Interorganizational Challenges in the Design and Management of Business Incubators

Abstract

Business incubators are intended to enhance the growth of new firms by minimizing business failures. The environment for incubators improved as governmental policies shifted their emphasis toward small business generation. However, not enough is understood about how, why, and under what circumstances new firms succeed within the sheltered environment of incubators. This article uses an interorganizational framework to evaluate some preliminary studies of incubator performance and effectiveness. Copyright 1991 by The Policy Studies Organization.

Business incubators and accelerators: a co-citation analysis-based, systematic literature review

“…Udell (1990) ''Are multi-tenant buildings providing affordable, flexible space, and a variety of office and support services which share a common purpose: to nurture small fledgling firms into healthy businesses'' Weinberg et al (1991) ''Locally based institutions that provide shared physical space and business support services to new and young firms'' Markley and McNamara (1995) ''[Organizations that] offer fledgling companies a number of benefits-office space, funding, and basic services such as recruiting, accounting, and legal-usually in exchange for equity stakes''…”

“…Incubators manage both an external and an internal inter-organizational field, to which they connect their incubatees (Weinberg et al 1991). Externally, the incubator should foster business connections between tenants and outside firms, government agencies, and other sources of commercial relevance.…”

Business incubation process and firm performance: an empirical review

“…Bringing a network dimension to the concept, Weinberg (1991) views incubators as inter-organizational or social partnership organizations that are concerned with addressing "socially-relevant" purposes by harnessing the strength from diverse organizations. Mian (1996) and Bollingtoft and Ulhoi (2005) championed the concept of a network incubator "based on territorial synergy, physical proximity, relational symbiosis and economies of scale" with the overall aim of leveraging entrepreneurial initiative and know-how in creating and operating successful companies.…”

“…In their contribution, Bergek and Norrman (2008) observe that research scholars disagree on whether a business incubator is an organization or a general term likened to an entrepreneurial support environment. To scholars such as Brooks (1988), Weinberg et al, (1991), Lalkaka (2001), and Phan et al (2005), incubators are registered organizations that provide affordable office space, offering targeted support services with the sole purpose of nurturing small fledgling firms into healthy businesses.…”

“…Incubators as cost-effective instrument of entrepreneurial promotion (EC, 2002) have impacted positively on firm survival, turnover, employment and job creation (Weinberg et al 1991;Mian & Suny, 1996;Headd, 2003;Al-Mubaraki & Busler, 2011;Voisey et al 2013;Sehitoglu & Ozdemir, 2013) with the success of the incubation program dependent on its practices (Lewis et al 2011). However, studies conducted by Schwartz (2012) and Amezcua (2010) have reported that incubation has not contributed significantly to the survival, employment and sales growth of incubated firms notwithstanding the time spent in the program.…”