Academic journal article American Journal of Entrepreneurship

Corporate Entrepreneurship: The Facilitating Effects of Creative Self-Efficacy and Leader-Member Exchange

Academic journal article American Journal of Entrepreneurship

Corporate Entrepreneurship: The Facilitating Effects of Creative Self-Efficacy and Leader-Member Exchange

Article excerpt

The challenge for leaders is to create an internal marketplace for ideas within their companies, and encourage employees to act on these ideas (Kuratko, 2007: 7).

Introduction

Virtually all organizations confront pressure to generate streams of both incremental and radical, industry-changing innovations as means to grapple with constant environmental change and create sustainable competitive advantage (Bettis & Hitt, 1995; Dess, Lumpkin, & McGee, 1999; Hitt, Ireland, Camp, & Sexton, 2002; Ireland, 2001). Researchers in Corporate Entrepreneurship (CE) have made great strides in studies that emphasize conditions supporting the strategic transformation of rigid and static organizations into more dynamic learning entities, including the identification of pro-entrepreneurial architectures (Ireland, 2001), entrepreneurial organizational cultures (Brazeal, 1993; Hornsby, Kuratko, & Montagno, 1999; Kuratko, Montagno, & Hornsby, 1990) and strategic postures geared towards innovation and creativity (Covin & Slevin, 1989, 1991; Hornsby et al., 1999; Kuratko et al., 1990). Collectively, this work suggests that successful sustained regeneration (Dess, Ireland, Zahra, Floyd, Janney, & Lane, 2003) of novel products, processes and technologies is most often a deliberate, strategic choice orchestrated through structural and internal organizational factors such as "free" time for creative pursuits and monetary rewards for innovations (Hayton & Kelley, 2006; Kuratko, Montagno, & Hornsby, 1990; Marvel, Griffm, Hebda, & Vojak, 2007; Sathe, 1985; Sykes, 1986).

Despite these important advances and with a few exceptions (e.g. Shepherd & Krueger, 2002), the literature falls short of addressing individual volition to undertake innovative pursuits and of the role of relationships among leaders and followers in the proactive engagement of promoting organizational change (Dess et al., 2003). Understanding such processes is important because individuals within organizations - not organizations themselves - choose to innovate and exploit opportunity through the creation of future goods and services (Shane & Venkataraman, 2000). As a result, the richness and intenti onality of the "human element" in the CE process remains less than fully considered. For example, despite research suggesting that viable entrepreneurial opportunity rarely presents itself in pre-packaged form (Ardichvili, Cardozo, & Ray, 2003), there are few studies that explicitly consider the dynamic role of attitudes and leader-member relationships associated with individual creative choice to facilitate the exploitation of "ripe" opportunities and innovations (Tierney, Farmer, & Graen, 1999).

To address this gap we utilize creative self-efficacy and leader-member exchange (LMX) as unique lenses to frame organizational efforts for sustained regeneration through CE. Specifically, our research question focuses on these variables as individual and dyadic level contributors to CE activity under internal conditions that are designed to foster an entrepreneurial organizational environment. We postulate that the perception of entrepreneurially oriented organizational factors bound to innovation such as management support, work discretion, time availability, organizational boundary and reinforcement will be related to creative self-efficacy (i.e., individual confidence to engage in creative activities). Creative self-efficacy, in turn, will then impact nascent opportunity exploitation behavior. LMX is postulated to directly impact creative self-efficacy and moderate the relationship between self efficacy and opportunity exploitation. As we will explore later, creative self-efficacy, a largely unexplored construct in the CE domain, focuses on an individual's perceived capacity to engage in creative behaviors, a state that is bound to individual decision-making and serves as an impetus for exploiting opportunity (Shane, 2000). …

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