University of Twente Student Theses


Entrepreneurial processes in a cultural context - the influence of uncertainty avoidance on entrepreneurial processes in Denmark

Telman, Ruud (2012) Entrepreneurial processes in a cultural context - the influence of uncertainty avoidance on entrepreneurial processes in Denmark.

[img] PDF
Abstract:This research looks into the relationship between culture and entrepreneurial processes and focuses on the culture of Denmark. Common knowledge tells us that culture has an influence on the perception of people. Therefore the suggestion can be made that national culture might also have an influence on the perception of entrepreneurs and entrepreneurial processes. Culture can be defined as the collective programming of the mind, which distinguishes the members of one group or category of people from another (Hofstede, 2001, p. 29). Culture describes both the underlying value as well as the behavior that can be observed. Entrepreneurial processes describe the sequence of activities and decisions that the entrepreneur goes through that lead from an initial idea to a venture. Sarasvathy (2001) advanced our understanding of the entrepreneurial process by describing two distinct approaches to new venture creation: causation and effectuation. This research investigates whether culture has an influence on entrepreneurial processes. Therefore the literature of Hofstede (2008) is going to be used to study and operationalize culture and the literature of Sarasvathy (2008) is going to be used to study and operationalize entrepreneurial processes. Based on the literature three hypotheses were formulated on the expected relationship between entrepreneurial processes and uncertainty avoidance, which is a dimension of culture according to Hofstede (2002). The units of analysis for this study are student entrepreneurs. Student entrepreneurs can be defined as students in higher education that started their own business. The subjects were found thanks to incubators of Copenhagen school of entrepreneurship and Venture Cup, two organizations that help student entrepreneurs and therefore have a lot of contact and knowledge about Danish student entrepreneurs. Data was collected through interviews and surveys. These interviews were either carried out face-to-face or through videoconference and have been recorded digitally. The interviews consists of a case in which the subjects are asked to put themselves in the role of a student entrepreneur that wants to start up a coffee shop and they encounter ten problems. The subjects need to solve these problems while thinking aloud. The think aloud method means that the subject needs to speak out loud whatever comes to mind, while solving a problem. The interviews were coded according to the elements Sarasvathy (2008) assigned to the causal and effectual entrepreneurial process, with the addition of one element (Harms & Stienstra, 2012). Using a statistical model, Wilcoxon signed-rank test, the conclusion can be made that the score for student entrepreneurs in Denmark were significantly higher for effectuation than for causation. In order to measure culture the literature of Hofstede (2001) has been used. Hofstede (2001) identifies five dimensions of culture and assigned scores per country to these dimensions. Several studies however state that entrepreneurs might have different scores on these dimensions compared to the overall score in a given country. Therefore a survey will be held to measure the score of these dimensions concerning the student entrepreneurs in Denmark. The results of the VSM08 survey show that student entrepreneurs have different scores in the dimensions of Hofstede (2008) than the overall population of Denmark. Therefore the conclusion can be made that student entrepreneurs have a different perception upon these dimensions. Using dependent t-test the conclusion can be made that there is statistical evidence that uncertainty avoidance has an effect on entrepreneurial processes. Results of the statistical test indicate that there was a significant effect of uncertainty avoidance on (1)predictions of the future/non-predictive control, (2) competitive analysis/use of alliances or partnership and (3) expected returns/affordable loss. Statistical evidence was found to confirm the relationship between uncertainty avoidance and entrepreneurial processes and therefore the conclusion can be made that the uncertainty avoidance has an influence on entrepreneurial processes. Looking at the other dimensions, the dimensions masculinity and long-term orientation show no significant influence on entrepreneurial processes. Therefore the conclusion can be made that culture has some influence on entrepreneurial processes. Findings show that entrepreneurs in Denmark use more effectuation in the beginning of starting a business. Comparing the results from the fictional case with the use of entrepreneurial processes in the subjects own venture show that entrepreneurs make more use of effectuation in a fictional case compared to their own venture. Even though entrepreneurs use more effectuation than causation regarding their own venture the difference is much less than in the fictional case. One other influence on entrepreneurial processes has been researched. Findings show that government regulations have an influence on entrepreneurial processes. There are other aspects that might influence entrepreneurial processes, like study or experience. These relationships would have to be looked at in future research.
Item Type:Essay (Bachelor)
Faculty:BMS: Behavioural, Management and Social Sciences
Subject:85 business administration, organizational science
Programme:Business Administration BSc (50645)
Link to this item:
Export this item as:BibTeX
HTML Citation
Reference Manager


Repository Staff Only: item control page