Entrepreneurship is certainly alive and well in Brisbane

The last few weeks have seen both the Q400 awards and the Brisbane YoungEntrepreneur of the Year awards. We certainly congratulate all winners, as well as everyone who participated in these awards. Clearly it shows that entrepreneurship and the pursuit of business excellence is alive and well in Queensland.

Details of the Q400 awards can be found here.

Details of the Brisbane Young Entrepreneur of the Year can be found here.

 

Project Update – DEEO

The DEEO project investigates opportunities for entrepreneurship and innovation in the mining industry and is funded under the Australian Research Council’s (ARC) Discovery Projects funding scheme. The chief investigators on this project are Dr Henri Burgers, Professor Per Davidsson and Associate Professor Paul Steffens. The research team also comprises Dr Van de Vrande, our international partner investigator based in Rotterdam, and Dr Sandeep Salunke, a postdoctoral research fellow at ACE.

The project is being undertaken in the backdrop of unprecedented global macro-economic and geo-political changes by which the Australian mining sector is now experiencing one of its most exciting times. Given these changes and the sheer scale of demand for resources, the mining industry is faced with a conundrum of sorts in its approach towards innovation. While tremendous progress has been made in terms of safety and productivity by decades of incremental innovation and continuous process improvement, there have not been great leaps forward. There seem to be bottlenecks in the emergence of disruptive innovations that have the capacity to transform the mining industry.

The industry at its core comprises mining firms and supplier firms that actively support them. Both types of firms bring different strengths and face different hurdles in the discovery and exploitation of entrepreneurial opportunities that lead to innovation. The study will for the first time compare the differences in the approaches and the challenges faced by entrepreneurs in innovatively delivering a problem-driven solution vis-à-vis proactively creating opportunities. Initial findings suggest that current approaches in the mining industry are optimised for providing solutions for problems provided by clients (i.e. the mining companies), yet constrain the development of entrepreneurial opportunities that may have potential but are not driven directly by client demands.

We combine case study research and survey in the Australian resources and mining industry to generate new fundamental knowledge that provides a common framework to study (corporate) entrepreneurship in the mining industry. This new knowledge will benefit managers not only to understand and manage the processes underlying discovery and exploitation, but also to facilitate the collaboration in terms of opportunities for innovation between mining and supplier firms. In particular, the unique features of the mining industry (e.g. few but very large clients, capital intensity, limited scale economies, client/ problem-driven nature of the opportunity process) may provide important new insights for existing innovation and entrepreneurship practices.

The study is in initial stages of case study research and we are currently looking for respondents in senior managerial positions in the mining industry who have in-depth knowledge of the innovation, opportunity recognition and commercialisation process in the mining and resources sector. These in-depth interviews, each lasting around 45-60 minutes will help the researchers to generate rich insights in relation to the innovation and opportunity process and provide the basis for a survey to be sent out to a nationwide sample of companies. With your help, this knowledge will be a stepping stone to enhance our understanding of innovation and entrepreneurship in the Australian mining and resources sector.

For further information please contact Dr Henri Burgers or Dr Sandeep Salunke.

Brisbane News – Sept ’11 – Putting Research Into Practise

Professor Per Davisson from The Australian Centre for Entrepreneurship Research argues that we would see more successful private companies if they were to adopt research based knowledge.

Imagine a world where doctors learned their profession early in life and then stopped caring about the science of medicine. For the remainder of their career they would instead rely exclusively on fading recollections of their education, their own experience, and occasional discussions with colleagues.

Such doctors exist, but they are not necessarily the kind you would like to deliver the anaesthetic or to be holding the knife as it sends you into deep slumber. Most doctors keep up with research of direct relevance to their work.

Not so with business and management. In business, some “doctors” (managers) have never had formal, research-based training and most do not use research-based knowledge as an input into their decisions.

There are reasons for this. Many business practitioners get by pretty well most of the time without turning to research. By the way, much academic “business research” isn’t that great anyway) which is sadly true for most medical research and most business practice as well). Fair enough.

Further, the practitioner wrestles with immediate questions about firm-, industry- and situation-specific problems to which the researcher – focusing on broadly generalisable “on average” truths – cannot deliver complete answers. Researchers are rightly pressured to convince academic peers that their conclusions are valid and to publish their findings in prestigious academic outlets. Regrettably, they are not much rewarded for asking the questions practitioners are interested in, or to make sure that their findings are put to use.

Practitioners, in their turn, lack the training to find and see the relevance in research that could contribute to better decision-making. And sometimes they may even be arrogant enough to think they know all they need to know or that academe has nothing to offer.

But business research can be useful. Take the area of small firm growth. Queensland has many examples of small firms that have successfully grown larger – BMD Group, G James Group, The Coffee Club, Morris Corporation, Eagle Boys, Terry White Chemists to name a few – but we could arguably have more if research-based knowledge were put to better use.

Policy initiatives would do well starting from more realistic assumptions than that most firms have growth potential and that their owner-managers want to expand their firms. Research suggests many of them are reluctant to grow. This is often for good reasons. Growth is frequently unprofitable, and letting high profitability drive growth is usually sounder than is hoping that growth will make the firm flourish. While their concerns for loss of the “family” atmosphere are valid, managers also refrain from growth due to unsubstantiated fears that growth would make their firms more vulnerable.

Media praise the fast-growing “gazelles” and policy-makers rely on their job creation prowess. At the same time, research suggests that it is more meaningful to talk about “high firm growth” as a temporary state than of “high growth firms” as a particular species of firm. This is because few “gazelles” sustain their high growth over long periods of time. Moreover, very high rates of growth can be foolish rather than heroic.

As regards job creation, policy-makers should realise that this is a consequence rather than a goal of successful firm growth and that much of the growth of “gazelle” firms is acquisition-based and thus represents job re-shuffling rather than addition of genuinely new jobs.

This said, research suggests that while mergers and acquisitions among large corporations may be over rated – often a sound economic outcome does not materialise – acquisitions may be an under-utilised growth strategy among small firm managers. While organic (internally generated) growth can be exhausting for small firm, leading to lower growth in the next period, there is indication that acquisitions can spark a new spurt of organic growth in the following period.

The Australian Centre for Entrepreneurship at QUT (www.bus.qut.edu.au/research/ace/) arguably delivers on its mission to be nationally leading and internationally highly recognised among academics in our little specialty. We have also started to try to deliver on our second mission – to be the major hub in the country for making entrepreneurship research accessible and useful for practitioners. However, business researchers are few and the potential users are many, so delivering on this ambitious task requires time and resources.

Putting research-based knowledge in business to better use requires academics who care about practice in the ways they source their research questions and disseminate their results. That’s our job. Realistically it also requires better “distribution channels” – interested and competent journalists and consultants, well organised web sites, research-trained employees, and other means that make research accessible to business and policy decision makers.

Putting research-based knowledge in business to better use also requires curious, reflective – and demanding – practitioners. People who take their profession as serious as doctors do. Such “business doctors” appreciate that easy and certain solutions to their problems are rarely to be found anywhere. They also realise that if they make an effort, research-based knowledge can enhance the firm-, industry- and situation-specific they already have. That effort can never be provided by the researchers.

You can read it online here

International Research Collaboration

ACE may be located in Australia, but the nature of scholarly research ensures that international collaboration is very active. We are fortunate to be able to collaborate and work with some of the leading international entrepreneurship scholars.

The following colleagues are currently involved in joint research with ACE researchers:

CAUSEE Update – November 2011

The Comprehensive Australian Study of Entrepreneurial Emergence (CAUSEE) project that ACE has been conducting over the past 4 years has just completed its final year of data collection. What this means is that we now have one of the largest longitudinal datasets on Australian entrepreneurial activity.

We have already published a number of industry and academic papers that directly use CAUSEE data. These can be found here.

Our international research teams are actively working on a  number of projects including:

  • The role of action in the venture creation process [Scott Gordon]
  • Entrepreneurial bricolage – business founders’ clever and frugal ways of getting by with very limited resources (and possible negative effects of being overly clever/frugal) [Julienne Seynard and others]
  • The role of business planning in new and emerging ventures [Christophe Garonne]
  • How novelty and relatedness of the business idea affects new venture creation outcomes [DM Semasignghe – ‘relatedness’ = how closely the idea builds on knowledge and resources the founders already have]
  • The development and effects of resource advantages in new ventures [Paul Steffens]
  • Gender and new venture creation [Roxanne Zolin & others]
  • Internationalization of new and emerging firms [Siri Terjesen & industry report]
  • Engaging, Persisting, Progressing and Succeeding at new venture creation: Different milestones, different drivers?
  • Learning and adaptation in the venture creation process [only industry report so far]
  • The role of family in new venture creation [industry report]
  • High potential new ventures [industry report]
  • Business model adaptation [Antonio Dottore]

Additionally there is still great opportunity for additional projects using the data that has already been collected.

We would also like to follow-up on outcomes for all start-ups that were originally included in the survey whether or not they participated in all of the previous four waves. However, like all much of our research, funding is a key component. We would welcome any suggestions, or indeed interest from you in supporting us with additional research using this fantastic dataset.

CAUSEE is proudly supported by:

ACE Researcher gains Academy of Management Award

Dr Michael Stuetzer, a Postdoctoral Research Fellow within the Australian Centre for Entrepreneurship Research has been recognised as a finalist for the 2011 Dorothy Harlow Best Paper Award within the Gender and Diversity division of the Academy of Management.

His paper “Functional heterogeneity as a two-dimensional concept: Empirical evidence for new venture teams” was co-authored with Uwe Cantner and Maximilian Göthner, both from the Friedrich Schiller University Jena. This paper discusses the benefits and drawbacks associated with functional diversity within team start-ups.

The Dorothy Harlow award is given annually to the author(s) of the best paper submitted to the Academy meeting. Papers were nominated for consideration by the division’s reviewers. The late Dr. Dorothy Harlow pioneered the effort which started the Gender and Diversity in Organizations of the Academy of Management. The award has a winner and two finalist papers.

Given the quality of the papers and scholarship submitted to the division, Michael’s selection as a finalist is an important and well deserved achievement.

The paper, is also available as a 2 page vignette from the ACE website. Download

IPMA Young Researcher Award 2011

It is proving to be a rewarding conference season for the Australian Centre for Entrepreneurships Research Postdoctoral Research fellow Rene Bakker.

Rene receiving award

First, his doctoral dissertation (Entitled “It’s only temporary: Time and Learning in Inter-Organizational Projects”) was nominated for a Best Dissertation Award by the Technology and Innovation Management (TIM) division of the Academy of Management.

Besides a monetary reward and plaque, the award also gave Rene the opportunity to present his dissertation at AOM’s annual meeting which was held in August in San Antonio, Texas.

Secondly, during the upcoming International Project Management Association (IPMA) World Congress (held in Brisbane, October 9-12) Rene’s collective research contribution was recognized as IPMA Outstanding Research Contribution of a Young Researcher 2011.

The young researcher award is awarded yearly to a researcher who is either younger than 35 years, or has been actively involved in research for less than 10 years. The award recognises cutting edge contributions to the development of the discipline and profession of project-based organization and management.

Benefits and drawbacks of startup team heterogeneity

In this vignette, post-doctoral research fellow Michael Stuetzer considers some of the benefits and drawbacks associated with team start-ups.

Start-ups in innovative industries are often created by teams rather than individual entrepreneurs. Furthermore team started ventures seem to outperform solo started ventures. The overt success of entrepreneurial teams can be attributed to the logic that particularly innovative industries might require more skills and knowledge than an individual would be likely to posses, necessitating that individuals combine their abilities in teams in order to start-up successfully. But how do we build a successful start-up team?

Academic research usually portrays functional heterogeneity in a start-up team as a good thing. A range of arguments related to the scope of team member’s functional background (e.g. more knowledge, pooling of resources, higher creativity) support this view. However, business history is full of shocking stories about heterogeneous start-up teams who dissolved in bitter fights stemming from communication problems and internal conflicts.

Read the full vignette here

Growing Profitable or Growing from Profits?

In this vignette, Professor Per Davidsson considers some of the dynamics associated with firm growth.

Praise for rapidly growing firms – the ‘gazelles’ as they are sometimes called – abound in the media and sometimes also in political rhetoric. These fast-growing firms, we are told, create the bulk of new jobs and new wealth and are therefore the heroes of the economy. And surely sometimes they are.

Several academic theories also portray firm growth as a good thing. Economies of scale, experience effects and first mover advantages are assumed to accrue to those firms that grow larger than their competitors. More recently phenomena like eBay and Facebook are clear examples of Network externalities; that the value of a product or service can increase with the number of users.

But is growth universally a good thing? We also hear horror stories about firms that grew to their own death by losing financial control and/or growth creating internal, organizational turmoil. And to achieve rapid volume growth all you need to do is buy high and sell low, and for sure customers will love you; grow in numbers, and buy more. Financially it would be sheer disaster. So when we are assessing the value of growth we also need to consider how sustainable it is, and what are its likely effects on profitability.

This is what we tried to do in the research here. We asked the question:

What firms are more likely to be able to combine high growth with high profitability? Do firms become more profitable as a result of their growth? Or is it the small, profitable firms that manage to scale up their businesses without losing their already high profitability?

Download and read the full vignette here

Supporting Survival Entrepreneurs in Developing Economies

Dr Marcello Tonelli and Associate Professor Carol Dalglish have been working on a number of projects related to entrepreneurship in developing countries. One of their current projects is an ethnographic study in Mozambique based on work which was first started by Carol Dalglish in 2004. This current project is looking specifically at the role of transport.

The data for this project is sourced from both local entrepreneurs, NGO (Non Government Organisations) staff members, community leaders and government officials.

Funding for this project is being provided from the IMRG (Infrastructure Management Research Group) – QUT Business School.

Please contact ACE for further information.