Abstract
The question of why entrepreneurs undertake business planning activities differently, ranging from planning “in the head” to generating formal written documents, is still impenetrable. Aggregating data on 11,064 observations from 32 independent data set, this study meta-analyzed how business experience and gender influence entrepreneurs' disposition to business planning behaviors. Surprisingly, contradictory to some extant views that entrepreneurs without prior experience are more likely to make business plans, we found that both managerial experience and entrepreneurial experience positively influence entrepreneurs' subsequent business planning behaviors. Drawing insight from the effectuation and institutional perspectives, this study showed that, rather than entrepreneurial experience, managerial experience motivates entrepreneurs to generate formal business plans. For entrepreneurs who create formal business plans, both entrepreneurial experience and managerial experience enhance their business planning sophistication. In addition, we examined the moderating effects of gender on the relationship between business experience and business planning. The results suggested that female entrepreneurs with entrepreneurial experience are more likely to undertake business planning behaviors and create formal business plans than their male counterparts.
Highlights
Business planning is often taken for guaranteed as a handy tool for entrepreneurship by universities, governments, investors, and consultant agencies, as extensive studies reveal a positive association between business planning and venture performance (Delmar and Shane, 2003; Gruber, 2007; Burke et al, 2010)
Entrepreneurial experience enhances female entrepreneurs’ risk awareness, and they are more likely to engage in business planning activities to avoid uncertainty and decrease future risk (Brinckmann et al, 2010)
We studied the relationship between formal business planning activity and the degree of business planning sophistication and entrepreneurial experience and managerial experience
Summary
Business planning is often taken for guaranteed as a handy tool for entrepreneurship by universities, governments, investors, and consultant agencies, as extensive studies reveal a positive association between business planning and venture performance (Delmar and Shane, 2003; Gruber, 2007; Burke et al, 2010). From the institutional perspective, writing a business plan is only a symbolic act taken for institutional reasons (Karlsson and Honig, 2009). Even though whether and how to engage in business planning are considered essential issues (Baker et al, 1993; Barry, 1998), to date, the formation mechanism for business plans is still impenetrable and inconclusive
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