The decision-making literature emphasizes that in high-stake decisions the characteristics of individual decision-makers, their interpretation of decision situations, and their social ties play an important role in decision outcomes. Despite these results, research on small-and medium-sized enterprises has only partially covered these influences. In a sample of 565 small-business owners, this study identifies the extent to which these characteristics and social ties affect decision effectiveness and the extent to which their impact is mediated by evaluative judgements of the decision situation. Our results suggest that the interplay between human capital and social capital affects decision outcomes via evaluative judgments and this effect is moderated by decision content, in such a way that depending on decision content (internal versus external focus) entrepreneurial experience and the breadth of social capital are either assets or liabilities for decision effectiveness.
If you would like to write for this, or any other Emerald publication, then please use our Emerald for Authors service information about how to choose which publication to write for and submission guidelines are available for all. Please visit www.emeraldinsight.com/authors for more information. About Emerald www.emeraldinsight.comEmerald is a global publisher linking research and practice to the benefit of society. The company manages a portfolio of more than 290 journals and over 2,350 books and book series volumes, as well as providing an extensive range of online products and additional customer resources and services.Emerald is both COUNTER 4 and TRANSFER compliant. The organization is a partner of the Committee on Publication Ethics (COPE) and also works with Portico and the LOCKSS initiative for digital archive preservation. AbstractPurpose -This paper aims to examine the role of social capital as a strategic decision aid in small and medium sized enterprises (SMEs) in different service sectors. Design/methodology/approach -Data on 434 strategic decisions in service SMEs was gathered through computer-aided telephone interviews and analyzed using structural equation modeling to test the mediating role of level of risk acceptance and confidence in the relationship between the breadth of social capital and decision effectiveness. Findings -Evaluative judgments (risk acceptance and confidence) explain the negative effects of social capital on decision effectiveness. Service delivery and dependency on tacit know-how account for differences between SMEs in different service sectors and serve as explanations for different effects of social capital as a decision aid.Research limitations/implications -The study sheds light on the psychological underpinnings of social capital effects in strategic decisions. Higher varieties of actors make decision makers more tolerant for risk and decrease their confidence, which in turn hampers decision effectiveness. Originality/value -Previous work on social capital suggests that it is beneficial to outcomes. The literature and policy initiatives also stress the beneficial effects of social capital and networking. This research on strategic decision-making shows that the positive effects of social capital are not as pronounced as expected for the service SMEs. This paper draws explicit attention to the negative effects for strategic decision-making.
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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in Elizabeth Garnsey University of Cambridge AbstractThis paper analyses the association between dynamic capabilities and new firm growth, controlling for measures of firm resources, characteristics of the entrepreneur, and aspects of the environment. The central research question is: How strong is the relationship between dynamic capabilities and the growth of new firms? The paper opens with a review of empirical studies on employment growth in new firms and then moves on to a discussion on the role of dynamic capabilities in the explanation of new firm growth. After a description of the data and variables the results and implications of this study are discussed. JEL-classification: D21, L23, L25, L26, M13, M21
The SCALES-paper series is an electronic working paper series of EIM Business and Policy Research. The SCALES-initiative (Scientific Analysis of Entrepreneurship and SMEs) is part of the 'SMEs and Entrepreneurship' programme, financed by the Netherlands' Ministry of Economic Affairs. Complete information on this programme can be found at www.eim.nl/smes-and-entrepreneurship The papers in the SCALES-series report on ongoing research at EIM. The information in the papers may be (1) background material to regular EIM Research Reports, (2) papers presented at international academic conferences, (3) submissions under review at academic journals. The papers are directed at a research-oriented audience and intended to share knowledge and promote discussion on topics in the academic fields of small business economics and entrepreneurship research. Contents 1 Introduction 2 Introduction to general decision theory 2.1 Classical rationality 2.2 Bounded rationality 2.3 Neoclassical rationality 2.4 Conclusion: what is the place of entrepreneur in the general decision theory? 3 Analytical framework of strategic decisionmaking in SMEs 3.1 The entrepreneur 3.2 The decision environment 3.3 The decision and the process of strategic decisionmaking 4 Empirical findings on entrepreneurial strategic decision-making Literature
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