Entrepreneurial thinking and action in opportunity development: A conceptual process model

Abstract

This article develops a conceptual process model of how founders develop entrepreneurial ideas into opportunities. Drawing on translation theory, I conceptualise opportunity development as a process of translation between three interlinked but distinct entities over time: ostensive ideas (abstract entrepreneurial ideas), performative ideas (context-specific entrepreneurial ideas) and venture offerings. Whereas ostensive and performative ideas reside in the realm of conceptual and entrepreneurial thinking, venture offerings reside in actual business worlds and entrepreneurial action. The model identifies learning about the abstract nature of the entrepreneurial idea itself (ostensive) through lateral translation and abstraction and separates this from developing a concrete manifestation of the idea in time and space (performative) through vertical translation and concretisation. This is different from the venture offering, which is a specific empirical translation of the performative idea. Entrepreneurs receive feedback about the viability of the venture offering from social interaction that influence further opportunity development. The model portrays opportunity development as a triple-looped process driven by distinct types of translation, lateral, vertical and empirical. It clarifies the relationship between entrepreneurial ideas and entrepreneurial opportunities and maps the role of thinking and action in this regard.

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“…Already in the year 2000, Shane and Venkataraman [22] had established that entrepreneurship is an opportunity-based behavior and that the entrepreneurial act focuses mainly on the questions of how, by whom, and with what effects opportunities are discovered, evaluated, and exploited to create goods and future services [21]. Shane and Venkataraman [22] defined opportunities as situations in which new goods, services, raw materials, and organization methods can be introduced and sold at a cost higher than their production cost [23].…”

“…Although the opportunity is central to both research and practice on entrepreneurship, it is still a vague construct. Likewise, the dynamics of opportunity recognition, selection, and seizing are conceptually undefined and empirically hard to reach [21,23,24]. Clausen [23] points out that discussions among researchers about the nature of opportunities have possibly hindered theoretical development, testing, and empirical research.…”

“…Likewise, the dynamics of opportunity recognition, selection, and seizing are conceptually undefined and empirically hard to reach [21,23,24]. Clausen [23] points out that discussions among researchers about the nature of opportunities have possibly hindered theoretical development, testing, and empirical research. Researchers have discussed the nature of entrepreneurial opportunities, including their ontological and epistemological status [19,23,25,26].…”

“…Clausen [23] points out that discussions among researchers about the nature of opportunities have possibly hindered theoretical development, testing, and empirical research. Researchers have discussed the nature of entrepreneurial opportunities, including their ontological and epistemological status [19,23,25,26]. At this moment, the focus of the debate is whether opportunities result from exogenous market gaps or endogenous enactment [23,25,27].…”

“…As noted by Clausen [23], at least three perspectives can be identified in the opportunity debate. The first, the discovery perspective, argues that opportunities are real external entities and opportunities for profit.…”