Corporate Entrepreneurship as a Learning Process: Development of New Capabilities

Abstract

Abstract Corporate entrepreneurship (CE) seems as an insurance against environmental dynamics to let the organization grow by seeking opportunities. The main purpose of this study is to offer a conceptual framework evaluating how the individual level opportunity recognition links to firm-level integration and institutionalization of knowledge bases. This study proposes a conceptualization of CE as a learning process to develop new Dynamic Capabilities (DC) that enables firms to reinvent themselves through innovative ideas. Dynamic capabilities contribute to the managerial cognition to explore new entrepreneurial opportunities; however, no former research has investigated the development of DC through CE process. Building from our analysis of the mechanisms through which the corporate entrepreneurship could influence the development of dynamic capabilities, we apply a multiple case study design to address the research gap. To investigate the research question, four case studies have been selected, through which we examine: a) the association of managerial cognition, as the knowledge foundation of opportunity exploration, to capability development; b) the mechanism of corporate entrepreneurship learning process through discovery, engagement, and transformation; c) the reasons behind ignorance of some entrepreneurial opportunities; and d) the effect of capability development on the corporate entrepreneurship outcomes. We conclude that dynamic capabilities are most beneficial for entrepreneurs to make drastic change by moving further away from sense-making of opportunities to institutionalization of new capabilities. However, our proposed conceptual framework is general and needs to address the deeper interdependencies and complexities. As a result, the proposed framework calls for empirical astuteness and further theoretical development. Derived from two interrelated fields of corporate entrepreneurship and dynamic capability, this study contributes with a novel model addressing how managerial cognition links to entrepreneurial outcomes. By adopting organizational learning view, the proposed framework seeks to capture corporate entrepreneurship as a dynamic ongoing process.