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This chapter deals with the process perspective of entrepreneurship, that is, what prospective entrepreneurs should do and how they do it (the processes they use) to launch a new venture in the tourism field. The main purpose of this chapter is to explain what the entrepreneurial process is, the steps/phases to transit from idea to enterprise and the risks involved.

General review was conducted on conceptual issues and managerial aspects of the entrepreneurial process and legal issues.

This chapter highlights that the entrepreneurial process undergone by entrepreneurs is dual in nature, both in terms of action and thinking process. Given that the failure rate of new ventures is high, there is a need to focus on the importance of understanding the dynamics of entrepreneurship, the action process of the prospective entrepreneur and the potential risk impact.

This chapter is explorative in nature because the discussion is based on a general review.

Prospective entrepreneurs should follow specific steps, a rational process to establish their business venture and to protect its operations against any event. Thus, any new business should manage risks appropriately, as well as record insurance to cover for unforeseen events.

This chapter provides an overview of the entrepreneurial process and legal risk issues that may affect the success of a new venture. The hands-on approach is particularly useful in dealing with the entrepreneurial mind when exploring new business ventures in the tourism field.

Shane and Venkataraman (2000) suggest “the field [of entrepreneurship] involves the study of sources of opportunities; the processes of discovery, evaluation, and exploitation of opportunities; and the set of individuals who discover, evaluate, and exploit them” (p. 218). However, the study of the judgment required for opportunity evaluation has been greatly overshadowed by interest in opportunity recognition and to a lesser extent opportunity exploitation. This is surprising considering the number of economic theories of the entrepreneur that recognize sound judgment as a principal quality of entrepreneurship (Cantillon, 1755; Kirzner, 1973; Knight, 1921; Mises, 1949; Say, 1840; Schumpeter, 1934; Shackle, 1955). In fact, the first recognized theory of the entrepreneur defined the entrepreneur as someone who exercises business judgment in the face of uncertainty (Cantillon, 1755/1931, pp. 47–49). Similarly, Knight (1921, p. 271) suggests that the essence of entrepreneurship is judgment, born of uncertainty, and argues that it is this judgment that delineates the function of entrepreneur from that of manager. He goes on to point out that the function of manager does not in itself imply entrepreneurship but that a manager becomes an entrepreneur when he exercises judgment involving liability to error (Knight, 1921, p. 97). However, the judgment referred to by these theorists is not just any form of judgment, it is judgment exercised in the decision of whether to take action.

Recognition of a profit opportunity requires a framework of knowledge to place information about a profit opportunity in a context where it can be recognized. The same information about a profit opportunity could be revealed to many people, yet only a few with the appropriate knowledge will be able to place this information into a context that suggests to them a profit opportunity. This paper discusses how entrepreneurs gain knowledge to enable them to be more entrepreneurial, and shows how an economy generates information about entrepreneurial opportunities. Entrepreneurship adds to an economy’s knowledge base, making it easier to recognize profit opportunities when they arise.

Studies of entrepreneurial action often distinguish between different phases such as opportunity identification, evaluation, and exploitation. Yet, the richness of past contributions masks the absence of an integral framework to organize, in a theoretically consistent ensemble, the different kinds of cognitive processes that underpin entrepreneurial action. In this chapter, we draw from research on human action and cognition to offer an integrative model of the cognitive processes that foster entrepreneurial action. By presenting a more specific articulation of when, how, and why different cognitive processes operate, we provide theorists and empiricists with a more complete picture of how entrepreneurs’ thinking evolves from the emergence of an opportunity idea to the initiation of concrete entrepreneurial acts. In addition, our framework draws attention to cognitive inflection points that entrepreneurs must navigate in their journey toward entrepreneurship. By explicitly locating these inflection points and specifying the changes in mental processing that occurs at each point, we highlight that for entrepreneurial action to ensue, entrepreneurs must shift from one type of cognitive processing to another. Along this line, our model draws attention to the entire set of cognitive “skills” entrepreneurs must master for successful completion of each phase and successful transitions between phases.

Twenty-one years ago (1997), the entrepreneurial revolution, both academic and actual, was just beginning. Entrepreneurial opportunities represent both the core theoretical construct and the plethora of products, services, processes, and business models, which dramatically changed daily life. This chapter examines key developments, which have emerged in the scholarly investigation of the opportunity identification process during the intervening years: what fundamentally is an opportunity; what socio-cognitive processes are involved; what is the role of time, of meaning, of context; and finally, what is the relationship between the academic and practitioner. In addition, exemplary research work is highlighted and guidelines for future academic efforts are offered.

Entrepreneurs are action takers. This paper presents an agent-based model illustrating entrepreneurial action choices between rhetoric and action during the very early stages (pre-formal alliance) of an entrepreneur's journey. Environmental factors, inertia, entrepreneurial conation preferences, the context-for-learning, and identified opportunities are all factors that will influence action choices both separately and in configurations. In virtual experiments, we examine the length of time it takes entrepreneurs to reach the stage for opportunity commitment, based on their skills and conation profiles. From the computer simulation, we determined that certain entrepreneurial profiles do make a difference in the overall effectiveness and efficiency of reaching an opportunity commitment. In general, an entrepreneur is more effective in reaching opportunity commitment if the entrepreneur has either a high skills profile, or a high conation profile, while the combination of high-level skills and conation profiles do not provide any real advantage. A high skills profile proves to create the greatest advantage of reaching opportunity commitment in the shortest length of time.

Despite the extensive research on the determinants and consequences of firm growth, research focusing on how the actual process unfolds is still evolving. An important part of firm growth process research is entrepreneurial cognition. The purpose of this chapter is to explore the relationship between entrepreneurial cognition and firm growth intentions. Specifically, we propose a theoretical model of entrepreneurial cognitive interpretation and categorization of market information as it relates to firm growth intentions. Drawing from the strategic cognition literature in general and strategic issue interpretation literature in particular, we propose that entrepreneurs’ interpretation of market information as opportunity or threat, gain or loss, and controllable or uncontrollable influences their firm growth intentions. Furthermore, our theoretical model discusses the condition under which favorable interpretation of market information leads to higher growth intentions by incorporating insights from the Entrepreneurial Orientation (EO) construct. This chapter extends our understanding of firm growth processes by highlighting the important role cognitive interpretation and categorization play in facilitating or hindering entrepreneurial firm growth.

Evidence suggests habitual entrepreneurs (i.e. those with prior business ownership experience) are a widespread phenomenon. Appreciation of the existence of multiple entrepreneurial acts gives rise to the need to examine differences between habitual and novice entrepreneurs (i.e. those with no prior business experience as a founder, inheritor or purchaser of a business). This paper synthesizes human capital and cognitive perspectives to highlight behavioral differences between habitual and novice entrepreneurs. Issues relating to opportunity identification and information search, opportunity exploitation and learning are discussed. Avenues for future research are highlighted.

In this paper, we argue that the opportunities created from the recent transformational change in the health care industry have provided the environment for entrepreneurship to thrive. As a result, new and innovative organizational forms have flourished particularly when embedded in communities of entrepreneurial activity where networks of experience, access, and social/work relationships exist. The major purpose of this paper is to initiate a theoretical dialogue in which entrepreneurship is introduced as a field of research that can be used to explain how and why health care organizations have emerged and changed into their present forms. First, we present the basic elements for understanding the process of entrepreneurship and how entrepreneurial activity is important to the innovation of new organizational forms. Second, we relate this to the field of health care by focusing on the three stages in the entrepreneurial model: creation, discovery, and exploitation of entrepreneurial opportunities. Third, we argue that the degree of entrepreneurial activity within a given community is the outcome of a dynamic process involving social networks along with positive economic and legal activities that reduce transaction costs and encourage entrepreneurship. To demonstrate this, we focus on the area known as the “health care business capital” in the U.S. – Nashville, Tennessee – and describe the entrepreneurial activity in that city beginning in the 1960s and relate this to the existing theory. We believe this research represents a juxtaposition of the practical and theoretical, so critical in understanding entrepreneurial activity and new organizational forms in health care.

This chapter considers the role of entrepreneurship theory in the development of ideation techniques for entrepreneurship education. It begins by considering how metatheories impact theory construction in entrepreneurship research and discusses the role of ontology, epistemology, axiology, as well as the role of assumptions about human nature and social change. The chapter presents four different paradigms of thought that apply different philosophies and illustrates how these different paradigms conceptualize entrepreneurship and entrepreneurial opportunity differently. The four paradigms include the equilibrium paradigm, the disequilibrium paradigm, the disruptive innovation paradigm, and the social constructionism paradigm. Within each paradigm, the nature of entrepreneurial opportunity is discussed, and the chapter provides examples to show how different ideation techniques can be generated from these different conceptualizations. Forms of ideation technique are presented and explained, as they relate to each paradigm, and the chapter concludes by explaining the value of these techniques for ideation, opportunity discovery, and creation, in the entrepreneurial process.