Exploring the World of Strategic Entrepreneurship
Taylor A. Thompson
University of Alaska Anchorage
Strategic Entrepreneurship (SE) helps to improve your entrepreneurial effectiveness both in creating and launching new start-ups and also identifying development opportunities within pre-existing organizations. Strategic entrepreneurship has been widely distributed with organizational performance, wealth and most importantly, value creation. Strategic entrepreneurship also is a combination of both entrepreneurship and strategic management. An organization will dabble in strategic entrepreneurship when it concurrently searches for potential business region and enterprises current business regions. My analysis explores all demeanors of this relatively new, unknown topic and proposes a theoretical framework for strategic entrepreneurship. “The conceptual framework illustrates that strategic entrepreneurship is the combination of strategic input and entrepreneurial input; configured by the environment, the organizational structure, resources and capabilities, the strategy and entrepreneurial leadership” (Griffin & Oosthuizen, 2016). Strategic entrepreneurship is only fully actualized in a company if that concept is understood and its introduction is conveyed with intent.
Exploring the World of Strategic Entrepreneurship
Strategic Entrepreneurship has been classified as one of the newer fields, discussed primarily in the realm of corporate entrepreneurship, emerging officially in 2001, in the special issue of the Strategic Management Journal on “strategic entrepreneurship”, the first zealous periodical, was published in 2007. Strategic entrepreneurship has been fabricated based off of two core ideas, firstly, “strategy formulation and execution involves attributes that are fundamentally entrepreneurial, such as alertness, creativity, judgment, and entrepreneurs try to create and capture value through resource acquisition and competitive positioning. Secondly, opportunity seeking and advantage seeking the former the central subject of the entrepreneurship field, the latter of the central subject of the strategic management field are processes that should be considered jointly” (Klein, 2013).
Strategy and entrepreneurship go hand in hand when discussing strategic entrepreneurship, entrepreneurs require strategy across any and all stages of production and firm cycles. It is also needed for insights from strategic management, inquiring value through resource achievement, industry positioning, capability development, and the creation of realistic alternatives. Strategic entrepreneurship can take one of five forms—strategic renewal (dynamically adapting business models and strategies ending in changes in the external work environment), sustained regeneration (entrepreneurial practice for an organization to introduce new products or service in the market on a regular basis), domain redefinition (entrepreneurial wonder where organizations proactively develop a new-product market arena), organizational rejuvenation (a strategy where an organization intends to sustain or improve its competitive standing by altering its internal process, structure and capabilities), and the business model reconstruction (strategy where organizations recalibrates its business model with hopes in improving operational efficiencies), (Covin & Miles, 1999).
The strategic management theory can be highly benefit by exploring the inception of competitive advantage. “The basic underlying fundamental of strategic entrepreneurship is the concept pulled from strategy designed to answer the question, why do some firms outperform others?” (Kelin, 2013). Sustained competitive advantage is a dependent variable in strategic management analysis, this is defined as a firm’s ability to create and appropriate more value than the competition on a sustained base. The modern strategic management theory is based off of logic of deviation from the ideal of the competitive model, and also leading to imperfect factors or product markets.
Strategic Entrepreneurship analysis normally takes the creation and capture of a firm’s attraction as an anomaly of interest, allowing Strategic entrepreneur intellectuals to use constructs, theories and methods well developed in both fields. For example, entrepreneurial adaptation and compelling capabilities are established variables among value creations and capture. The focus on value creation and capture suggests that strategic entrepreneurship analysis is not committed to the intellectual’s emphasis on sustained competitive advantage. Strategic entrepreneur have inquiries on how firms can implement strategic intent to regularly leverage entrepreneurial contingency for advantage-seeking principles.
Strategic Entrepreneurship is a very young field that has only been in existence for close to a decade. The strategic management theory has until recently kept quiet about where they are getting their competitive advantage from, but with accumulating, expanding, managing, and transforming resources, it has become a essential motive in strategic management. Strategic management has the alternatives between flexibility and commitment at the leisure of its fingertips. Having real life choices permits for strategic managers to take peculiar behavior at anytime of convenience for them, thereby allowing flexibility in uncertain markets. With having time flexibility, managers are able to assimilate a variety of alternatives to accommodate accelerated and flexible response to previous actions in their surroundings. As a firm changes, so does its competitive advantage, but seeing as competitive advantage is highly uncertain, it would be beneficial to continue development and keep your options open.
One alternative to strategic entrepreneurship is internal corporate venturing, which comes into play when a firm can tell that the option that is most likely to end in an advantage in the relevant environment and plays a role in corporate growth and diversification. But, however, the key alternative would have to be the dynamic capabilities, which was viewed and associated with David Teece and associates. The dynamic capability views that exceptional performance in derived from a firm’s willingness to change its resource base in the face of Schumpeterian competition and physical change. Dynamic capabilities reflect previous learning techniques, being a learned sequence of cumulative activity for an organization to methodically produce and modify pre-existing operational routines in hopes of positively reconstructing performance.
Strategic Entrepreneurship has only come to light over the past decade, being a new focus on the foundation between individual-centric and start-up focused entrepreneurship field along with the strategic management field with importance regarding the established firm-level performance variable. The defining characteristics that link opportunity and advantage seeking are dynamic capabilities, hyper competition and realistic alternatives. It appears as though strategic entrepreneurship has been concentrating more time in the entrepreneurial inquiry of an assortment of brief advantages, often enclosed beneath wealth creation. Strategic entrepreneurship is still a widely loose composite of a variety of observations from both strategy and entrepreneurship. A strategist is in need of the entrepreneur, and the entrepreneur is in need of a strategist.
Stages of managing resources strategically. The differences in a firms performance varies by both owned or controlled resources as well as how a firm manages said resources. Resources need to be managed strategically when they support concurrent use of opportunity and advantage-seeking behavior. There are three stages of managing resources strategically, the first being structuring the resource portfolio. The second step is bundling resources followed by leveraging capabilities.
Structuring a resource portfolio. A resource portfolio provides a collection of either tangible or intangible resources as well as how a firm chooses to manage said resources. “An important process (Dierickx & Cool, 1989; Makadok, 2001), structuring the resource portfolio involves the on-going processes of acquiring, accumulating and divesting resources. As the actions in the structuring process suggest, the resource portfolio is changed continuously, resulting in the firm owning or controlling a dynamic collection of tangible and intangible assets (Duane, Hitt, Sirmon, 2003).”
Bundling resources. The logic behind bundling both tangible and intangible resources is to align them in way that plays a role in identifying and capitalizing on entrepreneurial opportunities. Bundling said resources build capabilities such as marketing and production, which are needed to select and implement a firm’s strategies. The overall reason for bundling resource is one to maintain any current competitive advantage at the time, but also to one could be influenced to manipulate opportunities while establishing competitive advantage.
Leveraging capabilities. Once the first two stages are completed a firm must allocate how the capabilities created from bundling are going to be leverage across the business entity. If you are at a corporate level or in individual business units then your choices are more diversified versus a single business firm using their resource bundles in hopes of maximizing opportunity recognition. The most effective decisions about bundled resources are to identify opportunities and appropriate rents from them are creative and entrepreneurial in nature (Barney ; Arikan, 2001).
Strategic Entrepreneurship is a very complex anomaly in which scholars are trying to get a better grasp on. New developments as such are best understood through thorough analysis combining a finite series of theories while also demonstrating how theory traditionally applied to one issues can also be applied to another issue (Ketchen et al. 2014). Managers of newer/smaller firms should take into consideration core inquires of strategic positioning, organizational design, and contracting that are essential to the process of creating and capturing economic worth.
This table identifies the domain of strategic entrepreneurship through a developmental configuration approach.
This is a comparison of strategic management and entrepreneurship, relating strategic entrepreneurship with them.
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Strategic Entrepreneurship: Identifying Domains in a Developmental Configuration Approach – Scientific Figure on ResearchGate. Available from: https://www.researchgate.net/Identifying-domains-of-SE-through-a-developmental-configuration-approach_fig2_228134115 accessed 26 Nov, 2018