Management issues in the entrepreneurial process for Chinese new ventures

Citation

Zhang, Y. and Wang, Y. (2010), "Management issues in the entrepreneurial process for Chinese new ventures", Journal of Chinese Entrepreneurship, Vol. 2 No. 2. https://doi.org/10.1108/jce.2010.40502baa.001

Management issues in the entrepreneurial process for Chinese new ventures

Article Type: Editorial From: Journal of Chinese Entrepreneurship, Volume 2, Issue 2

The increasingly important effects of entrepreneurship on economic development, innovation and employment have been widely studied, yet there is insufficient attention to entrepreneurship as a process. The proliferation of new ventures and small businesses in China in recent years presents an exciting and unique environment for researchers, inside and outside China, to explore the nature, evolution and practices of entrepreneurial process. Recently, the National Natural Science Foundation of China has sponsored a few projects which are dedicated to the entrepreneurial processes for Chinese new ventures. Among these meaningful attempts, Chinese Panel Study of Entrepreneurial Dynamics (CPSED), led by the Entrepreneurial Research Centre of Nankai University, is a pioneering research program which focuses on the micro-level entrepreneurial activities by tracking randomly sampled nascent entrepreneurs across China over a period of two years.

Given the prospering, entrepreneurship-driven economic growth and increasing scholarly attention to the entrepreneurship field in China, this special issue of the Journal of Chinese Entrepreneurship focuses on the management issues in the entrepreneurial process for Chinese new ventures. More specifically, we aim to:

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  examine the environments for entrepreneurship and entrepreneurial activities in China;

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  investigate the key issues derived from western entrepreneurial research in the Chinese context, such as effectuality, bricolage, and entrepreneurial learning; and

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  explore various entrepreneurial activities in the Chinese new ventures, such as social capital and opportunity discovery, and the interaction between entrepreneurs and opportunities.

This collection of papers is dedicated to deepening our understanding of the management issues in the entrepreneurial process for Chinese new ventures. The first featured paper, by Cai Li, Zhu Xiumei, Cui Qiguo, and Zhao Di “Research on the affecting mechanism of entrepreneurial environment on new firm performance” builds a theoretical model to examine the mechanism of entrepreneurial environment affecting new venture performance. Drawing from network theory and resource-based view, the authors identify entrepreneurial network and resource acquisition as the channel through which entrepreneurial environment impacts on firm performance. Their research presents the findings that new ventures could promote their performance through building entrepreneurial networks in the hostile, dynamic and complex environment.

What are the general patterns of Chinese entrepreneurial activities? The second paper, by Dan Long, Jun Yang, and Jiayong Gao “Anatomy of nascent entrepreneurship in China: a preliminary study from CPSED project” addresses the characteristics and traits of nascent entrepreneurs, how entrepreneurial activities take place, and how to manage these activities in the context of China. Their research finds that nascent Chinese entrepreneurs are likely to be young, educated and experienced, who pursue opportunity via systematic searching and start businesses by making full use of available resources and abilities. Their large-scale survey also identifies saving funds, collecting information of target customers and markets, and analyzing and forecasting financial risks as three major entrepreneurial activities undertaken by Chinese nascent entrepreneurs. As to entrepreneurial strategy, most Chinese nascent entrepreneurs create their businesses on their own, adopt second-mover strategy and target mature and developing markets.

The paper by Xiaogang He, Zhixin Wang, Lin Mei, and Yanling Lian assesses the immediate and lagged effects of founder’s turnover on the firm performance “The impact of founder turnover on firm performance: an empirical study in China”. Based on secondary data of listed companies, they find that founder turnover negatively affects firm performance, but the negative impact weakens over time. They further propose that the negative relationship between founder turnover and firm performance becomes lower in larger sized firms and firms with longer term founders.

Taking the cognitive perspective and focusing on individual entrepreneurs, Zhao Wenhong and Fan Liuying empirically study the relationship between entrepreneurial thinking systems as well as risk-taking propensity and entrepreneurial behavior “The impact of entrepreneurial thinking system on risk-taking propensity and entrepreneurial behavior”. Their research finds reverse effects of different thinking systems, that is, the experiential system has a positive impact on risk-taking propensity and yet a negative impact on entrepreneurial behavior; while the rational system has a negative impact on risk-taking propensity but a positive impact on entrepreneurial behavior. The authors interpret the results within the Chinese context.

Raising the question of which dimension of human capital helps firm growth, Zhang Jin, Yang Huixin, and Lv Ruizhan test in turn the impact of the common knowledge of entrepreneurs, their personal abilities, personality characteristics and psychological factors upon firm growth performance “Empirical research on private entrepreneur human capital in China and enterprises’ growth performance: a comparative analysis between high-tech enterprises and traditional enterprises”. Furthermore, they compare what was found in high-tech enterprises and traditional enterprises. One of their main conclusions is that high-tech enterprises may achieve greater innovation and growth from the human capital of entrepreneurs.

Finally, the paper by Hao Jiao, dt ogilvie, and Yu Cui “An empirical study of mechanisms to enhance entrepreneurs’ capabilities through entrepreneurial learning in an emerging market” reveals the complex relationship between entrepreneurial learning and entrepreneurs’ capabilities. They not only explore the impact of the changes in entrepreneurial learning approaches on the entrepreneurs’ capabilities, but also propose an inter-temporal learning model, suggesting that entrepreneurs’ capabilities rest on a self-reinforcing learning cycle of experiential learning and social network learning from stakeholders. Their longitudinal empirical study supports the enhancing effects of formal education/training and experiential learning on the entrepreneurs’ capabilities.

Overall, the set of papers in this special issue summarize past efforts, introduce new perspectives, provide new empirical insights, and define future directions of management issues in the unique context of entrepreneurial process. It is our attempt (and of all those scholars who have contributed to this collection), to help narrow the gap between the significance of entrepreneurial process and the research efforts devoted to it. We do hope this special issue will inspire other scholars to share our curiosity and generate the kind of dialogue necessary to furthering our understanding in this topic of major theoretical and practice significance.

Yuli ZhangGuest Editor

Yonggui Wang Co-Editor