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About this paper
Yngve Dahle, Martin Steinert, Anh Nguyen Duc, Roman Chizhevskiy
Researchers from the Norwegian University of Science and Technology and University College of Southeastern Norway investigated whether startups initially define their businesses from an internal (resources/competences) or external (market/environment) perspective, finding a general tendency towards an internal view. Their analysis, utilizing an Entrepreneurial Data Warehouse (EDW) to capture real-time input from 701 startups, revealed that the sequence in which entrepreneurs define strategic elements better indicates this orientation than the quantity of elements, with European startups showing a higher internal focus than African startups.
Key insights
- Startups generally exhibit a tendency to prioritize an Internal View (focus on unique competences/distinction) over an External View when defining their business mission.
- The sequence in which entrepreneurs articulate business mission elements (Order Coefficient) is a more robust indicator of their strategic orientation and perceived importance than merely the quantity of elements (Number Coefficient).
- A stronger Internal View (higher Order Coefficient) correlates with a greater number of defined core resources, suggesting a more comprehensive internal focus in strategy.
- Strategic orientation varies geographically, with startups in stable economies (Europe) showing a higher propensity for an Internal View compared to those in emerging economies (Africa).
Summary by alphaXiv.
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