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2009 | Book

Perceptions – Looking at the World Through Entrepreneurial Lenses Read chapter Read first chapter

Understanding the Entrepreneurial Mind

Opening the Black Box

Editors: Alan L.  Carsrud, Malin  Brännback

Publisher: Springer New York

Book Series : International Studies in Entrepreneurship

Part of: Springer Professional "Wirtschaft+Technik" , Springer Professional "Wirtschaft"

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About this book

Interest in the functioning of the human mind can certainly be traced to Plato and Aristotle who often dealt with issues of perceptions and motivations. While the Greeks may have contemplated the human condition, the modern study of the human mind can be traced back to Sigmund Freud (1900) and the psychoanalytic movement. He began the exploration of both conscious and unconscious factors that propelled humans to engage in a variety of behaviors. While Freud’s focus may have been on repressed sexuality our focus in this volume lies elsewhere. We are concerned herein with the expression of the cognitions, motivations, passions, intentions, perceptions, and emotions associated with entrepreneurial behaviors. We are attempting in this volume to expand on the work of why entrepreneurs think d- ferently from other people (Baron, 1998, 2004). During the decade of the 1990s the eld of entrepreneurship research seemingly abandoned the study of the entrepreneur. This was the result of earlier research not being able to demonstrate some unique entrepreneurial personality, trait, or char- teristic (Brockhaus and Horwitz, 1986). It was both a naïve and simplistic search for the “holy grail” of what made entrepreneurs the way they are. However, many of the researchers in this volume have never gave up the belief that a better und- standing of the mind of the entrepreneur would give us a better understanding of the processes that lead to the creation of new ventures.

Table of Contents

Frontmatter

Entrepreneurial Perceptions and Intentions

Frontmatter
Chapter 1. Perceptions – Looking at the World Through Entrepreneurial Lenses
Abstract
In this chapter we consider how the perceptions of entrepreneurs might differ from those of non-entrepreneurs and how this might lead individuals to act entrepreneurially when others would not. Perceptions are reality for nascent entrepreneurs who must make business decisions in an uncertain world, based on what they see or what they think they see. We use the analogy of “entrepreneurial lenses” and discuss clear lenses (self-efficacy), rose-colored lenses (cognitive biases), blue lenses (simplistic decision rules), yellow lenses (preference for monetary gains), purple lenses (preference for intrinsic benefits), and telescopic lenses (overestimation of profits and underestimation of risks). We also consider the frames that hold the lenses (framing effects).
Evan Douglas
Chapter 2. Toward A Contextual Model of Entrepreneurial Intentions
Abstract
In this chapter, the authors challenge the existing linear views of entrepreneurial intentions by proposing a contextual model of entrepreneurial intentions (EIM). This model, initially proposed by Elfving (2008), bridges self-efficacy, motivations, and intentions, in particular it addresses the role that specific goals and motivations play in intentionality. In addition, the chapter addresses the issues of the inconsistent effect of social norms on entrepreneurial intentions. It builds upon the prior work of a broad range of researchers, including those represented in the other chapters in this cluster on entrepreneurial intentions within this volume.
Jennie Elfving, Malin Brännback, Alan Carsrud
Chapter 3. An “Informed” Intent Model: Incorporating Human Capital, Social Capital, and Gender Variables into the Theoretical Model of Entrepreneurial Intentions
Abstract
This chapter was motivated by a belief, based on a substantial body of research, that prevailing theoretical models of entrepreneurial intensions are underspecified. Currently, such models as represented by the Shapero–Kreuger intentions model (Krueger et al., 2000) are highly focused on cognition in its more limited sense of the thinking process that occurs within an individual’s head rather than the broader, contextually embedded process of social cognition as conceived by Bandura (1977, 1986) and subsequent scholars. In the chapter, we develop six proportions derived from the literatures of human capital, social capital, and gender as they relate to entrepreneurship. We argue, when it comes to start-up intentions, the entrepreneurial mind is indeed broader than current theoretical models indicate. Accordingly, an enhanced model of informed entrepreneurial intent was developed and discussed.
Kevin Hindle, Kim Klyver, Daniel F. Jennings
Chapter 4. Entrepreneurial Intentions are Dead: Long Live Entrepreneurial Intentions
Abstract
Short of studying actual new venture launches, what could possibly be more potent than understanding the preconditions that enable entrepreneurial activity? Early research focused unsurprisingly on behavior (the “what?” and the “how?” even somewhat the “where?” and the “when?”) and since entrepreneurs were obviously special people, on the entrepreneurial person (the “who?”). Intentions are classically defined as the cognitive state temporally and causally prior to action (e.g., Dennett 1989; Krueger 2000). Here that translates to the working definition of the cognitive state temporally and causally prior to the decision to start a business. The field has adopted and adapted formal models of entrepreneurial intentions that are based on strong, widely accepted theory and whose results appear not only empirically robust but of great practical value. But do we have what we think we have? Or have we also opened the door to a much broader range of questions that will advance our theoretical understanding of entrepreneurship and entrepreneurs? We offer here a glimpse of the remarkably wide array of fascinating questions for entrepreneurship scholars.
Norris Krueger

Cognitive Maps and Entrepreneurial Scripts

Frontmatter
Chapter 5. Cognitive Maps in Entrepreneurship: Researching Sense Making and Action
Abstract
In this chapter, we show that cognitive maps are a viable way of both examining the cognitive structures of entrepreneurs and understanding the differences between entrepreneurs and managers in their cognitive structures. We demonstrate that these maps differ in their use and differ based on prior experience and perceptions. We tie this research stream in organizational behavior and strategic management to a potential research approach in the study of the cognitions of entrepreneurs. We also demonstrated how maps are tied to goals and to actions and thus to entrepreneurial motivations and perceptions. We also conclude that this stream of research into the cognitive maps of entrepreneurs has yet to be fully explored. Certainly maps can yield significant new insights into how entrepreneurs view their world and translate that either into successful or into unsuccessful new ventures. Finally, we demonstrate that entrepreneurial researchers likewise have such cognitive maps that influence, sometimes without awareness, their own views of the world.
Malin Brännback, Alan Carsrud
Chapter 6. Entrepreneurial Scripts and Entrepreneurial Expertise: The Information Processing Perspective
Abstract
Entrepreneurial scripts that represent entrepreneurial expertise enable researchers to begin to map the entrepreneurial mind. This chapter provides a complete demonstration of the steps needed by researchers to uncover the structure and content of the expert script knowledge structures that entrepreneurs utilize and to relate the use of these scripts to substantive organizational and entrepreneurial consequences.
Ronald K. Mitchell, Benjamin T. Mitchell, J. Robert Mitchell

Motivations, Emotions, and Entrepreneurial Passion

Frontmatter
Chapter 7. Motivations: The Entrepreneurial Mind and Behavior
Abstract
In this chapter various theories and approaches to motivational research are reviewed and applied to the study of the entrepreneur. These are discussed with respect to both necessity and opportunistic entrepreneurship. Various models that integrate internal and external motivation are explored and the concept of risk is examined as a form of motivation. The role of goals and goal setting is also discussed in the motivational framework and is tied to intrinsic and extrinsic motivations. In addition, work and life satisfaction are reviewed as they impact entrepreneurial motivation with specific attention paid to career motivation. Finally, achievement motivation is discussed, not only in terms of a unidimensional model, but also in terms of a multi-dimensional model to predict the performance of firms using the motivation characteristics of the entrepreneur.
Alan Carsrud, Malin Brännback, Jennie Elfving, Kristie Brandt
Chapter 8. The Role of Emotions and Cognitions in Entrepreneurial Decision-Making
This chapter examines the role of emotions and cognitions in entrepreneurial decision-making and how they interact in this process. First, definitions of the terms emotions and cognitions are outlined. Second, entrepreneurial decision-making processes and the role of emotions and cognitions within these processes are presented. Afterward, we briefly describe three representatives of cognitive appraisal theories of emotion with the focus on entrepreneurship. Finally, we present a model of how to study emotions and cognitions in entrepreneurial decision-making and point out implications for future research, for practice, and for teaching.
Theresa Michl, Isabell M. Welpe, Matthias Spörrle, Arnold Picot
Chapter 9. Collective Passion in Entrepreneurial Teams
Affective processes of individuals and teams at work are increasingly becoming acknowledged as important drivers of business decision-making processes and organizational behaviors. In particular, there has been an increasing interest in the notion of passion and its role in entrepreneurship. Business practitioners reckon that to stand even a chance of winning in a cutthroat environment dominated by larger, richer competitors, an entrepreneur needs to have “passion” – the “fire of desire” that enables an entrepreneur to surmount even the most difficult obstacles.
Mateja Drnovsek, Melissa S. Cardon, Charles Y. Murnieks

Attributions, Self-Efficacy, and Locus of Control

Frontmatter
Chapter 10. Why? Attributions About and by Entrepreneurs
Abstract
To help explain events and behavior, people search for causes. In some cases the identified causes are found within persons, in other cases they are found in the environment, in still other cases they are found in the interaction between person and environment. When provided with multiple opportunities for observation, people typically follow a principle of covariation. With only one chance for observation, people rely on causal schemata. Although attributional inferences are often correct, there are two primary classes of attributional error. First, there is a natural difference in perspective between actors and observers. Actors are “looking outward,” concentrating on factors in the environment, but observers are concentrating only on the actor. This perspective difference leads observers to over-attribute events to persons, paying too little attention to situational factors, a cognitive mistake known as the fundamental attribution error. Second, there are errors created by the observer’s motivation. Three examples are the self-serving bias, the need to believe in a just world, and defensive attribution. These errors and objective attribution processes are described and illustrated by examples from entrepreneurship.
Kelly G. Shaver
Chapter 11. Self-Efficacy: Conditioning the Entrepreneurial Mindset
Since Bandura’s original work (Bandura 1977a), the self-efficacy concept has become an important variable within social psychology research. However, it has also been invoked in numerous other areas of research: organization theory, human resource theory, cognition and behavioral theory, as well as identity theory, in connection with topics such as health, stress, leadership, commitment, ethnicity, religion, gender, culture, social class, because it emphasizes values that we perceive as important in the Western world such as achievement and performance (Gecas 1989).
René Mauer, Helle Neergaard, Anne Kirketerp Linstad
Chapter 12. Perceptions of Efficacy, Control, and Risk: A Theory of Mixed Control
Entrepreneurship involves the establishment of new organizations and the development of new economic activities. Its consequences have not been experienced before and thus are rife with risk and uncertainty. Those who engage in such activities have consequently been considered as being willing to take on more risk and uncertainty than others. Empirical work, however, has demonstrated that entrepreneurs are not willing to take more risks than non-entrepreneurs (Busenitz and Barney 1997; Miner and Raju 2004; Palich and Bagby 1995; Wu and Knott 2006). Therefore, a corresponding difference in general risk propensity hypothesis is not supported by research findings. Alternatively, a difference in risk perception hypothesis has been suggested. In other words, even if entrepreneurs and non-entrepreneurs have similar risk preferences, entrepreneurs may perceive less risk by overestimating their chances for success (Baron 1998).
Erik Monsen, Diemo Urbig

Beyond Cognitions: From Thinking and Opportunity Alertness and Opportunity Identification to Behaving

Frontmatter
Chapter 13. Entrepreneurial Decision-Making: Thinking Under Uncertainty
Veronica Gustafsson
Chapter 14. Entrepreneurial Alertness and Opportunity Identification: Where Are We Now?
Since its inception, entrepreneurship has struggled with the academic version of a new venture’s liability of newness; the field was considered pre-paradigmatic (Ireland et al., 2005b), bereft of theory or conceptual frameworks (Phan, 2004; Zahra and Dess, 2001) and so lacking in understanding that investigators could not agree on what constituted the phenomenon of interest: any kind of self-employment? New venture creation? Corporate venturing? Something else? All of the above (Gartner, 1990; Ireland et al., 2005a; Low, 2001, Vesper, 1982)?
Connie Marie Gaglio, Susan Winter
Chapter 15. Entrepreneurial Behavior: Its Nature, Scope, Recent Research, and Agenda for Future Research
The end of all the cognition and motivation of entrepreneurs is to take some action in the world, and by doing so, give rise to a venture, an organization. Thoughts, intentions, motivations, learning, intelligence without action does not create economic value. The very nature of organizing is anchored in actions of individuals as they buy, sell, gather and deploy resources, work, etc. The values created by exploiting of opportunity undoubtedly include some that are intrapsychic and personal, but those we study, those of value to the readers of this book, are inherently interpersonal and social and thus observable and learnable. This chapter provides a brief overview of entrepreneurial behavior using a limited but hopefully representative lens on recent research. We call for more research on what entrepreneurs do and that this research be both more rigorous than what we currently have and also more creatively sourced.
Barbara Bird, Leon Schjoedt
Backmatter
Metadata
Title
Understanding the Entrepreneurial Mind
Editors
Alan L. Carsrud
Malin Brännback
Copyright Year
2009
Publisher
Springer New York
Electronic ISBN
978-1-4419-0443-0
Print ISBN
978-1-4419-0442-3
DOI
https://doi.org/10.1007/978-1-4419-0443-0

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