Policy and support for entrepreneurial behaviour (Part 2)

Citation

Deakins, D. (2000), "Policy and support for entrepreneurial behaviour (Part 2)", International Journal of Entrepreneurial Behavior & Research, Vol. 6 No. 4. https://doi.org/10.1108/ijebr.2000.16006daa.001

Policy and support for entrepreneurial behaviour (Part 2)

Policy and support for entrepreneurial behaviour (Part 2)

This editorial is a continuation of the editorial in the previous edition of this journal. The previous editorial identified the current focus of policy makers on entrepreneurial behaviour and the support of small firm business development in many nations. The issues in developing entrepreneurial support programmes were identified and discussed, including issues such as the style of advisers providing business support and the nature of adviser relationships and their impact on entrepreneurial behaviour. The papers in the previous edition were discussed in the context of these developments. We continue with this theme for the remaining papers, which are the focus of this editorial. The papers in both this edition and the previous edition, are taken from the 3rd Enterprise and Learning Conference. The previous edition carried papers that focused on the potential impact of advisers, mentors and others on the nature of entrepreneurial behaviour and entrepreneurial learning. The papers in this edition focus more on general business development and the growth of entrepreneurial firms and supporting development.

Segmenting the market

Continuing with our theme, however, from the previous edition, a further issue that has concerned policy makers is segmentation of the markets for entrepreneurial support. Segmentation may be achieved in a number of different ways. Support programmes that are targeted at new entrepreneurial behaviour and start-ups, cannot afford to provide blanket support to all firms, hence there are, usually selected, higher growth entrepreneurs that are targeted for support. In this editorial we will put on one side the debate about pre-selection and &#34"picking winners&#34", but it is inevitable that with publicly-funded support programmes for entrepreneurs, such support will be selective.

An alternative segmentation, is to provide support for technology-based and innovative firms. While there may be definitional problems again, such firms are easier to pre-select and the arguments for supporting such entrepreneurs are easier to justify due to the arguably greater needs of technology-based entrepreneurs for seed and development finance and additional support such as marketing expertise. In addition, in many nations we have seen a veritable explosion in specialised support for technology-start-ups with specialised business incubators and science parks.

The experience of the USA suggests that many incubators are located within technology clusters such as the Austin Technology Incubator, Texas (surrounded by a cluster of 1,800 high-tech companies) or the St John's Incubator, Cambridge, where entrepreneurs enjoy many obvious networking opportunities. A recent development of this rationale involves using the incubation network and techniques as a means to directly enter overseas markets. Scottish Trade International and Scottish Enterprise have recently established an incubator facility in Virginia, USA, to help six technology companies enter the local market (the largest software producing state in the US after California). Visiting the centre, Patricia Hewitt, UK Minister for Small Business and e-Commerce, claimed that &#34"you need a physical presence (here) to sell into the US.&#34" The Minister also suggested that incubators be used to attract inward investment into the UK (Financial Times, 2000). This development in &#34"traditional&#34" incubation practice seems in part congruent to recent research undertaken at Babson University that concluded: &#34"The enterprise support/incubation system of the future will look beyond national boundaries to globalized markets; will mobilise better the new computing/communications technologies; be fully linked to knowledge bases such as universities and R&D centres and technology parks; and provide a platform for the convergence of services including risk capital&#34" (Lalkaka and Abetti, 1998).

While incubators are not confined to technology, a high proportion deal with technology ventures. An examination of the literature shows that traditionally the focus of high technology analysis was usually concentrated on the individual entrepreneur and his personality (Roberts, 1991; Jones-Evans, 1995) by extension literature on the performance of small firms' start ups attempted to apply models which explained the performance of medium and large firms to small firms. Thus the various typologies on strategy used by large firms have been applied to small firms in high technology sectors. However, there have been doubts as to whether those conceptual tools were appropriate not only in terms of appraising the small firm start up performance, but also in terms of prescribing a course of action (Carter et al., 1994).

The papers in context

The papers in this edition contribute insights into the nature of technology or growth firms, the role of science parks and incubators and the development of related support policies. The first paper, by Keogh et al., investigated 60 technology-based firms in a cluster of high technology firms based on the Aberdeen Science Park and the surrounding area. Keogh et al. make observations on entrepreneurial learning that have close comparisons to papers in earlier editions, however, their paper also provides analysis of skill requirements of such firms suggesting ways in which support agencies can enhance the learning process and entrepreneurial development in technology-based firms and other science parks, supporting many of the views in the literature regarding marketing support for such firms.

The second paper by Boussouara and Deakins examines the role of non-executive directors (NEDs) in high technology-based firms. Support programmes, as discussed above may provide longer term help for technology-based companies through advisory and consultancy relationships (also discussed in more detail in the previous edition). This editorial has also discussed the need to have a selective approach due to limited resources. NEDs provide a potential solution since they may originate from publicly-funded programmes, but they also are self-funding. NEDs provide a means of channelling expertise into high technology-based firms, and in this situation the public sector agency may just provide a match-making service. This paper discusses the important issue of trust and knowledge acquisition. A development agency may have a role to play in ensuring trust, in developing a relationship, so that knowledge is transferred.

The third paper by Choueke and Armstrong examines the issue of culture in growth firms, through research conducted in the North West of England and Scotland. As Choueke and Armstrong argue, culture is a missing perspective on entrepreneurial development, especially in business support programmes. The authors argue that recognition of differing culture may alter the nature of training and support programmes, with advisers needing to work sympathetically within a growth company's organisational culture.

The final paper by Wyer et al. is a more conceptual paper. They argue that the concept of the learning organisation can be applied to entrepreneurial and small firm development, although, as addressed within the mainstream literature, it needs considerable development for entrepreneurial behaviour. The authors suggest a research agenda for development of this area.

Conclusion

This editorial has highlighted the contribution of four papers which all have an insight into entrepreneurial behaviour in certain specific groups of firms, notably high technology and growth firms. While governments continue to pursue national agendas that make entrepreneurial encouragement and development central to their policies, further research and insights are required on the nature of support policies, on business incubators and the development of relationships between entrepreneurs and other directors, advisers and consultants.

David DeakinsPaisley Enterprise Research Centre,University of Paisley

ReferencesCarter, N.M., Stearns, T.M., Reynolds, P.D. and Miller, B.A. (1994), &#34"New venture strategies: theory development with an empirical base&#34", Strategic Management Journal, Vol. 15, pp. 21-41.Financial Times (2000), 15 March.Jones-Evans, D. (1995), &#34"A typology of technology-based entrepreneurs: a model based on previous occupational background&#34", International Journal of Entrepreneurial Behaviour and Research, Vol. 14 No. 1, pp. 26-47.Lalkaka, R. and Abetti, P.A. (1998), &#34"Business incubation and support systems in restructuring&#34", research paper, Babson College, Babson Park, MA.Roberts, E.B. (1991), Entrepreneurs and High-technology: Lessons from MIT and beyond, Oxford University Press, Cambridge, MA.