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Entrepreneurial Learning: Development and Uses of Knowledge Kelly G. Shaver College of Charleston shaverk@cofc. Entrepreneurial Learning: Development and Uses of Knowledge Kelly G. Shaver College of Charleston [email protected] edu www. cofc. edu/~shaverk Copyright © Kelly G. Shaver 2007 All rights reserved.

With thanks to • John Clarkin, College of Charleston • G. Page West, Wake With thanks to • John Clarkin, College of Charleston • G. Page West, Wake Forest University Copyright © Kelly G. Shaver 2007 All rights reserved.

The recurrent question… • “Can you really teach entrepreneurship? ” • “Don’t some people The recurrent question… • “Can you really teach entrepreneurship? ” • “Don’t some people just have what it takes (so they don’t need you), but others will never have what it takes (so they don’t need you either)? ” Copyright © Kelly G. Shaver 2007 All rights reserved.

Regulations • • • Business licenses Employer identification numbers Tax registration and payments Workplace Regulations • • • Business licenses Employer identification numbers Tax registration and payments Workplace safety regulations Local ordinances Copyright © Kelly G. Shaver 2007 All rights reserved.

Industry and competition • • • What industry, exactly, is it? Where in its Industry and competition • • • What industry, exactly, is it? Where in its own life cycle is that industry? Who are my local competitors? Do I have competition from “the world? ” What are the strengths of my competition? What are their weaknesses? Copyright © Kelly G. Shaver 2007 All rights reserved.

Markets • • Who are my potential customers? How many of them are there? Markets • • Who are my potential customers? How many of them are there? How many of them will I be able to attract? Who else wants them? How can I reach them effectively? Why will they buy from me? What will I need to do to keep them coming back? Copyright © Kelly G. Shaver 2007 All rights reserved.

Organizational knowledge • • How large a team do I really need? How can Organizational knowledge • • How large a team do I really need? How can I recruit them? Why would they want to work with me? What can I do to make them want to stay? How can I get them to care as much as I care? How can I help them work well together? How can I tell that they’ll keep their promises? What will I do if some of them are dishonest? Copyright © Kelly G. Shaver 2007 All rights reserved.

Managing relationships • • • In general, what effect do I have on others? Managing relationships • • • In general, what effect do I have on others? Am I comfortable talking to other people? Do I make friends easily? Do I have the support of my family? How do I feel when others around me are not working that hard? • Do people consider me a leader? • Can I mediate disputes among others? Copyright © Kelly G. Shaver 2007 All rights reserved.

Self-knowledge • • • Do I have the necessary experience? How good am I Self-knowledge • • • Do I have the necessary experience? How good am I at learning what I don’t know? Do I enjoy solving problems? How hard am I willing to work? Am I always thinking how to do things better? What do I do when the going gets tough? Copyright © Kelly G. Shaver 2007 All rights reserved.

How are things learned? • • • Direct investigation Past experience Social comparison Vicarious How are things learned? • • • Direct investigation Past experience Social comparison Vicarious learning from models Learning by doing, in the present Copyright © Kelly G. Shaver 2007 All rights reserved.

What must be learned? • • • Facts Business processes Behavioral scripts Social skills What must be learned? • • • Facts Business processes Behavioral scripts Social skills When to redouble one’s effort When to walk away Copyright © Kelly G. Shaver 2007 All rights reserved.

Examples • Facts: markets, competiton, prices, ratios, costs • Business processes: licenses, incorporation, management Examples • Facts: markets, competiton, prices, ratios, costs • Business processes: licenses, incorporation, management functions and roles, accounting • Behavioral scripts: normal everyday actions • Social skills: customer focus, creative problem solving, network maintenance, sales tactics • When to redouble one’s effort: early warning signs of trouble • When to walk away: time to exit Copyright © Kelly G. Shaver 2007 All rights reserved.

Failures in learning • • • “Discovery” of competition Ineffective cash management, inventory control Failures in learning • • • “Discovery” of competition Ineffective cash management, inventory control Constant battles with employees, customers Insensitivity to constructive feedback “Hoping for A while rewarding B” Erroneous self-conceptions Copyright © Kelly G. Shaver 2007 All rights reserved.

Why plans are important • • • About the regulatory environment About the industry Why plans are important • • • About the regulatory environment About the industry and competition About markets, segmentation, marketing About organizational structures About interpersonal relationships About your own tolerance for ambiguity and the bad behavior of others on whom you depend Copyright © Kelly G. Shaver 2007 All rights reserved.

The gap • Individuals start firms • Firms do business • By and large, The gap • Individuals start firms • Firms do business • By and large, the individual attributes that have received most research attention do not translate well to the level of the firm Copyright © Kelly G. Shaver 2007 All rights reserved.

“Mind the gap” • Physical reality: the boundary between one system and another • “Mind the gap” • Physical reality: the boundary between one system and another • Admonition: be warned about the crossing • Metaphorical: person and firm are also different systems • Solution: particular contents of mind may carry us from one of these systems to the other Copyright © Kelly G. Shaver 2007 All rights reserved.

Elements of the argument • RBT supports the importance of inimitable, nonsubstitutable knowledge • Elements of the argument • RBT supports the importance of inimitable, nonsubstitutable knowledge • “Personality” characteristics of nascents cannot cross the person-firm gap • But individual knowledge, as held, sought, or created, can make the transition • As a result, knowledge connects the person to the firm strategy Copyright © Kelly G. Shaver 2007 All rights reserved.

A different use of the PSED • We begin with 1, 216, not 1, A different use of the PSED • We begin with 1, 216, not 1, 261 • Sample reduced to respondents by mail (459 females and 412 males) • Only nascents (not CG) asked many of the knowledge-based items • Final sample is 286 females, 267 males Copyright © Kelly G. Shaver 2007 All rights reserved.

The “knowledge” variables • Three primary sources of items – The “opportunity recognition” items The “knowledge” variables • Three primary sources of items – The “opportunity recognition” items (QA 2, QA 4, QA 5 a, QA 5 b, QA 5 e, QA 5 f, QA 5 g, QA 6, QA 7 d; QK 1 j, QK 1 k, QK 1, l, Qk 1 n) – Past courses taken (items QF 1 a 1 - QF 1 i 1) – Past work experience (items QF 1 a 2 – QF 1 i 2) • Other items (QK 1 e – expectancy; QD 1 g – competitive confidence) Copyright © Kelly G. Shaver 2007 All rights reserved.

Particular Answers • QK 1 n: “If this business idea is not successful, I Particular Answers • QK 1 n: “If this business idea is not successful, I am willing to try up to five other business ideas before I go to work for someone else. ” • But we want people who would disagree Copyright © Kelly G. Shaver 2007 All rights reserved.

Possession Of Knowledge • QA 2: Which came first? Idea, desire, or both together Possession Of Knowledge • QA 2: Which came first? Idea, desire, or both together (idea) • QA 6: How much new information was acquired? None, some, moderate, great amount (some) • New variable with 12 categories Copyright © Kelly G. Shaver 2007 All rights reserved.

A knowledge estimate None Some Moderate Idea first Desire first Both together Copyright © A knowledge estimate None Some Moderate Idea first Desire first Both together Copyright © Kelly G. Shaver 2007 All rights reserved. Great amount

Examine The Proportions • How many gave the combined answer? • How many were Examine The Proportions • How many gave the combined answer? • How many were fully autonomous? • How many were women vs. men? • How many remained at Year 1 follow-up? • How many of those operating or active? • How many of those were women vs. men? Copyright © Kelly G. Shaver 2007 All rights reserved.

For Some, Say “Some” Copyright © Kelly G. Shaver 2007 All rights reserved. For Some, Say “Some” Copyright © Kelly G. Shaver 2007 All rights reserved.

The conclusion? • Knowledge matters. To the individual and the firm. • Contact: shaverk@cofc. The conclusion? • Knowledge matters. To the individual and the firm. • Contact: [email protected] edu Copyright © Kelly G. Shaver 2007 All rights reserved.