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15 February 2010 | Posted by Innova Institute

The Opportunity and the Entrepreneur

The concepts of entrepreneurship and business opportunities are closely linked. In words of Shane and Venkataraman (2000) "To have entrepreneurship, you must first have entrepreneurial opportunities" or in a more casual approach: “without an opportunity there would be no entrepreneurship” (Short et al. 2009). The objective of this post is to shed some light on the definitions of each of these concepts and to engage in further discussions: A review of the academic literature brings different understandings of the concept of entrepreneurship, Klein (2008) suggests to organize them in three groups:

  • Occupational: describes the role of entrepreneurship as a self-employment option, and focuses in the individual traits of those who engage in entrepreneurial projects.
  • Structural: depicts entrepreneurship using the firm as unit of analysis, limiting entrepreneurship research to small or new firms phenomena in the market structure.
  • Functional: gives to entrepreneurship the functions of "judgment, innovation, adaptation, alertness and coordination "(Klein 2008), regardless of the size, age, or occupational motivation of the firm or individual.

A more open area of discussion is the definition of entrepreneurial opportunities. Despite divergent views on whether opportunities are created or discovered (Klein 2008; Alvarez & Barney 2007), or if they are of subjective or objective nature, we would like to leave you a cohesive definition that has been suggested by Short et al. (2009): “An opportunity is an idea or dream that is discovered or created by an entrepreneurial entity and that is revealed through analysis over time to be potentially lucrative”. As presented in the previous post, in the Innova Institute at BES La Salle we are engaged in a research project (Garcia 2009) that aims to better understand how the prior knowledge of individuals affects entrepreneurial opportunities. We expect that research outcomes will help to understand better how business experience and management education influence the ability of managers and entrepreneur to further innovate or start entrepreneurial ventures. References:

  • Alvarez, S. & Barney, J., 2007. Discovery and creation: alternative theories of entrepreneurial action. Strategic Entrepreneurship Journal, 1(1-2), 11-26.
  • Garcia, R., 2009. El conocimiento a priori de los individuos y la identificación de las oportunidades de emprendeduría: el papel complementario del conocimiento de negocio y el conocimiento emprendedor. Advanced Studies Diploma (DEA), La Salle, Ramon Llull University.
  • Klein, P., 2008. Opportunity discovery, entrepreneurial action, and economic organization. Strategic Entrepreneurship Journal, 190, 175-190.
  • Shane, S. & Venkataraman, S., 2000. The promise of entrepreneurship as a field of research. Academy of Management Review, 25, 217-226.
  • Short, J.C. et al., 2009. The Concept of "Opportunity" in Entrepreneurship Research: Past Accomplishments and Future Challenges. Journal of Management, 36(1), 40-65.
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