Strategic Entrepreneurship: Topic 1

STRATEGIC ENTREPRENEURSHIP
TOPIC 1
INTRODUCTION TO THE CONCEPT
OF STRATEGIC ENTREPRENEURSHIP
Table 1: The birth of strategic entrepreneurship
Name of Author Year Issues relate to strategic entrepreneurship
Mintzberg 1973 Introduce the notion of entrepreneurial strategy making
Schendel&Hofer 1979 Argued that the entrepreneurial choice is at the heart of the concept of strategic
Burgelman 1983 Empirically examine the interrelationship between strategic management and entrepreneurship
inside a large corporation
Covin&Slevin 1989 Posited the concept of entrepreneurial strategy posture examining a firms competitive
orientation on a spectrum from conservative to entrepreneurial
Chittipeddi&Wallett 1991 Reviewed macroscopic trend impacting business and argue that the ethos of entrepreneurship
would pervade winning firms and that ‘the organizational’ archetype of the future will be
entrepreneurial . Its leadership, strategies, and structure will reflect entrepreneurial thinking
with associated traits such as flexibility, innovativeness, and a problem solving actions
orientation.
Day 1992 Examined the research linkages between entrepreneurship, strategy management, and
general management and offers one possible configuration of their interrelation.
Sandberg 1992 Investigated cross-fertilization opportunities between strategy management and
entrepreneurship and posited six fertile areas; innovation; new business creation; opportunities
seeking; risk assumption; top management teams; and group processes used in strategic
decisions.
Barringer&Bluedorn 1999 Studied the relationship between entrepreneurial intensity and five strategic management
practices finding statistically significant results for the impacts of scanning intensity, planning
flexibility, locus of planning and strategic controls.
Meyer & Heppard 2000 Edited the first scholarly book addressing the interface between entrepreneurship and strategy
to uncover the components of a firm’s entrepreneurial ‘dominant logic’ independent of firm size.
The Birth of Strategic Entrepreneurship
 There are three perspectives on the marriage of strategic and
entrepreneurship.
 strategic management is “dominants” over entrepreneurship (Baker
and Pollock, 2007 cited in Rensburg, 2013)
 strategic management is itself a “subset” of entrepreneurship (Browne
& Harms, 2003 cited in Rensburg, 2013)
 Strategic management “intersection” with entrepreneurship
(Rensburg, 2013).
 The former indicates that the entrepreneurship concepts can be explained
by the strategic management domains while the later argues that
strategic management only the division of entrepreneurship field.
 The “intersection” perspective agrees with the overlapping of research’s
areas and suggests that the marriage should be created through
combining the core advantages of each which are the strategic and
entrepreneurship.
The Birth of Strategic Entrepreneurship
 The term of ‘Strategic Entrepreneurship’ was first

pointed out by Herbert & Brazeal (1998 cited in
Rensburg, 2013).
 Researchers in Strategic Entrepreneurship field, studies
on board of directors’ roles, firm resources and
capabilities, and financial implications (Rensburg,2013).
 Other researchers study on the combination of
opportunities seeking behaviour (exploration) and
advantages seeking behaviour (exploitation) and relates
it to wealth creation (Hitt et al. cited in (Rensburg, 2013)
Definition of Strategic
Entrepreneurship
 Strategic Entrepreneurship (SE) is a process that
facilitates firm efforts to identify opportunities with the
highest potential to lead to value creation through the
entrepreneurial component and then to exploit them
through measured strategic actions, based on their
resource base.
Definition of Strategic
Entrepreneurship
 The entrepreneurial aspect contributes to the ability of
identifying opportunities and to the willingness of firms
to pursue new opportunities; whilst
 The strategic perspective enables them to isolate and
exploit those opportunities to lead to sustainable
competitive advantage (Hitt et al., 200)
 Strategic Entrepreneurship can be enacted within small
medium size enterprise as well as within large
established corporations (Resburg, 2013).
Strategic Entrepreneurship and Strategic Management
Source : Wheelen, T. L. and Hunger, J. D. (2000 cited in

Kuratko, D. F. & Hodgetts, R. M., 2004: 521).
 Also known as Strategic Planning
 Involves 5 stages:-
 Examine the internal and external environments
(SWOT)
 Formulate the venture’s long range and short range
strategies (Mission, Objectives, Strategies, Policies)
 Implement the strategic plan (Programs, Budgets,
Procedures)
 Evaluate the performance of the strategy
 Take follow-up action through continuous feedback
How strategic management relates to strategic
entrepreneurship?
• Innovation
• Networks
• Internalization
Entrepreneurial• Organizational
Strategic
actions Learning actions
• Top Management
Teams and
governance
• Growth
Wealth Creation
Source : R. Duane Ireland, Micheal A.Hitt, S. Michael Camp,
and Donald L.Sexton, (2001 cited in in Kuratko, D. F. &
Hodgetts, R. M., 2004: 531)
Components of Strategic
Entrepreneurship
Resource Management
Opportunity
Growth identification
Innovation
Strategic
Entrepreneurship
vision Acceptance
of risk
Flexibility
Dynamic capability
Sources : Kyrgidou, L. P. And
Mathew Hughes, M. (2009: 49)
Components of Strategic Entrepreneurship
 Opportunity identification - suggested to be an
important source of competitive advantage (Hitt et
al., 2002), which can lead to entrepreneurial
opportunity creation.
 Innovation or the ability to innovate - one of the
distinctive competencies of entrepreneurial firms
(Kirby, 2003). Sonfield and Luccier (1997) proposing
that the most effective way to position an
entrepreneurial firm is to use risk and innovation.
 Acceptance of Risk –becomes a potential source of
competitive advantage when balanced with intuition
and strategic actions.
UNIVERSITI MALAYSIA KELANTAN

Components of Strategic Entrepreneurship
 Flexibility- firms should be able to respond to change
quickly, independent of their current strategy (Eisenhardt
et al., 2000). Flexibility refers to balancing structure with
the freedom to implement and change strategy
(Eisenhardt et al., 2000), which in turn will facilitate quick
response to change (Bhide, 1994).
 Vision- Establishing a clear vision and developing strategy
that focuses both on opportunity and advantage within
that vision (Hitt et al., 2001) enhance opportunity
identification
 Growth is related not only to innovative and creative ideas,
but also to the structure and strategy to turn such ideas
into profitable ventures resources and dynamic capabilities
appear
Strategic Entrepreneurship Theory
Sources : Kyrgidou, L. P. And Mathew Hughes,

M. (2009: 53)
 Ireland et al. (2003) specify four components to the
process of SE theory :-
1. An entrepreneurial mindset, culture and leadership
that support the search for entrepreneurial
opportunity;
2. Strategic management of resources involving
managing the financial, human and social capital;
3. Applying creativity to develop innovations and new
combinations to achieve radical and incremental
innovation;
4. Forming and executing competitive advantages.
Conclusion
 Entrepreneurs do not use strategic planning for many reasons
because:
 scarcity of time
 lack of knowledge about how to plan
 lack of expertise in the planning process,
 lack of trust in others.
 Benefits to strategic entrepreneurs are:
 have better financial performance
 more efficient resource allocation
 improved competitive position
 higher employee morale
 more rapid decision making
REFERENCES
 Rensburg, D.J.V. (2013). Is Strategic Entrepreneurship a Pleonasm?. Journal of Management
and Strategy, 4, 1, 15-27.
 Kuratko, D. F., & Hodgetts, R. M. (2004). Entrepreneurship: Theory, process, practice. Mason,
Ohio: Thomson/South-Western
 Kyrgidou, L. P., & Hughes, M. (2010). Strategic entrepreneurship: Origins, core elements and
research directions. European Business Review, 22, 1, 43-63
 Dollinger, M, J. (2008). “ENTREPRENEURSHIP: Strategies and Resources Fourth Edition”, Kelley School
of Business, Indiana University. MARSH publications, pp. 33-40.
 Hisrich, R. D., Peters, M. P., & Shepherd, D. A. (2009). Entrepreneurship. New York: McGraw-Hill Higher
Education.
 Lieberman, M. B., & Montgomery, D. B. (1988). First‐mover advantages. Strategic management
journal, 9(S1), 41-58.
 Zimmerer, T., Scarborough, N. M., & Wilson, D. (2002). Essentials of entrepreneurship and small business
management (Vol. 2). Upper Saddle River, NJ: Prentice Hall.
 Barringer, B and Ireland, D (2012) Entrepreneurship – Successfully Launching New Ventures (4th Ed.).
Pearson Education, Global Edition. (B1)
 Dollinger, Marc J., (2003) Entrepreneurship: Strategies and Resources, 3rd Edition, Prentice Hall
International Edition. (B2)
 Wickham, P. A. (2006) Strategic Entrepreneurship. (4th. Ed.). England: Pearson Education Ltd. (B3)
 Timmons J, Spinelli S, (2007) New Venture Creation: Entrepreneurship for the 21st Century, 7th. Edition,
McGraw Hill International Edition.
 Roberts,M, Stevenson, H., Shalman, W., Marshall, P., and Hamemesh, (2007) New Business Venture and
The Entrepreneur, 6th. Edition, McGraw Hill International Edition.

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STRATEGIC ENTREPRENEURSHIP

 The term of ‘Strategic Entrepreneurship’ was first

Source : Wheelen, T. L. and Hunger, J. D. (2000 cited in

UNIVERSITI MALAYSIA KELANTAN

Sources : Kyrgidou, L. P. And Mathew Hughes,

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