Firm Level Entrepreneurship

In order to establish definition for the firm level entrepreneurship, it is necessary to present the characteristics of management behavior used by scholars for that matter. Schumpeter (1934) states that innovativeness is the only entrepreneurship behavior that separates between entrepreneurship’s activities to non-entrepreneurship’s activities. Innovation relates to the pursuit after creative solutions through the development and improvement of services and products as well as administrative and technological techniques (Davis et al., 1991). Innovation reflects the firm’s tendency to support new ideas and procedures, which can end as new products or services Lumpkin and Dess (1996).

In his book “Essai sur la Nature Commerce en General”, Richard Cantillon (1755) argues that the essence of entrepreneurship is a risk-taking behavior. According to Lumpkin and Dess (1996), risk-taking can range from relatively “safe” risk as deposit money to the bank to quite risky actions like investing in untested technologies or launching new product to the market. In their research, Miller and Friesen (1982) define an entrepreneurial model of innovativeness, this model regards firm that innovate audacity and regularly while taking substantial risks in their strategy.

Third dimension, which can be added to innovation and risk-taking, is Proactive. According to Davis et al., (1991) proactive associates with an aggressive posture, relatively to competitors, while trying to achieve firm’s objectives by all rational needed means. Lumpkin and Dess (2001) mention that proactive relate to the way the firm associates to business opportunities through acquisition of initiatives in the market it’s operate in.

Although other dimensions are used to define firm level entrepreneurship, the vast majority of scholars use these 3 dimensions:

  • Innovation
  • Risk-taking
  • Proactive
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