May 2016 Social Networks and Knowledge Acquisition of Entrepreneurs Prof. Dr. Dr. Fabian J. Froese Chair of Human Resources Management and Asian Business Georg-August-University Göttingen Platz der Göttinger Sieben 5 (Blauer Turm) 37073 Göttingen, Germany www.hrm.uni-goettingen.de
Content 1 Introduction & Theoretical Background 2 Methodology & Current Sample 3 Tentative Findings & Discussion 2
Content 1 Introduction & Theoretical Background 2 Methodology & Current Sample 3 Tentative Findings & Discussion 3
Entrepreneurship in Germany 93% of companies operating in Germany • are SMEs employing 60% of the German workforce (Federal Statistical Office, 2014) 2014: 585.700 new companies in • Germany (Federal Statistical Office, 2014) • Typical entrepreneur: male, 35-55 years • Typically: An increase of new businesses in knowledge based industries, such as IT or engineering services (Volery, 2007; Nijkamp, 2009) 4
Minority entrepreneurs in Germany Share of female Share of migrant Dropout rate entrepreneurs entrepreneurs Migration 50% background 40% 40% 40% 30% 30% 30% 20% 20% 20% 10% 10% 10% 0% 0% 0% 2008 2009 2010 2011 2012 2013 2008 2009 2010 2011 2012 2013 12 months 36 months 12 Monate 36 Monate Challenges these minority entrepreneurs face: • Migration background: e.g., smaller networks, lack of knowledge about local market, victims of stereotypes and discrimination, less financial support, higher risk of failure, … (e.g., Högberg et al. in press; KfW, 2014; Shinnar &Young, 2008; Smallbone et al., 2005) • Females: less active in networking, lower social capital, missing role models; less support from networks, less financial support; work-family challenge, … (e.g. Allen & Curington, 2014; Carter et al., 2007; Maes et al., 2014; Marlow und Patton, 2005; Schmid und Parker, 2003) 5
Research project (minority) entrepreneurs Research area 1 • Knowledge/ competences needed during stage of establishment Meaning of networks • Research area 2 • Identity of (minority) entrepreneurs Identity changes over time • 6
Literature review: Entrepreneurial networks Importance of networks for entrepreneurs Family and informal networks are sources of knowledge or capital for entrepreneurs (Masurel, Nijkamp, Tastan & Vindigni, 2001; Basu, 2004; Puryear, Rogoff, Lee, Heck, Grossmann, Haynes & Onochie, 2008) Entrepreneurial networks determine the corporate success in different phases of the start-up process of a firm (Anderson, Dodd & Jack, 2010; Elfring & Husink 2003) Networks influence the innovativeness of the newly found firm (Zali, Schott, Kordnaeij & Najafian, 2012) 7
Today`s focus: Social networks as sources of knowledge Social networks & knowledge Knowledge/ competences as competitive advantage (knowledge based view) Social networks as a person´s social capital (network theory) Acquisition and generation of knowledge/ competencies through networks? 8
Content 1 Introduction & Theoretical Background 2 Methodology & Current Sample 3 Tentative Findings & Discussion 9
Methodology – Exploratory pilot Study Data collection: • 97 semi-structured interviews • 30-60 minutes Data analysis: • Transcription of interviews • Qualitative content analysis 10
Current sample Foreing born or immigrant Local (German) background female 1 (IT, Online & Engineers) 16 (IT, Online & Engineers) 7 (Services*) 31 (Services) male 7 (IT, Online & Engineers) 14 (IT, Online & Engineers) 10 (Services) 11 (Services) * Services include all different types of services, e.g. cosmetics, consultancy, sales, etc. 11
Content 1 Introduction & Theoretical Background 2 Methodology & Current Sample 3 Tentative Findings & Discussion 12
Tentative findings I: Types of knowledge/ competencies Knowledge/ Competencies Business Personal Social • Industry-specific (most • Responsibility & • Customer loyalty inside their field) reliability • Communication Founding/ planning Taking initiative Leadership • • • Business functions Perseverance (Intercultural • • • (organization, finance/ • Self-organization competence) accounting, marketing/ • Self-confidence sales/ HRM • Flexibility & willingness to learn 13
Tentative findings I: Knowledge acquisition through networks Personal Most important source (exp. for females); high trust • • Personal support/ personal competencies (e.g. self-confidence; perseverance) family & friends Business and social skills experienced family & friends • Professional • Industry knowledge colleagues (prior experience) Business functions consultants, advisors, and institutions • (IHK; KfW; BA) • Planning institutions (IHK; KfW; BA) 14
Discussion Implications Knowledge is of crucial importance during stage of • establishing a firm • Most entrepreneurs found in their field of expertise prior knowledge is most important Various sources of knowledge in the networks • indication of a relation between type of network members and type of knowledge/ skills Limitations and future avenues Qualitative approach limited generalizability • Future quantitative testing of proposed relations • Long-term data in order to identify factors of success • 15
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