the determinant of business closure. Some entrepreneurs are exiting financially well-performing firm due to alternative opportunities, 37.7% of the small business owners perceived their ventures as successful when closing (Bates, 2005). A higher threshold level of performance, e.g. potential income available in alternative, increases the entrepreneur’s likelihood of leaving the business (Gimeno, Folta, Cooper, & Woo, 1997). Jenkins and McKelvie (2016, p. 179) write, “entrepreneurs with a high level of human capital
are likely to have higher threshold levels given more attractive alternatives uses for their skills and abilities”.
The last determinant is for entrepreneurial failure. Organizations whose performance fall short of the expectation do not have to cease to exist (DeTienne et al., 2008). The business can continue, not meeting the business failure or business closure requirements. Those
organizations financially survive, but it would be far stretched to call them successful. This implies that there is something more in between business survival and business success. Khelil (2016) clarifies that the subjective perspective of entrepreneurial failure, by presenting it as a psycho-economic phenomenon. Khelil builds on Cooper and Artz’s (1995) discrepancy theory, which consist of two aspects: the goal-achievement gap theory, both economic and non-economic set goals are compared to the actually achieved results, and the expectation-reality gap theory, as in the initial expectations an entrepreneur has, compared to the eventual reality. When the expectations, or vision, an entrepreneur has for the venture is in line with the eventual reality we can potentially speak of entrepreneurial success.
Entrepreneuring and Entrepreneurial Failure
This study aims to create a new perspective within the already existing stream of research by taking social constructionist approach. Shifting the ontology from an entity-based ontology towards a process-based ontology (Shepherd & Suddaby, 2017). Following Pevereli and Verduyn’s (2012) view on entrepreneurial process, which is the transformation of an
opportunity with the use of resources and legitimacy into an enterprise, can be seen as a type of organizing, or in this case, entrepreneuring. Entrepreneuring cannot be done on a firm-level, since organization, firms, or businesses do not actually exist, but are an enactment created by the process of entrepreneuring. Nor can it be done on an individual-level, because entrepreneuring consist of interactions between more than one actors. Entrepreneuring creates configurations, actors with a shared view on an entrepreneurial reality, within cognitive spaces out of an urge to ‘make sense’ of the world around them. Sensemaking, which is almost a synonym of organizing (Pevereli & Verduyn, 2012), is the attempt to ‘make sense’ of an environment by reducing equivocal inputs and the process of enacting this ‘sense’ back in the world by creating social configurations (Weick, Sutcliffe, & Obsfeld, 2005). This is all the process of social interactions between actors, creating a shared reality of the world around them. An entrepreneurial reality can be seen as a certain view on how the venture is now, but also can be seen as an abstract image of how the venture will be in the future, entrepreneurial
vision, which is created by ongoing social interactions between actors active in the
entrepreneurial cognitive space. Therefore, in this view, entrepreneurial failure is the ceasing of a configuration, the abandoning or demolishing of a shared entrepreneurial reality and entrepreneurial vision by its actors.
Opportunities of a conceptual development
As mentioned before, a powerful well-formulated vision which is shared within the cognitive space is associated with a financially well-performing business both directly as indirectly through staff and customer satisfaction, which can be called business success. Concluding from the previous section, when the entrepreneurial vision—i.e., expectations of how a venture will be in the future—is in line with the eventual reality we can potentially speak of entrepreneurial success. Does then a lack of a powerful well-performed vision and lack of communication with other actors or lack of meeting the expectations of the vision lead to failure? It appears, however, that it is not so straightforward. Meyer and Zucker (1989) mentioned that there are “organizations whose performance, by any standard, fall short of expectations… yet whose existence continue” (p. 19). It suggests that lack of meeting vision does not have to lead towards business failure or closure. Furthermore, it appears that a configuration can cease to exist, while a cognitive space or social inclusion might survive. A venture could financially survive, as in business survival. While in the simultaneously, entrepreneurial failure has occurred, as in actors stop sharing an entrepreneurial reality or entrepreneurial vision. Similarly, a business might fail, while the entrepreneurial reality survives. In other words, when a cognitive space is demolished, as in a business filing for bankruptcy due to insolvency, the entrepreneurial vision might survive and be pursued through another route. There seems to be a paradox, how can success go hand in hand with failure. This study therefore asks the research question; how do recently failed entrepreneurs make sense of the role of vision during the lifespan of their failed enterprise?
Methods
The tension in the literature triggers and guides the process of theorizing in this study (Shepherd & Suddaby, 2017). In this chapter, I explain the empirical methodology used to answer my research question.
Research Design
This study builds on prior research from two bodies of literature- vision and failure. The vision concept sits in a mature stream of research, with many verified theories on how vision relates to business success (e.g. Baum et al., 1998; Haque et al., 2016; Kantabutra, 2005). The failure concept, however, sits in a more intermediate stream of research. Where business failure is nearing a mature body of research, with theories being tested, (e.g. Jenkins et al., 2014; van Gelder et al., 2007; Cardon et al., 2011) but where entrepreneurial failure is still a nascent theory research. By drawing from these two, or potentially three, bodies of literature this study builds on a combined intermediate body of literature and will aim for a right
methodological fit with the research approach to fit prior work (Edmondson & McManus, 2007). To balance both the conflicting need to inductively develop new concepts while on the same time meet the quantitative high rigor standards and fit an intermediate body of literature, this study applies Gioia and Hamilton’s (2012) systematic inductive approach using qualitative data from ten in-depth interviews with entrepreneurs who have experienced a failure process of one of their ventures to inductively develop a “grounded theory”. Through entrepreneur’s sensemaking of the role of vision during the failure process of their venture, this study aims to shed new light on the impact of vision on failure and the way we understand entrepreneurial failure.
Sampling
Our sample comprised 10 entrepreneurs, all of whom have been the founder of at least one venture that has been unsuccessful. These individuals were purposively selected on the basis of their venture’s ending. Potential respondents were initially identified through private (mutual) contracts and were subsequently screened to ensure compliance with my sampling criteria. My key and only sampling criterion, drawn from both the business and
entrepreneurial failure literature, was their venture ending. To include all different kinds of “failure”, venture endings ranging from positive to negative, from business failure to business closure accepted. Seven different endings are compliant with my sampling criteria: (1)
business failure, bankruptcy due to insolvency; (2) business closure due to insolvency; (3) business closure due to founder’s alternative career opportunity; (4) business exit due to founder’s alternative career opportunity; (5) business closure due to founder’s dissatisfaction of venture; (6) business exit due to founder’s dissatisfaction of venture; (7) business closure due to disagreement between founders. The sampling context was kept constant, all
(ex-)entrepreneurs were Dutch nationals and founded businesses based in The Netherlands. One entrepreneur was partly based in The Netherlands and partly in Kenya. Table 2 provides further descriptive data on the respondents.
Table 2 – Interview participants
No .
Respondents Pseudonym
Venture(s) description Venture(s) endings
1 Ellen Self-employed communication consultant
Business Closure (2)
2 Erik Financial software development Business Closure (2)
3 Guido 1) Sampling agency
2) Sampling & Communication consultancy firm
1) Business Closure (5) 2) Current
4 Jan Yacht rental & sailing school Business Exit (6)
5 Marina Foundation & social enterprise hygienic pads (NL/Kenia)
Business Closure (2)
6 Marnix Restaurant Business Closure (7)
7 Peter Knowledge management system Business Exit (4 & 6)
8 Ted 1) Sanitary showroom & installation 2) Sanitary showroom & installation 3) Stucco concrete bathroom installation
service
1) Business Failure (1) 2) Business Failure (1) 3) Business Failure (1)
9 Thomas 1) Poker house & poke school 2) Yacht rental (not the founder) 3) Self-employed web developer 4) A wooden product platform
1) Business Closure (7) 2) Business Exit (6) 3) Business Exit (4) 4) Current
10 Willem Wine merchant (tastings & tap installations)
Business Closure (3)
Data Collection
The analytical focus of this study is on the entrepreneur’s sensemaking of the role of vision in the lifespan of the venture leading to failure. The analysis is based on self-narratives, or
venture’s life-stories, collected in open structured one-on-one interviews focusing on entrepreneurial vision, vision sharing, failure indicators, and post-failure learning. To create the opportunity to discover new concepts, the respondents or informants are treated as knowledgeable agents, valuing their interpretations and not imposing prior constructs or theories on them (Gioia & Hamilton, 2012). Every interview initially started with the research question: How do you as an entrepreneur make sense of the role of vision during the lifespan
of your eventually failed venture? Some questions were specifically used to probe the
respondents to get them talking about how they make sense of the role of vision in the process of failure. Variations of: What was your initial idea of the venture? What did you want to
achieve with your business? How do you see the role of vision heading towards failure? How did you picture the venture in the beginning and how did you picture it in the end?
The interviews typically lasted approximately 60 minutes and were conducted in person (three were conducted by telephone), recorded, and transcribed verbatim. In some cases, I applied some backtracking to the respondents to clarify some potential misunderstandings from the initial interview.
Data Analysis
To conceive and construct a theory, the existing literature (i.e. prior knowledge) and the empirical observations from the ten interviews (i.e. emerging knowledge) will be weaved together (Shepherd and Suddaby, 2017). Due to the complexity of entrepreneurship and failure, this study will develop a process theory, a sequence of events (Shepherd and Suddaby, 2017). The grounded theory strategy will be applied (Langley, 1999), comparing and
categorizing sets of data from the interview transcripts to explain the process of failure and the role of vision in that process. Gioia and Hamilton’s (2012) grounded theory development approach will serve as a foundation in this studies data analysis. In the 1st -order analysis, I
have systematically analyzed respondent’s transcripts for informant-centric codes and develop a comprehensive compendium of 111 categories, contracted from 399 1st -order codes
(APPENDIX B.1). In the second phase, these categories have been transformed into 31 2nd
-order, theory-centric, themes (APPENDIX B.2). Finally, 5 overarching theoretical dimensions are extracted from the 2nd-order themes, creating a 3rd-order of analysis. The codebook table
(APPENDIX B.3) give a complete overview of the codebook with the three hierarchical levels of analysis. Two close-ups tables are created, zooming in on the transformations of categories into themes (APPENDIX B.4) and the transformation of themes into dimensions
(APPENDIX B.5). Along the three orders of analysis, no-repeated mentioned codes where deleted. The 5 dimensions are overarching the 399 initial codes distracted from the 10 interviews and are thus “grounded” in the data. From this system of categories, a theory will be constructed in the following chapter.
Results
The systematic analysis of this study’s interviews revealed that the role of vision seems to facilitate the sensemaking of important events during the venture’s lifespan, such as business creation, clashes of partners, lacking financial performance, interaction with the market or with external partners, major business changes, and eventually failure. In this chapter I will explore this insight by elaborating on the five aggregated dimensions and how they
interrelate: 1) Trigger to create a vision or business; 2) Learning from evaluation of failure experience; 3) Importance of shared vision; 4) External factors or inexperience are reasons for failure; 5) Clashes of vision are predictors for change. These five dimensions are mentioned numerous times among the ten interviews and were the result of a three-order analysis. The data structure figures (APPENDIX A.1-A.5) illustrate how each dimension is deducted from their themes and categories. Only two categories per theme are included, however, for a complete overview of the codebook (APPENDIX B.3) or the list of all first-order codes (APPENDIX B.1).
1 – Trigger to create a vision or business
My analysis suggests that the entrepreneurs use ‘vision’ as a sensemaking device to tell a narrative about the start of their venture process. As such, most respondents took me to the very beginning of their business, to their ‘vision creation’, or, in other words, to the start of the development of their entrepreneurial vision. The motivation or entrepreneurial drive to create a business or to create an entrepreneurial vision can come in many different ways. “Richard Branson, he was angry, he was angry about how it was, and said, I am going to find a solution. That is one of the entrepreneurial incentives” (Respondent C; APPENDIX C.3). Social of global engagement, recognizing a problem in society appears to be an incentive for many entrepreneurs to create an entrepreneurial vision on how to solve this issue. Respondent E identified that girls in Kenya did not go to school due to a lack of affordable menstrual pads and because of here internal drive for women empowerment, she created an entrepreneurial
vision to solve this issue. Respondent D and his partner acknowledged that the rental yachts their previous employer had were not up to standard, which led to an entrepreneurial vision of a better and more professional yacht rental.
For those respondents who recognized a problem, an entrepreneurial vision was the result of their sensemaking of the, in their opinion wrong, status quo. Their entrepreneurial vision served as a criterion for success and failure in a later stadium of the venture. “It could have been something great, but now it is, just a simple store on the corner of the street. Just standard, a mainstream rental company. It is such a pity, it is so completely different than when I started it” (Respondent D; APPENDIX C.4). Respondent E mentioned that not being able to meet her vision felt like letting these Kenyan girls down. Not achieving the vision created a frustration for respondent D, seeing how their business does not match his vision. “I am still getting frustrated when I talk about it. I am really upset about it. Whenever I see the company now, when I am at the harbor, then I am getting so disappointed, seeing the company as to how it is now” (Respondent D; APPENDIX C.4).
In some situations, the creation of a vision or business did not start with the respondent, but with a new actor, a new person, entering the scene. “Then he made me an offer I could not refuse: if I am running the business, and you only have to worry about product development. Is that an option?” (Respondent H; APPENDIX C.8). These new actors often turned into business partners or investors and together with the respondents they
adjusted the vision and transformed the business. Respondent B stated that because of the interest of a potential investor a hobby project turned into a business. In a later stadium of the sensemaking process, these new actors played an important role in explaining the failure or the transformation of the businesses. These new actor’s mistakes (Respondent H) and project abandonment (Respondent B) were given as reasons for the ventures to fail. “[Partner] did not do his job. Yes, then you are lost” (Respondent H; APPENDIX C.8). For Respondent B, the investor pulling out of the project was the key reason for the business to close.
Finally, as opposed to the respondents above, for some respondents, business creation did not always go together with an entrepreneurial vision creation. “There was no vision behind it, not at all” (Respondent H; APPENDIX C.8). The recognition of an opportunity was for some respondents the sole trigger to create a business. “There was something, there was a situation where both of us could gain something from, he had a kitchen, and I had experience” (Respondent F; APPENDIX C.6). Respondent H clearly stated that the lack of vision was the reason for failure during the sensemaking process of his failed enterprise. “[The business] was failing because of all different reasons, but especially because I was stubborn. I did not listen
to anyone, but also, as I said before because there was no vision, nothing at all” (Respondent H; APPENDIX C.8). This suggests that entrepreneurial vision is not necessary in all cases to be developed as a sensemaking tool.
2 – Learning from the evaluation of failure experience
My analysis also suggests that vision helps entrepreneurs make sense of the failure experience. During the respondents’ sensemaking process, numerous remarks were made emphasizing the importance of vision. “What the role of vision is? I think, that after going bankrupt a couple of times, that role has only grown bigger” (Respondent H; APPENDIX C.8). Similarly, Respondents A and J emphasized the importance of having a focus or a clear direction of where you want the business to go. “Just trying a bit without any clear direction, that is not enough” (Respondent J; APPENDIX C.10). For the respondents who had
experience of failure before, and started another business again, they found themselves more focused and having a clear mental picture of the company now and in the future. “Yes, [new business] had a vision. “We wanted to make bathrooms, and we were realizing them starting from 25.000 euro. The complete packages, a comfort packages for the those who can afford it. Those who wanted to pay a little extra to be taken care of completely” (Respondent H;
APPENDIX C.8)
On the contrary, however, to having a clear vision, respondents mentioned that it is important to stay flexible and not to get stuck in tunnel vision. “If you really get stuck in tunnel vision and you find it hard to let it go, and eventually it becomes clear it will be too hard to achieve it, then that can work against you” (Respondent B; APPENDIX C.2). A balance seems to be needed between a clear and steady direction of where the business is heading to and a flexibility to adjust when needed. However, for this ability to adjust, failure indicators have to be identified. During the process of sensemaking of failure, some
respondents realized that they had ignored or failed to recognize the failure indicators. “I kept going for too long, telling myself that [the bad performance] was caused by other, but the problem was me. I have denied that for a long time, that I was my own problem. Not because I was stubborn, but because I did not see it… I just kept going, although I knew that it wasn’t working” (Respondent A; APPENDIX C.1). The ability to adjust when needed has been well-formulated by one respondent: “I think that success, is a consequence of failure. You cannot learn from success, no. Success in the sum of the mistakes you made” (Respondent H; APPENDIX C.8). The ability to identify these indicators for a need to adjust has been a
product of the sensemaking process of failure. Over-confidence and arrogance were identified during the sensemaking process of failure. “I started to believe in myself because everything I touched turned into gold. I was making money as water, but it also went out very fast”
(Respondent H; APPENDIX C.8). For another respondent, after successfully testing the concept within a company, they acquired a big launching customer. “Nothing could go wrong, we thought” (Respondent G; APPENDIX C.7).
3 – Importance of shared vision
Many references have been made emphasizing the importance of properly communicating a vision both internally and externally, which suggests that ‘vision’ also plays a role in internal management processes, market assessment processes, and external partner cooperation. The clash between founders has been mentioned in many different forms during the sensemaking process: clashes in vision; clashes in ambition; or clashing in business strategies. “It went wrong on the vision part. [We, founders, clashed] on vision and on ambition” (Respondent D; APPENDIX C.4). “Because, we, ourselves were not 100% clear which business model it was going to be, we were not able to convince the market of our story” (Respondent G;
APPENDIX C.7). Beyond a shared vision between founders, the importance to share or communicate the vision clearly to employees have also been mentioned in the sensemaking process of failure. “It was my way or the highway. So, staff turnover was high” (Respondent H; APPENDIX C.8).
Besides an internally shared vision, numerous references were made to the importance of matching the entrepreneurial vision to the market’s need. Many entrepreneurs emphasized the importance to share the entrepreneurial vision with potential customers and Respondents C, E, and G even gave wrong market assessments as a reason for failure. “There are all external influencers, initially you think, I have a product and that’s it, but then you are faced with external factors, strong forces, you did not calculate on. We thought, we have a solution, those girls are waiting for this, this is what they want” (Respondent E; APPENDIX C.5). When the vision did not match the market’s demand something needed to change. “It was a good product, but the market was not ready for it” (Respondent G; APPENDIX C.7).
Furthermore, matching the entrepreneurial vision to strategic partners or other
important institutions has also be mentioned as important and a mismatch has been mentioned as a reason for failure. As already mentioned above, the importance of external actors arose again in the sensemaking process. Not only those actors who were the trigger for a vision
creation, other external actors still need to accept or be in line with the entrepreneurial vision. “The [poker]game was not really accepted by the Local Government” (Respondent I;
APPENDIX C.9). Respondent F mentioned that the location they were renting for a restaurant was not assigned to be used as a restaurant by the local government, which put an end to their business.
4 – External Factors and inexperience of entrepreneur are reasons for failure
My analysis also suggests that vision is influential for entrepreneurial sensemaking of failure by drawing attention to inexperience. Wrong entrepreneurial choices due to inexperience emerged during the sensemaking process. “We should have focused on [our initial vision] from the start and not be distracted by the restaurant and café solution [alternative vision]” (Respondent J; APPENDIX C.10). Respondent A identified some wrong choices, such as starting a business without having a proper network or trying to combine multiple
entrepreneurial activities at once, were reasons for failure. Choices which were rectified after gaining more experience. Respondent A and J also mention the importance of having a focus or clear mental picture of what the business is and will be. Respondent E acknowledged that some reasons for failure were wrong choices, such as not having a clear distinction between the first created foundation and the later additional enterprise. Respondent J and his partner were part-time active in their business and experience this lack of full focus as a reason for failure. “As I said before, you cannot do a little bit of entrepreneuring. You are
entrepreneuring or you are not. If you are trying to do it in evenings, a wine starting you can organize in the evenings, but you cannot recruit and training employees in evenings. That is another point, we were not able to get this business running in just evenings” (Respondent J; APPENDIX C.10). During the sensemaking process, respondents emphasized the importance to have people around you. People such as co-founders or advisors to talk with, to share and verify business ideas with. “When you work for yourself, and I think that is important for failure, you have no one to spar [ideas] with, you are lonely” (Respondent A; APPENDIX C.1). Both Respondents A and H emphasized the importance of surrounding yourself with people you will listen to and can verify business ideas with and identified not doing so as a reason for failure. “If I would have listened to others, it would not have gone so far” (Respondent H; APPENDIX C.8).
5 – Vision clashes are predictors for change
My analysis suggests that through vision clashes entrepreneurs make sense of business
changes, either business transformation, business exit, business closure, or business failure. A clash between the founder(s) vision of the business and the reality was for two respondents the trigger for change. Respondent I had the entrepreneurial vision of his venture to be a web designer who was, in contrary to others, able to provide the service the client requested. Whenever he discovered he was not able to focus on this customer intimacy, he decided to sell the business (business exit). “We stood there [at a wine fair] with wine tap installations, which was not my passion. That has been a trigger moment, if we are not going to work with wine now, then it has to end” (Respondent J; APPENDIX C.10). The clash in entrepreneurial vision and business reality was the reason for Respondent J and his partner the reason a business transformation.
A clash between founder’s entrepreneurial visions appears to be another trigger for change. “I do not want to continue like this, or we are radically changing, or we have to quit, because I really do not want to continue like this. I do not like it anymore. I am not enjoying it anymore. This is not my business anymore” (Respondent D; APPENDIX C.4). Similarly, Respondent G and his partner were not able to run a business together as they had completely different ideas of what business they wanted to create and which business strategies they will apply to achieve their different vision. Both respondents D and G exited the business because they were not able to create a shared vision of the business with their business partners. Respondents H sensemaking process of the failure of his latest business has been some sort of mixture between a clash of vision and reality and clash of founders. While the entrepreneurial vision was shared among the partners, the respondents’ partner was not able to realize this vision, which led to a breakup and ended in a business failure. “I was very clear, look, this is not what we agreed upon, this is not my style. This is not what I agreed to do. And every time someone new was hired, to ease the pain, until six or seven months later it started again. Listen, this is where it ends. I am not taking these responsibilities upon me anymore. And then it was over, and you are standing in front of each other, in a conflict situation” (Respondent H; APPENDIX C.8).
As mentioned before, the importance has been emphasized by the respondents to match the entrepreneurial vision with the market’s demands. The inability to match, to share a reality and share a vision, with potential customers appears to be a predictor for change. Respondent C transformed his business after he realized that there was a flaw in the market. He was providing something the market did want but did not have money for, so he adjusted
his vision and transformed the business to match the market’s demands. “We wanted to come with a solution for the base of the pyramid, really the lowest. Those people who do not have much money. If that is an intrinsic goal, how in god’s name should you achieve that as a business, can you achieve it as a business? Is there a way to make it work? What we should have done, and we started to think about that after a while. What kind of other business models can we think off? I accepted that challenge, but too late” (Respondent E; APPENDIX C.5). Although respondent C was able to adjust the vision and transform the business,
respondent E was unsuccessful in transforming the business and had to close the business.
Vision as a Sensemaking Device
Throughout all previous five sections, it is emphasized that my analysis suggests that vision plays a part in making sense of the entrepreneurial process. This study’s respondents seem to use vision as a sensemaking device for important events during the venture’s lifespan, such as:
1) business creation – My analysis implies that vision is a sensemaking device for entrepreneurs with regard to the business creation. Nearly all respondents, excluding
Respondent F and one venture from Respondent H, refer to the creation of an entrepreneurial vision in order to the explain the creation of their business. This creation of a vision, often with other actors, was a driving force in creating their business. “With me, a strong internal drive is that I, being a woman, want to stand up for women. I really have that drive. That has to do with my past. I have had a bumpy road in my own life, so I really understand where those girls are coming from. So, you know, I am also very passion driven. That has been an important motivating force for me. So, my vision, because that is the answer to your question, we started with the problem and with the idea that those girls needed to go to school”
(Respondent E; APPENDIX C.5);
2) clash of partners – For Respondents C (first venture), D, G, H (third venture), and I (second venture) clashes of partners were mentioned and all clashes were explained in terms of clashing visions. Either clashing ambitions of how they wanted to venture to be in the future, or how they pictured the venture now or in the future. My analysis suggests that vision is a sensemaking device entrepreneurs use to explain an important event in their
entrepreneurial process.
3) lacking performance – Respondents A, E, and G have referred to vision while mentioned lacking financial performance during their entrepreneurial process. My analysis
implies that entrepreneurs use vision as a sensemaking device to ‘make sense’ of the lacking performance. “If the product would have been a direct hit, there wouldn’t have been a problem. But when you have to deal with disappointing revenues, then it becomes clear that [co-founder] has another idea to solve it. Look, if there is no problem [it is alright], but if there is a problem and [we as partners] are not able to find a direction [- a vision for the venture -] to solve the problem, then we have a problem” (Respondent G; APPENDIX C.7);
4) interaction with market or external partners – My analysis suggests that
entrepreneurs use vision as a sensemaking device to explain interactions with customer and external partners. Respondents B, E, F, G, I, and J all referred to vision to give meaning to their interaction with the market. Respondents B, F, and I referred to vision when explaining the interaction with external partners, such as investors and local government.
5) business changes and failure – Nearly all respondents, except Respondent B, E, H (second venture), and I (first venture), referred to vision when explaining why a business had to change or was failing, either business transformation, business exit, business closure, or business failure. My analysis implies that entrepreneurs use vision as a sensemaking device explaining why the business was changing. Vision or a clash of vision was referred to as a trigger for business change or failure.
Discussion
In this thesis, I asked the question, “how vision plays a role in the entrepreneurial process, specifically failure?” I have identified two categories within the concept of failure, one the two key concepts of this study. Firstly, I have identified three types of venture’s ending: business exit; business closure; and business failure. Secondly, although no respondents use the term ‘entrepreneurial failure’, I found that visions frame three narratives of
entrepreneurial failure: clash between reality and vision; clash between founder’s visions; and mismatch vision and market’s demands. These forms of entrepreneurial failure were
mentioned in explaining a venture’s ending (business exit, business closure, or business failure) or a business transformation. In the process of making sense of why the business was changing or needed to change, either a venture’s ending or business transformation, most respondents did so by referring to vision. Furthermore, my analysis implies that vision can also be perceived as a driving force for action. In some cases, it seems that the vision itself is the trigger, motivation, or drive to change the status quo through entrepreneurial activities.
Furthermore, vision or rather the clashes of visions seem to predict, or maybe even trigger, business change. Change that comes in the form of business exit, business closure, business failure, or business transformation
Theoretical Contributions
In this chapter, I argue that my findings point towards the importance of vision in
entrepreneurial failure, which makes an important contribution to entrepreneurship research. I argue that the process of ceasing a social configuration, group of actors sharing a reality of the business now and sharing a vision of the business in the future as in the abandonment or demolishment of a shared reality or vision is part of the sensemaking process of failure. Entrepreneurs perceive the role of vision as a way to make sense of entrepreneurial process, from the creation of a business to the ending of a business, and all the changes and adjustment during the lifespan of the venture. Vision seems to be the trigger for creating a business, and through social interactions, the vision is shaped and adjusted and eventually triggering either business transformation, business exits, business closures, or business failures. It appears that vision is the sensemaking process itself of business creation and business change, while at the same time, vision appears to be the trigger for business creation and business change.
This argumentation differs from existing models. For example, in the conceptual framework, vision is defined as mental model defined by a leader (Kantabutra, 2009), whereas I argue it is a sensemaking device of failure. Furthermore, in this study’s literature vision it is suggested that a vision consists of seven attributes, a content, and must be
communicated to others (e.g. Baum et al., 1998; Kantabutra, 2009). This implies that the term ‘vision’ refers to an objective phenomenon, something that can be created and from that point onwards exists. That it is a brief and clear vision statement: a future orientated, challenging, but an abstract goal. Something that is stable and not affected by short-term events.
Something that has the ability to inspire followers, when successfully communicated from the leader to the followers. My findings, however, implies that entrepreneurs do not see vision as a static objective phenomenon. As Hill and Levenhagen (1995) suggest, I find that the
development of a vision is a result of the ongoing sensemaking process of the environment. Although this idea suggests that a vision is a continuously changing, it does suggest that a vision in the product of sensemaking, while from this research analysis, it appears that vision is the process of sensemaking itself.
My study contributes to the literature on the process of sensemaking in
entrepreneurship. Vision is a key component for the concept of ‘organizing’. Organizing is “the reduction of equivocality by actors through ongoing social interaction in order to couple their behavior in ways that suit the joint performance of certain activities” (Pevereli & Verduyn, 2012, p. 14). As already mentioned in the conceptual framework organizing, or in this case entrepreneuring, creates social configurations. It appears that entrepreneurs see the role of vision as a conceptual device to make sense of the entrepreneurial world, reducing equivocality by continuous social interaction with other actors all to couple their behavior to suit the entrepreneurial performance and creating configurations. While simulations, they see vision as a conceptual device to make sense of the changing entrepreneurial world, ceasing of old configurations and creating new configurations. Similarly, to the organizing concept (Pevereli & Verduyn, 2012), it seems that my study’s respondents see vision as the conceptual device in the sensemaking process, as in ‘making sense’ of the changing entrepreneurial world, but also as the driving force in the sensemaking process, creating configurations, or changing the entrepreneurial world. Vision seems to be a self-maintaining process. In sum, I argue that, in contrast to existing research, vision is a key sensemaking device that
entrepreneurs use in ‘making sense’ of, the through vision itself, changing entrepreneurial world.
Limitations and Future Research
This research has a number of limitations. The first limitation concerns sample size, the number of units of analysis. Although I believe that a sample size of ten suits the purpose of this study’s theorizing, a larger sample size would increase the generalizability of the research findings. Second, this research’s analysis only relies on interviews and some backtracking of data. Alternative data collection methods or combining methods are advisable for future research. Collecting data through large-scale surveys for example. Third, in selecting the ten (ex-)entrepreneurs, this research applied a convenient no-probability sampling selection approach together with a snowball method starting from my own personal network. Biases are possible with these sampling techniques. Underrepresentation or overrepresentation of a particular group could have occurred. Fourth, the theory created in this study is grounded in subjective data. The interviews were focusing on respondents sensemaking capabilities, how they had perceived the role of vision in a process of failure. Future research would be advised to apply a longitudinal study to limit the subjectivisms of this research, by collecting data
during the process of failure both from interviews but also from observations. Fifth, the interviews were conducted and transcribed in Dutch and coded and quoted in English.
Although I carefully translated and tried to maintain the structure of the sentences, while also maintaining the meaning, potential translations and interpretation mistakes could have occurred. Lastly, interpreting this study’s analysis is a based on the collected data and prior research, however, it is still a personal attempt to explain entrepreneurs sensemaking of vision and the failure during the entrepreneurial process. The findings in this study should be
handled with care with regard to transferability. Future research is encouraged to verify these study’s findings in other domains.
Practical contributions shall arise due to future research verifying these study’s findings. However, entrepreneurs or other actors active in the entrepreneurial world should take the following potential practical implications in mind. Organizations are mere shells in which configurations can occur. A lack of social interaction could result in clashing
entrepreneurial realities and visions. On the contrary, however, entrepreneurs should be wary that communication with entrepreneurs or stakeholders will likely change the entrepreneurial world, for the better or for the worse. Furthermore, although vision is portrait as a self-maintaining process, both explaining and changing the entrepreneurial world, it is a mere device. Entrepreneurs, employees and other actors, are the most essential factor in
entrepreneuring, because they need to wield the sensemaking tool.
Conclusion
This study builds on empirically gathered insights to shed new light on the concepts of vision and failure, by focusing on the role of vision in a failing entrepreneurial context. The aim of this study was to contribute to the field of entrepreneurship by examining the role of vision with regard to their failed venture, through entrepreneur’s sensemaking process. A grounded theory development approach was conducted together with a social constructionist theorizing process. This study’s analysis implies that entrepreneurs use vision as a sensemaking device to ‘make sense’ of a changing entrepreneurial world, while simultaneously vision appears to be the driving force in the sensemaking process changing the entrepreneurial world.
Entrepreneurs perceive vision, both as a conceptual device in the sensemaking process to give meaning to important events during the entrepreneurial process; and as a driving force in the sensemaking process creating social configurations and changing the entrepreneurial world.
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