International Entrepreneurship and Management Journal 1, 275–291, 2005 c 2005 Springer Science + Business Media, Inc. Manufactured in The United States.
Managers’ Corporate Entrepreneurial Actions and Job Satisfaction DONALD F. KURATKO∗ Kelley School of Business, Indiana University, Bloomington, IN 47405
[email protected]
JEFFREY S. HORNSBY Miller College of Business, Ball State University, Muncie, IN 47306
[email protected]
JAMES W. BISHOP College of Business, New Mexico State University, Las Cruces, NM 88003
[email protected]
Abstract. Through the development and extension of theories and scholars’ subsequent empirical analyses of significant, theoretically grounded research questions, the knowledge about corporate entrepreneurship (CE) and its successful use continues to advance. Moreover, the literature suggests important relationships between the corporate environment, managers’ entrepreneurial behavior and successful implementation of corporate entrepreneurship actions. In an attempt to test some of those relationships, we describe an empirical study of 523 managers that examines the relationships among the antecedents to managers’ entrepreneurial behavior, a decision to implement entrepreneurial actions, and resulting job satisfaction and reinforcement practices.
Through the development and extension of theories and scholars’ subsequent empirical analyses of significant, theoretically grounded research questions, knowledge about corporate entrepreneurship and its successful use continues to expand. However, despite the espoused and observed positive effects of CE, issues remain if we are to fully understand this construct’s promise (Hornsby, Kuratko and Zahra, 2002; Zahra, 1991; Zahra, Nielsen and Bogner, 1999). Moreover, outcome factors that influence an organization’s willingness to continue implementing a CE strategy as well as managers’ willingness to continue engaging in entrepreneurial behavior have not been integrated to enhance our understanding of CE practices. Also, a fundamental ambiguity exists in the literature concerning what it means, in a theoretical sense, to have CE as a firm’s strategy (Meyer and Heppard, 2000). As such, while there is a broadly held belief in the need for and inherent value of entrepreneurial action on the part of established organizations (Hitt, Ireland, Camp and Sexton, 2001; Morris and Kuratko, 2002), much remains to be revealed about how CE strategy is enacted in organizational settings. In our present study, we review the existing literature and present an empirical study of ∗ Corresponding author. Donald F. Kuratko, Kelley School of Business, Indiana University, Bloomington, IN 47405.
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523 managers that examines the relationships among the antecedents to managers’ entrepreneurial behavior, a decision to implement entrepreneurial actions, and resulting job satisfaction and reinforcement practices. The concept of corporate entrepreneurship (CE) has evolved over the last thirty years (Hanan, 1976; Hill and Hlavacek, 1972; Peterson and Berger, 1972; Quinn, 1979). CE was defined early on as a process of organizational renewal (Sathe, 1989). Zahra (1991) observed that “corporate entrepreneurship may be formal or informal activities aimed at creating new businesses in established companies through product and process innovations and market developments. These activities may take place at the corporate, division (business), functional, or project levels, with the unifying objective of improving a company’s competitive position and financial performance.” Other researchers conceptualize CE as embodying entrepreneurial behavior requiring organizational sanctions and resource commitments for the purpose of developing different types of valuecreating innovations (Alterowitz, 1988; Borch, Huse and Senneseth, 1999; Burgelman, 1984; Jennings and Young, 1990; Kanter, 1985; Schollhammer 1982). This conceptualization of CE is consistent with Damanpour’s (1991, p. 556) perspective that corporate innovation is a very broad concept that includes “. . . the generation, development and implementation of new ideas or behaviors. An innovation can be a new product or service, an administrative system, or a new plan or program pertaining to organizational members.” In this context, CE centers on re-energizing and enhancing the firm’s ability to develop the skills through which innovations can be created. CE is linked to firms’ efforts to establish sustainable competitive advantages as the foundation for profitable growth (Ireland, Kuratko and Covin, 2003; Kuratko, 1993; Merrifield, 1993; Pinchott, 1985; Zahra, 1991). More comprehensively, Sharma and Chrisman (1999, p. 18) suggested that CE “is the process where by an individual or a group of individuals, in association with an existing organization, create a new organization or instigate renewal or innovation within that organization.” Guth and Ginsberg (1990) stressed that CE encompasses two major types of phenomena: new venture creation within existing organizations and the transformation of on-going organizations through strategic renewal. In this paper, we argue that managers’ entrepreneurial behavior is critical to effective CE, regardless of the primary reason (either the creation of new ventures or strategic renewal) it is being pursued.
Entrepreneurial actions Entrepreneurial actions are any newly fashioned set of actions through which companies seek to exploit entrepreneurial opportunities that rivals have not noticed or exploited. Entrepreneurial actions constitute a “. . . fundamental behavior of firms by which they move into new markets, seize new customers, and/or combine (existing) resources in new ways” (Smith and Di Gregorio, 2002). Three key dimensions—innovativeness (the seeking of creative solutions to problems or needs), risk-taking (the willingness to commit significant levels of resources to pursue entrepreneurial opportunities with
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a reasonable chance of failure), and proactiveness (doing what is necessary to bring pursuit of an entrepreneurial opportunity to completion)—underlie entrepreneurial actions (Covin and Slevin, 1991; Lumpkin and Dess, 1996; Morris and Kuratko, 2002). The relationship between entrepreneurial actions and performance in large organizations has been assessed differently across time. During the 1980s, some (e.g., Duncan, Ginter, Rucks and Jacobs, 1988; Morse, 1986) argued that it was difficult for people to act entrepreneurially in bureaucratic organizational structures. During this same time period others suggested that for companies of any size, entrepreneurial actions were possible, should be encouraged, and could be expected to enhance firm performance (Burgelman, 1984; Kanter, 1985; Kuratko and Montagno, 1989). A significant change in the general perception of the value of entrepreneurial actions as a predictor of firm performance took place throughout the 1990s. This was a time during which companies were redefining their businesses, thinking about how to most effectively use human resources and learning how to compete in the global economy. In short, this was a time during which “some of the world’s best-known companies had to endure painful transformation to become more entrepreneurial. These companies had to endure years of reorganization, downsizing, and restructuring. These changes altered the identity or culture of these firms, infusing a new entrepreneurial spirit throughout their operations. . . change, innovations, and entrepreneurship became highly regarded words that describe what successful companies must do to survive” (Zahra, Kuratko and Jennings, 1999, p. 5). Increasingly, organizations are committing to the position that entrepreneurial actions are essential if they are to first survive and then achieve competitive success in a world that is being driven by accelerating change (Barringer and Bluedorn, 1999; Ireland, Hitt, Camp and Sexton, 2001; Lyon, Lumpkin and Dess, 2000). Entrepreneurial actions do not occur in a vacuum; rather, they take place within the context of the organization’s full array of actions (Dess, Lumpkin and Covin, 1997). Establishing an internal environment in large, established organizations that elicits and nurtures entrepreneurial actions is challenging and requires appropriate decisions (Sathe, 1985). However, as we demonstrate in this study, entrepreneurial actions are a product of organizational antecedents. Furthermore, we argue that managers’ entrepreneurial actions can be a source of competitive advantage for a firm over its rivals (Floyd and Wooldridge, 1994; Kuratko, Ireland, Covin and Hornsby, 2005).
Role of managers in corporate entrepreneurship Managers at all organizational levels have critical strategic roles to fulfill for the organization to be successful (Floyd and Lane, 2000; Ireland, Hitt and Vaidyanath, 2002). According to Floyd and Lane (2000), upper-, middle-, and lower-level managers have distinct responsibilities with respect to each subprocess. Upper-level managers have ratifying, recognizing, and directing roles corresponding to the competence definition, modification, and deployment subprocesses, respectively. These roles, in turn, are
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associated with particular managerial behaviors. The specific managerial behaviors through which upper-level managers’ ratifying, recognizing, and directing roles are expressed, as described by Floyd and Lane (2000), are too numerous to fully review here. However, as examples, upper-level managers articulate strategic intent and endorse and support others’ entrepreneurial behavior as part of their ratifying role; they set strategic direction and empower and enable others as part of their recognizing role; and they plan and deploy resources as part of their directing role. Burgelman (1984) contends that in successful corporate entrepreneurship upper-level management’s principal involvement takes place within the strategic and structural context determination processes. In summary, upper-level managers have multiple and critical roles in CE activity. These managers are responsible for the articulation of an entrepreneurial strategic vision and instigating the emergence of a pro-entrepreneurship organizational architecture. In examining the role of middle-level managers, research highlights the importance of middle-level managers’ entrepreneurial behavior to the firm’s attempt to create new businesses or reconfigure existing ones (Ginsberg and Hay, 1994; Kanter, 1985; Floyd and Wooldridge, 1992; Pearce, Kramer and Robbins, 1997). This importance manifests itself both in terms of the need for middle-level managers to behave entrepreneurially themselves and the requirement for them to support and nurture others’ attempts to do the same. Middle-level managers’ work as change agents and promoters of innovation is facilitated by their organizational centrality. According to Floyd and Lane (2000), middle-level managers have championing roles corresponding to the competence definition subprocess, synthesizing and facilitating roles corresponding to the competence modification subprocess, and implementing roles corresponding to the competence deployment subprocess. Middle-level managers’ championing role is expressed through, for example, their nurturing and advocating of entrepreneurial initiatives. The synthesizing and facilitating roles are expressed through, for example, middle-level managers’ categorizing and selling of issues to upper-level management and their sharing of information and guiding of adaptation processes, respectively. Finally, the implementing role is expressed through, for example, middlelevel managers’ motivation, inspiration, and coaching of lower-level organizational members. In examining the role of lower-level managers, they are often the catalysts behind autonomous entrepreneurial initiatives. In Floyd and Lane’s (2000) model, lower-level managers have experimenting roles corresponding to the competence definition subprocess, adjusting roles corresponding to the competence modification subprocess, and conforming roles corresponding to the competence deployment subprocess. Lowerlevel managers’ experimenting role is expressed through, for example, the initiating of entrepreneurial projects. The adjusting role is expressed through, for example, lowerlevel managers’ responding to recognized and unplanned entrepreneurial challenges. Finally, the conforming role is expressed through, for example, lower-level managers’ adaptation of operating policies and procedures to the strategic initiatives endorsed at higher organizational levels.
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Thus, organizations pursuing CE strategies exhibit a cascading yet integrated set of entrepreneurial behaviors and associated processes at the upper-, middle-, and lower-levels of management. Working jointly, upper-, middle-, and lower-level managers are responsible for verifying that some of today’s resources and capabilities are used to form the core competencies through which future competitive success can be pursued.
Organizational antecedents Research has examined the organizational antecedents that affect (either by promoting or impeding) the breadth and depth of entrepreneurial actions that are taken within the firm at a point in time to pursue CE (Zahra, 1991; Zahra and Covin, 1995; Zahra et al., 1999). This research has studied different internal organizational factors including the firm’s incentive and control systems (Sathe, 1985), culture (Brazeal, 1993; Hisrich and Peters, 1986; Kanter, 1985), organizational structure (Covin and Slevin, 1991; Dess, Lumpkin and McGee, 1999; Naman and Slevin, 1993), and managerial support (Kuratko, Hornsby, Naffziger and Montagno, 1993; Stevenson and Jarillo, 1990). Because they affect the nature of the firm’s internal environment, these factors, both individually and in combination, are recognized as antecedents of the entrepreneurial actions on which CE is built. An internal environment supportive of innovation tends to have strong antecedents of entrepreneurial actions while an environment that dismisses innovation and its importance yields weak antecedents of entrepreneurial actions (Hornsby et al., 2002). The research literature has been developing our understanding of organizational antecedents of entrepreneurial actions (Hornsby, Kuratko and Montagno, 1999; Ireland et al., 2003; Kuratko, Montagno and Hornsby, 1990). An integrated review and analysis of the literature demonstrates a grouping of five major categories or dimensions that are considered antecedents to entrepreneurial actions (see Table 1 for a list of the five dimensions and the research supporting each one). These dimensions are: (1) the appropriate use of rewards to elicit and then support entrepreneurial actions; (2) managerial support, which indicates the willingness of managers, especially upper-level executives, to facilitate and promote entrepreneurial actions; (3) available resources, including the time required to continuously engage in entrepreneurial actions; (4) a supportive organizational culture, which is a culture that is organic rather than mechanistic in nature; and (5) work discretion (autonomy and risk taking), the ability or willingness on the part of managers, based upon their job descriptions, to take risks in the pursuit of innovation and to tolerate and learn from failures. Based on earlier exploratory theoretical (Hornsby, Naffziger, Kuratko and Montagno, 1993) and empirical (Kuratko et al., 1990) work that was completed to increase our knowledge about the antecedents of managers’ entrepreneurial behavior, Hornsby et al. (2002) executed an empirical study that was designed to identify antecedents of entrepreneurial behavior on the part of middle-level managers. In this study the authors developed a Corporate Entrepreneurship Assessment Instrument
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Internal organizational antecedents.
Factor
Research citations
Rewards/reinforcement
Scanlan, 1981; Souder, 1981; Kanter, 1985; Sathe, 1985; Block and Ornati, 1987; Fry, 1987; Sykes, 1992; Barringer and Milkovich, 1998; Covin and Miles, 1999; and Kuratko, Ireland and Hornsby, 2001. Souder, 1981; Quinn, 1985; Hisrich and Peters, 1986; MacMillan, Block and Narasimha, 1986; Sykes, 1986; Sathe, 1989; Sykes and Block, 1989; Stevenson and Jarillo, 1990; Damanpour, 1991, Kuratko et al, 1993; Pearce, Kramer and Robbins, 1997; Lyon, Lumpkin and Dess, 2000; Antoncic and Hisrich, 2001; Kuratko et al., 2001; and Morris and Kuratko, 2002. Von Hippel, 1977; Souder, 1981; Kanter, 1985; Sathe, 1985; Burgelman and Sayles, 1986; Hisrich and Peters, 1986; Sykes, 1986; Katz and Gartner, 1988; Sykes and Block, 1989; Damanpour, 1991; Stopford and Baden-Fuller, 1994; Das and Teng, 1997; and Slevin and Covin, 1997. Souder, 1981; Burgelman, 1983; Sathe, 1985; Burgelman and Sayles, 1986; Hisrich and Peters, 1986; Schuler, 1986; Sykes, 1986; Bird, 1988; Sykes and Block,1989; Guth and Ginsberg, 1990; Covin and Slevin, 1991; Damanpour, 1991; Zahra, 1991, 1993; Zahra and Covin, 1995; Brazeal, 1993; Kuratko, 1993; Hornsby et al., 1993; Hornsby et al., 1999; Antoncic and Hisrich, 2001; Hornsby et al., 2002; and Hornsby and Kuratko, 2003. Burgelman, 1983, 1984; Kanter, 1985; Quinn, 1985; Sathe, 1985; MacMillan, Block and Narasimha, 1986; Sykes, 1986; Bird, 1988; Ellis and Taylor, 1988; Sathe, 1989; Sykes and Block, 1989; Stopford and Baden-Fuller, 1994; Hornsby et al., 1999; Zahra, Kuratko and Jennings, 1999; Morris and Kuratko, 2002; and Hornsby et al., 2002.
Top management support
Resources/time availability
Organizational culture
Work discretion (autonomy)
(CEAI) which contained 84 Likert style questions that were used to assess antecedents of entrepreneurial behavior. Results from the factor analyses by Hornsby et al. (2002) suggested that the five dimensions developed in Table 1 were in fact stable antecedents of middle-level managers’ entrepreneurial behavior. However, it should be noted that managers will engage in entrepreneurial actions only when the organizational antecedents to those actions exist and when managers are aware of their existence (Kuratko et al., 2005). Recognizing and interpreting the antecedents as indications of an internal environment supporting entrepreneurial actions results in individuals assessing their entrepreneurial capacities in reference to what they perceive to be is a set of organizational resources, opportunities, and obstacles to engaging in entrepreneurial actions (Chen, Greene and Crick, 1998). Thus, our first set of hypotheses is based upon the literature supporting the five dimensions and the importance of their perception by managers. H1a, b, c, d, e: The perceptions of a corporate entrepreneurial environment will be positively related to job satisfaction.
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H1a: Management support will be positively related to job satisfaction. H1b: Work discretion will be positively related to job satisfaction. H1c: Rewards/reinforcement will be positively related to job satisfaction. H1d: Time availability will be positively related to job satisfaction. H1e: Organizational boundaries will be positively related to job satisfaction.
Job satisfaction and entrepreneurial actions An individual’s job satisfaction could have a mediating effect on the ability of a CE environment to spur entrepreneurial actions or performance. While the relationship between job satisfaction and performance has been a persistent “chicken and egg” question, recent research suggests that job satisfaction and performance are moderately related and mutually influence each other (Judge, Thoresen, Bono and Patton, 2001a, b). Also, a recent meta-analysis by Harter, Schmidt and Hayes (2002) suggests the relationship between job satisfaction and performance is understated due to incomplete measures of individual performance. Based on these recent findings, an important step in the CE research would be to investigate the impact of a manager’s perceived job satisfaction on entrepreneurial performance. Several recent studies examined the viability of the job satisfaction-performance relationship. These studies support Harter et al. (2002) contention that the relationship is more complex and that the analysis suffers from poor measures of both constructs. Furthermore, the research suggests that many variables may mediate and or moderate the relationship. Judge, Bono and Locke (2000) derived a model that suggested job complexity or challenge was an important explanatory variable in the relationship between core self evaluations (a combination of self esteem, self efficacy, locus of control, and low neuroticism) and job satisfaction and that this relationship persists over time. Griffin (2001) replicated earlier work by Burke, Brief and George (1993) and Spector, Chen and O’Connell (2000). They found that dispositions and excessive job demands were related to work reactions including job satisfaction. Judge et al. (2001b) derived a new model to conceptualize the satisfaction— performance relationship. Based on a meta-analytic study, they suggest a “bidirectional” relationship that includes a series of moderators and mediators. Mediators suggested to affect the satisfaction to performance relationship include behavioral intentions, low performance, withdrawal, and positive mood. Moderators suggested include personality, autonomy, norms, moral obligation, cognitive accessibility, aggregation and level of analysis. On the other hand, mediators suggested to affect the performance-satisfaction relationship include achievement, self efficacy, goal progress, and positive mood. Moderators include performance-reward contingency, job characteristics, need for achievement, work centrality, and aggregation. One other result was that the satisfaction—performance relationship was stronger for more complex jobs. In spite of the research completed on job satisfaction and performance there has not been any attempt to examine the link between job satisfaction and the corporate
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entrepreneurial actions of managers. Thus, a second hypothesis was developed based upon the mediating effect of job satisfaction on the corporate entrepreneurial environment and entrepreneurial actions. H2: Job satisfaction will mediate the relationships between perceptions of a corporate entrepreneurial environment and entrepreneurial actions. For the purposes of this study entrepreneurial actions were measured by items developed by the authors. Each action was measured by a single item in which the respondents were asked (1) the number of new ideas suggested, (2) the number of new ideas implemented, and (3) the number of improvements implemented without official organizational approval. In each case the participants were asked to respond with the number of these actions that had occurred over the past six months. In this manner a measure could be used of entrepreneurial actions in relation to job satisfaction. Thus, a third set of hypotheses were developed based upon these measures of entrepreneurial actions. H3a, b, c: Job satisfaction will be positively related to entrepreneurial actions. H3a: Job satisfaction will be positively related to the number of new ideas suggested. H3b: Job satisfaction will be positively related to the number of ideas implemented. H3c: Job satisfaction will be positively related to the number of unofficial improvements implemented. Purpose of the study The purpose of this study is to investigate the relationship between the organizational antecedents that create a corporate entrepreneurial environment, as identified in Hornsby et al. (1999, 2002) and Ireland, Kuratko and Covin (2003), and the entrepreneurial actions taken by managers. Also of interest in this study is the relationship between the existence of a corporate entrepreneurial environment and a manager’s perception of job satisfaction. The model we will test and the hypotheses stated above are shown in Figure 1. Methods The sample for this study was taken from approximately 670 managers who participated in continuing education and training programs for managers conducted by a large Midwestern university. Participation in the survey was voluntary and approximately 80% of those eligible (530 individuals) chose to do so. Seven surveys were incomplete and were discarded, leaving a usable sample of 523. The average age of the respondents was 39.6 years, 75% were male, average organizational tenure was 12.2 years, and the average time in their current positions was 4.5 years. 30% described themselves as
MANAGERS’ CORPORATE ENTREPRENEURIAL ACTIONS AND JOB SATISFACTION
Figure 1.
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Hypothesized model.
lower level managers; 45%, mid-level managers; and 13%, senior-level managers. (12% declined to respond to this item) Measures The Corporate Entrepreneurship Assessment Instrument (CEAI) (Hornsby, Kuratko and Zahra, 2002) was used to measure the organizational factors that foster corporate entrepreneurial activity within a company. Upper-level management support for corporate entrepreneurship was measured by 19 items (α = .90), work discretion was measured by 10 items (α = .87), rewards/reinforcement was measured by 6 items (α = .73), time availability was measured by 6 items (α = .77), and organizational boundaries was measured by 7 items (α = .63). For each of these five scales, the participants responded to a 5-point Likert scale with responses ranging from “strongly disagree” to “strongly agree.” Job satisfaction was measured by the Minnesota Job Satisfaction Questionnaire (Weiss, Dawis, England and Lofquist, 1967) (α = .88). A 5point Likert scale was used with the responses ranging from “very dissatisfied” to “very satisfied.” Entrepreneurial actions were measured by items developed by the authors. Each action was measured by a single item in which the respondents were asked (1) the number of new ideas suggested, (2) the number of new ideas implemented, and (3) the number of improvements implemented without official organizational approval. In each case the participants were asked to respond with the number of these actions that had occurred over the past six months. Descriptive statistics and correlations among the variables are shown in Table 2.
284 Table 2.
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Means, standard deviation, correlations, and measures of reliability among the study variables.
Variable
Mean SD
1
2
3
4
Management support Work discretion Rewards/ reinforcement Time availability Organizational boundaries Job satisfaction New ideas New ideas implemented Unofficial improvements
2.84
0.60 (.90)
3.66 3.44
0.62 0.53∗∗∗ (.87) 0.64 0.56∗∗∗ 0.43∗∗∗ (.73)
2.55 3.01
0.73 0.23∗∗∗ 0.19∗∗∗ 0.15∗∗∗ (.77) 0.53 0.31∗∗∗ 0.34∗∗∗ 0.43∗∗∗ 0.26∗∗∗ (.63)
3.72 4.95 2.95
0.53 0.59∗∗∗ 0.61∗∗∗ 0.66∗∗∗ 0.21∗∗∗ 0.47∗∗∗ (.88) 7.19 0.10∗ 0.11∗ 0.11∗∗ −0.08 0.07 0.10∗ n/a ∗∗∗ ∗∗ ∗∗∗ ∗ 0.14 0.17 −0.01 0.09 0.13 0.70∗∗∗ n/a 4.72 0.19
4.14
6.49 0.15∗∗∗ 0.20∗∗∗ 0.07
0.00
5
0.09∗
6
0.15
7
8
9
0.34∗∗∗ 0.32∗∗∗ n/a
∗p
< .05. < .01. ∗∗∗ p < .001. Coefficient Alphas appear in parentheses in the diagonal. ∗∗ p
Results Measurement model In order to test our hypothesized model, we formed manifest indicators as described by Bishop, Scott, Goldsby and Cropanzano (2005) and subjected them to a confirmatory factor analysis (CFA). We formed 4 manifest indicators from the management support items, 3 from the work discretion items, 2 each from the rewards/reinforcement, time availability, and organizational boundaries items, and 4 from the job satisfaction items. Using a covariance matrix derived from these indicators we estimated a measurement 2 model. The results indicate that the model fit the data well: χ(104) = 210.57, root mean square error of approximation (RMSEA) = .044, non-normed fit index (NNFI) = .99 and comparative fit index (CFI) = .99. The model shown in Figure 2 shows the measurement and structural portions of the model.
Structural model We tested our hypotheses by estimating the model shown in Figure 2. Again, the model 2 fit the data well: χ(152) = 280.78, root mean square error of approximation (RMSEA) = .040, non-normed fit index (NNFI) = .99, and comparative fit index (CFI) = .99. Since γ12 and γ13 were significant, hypotheses 1b and 1c, respectively, were supported, while hypotheses 1a, 1d, and 1e were not supported because γ11 , γ14 , and γ15 were not
MANAGERS’ CORPORATE ENTREPRENEURIAL ACTIONS AND JOB SATISFACTION
Figure 2.
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Hypothesized model showing manifest indicators.
significant. Also established from Figure 2, Hypotheses 3a, 3b, and 3c were supported since β21 , β31 , and β41 were all significant. Using Figure 3, Hypothesis 2 received partial support because the indirect effects of work discretion on the number of new ideas (γ12 β21 = .039 ± .035), the number of ideas implemented (γ12 β31 = .056 ± .035), and the number of unofficial improvements (γ12 β41 = .056 ± .035) were significant as were the indirect effects of rewards/reinforcement on the number of new ideas (γ13 β21 = .056 ± .051), the number of ideas implemented (γ13 β31 = .080 ± .052), and the number of unofficial improvements (γ13 β41 = .080 ± .052). The indirect effects of the other 3 exogenous variables on the entrepreneurial actions were not significant. Their values were not calculated because the direct effects of the exogenous variables on job satisfaction were not significant.
Discussion Corporate entrepreneurship is not always successful (Block and MacMillan, 1993; Morris and Kuratko, 2002), yet it has to start somewhere—sometimes small and corporate controlled. But if it starts, managers become more comfortable with the idea, confidence builds, results occur, and soon the first corporate assigned projects evolve into more autonomous ventures that reach farther out before being required
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Figure 3.
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Structural path estimates of the hypothesized model.
to form administrative structure. The major thrust behind corporate entrepreneurship is a revitalization of innovation, creativity, and leadership in today’s corporations. It appears that corporate entrepreneurship may possess the critical components needed for the future productivity of growth-minded organizations. If so, then recognizing the antecedents and outcomes of CE activity as they relate to managers may be most important in establishing entrepreneurial strategies in contemporary organizations. Our focus has been on the antecedents, actions, and outcomes related to managerial performance. The findings of this research effort suggest that work discretion and rewards/reinforcement lead to higher perceived job satisfaction and that this heightened satisfaction results in increased entrepreneurial actions. Specifically, there is an increase in the number of new ideas suggested, the number of new ideas implemented and the number of unofficial improvements made. These findings and the resulting model advance the research in the area of organizational antecedents and the viability of the CE process. The results indicate that greater emphasis on these antecedents can lead to more internal entrepreneurial behavior thus adding to the validity of such CE antecedents suggested by Hornsby et al. (2002) and others. Furthermore, the results from this study are consistent with the job satisfaction research. In this case, job satisfaction has a mediating effect between environment (as measured by the antecedents) and performance. The findings emphasize the importance of providing positive rewards and reinforcement and increased work discretion when attempting to influence the satisfaction of managers. One possible explanation why management support, organizational boundaries and time availability were not
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significantly related to job satisfaction could be that the nature of the managerial role provides more control over these issues and therefore would not directly impact a manager’s job satisfaction. Some suggestions for future research include continuing to develop and refine performance measures as they relate to entrepreneurial actions. As Harter et al. (2002) concluded the relationship between job satisfaction and performance is underestimated due to the accuracy or inadequacy of the performance measures applied. Correspondingly, the measurement of entrepreneurial actions could also be improved. Also, further research should investigate how findings such as those described here sustain an overall CE strategy. While these results suggest that individual manager satisfaction plays an important role in the CE process, corporate satisfaction with outcomes must also be researched. The importance of this line of research is supported by Ginsberg’s (1988) strategic change model in that performance outcomes serve as feedback mechanisms for either sustaining the current strategy or selecting an alternative one. To conclude, many organizations are choosing to embrace innovation and entrepreneurial actions as central aspects of their corporate strategies, as well they should given conditions in their external environments. How such strategies differ from more traditional corporate strategies has only recently become the subject of broad discussion, and much remains to be learned about the matter. Toward this end, this paper offers an empirical examination of a key relationship between a corporation’s environmental antecedents and corporate entrepreneurial actions with job satisfaction as a mediator. While this study is limited in its scope, it does promote new understanding of the topic and will prompt meaningful future discussions.
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