This chapter purposed to inform the entrepreneurship field about the general question of what processes corporate parent firms use to exploit entrepreneurial opportunities. As such, it examined the resource and DILENE R. CROCKETT ET AL.
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Results of Regression Analyses for Hypotheses 1–5.
Main Effects Interactive Effects
H1 (TMT support), H2 (composite resource sharing)
H3 (functional importance functional resource sharing)
H4 (functional importance decision autonomy)
H5 (functional importance decision autonomy)
Beta Adj.R2 Beta Adj.R2 DinR2 Beta Adj.R2 DinR2 Beta Adj.R2 DinR2
TMT support 0.023
Composite resource sharing
0.21w 0.07
Functions
Marketing 1.4 0.13 0.07 0.1 0.09 0.001 0.09 0.09 0.001
Human relations 0.10 0.02 0.001 0.73 0.05 0.03 0.20w 0.04 0.04w
Sales 1.10 0.03 0.03 0.21 0.009 0.002 0.07 0.02 0.003
Customer service 0.26 0.03 0.003 0.47 0.05w 0.009 0.002 0.02 0
Technical 0.55 0.08 0.02 0.13 0.07 0.001 0.11 0.18 0.008
Strategy 0.38 0.03 0.005 0.23 0.21 0.002 0.07 0.28 0.003
Accounting/credit/
collections
0.11 0.02 0.001 0.72w 0.08 0.04w 0.32 0.11 0.08
Legal 0.71 0.03 0.02 0.66w 0.06w 0.04w 0.22w 0.05 0.04w
Production/
operations
0.61 0.07w 0.01 0.01 0.06w 0.001 0.08 0.05 0.005
R&D 0.04 0.10w 0.00 0.27 0.10w 0.005 0.07 0.06w 0.004
wpp0.10.
pr0.05.
pr0.01.
pr.0.001.
ofEntrepreneurialOpportunitiesintheCorporation51
decision-making implications of the implementation processes involved in exploiting an entrepreneurial opportunity inside an existing corporation.
Like prior research (Brown & Eisenhardt, 1995;Hitt et al., 1993), this study confirmed that corporate entrepreneurial initiatives receiving personal support from the TMT will be more successful. In practical terms, then, corporate executives seeking to launch entrepreneurial initiatives inside their existing corporations must be prepared to invest themselves and their personal time in support of the venture. They will need to provide communication and political support to the initiative. While this may seem intuitive, several of the experts consulted for this research suggested that many of the newspaper managers in the sample lacked vision for their digital initiatives, but knew that they needed to do something to respond to the emergence of the new technology and competition (Dimmick et al., 2004).
For some, these initiatives were simply an effort to ‘‘throw something out there and see what sticks’’, as one of the industry experts stated. While this may be an artifact of this single industry, it may also be representative of the kinds of general responses that firms in mature industries apply to new and unproven technologies.
The results of this research also enhance prior empirical study by discriminating between thesourcesof resource provision for new initiatives rather than only examining the overalllevelsof resource support provided to an initiative from their corporate parent. For example, other researchers have learned that higher overall levels of resource support result in more successful entrepreneurial initiatives (Cooper & Kleinschmidt, 1986;
Zirger & Maidique, 1990). This study, instead, focuses on the specific process ofresource sharingbetween corporate divisions or departments and the new initiatives. These findings suggest that the corporate sharing of resources in marketing, in particular, has a significant impact on initiative performance when marketing is critical to the success of the venture.
Therefore, the best source of critical marketing resources for exploiting opportunities is that found in the existing marketing divisions of the corporation. This finding may extend an explanation to Knight’s (1989) comparison between independent and corporate entrepreneurs. Knight (1989) found that marketing is the number one challenge of independent entrepreneurs. These findings suggest that it may not be so different for corporate entrepreneurs who must develop the ability to share the marketing resources of other corporate divisions and departments if their initiatives are to be successful. In other words, corporate practitioners must place a priority on addressing the issues inherent in the sharing of marketing resources through incentive plans, which promote cooperation in branding, DILENE R. CROCKETT ET AL.
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distribution, and promotion of the new initiative. All in all, the results of this study should encourage corporations to explore the resource needs of their new domain and use those to drive the sharing of corporate resources for new initiatives.
The results of this research also contribute to the field’s understanding of the decision-making implications of the implementation process required to exploit an entrepreneurial opportunity. The research question was presented in the form of two competing hypotheses, which are representative of the disparate results provided by extant research. On the one hand, researchers have found that decision control should rest within the initiative as they are closest to the new domain and would be best able to react to the evolving conditions in the domain (Block, 1983, 1989; Campbell et al., 1995).
Hypothesis 4 is consistent with this logic. Other researchers, however, have found that it is best if decision control rests with those that provide the resource and therefore provide the expertise for the function (Harrigan, 1985;Lyles, 1988, 1993). Hypothesis 5 is consistent with this logic.
This research contributes a deeper understanding of these issues to the field by investigating the questions according to the functional area of the corporation. As such, the effects that decision autonomy had on initiative success were found to be enhanced when the legal and accounting functions were more critical to the success of the venture. Contrary to theoretical expectations, however, it was also found that the more successful initiatives kept decision autonomy within the initiative even when the human relations, and legal and accounting functions were provided by the divisions and departments of the corporation. These surprising results would suggest to both practitioners and researchers that domain-specific information is more important to the success of an entrepreneurial initiative than function- specific information. Future research could substantiate these findings by testing a similar set of competing hypotheses in a different industry or among a more generalizable sample.