The changing role of guanxi in influencing the development of entrepreneurial companies: a case study of the emergence of pharmaceutical companies in China

“Guanxi” is a term in Chinese referring to the reciprocal nature of interpersonal relationships. Its attributes, which are specific to Chinese culture, have been the focus of recent literature. Whereas the impact of guanxi seems to be quite similar to that of general relationships, ties or connections, it is characterized by a number of different dimensions. In this paper, we studied 44 entrepreneurial companies in the pharmaceutical industry in China to examine these attributes in greater detail. We use a system dynamics model to simulate the influence of various guanxi variables – the strength, scale and structure of guanxi – on the development of entrepreneurial companies.     

The variable effects of dynamic capability by firm size: the interaction of innovation and marketing capabilities in competitive industries

Although investments in marketing and innovation capabilities theoretically help firms to compete in dynamic markets and enhance performance, company size has a strong influence on whether this is the case. In a test of a proposed conceptual model, this study of 692 small, medium, and large enterprises found that large firms prospered from building dynamic capabilities under conditions of high industry competitiveness, while investments in innovation and marketing individually diminished small firms’ performance. The effect was mixed for medium-size firms. In small enterprises, however, dynamic capability proved to be crucial in order to withstand competition. Therefore, taking into account these firms’ limited resources, managerial efforts should be focused on the integration of marketing and innovation capabilities, because each capability alone does not have a significant positive impact on performance. In medium-sized enterprises, the support of marketing capability is required to raise profitability under conditions of high industry competitiveness; otherwise, innovation would not lead to actual profits. For large enterprises, industry competitiveness was found to be a less serious threat to performance, and instead is a catalyst to the development of capabilities, suggesting that managers of such firms should focus on building long-term strategic advantages.     

Transition from part-time entrepreneurship to full-time entrepreneurship: the role of financial and non-financial motives

Part-time entrepreneurship is often a first step towards full-time entrepreneurship. This study analyzes how financial and non-financial motives of part-time entrepreneurs influence the propensity of part-time entrepreneurs to become full-time entrepreneurs. Our results show that the motivation to supplement wage income or the motivation to achieve social recognition is negatively associated with transition behavior, whereas the motivation to achieve independence or self-realization is positively associated with transition behavior. The motivation to follow a role model, financial success, and innovation are not significantly related to transition behavior. The implications of these results with regard to part-time entrepreneurship are discussed.     

Authentic leadership and intrapreneurial behavior: cross-level analysis of the mediator effect of organizational identification and empowerment

Intrapreneurial activity is positively associated with the organizational growth, and the factors that stimulate such behaviors need to be identified. The general goal of this work is to explore the relationship of authentic leadership with employees’ intrapreneurial behavior and the intervening processes. A correlational study was carried out with 212 employees of Spanish companies, in which two cross-level mediation hypotheses were tested. The results obtained indicate that employees’ organizational identification and organizational empowerment both mediate the relationship between authentic leadership and employees’ intrapreneurial behaviors. In this work, we note the importance of including authentic leadership as an antecedent of intrapreneurship.     

Entrepreneurial branding: measuring consumer preferences through choice-based conjoint analysis

Start-ups face branding challenges. Not only are they confronted with the task of building brands from scratch, their newness also leads to a particularly high amount of customer uncertainty. This paper contributes to the emerging field of entrepreneurial branding by investigating start-up characteristics that signal trustworthy information to potential customers. An extended choice-based conjoint approach for modeling brand equity is used to explore the impact of different signals as initiated by established and new firms in the field of tablet computers. An empirical study reveals brand signals that have significant effects on purchase probabilities and are appropriate to overcome information asymmetries between start-ups and prospective customers.     

Extending the link between entrepreneurial self-efficacy and intention: a moderated mediation model

This study extended the research on the relationship between entrepreneurial self-efficacy and intention by developing a moderated mediation model. This model posits that the link between entrepreneurial self-efficacy and intention is mediated by attitudes toward entrepreneurship and planned entrepreneurial control, and that these mediation processes are further moderated by subjective norms. Based on a sample of 308 valid responses, regression analysis yielded two noteworthy results. First, entrepreneurial self-efficacy positively affects intention through attitudes toward entrepreneurship and planned entrepreneurial control. Second, the direct effect of entrepreneurial self-efficacy on intention decreases as subjective norms increase. By contrast, the indirect intention effects of entrepreneurial self-efficacy through attitudes toward entrepreneurship and planned entrepreneurial control increase as subjective norms increase. In addition, the results indicated that subjective norms positively affect entrepreneurial intention. These findings indicated that the model advances the use of the theory of planned behavior and can be used to define a person as an entrepreneur.     

Social capital effects on the discovery and exploitation of entrepreneurial opportunities

Social capital refers to social networks and the norms of reciprocity, cooperation and trust associated with them. It can be studied at different levels of analysis. As previous literature suggests, social capital has aspects at both the individual and collective levels. However, theory development and empirical research have focused on separate, sometimes diverging levels. In an attempt to address this, this research examines the simultaneous influence of individual and regional social capital on the discovery and exploitation of entrepreneurial opportunities using individual-level data from the Global Entrepreneurship Monitor linked with regional-level data on social capital. The results show that individuals from regions with higher social capital are more likely to discover and to exploit entrepreneurial opportunities. Moreover, individuals having networks with other entrepreneurs are also more likely to identify a business opportunity and to become an entrepreneur. Also, we found that social capital at individual level had a greater effect than social capital at regional level in the two stages of the entrepreneurial process.     

Entrepreneur location decisions across industries

In this paper we analyse whether entrepreneur location decisions differ across industries and identify the factors determining the choice of location between rural and urban environments. Firm location is based on a new taxonomy developed over the influential three dimensions of Hayter’s (1997) approach. The paper uses data from sample of one thousand Portuguese firms. We present a stylized theoretical model to determine how these new five dimensions influence firm’s location and test the model through a logistic regression. Our results show that that the location decisions depend on the sector of activity, type of area (urban vs. rural) and the characteristics of the entrepreneur. We find that companies engaged in knowledge intensive business services prefer to locate in urban areas. From an institutional point of view, firms prefer to locate in rural areas.