Knowledge creation theory of entrepreneurial orientation in social enterprises

ABSTRACT

This study advances the entrepreneurial orientation and knowledge creation literature by investigating the ways opportunities, motivations, and abilities to knowledge exchange and knowledge creation drive entrepreneurial orientation in social enterprises. Using a pretested and pilot-tested survey questionnaire, data was gathered from 112 Australian social enterprises. Path analysis results identified that opportunity and motivation influence ability, which subsequently affects knowledge exchange. Knowledge combination is preceded by knowledge exchange which consequently influences entrepreneurial orientation. Future studies may consider including moderating variables, and investigating the development of opportunities, motivations, and abilities of employees to spur entrepreneurial orientation in the social enterprise context.

KEYWORDS:

• Entrepreneurial orientation
• knowledge creation
• opportunity-motivation-ability
• social enterprise

Notes

¹ There are arguments over the measurement of the EO concept and whether it is a behavioral or attitudinal construct or both. This study conceptualizes EO as a behavioral construct following De Clercq et al. (2013) and thus, the measurement model was specified with EO as a reflective construct. However, Anderson et al. (2015) provided a measurement theory-based reconceptualization of EO where innovativeness and proactiveness (entrepreneurial behaviors) are behavioral while risk-taking is attitudinal – managerial attitude toward risk. In this study we predicate that the higher the knowledge combination, the higher will be the EO. We believe it is important to clarify if there is an alternative explanation to our hypotheses if we follow the reconceptualization of EO. Following Anderson et al.’s (2014) EO reconceptualiztion, we posit that new knowledge combinations facilitate spotting new opportunities and perceiving varied pathways in exploiting identified opportunities, which subsequently increases the feasibility of actions. Therefore, there is a positive link between knowledge combination and entrepreneurial behaviors. Intensive knowledge combinations (i.e., creating new knowledge) increase a manager’s ability to compare opportunities by assessing relative strengths and weaknesses. This provides managers with more clarity about the new products and service they intend to introduce. This in turn increases the managerial attitude toward risk (i.e., willingness among strategic decision-makers to contribute resources to projects with uncertain outcomes). In addition, the open, egalitarian, and trusting environment in social enterprises further encourages managerial attitudes toward risk-taking.