Choosing an

Entrepreneurial
Development System:
TheWilliam
Concept and the
L. Smith, Ph.D.
Challenges
School of Business
Emporia State University
smithwil@emporia.edu
 Abstract

 This paper presents a discussion of the

process of choosing an entrepreneurial
development system for a local rural
community and region.
 A later version of this paper is “in press” in
the International Journal of Management
and Enterprise Development
Entrepreneurship has been
defined in a number of ways
over
 the years
From Schumpeter [1934] to the Internet of today
– Google gives a page of definitions
 I have adopted the definition of the field of
entrepreneurship as ‘the scholarly examination of
how, by whom, and with what effects
opportunities to create future goods and services
are discovered, evaluated, and exploited’
 From Venkataraman [1997] and Shane and
Venkataraman [2000]
In Essence - the field
involves:
 the study of sources of opportunities
 the processes of discovery, evaluation, and
exploitation of opportunities, and,
 the set of individuals who discover, evaluate
and exploit them.
Figure 1 Entrepreneurial
research framework
 (1) Opportunities, plus
 (2) Individuals, lead to
 (3) Entrepreneurial event
 Our Goal

 This paper seeks to explore the possibilities

of creating an ‘entrepreneurial community’
environment in a rural setting within which
individuals and groups of individuals may
develop sets of skills which allow them to
recognize opportunities for entrepreneurial
activities that did not seem to exist
previously.
 Background

 Foundation support; Kauffman and Kellogg

 Government support, Federal and State
 Enterprise Facilitation
 Lichtenstein and Lyons [1996, 2001]
Seven unique challenges for
rural entrepreneurs [Kauffman,
1999],
 p.that
1) culture 1 promotes
of 2: entrepreneurship
 2) distance to markets and services
 3) capital availability and capital-ready deal
flow
 4) threshold of demand to justify the location
of support services
 5) absence of other entrepreneurs
Seven unique challenges for
rural entrepreneurs [Kauffman,
1999],
 p. of
6) absence 2 industry
of 2: clusters
 7) independent spirit of rural population – i.e.,
balance the entrepreneurial desire to ‘be
one’s own boss’ with the realization that
successful entrepreneurs cannot ‘do it alone.’
Lichtenstein and Lyons
[1996, 2001]
 The focus of entrepreneurial development should be
shifted from programs to development of individual
entrepreneurial skills.
 They proposed a comprehensive ‘needs
assessment’ approach,
 To build on each of the existing programs in the
community, and
 Identify additional training services required
 The Proposed System

 Expand the population of entrepreneurs, not just

the ‘right’ ones.
 Entrepreneurs need continuous assistance with
many of the skills needed to move through the
stages of business development.
 This suggests an ongoing mentoring program
coupled with networking with others who have
already been through the process themselves.
 Truly creating an
‘entrepreneurial community.’
 Bringing together, in a developmentally focused
system, persons with entrepreneurial skills at
various stages of development to share these
skills
 Persons who help each other develop these skills,
and
 Persons who will assist others in recognizing new
opportunities for innovation in the community.
Table 1 The four
entrepreneurial skill categories
and
 17 skill
1) Technical dimensions
skills
• Operational – the skills necessary to produce
the product or service
• Supplies/raw materials – the skills to obtain
them, as necessary
• Office or production space – the skills to
match needs and availability
• Equipment/plant/technology – the skills to
identify and obtain
Table 1 The four
entrepreneurial skill categories
and
 17 skill
2) Managerial skills dimensions
• Management – planning, organising, supervising,
directing, networking
• Marketing/Sales – identifying customers, distribution
channels, supply chain
• Financial – managing financial resources, accounting,
budgeting
• Legal – organisation form, risk management, privacy
and security
• Administrative – people relations, advisory board
relations • Higher-order – learning, problem-solving
Table 1 The four
entrepreneurial skill categories
and
 17 skill dimensions
3) Entrepreneurial skills
• Business concept – business plan,
presentation skills
• Environmental scanning – recognize market
gap, exploit market opportunity
• Advisory board and networking – balance
independence with seeking assistance
Table 1 The four
entrepreneurial skill categories
and
 17 skill
4) Personal dimensions
maturity skills
• Self-Awareness – ability to reflect and be
introspective
• Accountability – ability to take responsibility for
resolving a problem
• Emotional Coping – emotional ability to cope
with a problem
• Creativity – ability to produce a creative
solution to a problem
 Volunteer Entrepreneur Corps
(VEC) mentoring program
 A volunteer group to be formed in the community
(region) who offer their experience to provide
assistance in their specialties to other
entrepreneurs, for the betterment of the
‘entrepreneurial community.’
 Share their experience using a skill with others
rated ‘medium’ on that skill.
 Annual volunteer recognition/citations
 Evaluation (p. 1 of 6)

 Motivation of rural entrepreneurs: There is a

significant difference in motivation between
rural entrepreneurs and their urban
counterparts.
All the adaptations have been made with this
issue in mind, and they will be regularly
reviewed to assure compliance.
 Evaluation (p. 2 of 6)
 Culture: Rural culture has multiple and
conflicting personalities; it is ‘anything goes’
and ‘can do’ on the one hand, and very
conservative overtones on the other, that often
discourage risk-taking and inhibit
entrepreneurial activity.
The networking and mentoring process will be
built on this dichotomy, with continuous
attention to making it a strength, not a
weakness.
 Evaluation (p. 3 of 6)
 Networks: Networks are even more important to rural
entrepreneurs. In fact, they are essential to entrepreneurial
success – but providing adequate forums to share experiences,
explore new opportunities, and seek reinforcement – are the
biggest challenges to promoting entrepreneurship in rural
America.
Networking is at the heart of the proposed system. Providing the
correct forums, the best mentors, and the most effective balance
of outside trainers and experienced entrepreneurs to provide
guidance and skills development to less experienced
entrepreneurs will be critical to success of the system.
 Evaluation (p. 4 of 6)

 Capital and deal flow: There is both a lack of

equity capital and a lack of ‘capital literacy’ in
rural areas.
Skills related to understanding and obtaining
appropriate funding are integral to the skills
development system proposed. New funding
sources will be available based on recent
legislation in the state.
 Evaluation (p. 5 of 6)
 Workforce: Both skilled workers and management
skills are often miles away. Identifying ways to
access these skills is a continuing challenge.

This identification and matching to the benefit of area

entrepreneurs is the reason for the creation of the
proposed system. Skills not available will be created,
brought in, or otherwise made available as an
integral part of the entire entrepreneurial
development system processes.
 Evaluation (p. 6 of 6)
 Youth: Rural America’s most significant export has
been its children – which are recognized by
community leaders as among the greatest threats to
the viability of many rural communities. Rural
entrepreneurship can address the aging of rural
communities in two ways:
 1) Discussion with rural youth about the value of
closeness to their rural hometowns and finding ways
to allow them to remain.
 2) Promoting rural communities as attractive to
youth and young families with a pro-
entrepreneurship environment.
 Action Steps, 1 & 2
 Enhancements of entrepreneurial education at all
levels are already under way through closely
coordinated efforts of related programs of the
university and other educational entities.
 An AgriTourism initiative is being undertaken in the
region which will provide mutually beneficial
activities and increased opportunities for
entrepreneurial tendencies to act upon.
 Action Steps, 3 & 4

 Implementation will require wide political and

social cooperation among a broad spectrum
of service providers, governmental units, and
members of the general community.
 Appropriate information sharing and input
from interested members of the public in
general will be critical to successful system
implementation.
 Action Steps, 5, 6 & 7

 Organize the Volunteer Entrepreneur Corps

(VEC) and begin the networking process
 Create the “needs assessment” process by
validating the Skills Sets to be measured and
the process of measuring them.
 Support the infrastructure to allow this
systematic process to be sustained over time.
 Conclusion

 From the conclusion section of Lichtenstein

and Lyons [2001], a great quote:
“H. L. Mencken once said that ‘for every
complex problem there is an easy answer,
and it is wrong.’
Community-wide enterprise development is a
complex problem; therefore, any useful
solution is bound to be so as well.” [p.17]