What Is It That Entrepreneurs Learn From Experience?

Abstract

Objectives: A key theme of research into entrepreneurs and entrepreneurship is with respect to whether or not entrepreneurs really learn from experience. If they do so what do they learn? And how is that learning determined? The notion of learning is also intertwined with experience and knowledge and with the impact of learning on the development of the habitual entrepreneur. Prior Work: Amongst the prior work in this area is a study of the nature of the development of entrepreneurial knowledge and how this has impacted positively on SME performance (Omerzel and Antoncic, 2008). The four key dimensions of knowledge outlined by Antonio are: education level; work experience; knowledge of functional disciplines and self confidence. Erikson (2003) discussed the three propositions of experience as outlined by Wood and Bandura (1989) that of: mastery experience; vicarious experience; and social experience. Approach: The basis of this paper is a series of in-depth interviews with mature and experienced successful Scottish entrepreneurs who will have been involved with significant business success and failure. This will allow us to look in detail at the four learning and entrepreneurial decision models outlined by Cooper (1973) by Rae (2007) and Rae and Carswell (2001) and of the work of Wood and Bandura (1989) and bring this together as it applies to our interviewees. It is argued in the literature that prior knowledge and ongoing learning play a key role in the founder’s ability to deal with the changing role they have within the business and to acquire the necessary skills to grow the business. The importance of knowledge and learning on the firm’s performance has been highlighted by many authors. These authors emphasize the role of life cycle, learning from mentors, experience and or critical incidentsImplications: The nature of entrepreneurial learning is an important area of concern for business support agencies and investors especially with respect to business support and lending at both the start-up and business development stages. What is crucial here is how learning can be supported in the context of both new start businesses and or existing entrepreneurs. Value: The main implications here are that we are arguing is the validity of a conceptual model that has four elements to it: experience; learning; knowledge end lastly firm performance. We are looking at a much longer valid build up of learning and knowledge over time than a short business start-up period or an educational programme which can only at best be described as part 1 of the process. Entrepreneurs take time to develop their skills and need to be given that opportunity if successful start-ups are to be achieved. What they mainly develop, that seems to determine their success, is people selection and team building skills.