Research On Entrepreneurial Experiences, Ambidextrous Opportunity Recognition And New Venture Performance

Entrepreneurship firms have become a vital driving force for China’s economicprosperity. In recent years, entrepreneurial activity in China became very active.However, the success rate of new ventures is very low. For entrepreneurs, creatingnew venture can be treated as running a marathon race, only few can eventually get totheir destination or gain remarkable firm performance. Many new ventures exist as aflash in the market, which is quickly and cruelly knocked out by the market. From ourobservations, there do exist some new prominent ventures can keep their survival andpromptly obtain their places in the competition-intensive environment. So thequestion, what are the factors that drive these profit-seeking companies to getoutstanding performance? Especially in the context of China transitional economy, theentrepreneurial process of new ventures creation is greatly affected by environmentalturbulence, rapid economic development along with underdeveloped market andimperfect institutional support give rise to a great amount of entrepreneurialopportunities. A critical question for entrepreneurs is how to combat the dilemma ofresource constraints in such hostile environment so as to successfully discover andexploit opportunities. To answer these questions, this paper derives a research modelof entrepreneur’s experience, ambidextrous opportunities recognition, and newventure performance based on knowledge management theory, experiential learningtheory, and organizational ambidexterity theory, to investigate distinct effects ofdifferent types of entrepreneur’s experience (entrepreneurial experience, functionalexperience, and industry experience) on recognition of ambidextrous opportunities aswell as examining the moderating role of knowledge sharing on the relationshipbetween entrepreneur’s experience and recognition of ambidextrous opportunities. Inaddition, we also explore the roles of recognition of ambidextrous opportunities onnew venture performance in different industrial contexts (high tech industry-low techindustry).Whereafter this study adopts the questionnaire to collect data. We choose samples from Jilin, Beijing and Guangdong to ensure the national representative nature of oursample, and334questionnaires are usable. Second, we use factor analysis, Pearsoncorrelation analysis, and multiple linear regression analysis to test the contingencyhypotheses, most of which are supported by the data. The results show that,entrepreneurial experience, functional experience, and industry experience are thecritical sources of entrepreneurial knowledge and skills. Our results also suggest theentrepreneur’s experience exerts different effects on exploration opportunity andexploitation opportunity. Besides, knowledge sharing as a moderator also has effecton the relationship among external-oriented, internal-oriented functional experienceand exploration opportunity recognition, as well as the relationship betweenentrepreneurial experience, external-oriented functional experience and exploitationopportunity recognition.In terms of the relationship between ambidextrous opportunities recognition andnew venture performance in the technology sector, perceiving either technologicalexploration opportunity or technological exploitation opportunity both have a positiverelationship with new venture performance for high tech enterprises and low techenterprises. However, our results suggest that capturing a technological exploitationopportunity demonstrates a much greater prominent effect on new ventureperformance. Furthermore, results indicate that firms get better performance whenmaintaining a balance between exploration opportunity and exploitation opportunity.Then, in terms of the relationship between ambidextrous opportunities recognitionand new venture performance in the marketing sector, the recognition of eithermarketing exploration opportunity or marketing exploitation opportunity both have apositive relationship with new venture performance for high tech enterprises and lowtech enterprises, however, the latter one has much more positively related to newventure performance. In addition, the balance between marketing ambidextrousopportunities is not positively related to new ventures performance in high techindustry, while positively related to new ventures performance in low tech industry.Thirdly, for both high tech and low tech enterprises, the relationship betweenrecognition of ambidextrous opportunities and new venture performance engaging inboth technology and marketing sectors, pursuing lower creative market penetration opportunity (technological exploitation opportunity-marketing exploitationopportunity) is negatively related to new venture performance. However, recognitionof radical creative opportunities does not have a significant effect on performance ofhigh-tech and low-techenterprise. Apart from that, our results suggest firms will get abetter performance when they are in pursue of both market development opportunity(technological exploitation-marketing exploitation) and technological developmentopportunity (technological exploration-marketing exploitation), and the technologicaldevelopment opportunity show more significant effect on new venture performance.There is a hot issue in the entrepreneurship and organizational managementliteratures-organizational ambidexterity. Therefore, to fill these gaps in recent research,enlightened by comprehensive ideas from organizational ambidexterity andrecognition of entrepreneurial opportunity, this study tries to investigate thecharacteristics of entrepreneur’s experience on new venture performance based onnew firms in China’s transitional economy. We not only investigate different effects ofdistinct types of entrepreneur’s experience on the recognition of ambidextrousopportunities, as well as the moderating effect of knowledge sharing onentrepreneur’s experience and recognition of ambidextrous opportunities. Meanwhile,we derive a research framework of exploration-exploitation and technology-market toanalyze the mechanism on how firms take strategic actions to keep balance betweenexploration and exploitation in technology and marketing sector, as well as thedistinct characteristics by making comparisons in the process of realizingorganizational ambidexterity between high tech industry and low tech industry. Thepurpose of this study is to fill the gaps in the organizational ambidexterity,entrepreneurial behaviors in opportunity recognition of new venture, andentrepreneur’s experience literatures. The theoretical contributions are as follows:First, based on the gaps existing in organizational ambidexterity literature, thisstudy investigates the issue of construction organizational ambidexterity for newventure in China’s tradition economy, by examining the effects of prior experienceand experience on the recognition of ambidextrous opportunities, and reveals themechanism of different types of experience on new venture, which can enrich thetheories of new venture creation. Second, given the fact that there is ‘experience liabilities’ prevalent inentrepreneurial process, this study investigates organizational knowledge sharing as amoderator in the relationship between different types of entrepreneur’s experience andthe recognition of ambidextrous opportunities. This offers significant implications fornew venture to build the atmosphere on how to develop knowledge sharing, whichalso shed light on the practical implications on utilizing entrepreneur’s experiencewhen exploring and exploiting entrepreneurial opportunity.In addition, taking characteristics of China’s transition economy intoconsideration, this study construct a research model of ambidextrous opportunitiesrecognition and new venture performance, by systematically introducing acomprehensive framework of technology-marketing and exploration-exploitation, inwhich four types of entrepreneurial opportunity are derived, technological explorationopportunity, technological exploitation opportunity, marketing exploration opportunity,marketing exploitation opportunity, respectively. Besides, this study attempt toexamine the mechanism on how new venture can identify ambidextrous opportunitiesin technology and marketing sector and its effect on new venture performance in hightech industry and low tech industry while simultaneously combining with differentcharacteristics of different industries. Through analyzing the issue of entrepreneurialopportunity choices in deferent industry context, we offer important implications forpractitioners on how to make entrepreneurial decisions on choosing entrepreneurialopportunity by utilizing resource base and industry context to firm’s advantages, howto allocate resources and capabilities into choosing, taking-off, and balancing differentopportunities when taking strategic actions of exploration and exploitation so as toconstruct organizational ambidexterity. This makes significant contributions forentrepreneurs and managers to keeping a balance relationship resource/capability,entrepreneurial behaviors, and entrepreneurial environment.