Acquisition of resources, formal organization and entrepreneurial orientation of new ventures

Abstract

Purpose

The purpose of this paper is to assess the impact of the acquisition of resources and formal organization on entrepreneurial orientation (EO) of new ventures.

Design/methodology/approach

The research was conducted using an original data set of 199 new ventures in China. The data were analyzed through regressing models.

Findings

It was found that new ventures experiencing difficulty in acquiring resources have higher levels of EO; formal organization is associated with the proactiveness dimension of EO significantly and positively.

Research limitations/implications

First, the measures of EO were mainly used to study established firms. The measures of EO may need to be modified to take into account new ventures' uniqueness. Second, this study focused on new ventures operating in a specific geographical region, China.

Practical implications

New ventures should build their formal management systems so that they can integrate as organic organizations to engage in entrepreneurial activities. New ventures lack regulations and their development mainly depends on entrepreneurs. The formal regulations can help new ventures better use and integrate the power of the whole organization systems to identify and explore external opportunities.

Originality/value

Research on EO has focused on established firms while the EO of new ventures is seldom studied. These findings indicate the uniqueness of new ventures and contribute to a better understanding of their behaviors.

Citation

Fang, N., Yuli, Z. and Hongzhi, X. (2009), "Acquisition of resources, formal organization and entrepreneurial orientation of new ventures", Journal of Chinese Entrepreneurship, Vol. 1 No. 1, pp. 40-52. https://doi.org/10.1108/17561390910916877