Entrepreneurial orientation and networking: Some Indian evidence

Abstract

Research evidence indicates that entrepreneurs who exhibit a need for unique, path-breaking accomplishments (pioneering) and transforming the status quo (innovative) are quite different from other entrepreneurs. This is called the PI motive, which is found to be a constellation of policy commitments to pioneering novel outputs, technological sophistication and so on. The nature of these policy commitments underlines the need for and pattern of interpersonal networking behavior demonstrated by PI entrepreneurs. There is evidence to show that such networking is a means of raising required resources and thus plays an important role in the process of enterprise creation and growth. There are both active and latent networks, and those belonging to inner and outer circles. This paper discusses the findings of a study undertaken to see whether or not PI entrepreneurs showed greater networking behavior, and if so, to look at the nature of these networks and the purposes for which they were used. Sixty-seven cases of small-scale entrepreneurs published in two Indian business journals constituted the data. In order to know the pioneering innovative orientation of entrepreneurs covered, independent professionals rated the cases on the presence or absence of ten types of innovations including the Schumpeterian innovations. It was found that entrepreneurs with high PI scores resorted to networking to raise critical resources more than those with low PI scores. High PI entrepreneurs did not merely adopt the suggestions or ideas acquired from their networks but synthesized them in a way that resulted in substantial learning. Networks, especially with inner circle contacts, provided hard resources such as capital and technology. Family and friends formed the major sources of resources. The search for excellence of PI entrepreneurs goes beyond their firms into the large communities with which they deal. For them the goals/visions of their business do not seem to be limited to considerations of survival or even money making; they would like to be change agents and bring about transformations in the industry and economy. Because of their emphasis on new products, markets, technology and so on, PI entrepreneurs showed behaviors that build capabilities to manage uncertainty and risk and build credibility to attract favorable attention and support. Towards this end, they tended to scan the environment constantly, collaborated with customers and consultants, and focused on enhancing professionalism in organizations. Similarly, their goals to influence groups related to their business required them to provide leadership in addressing industry/community issues, and the development of a distinct identity. It is shown that the business and non-business goals of PI entrepreneurs support each other—the higher networking behavior is a common denominator underlying both the personal and business agenda of the PI entrepreneur.