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Planning sophistication and planning commitment by entrepreneurs in the phase of their business start up

Bogaard, Jeroen uit den (2012) Planning sophistication and planning commitment by entrepreneurs in the phase of their business start up.

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Abstract:The question: "why some entrepreneurs become successful and others fail?" is a question that many researchers hold for many years (Markman & Baron, 2003). Entrepreneurship consists of many facets which could predict the likability for future entrepreneurial success. One of these facets entrepreneurs are coping with is the way how they execute their steps in pursuing their goals. For this study the focus is on the planning behavior of entrepreneurs who participate in a living lab setting created by Venturelab. Especially the sophistication and the commitment towards that planning is here of interest. Some entrepreneurs don't plan too much and keep their ideas in mind, where others refine their actions in order to obtain their pre-selected goals. Also the aspect of the difference between stating actions and actual carry out those actions is considered to be an important indicator to be able to define the effect planning has on performance. For this study we measured performance based on the judgment that is composed by the rating scheme of Frei (2004) and is rated by an expert panel. The central question for this study is: Does planning sophistication contribute towards better future performance in new venture start-ups when entrepreneurs commit themselves to their planning? This study has shown that the sophistication of planning does not significantly show a linear regression with the likeliness of future performance. From theory we know that planning consist of two mainstreams; Structure and Content. When we look only at the sophistication of the structure of the planning and the relation to the likeliness of future performance , no significance in the linear regression between these constructs has shown . Also, when we only take the sophistication of the content of planning in consideration in relation to the likeliness of future performance no significance has shown. This means that the sophistication of planning is not a good indicators for the likeliness of future performance by entrepreneurs who participate in the business development program. The strongest and probably the only claim for this study is that the commitment towards earlier stated planning showed significant results regarding the linear regression between planning commitment and the likeliness to future performance by entrepreneurs. The conclusion here is, based on the results shown in this study, that entrepreneurs need to control for committing themselves to their earlier stated planning in order to obtain a higher probability on the likeliness to perform better in respect to those who do not commit themselves to their earlier stated planning.
Item Type:Essay (Master)
Faculty:BMS: Behavioural, Management and Social Sciences
Subject:85 business administration, organizational science
Programme:Business Administration MSc (60644)
Link to this item:http://purl.utwente.nl/essays/62219
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