Entrepreneurs' Problem-Solving Styles: An Empirical Study Using the Kirton Adaption/innovation Theory

Article excerpt

Entrepreneurship has become a subject of research interest as scholars strive to learn what characteristics, cognitive styles, and behaviors identify a potentially successful business initiator, how entrepreneurs survive the early years of a risky venture startup, and finally how they make the transition to a professionally managed business. Past recent research has focused on entrepreneurial characteristics and personality profiles (e.g., Hornaday and Aboud 1971; McClelland 1965; Sexton and Bowman-Upton 1986, 1990).

Other research has focused on the differences in decision-making styles of managers and entrepreneurs. Begley and Boyd (1986) found that entrepreneurs exhibited higher risk-taking propensity than small business managers. Hoy and Carland (1983) found entrepreneurs to be more perceptive and flexible while small business owners were more logical and methodical in their decision making. In a comparison of the decision-making approaches used by entrepreneurs and managers of larger firms, Smith, Gannon, Grimm, and Mitchell (1988) found that the managers used a more rational approach than did the entrepreneurs. Finally, Swayne and Tucker (1973) argued that entrepreneurs are more innovative than managers in seeking ways to expand their business or start new ones.

While research investigating entrepreneurs' unique personality attributes and actions to solve problems has contributed to our understanding of the entrepreneur, it sheds little light on how entrepreneurs approach the challenges of venture initiation. More recently, research has shifted to an examination of entrepreneurs' cognitive styles.

ENTREPRENEURIAL COGNITIVE STYLES

A number of other researchers have examined the relationship between decision styles and (1) subsequent behaviors and (2) firm performance. Hoy and Hellreigel (1982) applied the Kilmann and Herden (1976) model of organizational effectiveness criteria to small business. The underlying premise of this model (based on Jung's theory of psychological types) is that managers perceive and solve problems in different ways, depending on their preferred problem-solving style. Hoy and Hellreigel (1982) found that the majority of their participants were characterized by a logical, analytical thinking process with a focus on the specific details of the situation.

Brodzinski, Scherer, and Weibe (1990) found that entrepreneurs' decision style, again defined by the Kilmann and Herden model and tested by the Myers-Briggs Type Inventory (MBTI), affected selection of boundary-spanning activities. That is, the number and type of outside contacts sought and the way that information was analyzed differed as a function of cognitive style.

Dollinger (1984) found that small business owners' boundary-spanning activities, including networking and information seeking, were related to two dimensions of decision styles: integrative complexity (the ability to interpret and recode environmental information) and tolerance of ambiguity. Entrepreneurs high on both dimensions spent a greater percentage of their time on boundary-spanning activities. Further, Dollinger found that this decision style was positively associated with firm financial performance.

In their investigation of small business owners' psychological traits associated with different information search patterns, Welsch and Young (1982) found two traits influenced entrepreneurs' choice of source and type of information sought from the environment: (1) rigidity, defined as a lack of variability and adaptability, and (2) openness to innovation. Thus, innovativeness seems to be related to one set of managerial behaviors: environmental scanning.

Cumulatively, the results of these studies indicate that decision style affects such behaviors as information search and boundary spanning in small business. All of these studies used small business owners rather than individuals who fit the definition of an entrepreneur as one who creates, manages, and assumes the risk of a new venture (Cunningham and Lischeron 1991). …