“How can entrepreneurial mindset be

developed in organisations?”

November 27, 2015

Kolding, Denmark

By

Shahamak Rezaei

Department of Society & Globalisation

Roskilde University

What Is Entrepreneurship?

Process of creating value by bringing together a

unique package of resources to exploit an

opportunity

Opportunity-alertness –“the ability to notice without search opportunities that have hitherto been overlooked”

Self-efficacy – ”can execute courses of action required to deal with prospective situations”

Risk-willingness – willingness of individuals to pursue action with uncertain outcomes

Role-modeling – increasing individuals’ confidence in specific acts as they provide familiarity with the act and similarly are a source of social acceptance

ENTREPRENEURIAL

COMPETENCES

How might entrepreneurial perceptual competences

be enhanced?

INSTITUTIONAL

Context

INNOVATION

COMPETENCIES

Self-efficacy

Opportunity-alertness

Risk-willingness

Role-modeling

BACKGROUND

Gender

Age

Education

ENTREPRENEURIAL

COMPETENCES

What is Innovation? Schumpeter’s promoted two major models of innovation, sometimes called

Schumpeter I and Schumpeter II. Schumpeter I is based on his early works,

where innovation is primarily driven by young and small entrepreneurs, who

are able to implement new ideas in the market, and hence take a temporary

monopolistic power in the market. These firms are hence able yield

monopolistic profit, which is eventually eroded as competitor firms imitate

their innovations (Schumpeter J. A., 1911).

In Schumpeter II innovation is driven by large and established firms

(corporation), which are able to overcome increasing innovations cost by

using economies of scale. Hence larger and older firms are hypothesised to

have higher innovation propensity and yield greater benefits from innovation,

i.e. higher growths (Schumpeter J. A., [1942]).

In more recent literature these two seemingly different innovation

approaches have been accepted to be co-existent in different sector. So that

Schumpeter I is predominant in less developed or sector with less capital-

intensive but more human-capital-intensive sectors; while Schumpeter II is

predominant in highly capital-intensive sectors.

Innovation system

Innovation system, describes how a country, a region, a

network or an industry functions as a system promoting

the transfer of innovations and business concepts into

profitable enterprises or organizations in national or

global economy. In a regional innovation system we

identify three major elements (trade and industry;

education and research; the political structure) interacting

(triple helix) in the field between demands from the

market and boundary conditions in the infrastructure.

Linking innovation

systems

Mark Granovetter (1973) argued that the presence of weak ties in social networks were

important aspects of social structure through which novelty is likely to flow, such as

information important for finding a new job. Burt (1992) took Granovetter's argument a step

further with the concept of "structural holes." Structural holes can be found in the vicinity of

nodes with high betweenness centrality that mediate connections between two or more

otherwise isolated cliques. In contrast to Coleman's view of social capital inherent in closed,

Burt argued, and empirically demonstrated, that open networks connected via bridges across

structural holes carried more consistent social benefits.

How to understand Diversity

and Innovation?

Figure 1 illustrates the individual advantage obtained by C, a member of clique ABC upon

bridging to the DEF clique that connects internationally to the GHI clique abroad. Thanks

to her friendship with F, who is not a co-ethnic, C has access to E, and thanks to E can

trade with GHI abroad. C’s clique has no co-ethnic trading partners abroad, but C is

sharing some network advantages that belong to another group’s diaspora. This is indeed

strengthening of the weak ties.

Figure 1 Individual Advantage Obtained by Bridging (Source Light 2010, Rezaei, Dana & Light 2010)

Local Linked International

Clique Cliques

distance

A B D - E ----------- - - - - - - - G - H

\ / \ / \ /

C - F I

Entrepreneurial Space

Globalization

Globalization means the accelerated economic

integration of previously less integrated national

economies.

Source data is from United Nations (2013)

An Example: Movement of

Chinese Entrepreneurs

North America

South America

Africa

EU

Asia

Australia

Globalization and Transnationalism

Transnationals are well endowed to do the work of

linking and integrating economies.

bi-cultural, spoke and hub organization, international networks,

enforceable trust, prompt perception of opportunity conditions

Transnationalism

What’s transnationalism?

It’s the term given to the people who live in a cross-national

context (abroad and in their homelands) more or less

simultaneously.

A recent product of: jet airplanes, electronic

communications, globalisation

Who’s in charge?

Globalisation is much bigger than transnationalism.

Transnationalism is globaliation’s helper; it did not cause

globalisation.

Transnational Entrepreneurship

(TE)

Inspired by AnneLee Saxenian’s seminal research questions in

the dominant Argonaut-literature – Brain Circulation

Super Diversity - Steven Vertovec has defined super-diversity

as: the arrival of new, small and scattered, multiple-origin,

transnationally connected, socio-economically differentiated and

legally stratified immigrants.

Transnational Entrepreneurship

The process of TE involves the entrepreneurial activities that are carried out in a cross-national context and initiated by actors who are embedded in at least two different social and economic arenas.

Transnational entrepreneurs are individuals that migrate from one country to another, concurrently maintaining business related linkages with their former country of origin and currently adopted countries and communities.

Transnational Entrepreneurship (TE) The process of TE involves the entrepreneurial activities that are carried out in a cross-national context and initiated by

actors who are embedded in at least two different social and economic arenas.

1. International Entrepreneurs IE’s , Growth entrepreneurs developing new

international markets

2. Ethnic Entrepreneurs EE’s , Often necessity entrepreneurs responding to

closed labor markets - Brain drain>waste

3. Returnee Entrepreneurs RE’s, Individual migrants returning with

qualified knowledge - Silicon Valley>Bangalore (Saxenian) - Brain circulation

4. Transnational Entrepreneurs, TE’s, Individual entrepreneurs linking two

business environments - Brain gain

5. Transnational Diaspora Entrepreneurs TDE’s , Entrepreneurs linking two

business/culture environments, but also link to a diaspora “community” EE’s

becoming TE’s - turning brain waste into brain gain

Classification of Entrepreneurs

The emergence of super-diversity

Diversity is not what it used to be. Some twenty-thirty years of government policies,

social service practices and public perceptions have been framed by a particular

understanding of equality, gender mainstreaming, immigration and multicultural

diversity. Policy frameworks and public understanding – and, indeed, many areas of

social science – have not caught up with recently emergent demographic and social

patterns. Many European societies can now be characterized by ‘super-diversity,’

(S.Vertovec , 2006, M. Ram 2011) a notion intended to underline a level and kind of

complexity surpassing anything the countries has previously experienced. Such a

condition is distinguished by a dynamic interplay of variables among an increased

number of new, small and scattered, multiple-origin,

transnationally connected, socio-economically differentiated and

legally stratified citizens as well as immigrants who have arrived over

the last decade. Outlined in the course, new patterns of super-diversity pose

significant challenges for both policy and research.

The New Buzzword:

Social Entrepreneurship

So, is entrepreneurship basically entrepreneurship regardless of the context?

Or is “social entrepreneurship” something truly different?

Social entrepreneurship is defined as "individuals with innovative solutions to

society’s most pressing social problems. They are ambitious and persistent,

tackling major social issues and offering new ideas for wide-scale change.

Rather than leaving societal needs to the government or business sectors,

social entrepreneurs find what is not working and solve the problem by

changing the system, spreading the solution, and persuading entire societies to

take new leaps." So defined, social entrepreneurship is concerned with the

entrepreneurs who undertake large-scale social innovation - which may or

may not involve a social enterprise. (Ashoka)

What Is Social

Entrepreneurship?

Nonprofits making money

What Is Social

Entrepreneurship?

Nonprofits making money

For-profits doing things to show they are not evil

What Is Social

Entrepreneurship?

Nonprofits making money

For-profits doing things to show they are not evil

Process of creating value by bringing together a unique package of resources to exploit an opportunity, in pursuit of high social returns

The only big difference between commercial and

social entrepreneurship:

Denomination of the returns

Social and commercial entrepreneurship have most

of the same characteristics

The Process of Social

Entrepreneurship

1. Find an opportunity

2. Develop a business concept

3. Figure out what success means and how to

measure it

4. Acquire the right resources

5. Launch and grow

6. Attain goals

Social Entrepreneurs “Look” Like

Any Other Kind of Entrepreneur Social concern, but also:

Innovativeness

Achievement orientation

Independence

Sense of control over destiny

Low aversion to risk

Tolerance for ambiguity

An Example: www.DiasporaLink.org

Transnational Diaspora Entrepreneurship as a

Development Link between

home and residence countries -

DIASPORALINK

DiasporaLink network The DiasporaLink network is North/South and European

university networks with a common objective to review,

research, develop and disseminate systematic, multi-

disciplinary knowledge and expertise of the collaborating

partners in area of transnational diaspora entrepreneurship as

a catalyst for economic empowerment and development.

Core themes of interest are cross-border SME

entrepreneurship, global entrepreneurship climate, financial

services for the under-privileged, sustainable rural

development and methodologies and tools to train and

sustain diaspora cross-border SME’s.

WWW.DIASPORALINK.ORG

DiasporaLink – TDE corridors

• DiasporaLink is running a EU-sponsored 4-year

project where 25 partners jointly developing a

platform to be tested in migration corridor

• A network is since several years established for

crossborder entrepreneurship linking Ethiopia and

the Netherlands.

• Microfinance is well established in Ethiopia and

start-up financing in Sweden is well developed

• The Ethiopian diaspora in Sweden is about 20 000

and quite well organized

Migration Corridor A migration corridor is linking the diaspora to the country of origin

through:

• Migration

• Financial transfers

• Transnational entrepreneurship and business

• Diasporas contributions to the home region

• Exchange within the extended family

The institutional and business environments within the migration

corridor and their function as a system promoting the transfer of

innovations, social and business concepts into sustainable

enterprises or organizations are often a limiting factor.

Innovation system

Innovation system, describes how a country, a region, a

network or an industry functions as a system promoting

the transfer of innovations and business concepts into

profitable enterprises or organizations in national or

global economy. In a regional innovation system we

identify three major elements (trade and industry;

education and research; the political structure) interacting

(triple helix) in the field between demands from the

market and boundary conditions in the infrastructure.

Linking innovation

systems

Corridor innovation

system

Conclusion

Transnational – and Diaspora entrepreneurs enhance the international trade of all

countries.

bi-cultural, spoke and hub organization, international

networks, enforceable trust, prompt perception of opportunity conditions

Who benefits?

Transnational- & Diaspora entrepreneurship does not have

identical economic consequences or bestow equal benefits

everywhere in the world.

We are facing “Global talent hunt”

Building a corridor innovation system

1. Financial/resource link between diaspora and kin, remittances

2. Team building of entrepreneurs and mentors across corridor

3. Linking financial resources supporting transnational startups

4. Connecting business development services across corridor

5. Information and training for entrepreneurs/mentors

End

Thanks for your attention.

SHRE@RUC.DK

rezaei@princeton.edu