Understanding entrepreneurship through the lens of entrepreneurial action

Updated: May 1



Christophe Schmitt*

University Professor of Entrepreneurship

University of Lorraine


*Faculty member of the Business Science Institute.

 

Article originally published on The Conversation France.



Christophe Schmitt's book, "L'Agir entrepreneurial. Rethinking the action of entrepreneurs" received the FNEGE Best Management Book Award (of which The Conversation France is a partner) in the essay category.


In recent years, entrepreneurship, especially in France, has evolved a lot. This is reflected in a lexicon that has integrated new words such as lean startup, crowdfunding or collaborative spaces (coworking spaces). The emergence of this new lexicon is not neutral. It reflects an important paradigm shift in the field of entrepreneurship. Indeed, traditionally, entrepreneurship has been part of a decision paradigm according to which everything that mattered was related to the decisions to be made.


The objective of the essay I have written is to shift the perspective around decision in entrepreneurship to entrepreneurial action. The idea is not to move from decision to action. It is much more than that. It is about considering human activity as a whole, incorporating decision and action. Entrepreneurial action invites us to free ourselves from the linear logic in which entrepreneurship was locked around the decision ⇒ action relationship.


Moreover, actions can precede decisions, and actions can take place without a rational or even conscious decision. The objective is to return to the way entrepreneurship has been constructed over time in order to understand the current rupture proposed by innovative practices.


This construction allows us to shed light on political decisions, the support methods implemented and the methods of teaching entrepreneurship. Thus, the way in which action has been envisaged in entrepreneurial thinking has a strong influence on the way in which it is represented.



The three actions that have structured entrepreneurship


Surprisingly, the idea of entrepreneurship has not been built on the notion of action. Indeed, entrepreneurship has been considered either in relation to the person who takes the action, the entrepreneur, or in relation to the consequences of his action. By building itself around an implicit hypothesis of separation between the action, its consequences and its author, entrepreneurship has given pride of place to the visible part of the entrepreneurial iceberg.


Thus, at first, it is the rational act that was born to allow us to understand entrepreneurship. It answers the question "What does the entrepreneur do?" We find traces of its emergence mainly through the reflections of the classics Cantillon and Say. This action is oriented towards rational decision making. Moreover, it has led and continues to lead to an interest in the economic impact of decisions made by the entrepreneur on society.


This action has also made it possible to develop economic policies to stimulate economic development. It was soon complemented by normative action, which is mainly concerned with the entrepreneur. The latter is not only a rational being, he is also a social actor.


Here, the contribution of psychologists from the 1970s onwards is based on the question "Who is the entrepreneur? The answer to this question refers to the work on entrepreneurial skills and the integration of the social role of the entrepreneur in society. This work has generated tools and approaches to assess the entrepreneur's competencies and promoted the development of the idea of the need to anchor the entrepreneur in economic networks.


The last few years, for their part, have seen the emergence of a reflection on the notion of effectuation developed by Sarasvathy. Without leaving the decision paradigm, far from it, effectuation proposes to answer the question "How does the entrepreneur decide? It is about cognitive action. Moving from the "what" to the "how" allows us to open the entrepreneur's black box in order to understand his or her decision-making mechanisms. The main added value of thinking about effectuation is the fact that it breaks out of the abstraction of Homo economicus in which entrepreneurship thinking has been locked since its origins. However, action always remains the consequence of decisions taken.


The entrepreneurial action to understand the entrepreneurial action


Through entrepreneurial action, the objective is to go further and go beyond the paradigm in which entrepreneurship was built through the three actions mentioned above. We need to change our perspective and consider that decision and action are the obverse and reverse sides of the same coin: entrepreneurial action.


From this perspective, it is important to consider entrepreneurship in a systemic way through a situation that links three dimensions: the entrepreneur (me), the entrepreneurial project and the entrepreneur's ecosystem. This situation can be summarized around the question "How does the entrepreneur act?


We find here the different dimensions of entrepreneurship that should be addressed not separately, but in interaction and not once the action is finished but while the action is being done. Thus, in entrepreneurship, it is not the creation of the enterprise that is most important but the path taken to get there.


Paradoxically, we have been able to show that the less entrepreneurs are told about starting a business, the more they succeed. This can be explained by the fact that creating a business is not the final objective of the entrepreneur. Indeed, the entrepreneurial project that he carries is, in many ways, more important to him. This project must be considered as an artifact that allows the translation of the entrepreneur's plan into a design for the actors of his ecosystem (customer, supplier, financier, coach...).


In this perspective, the entrepreneurial project contains the values, the vision of the entrepreneur, his intentionality and, even more, his posture in the world. Entrepreneurial action is therefore part of a phenomenological perspective. We can see here the importance of Callon and Latour's theory of translation in order to communicate with people whose interests and objectives are different from those of the entrepreneur.


Interests and contributions of entrepreneurial action to understanding entrepreneurship


Taking an interest in entrepreneurial action means changing the way we look at entrepreneurship. We are moving from a position where the business plan is considered the sacrosanct tool in entrepreneurship, allowing for the planning of the consequences of the actions taken by the entrepreneur, to the need to rethink the posture of support in entrepreneurship.


While entrepreneurship, through rational action, normative action and cognitive action, has been mainly interested in the creation of companies, it is appropriate to consider today, through notions such as lean startup, collaborative spaces or participative financing, that the path taken by entrepreneurs to build their actions and/or make decisions is essential to understand entrepreneurship.


In this respect, the experiments conducted within the framework of PeeL have highlighted the importance of helping entrepreneurs build a coherent representation of their entrepreneurial project in order to be able to communicate it to the actors of their ecosystem. While entrepreneurship policies, support and education have largely focused on the downstream phases of entrepreneurship around the creation of a company, it would be appropriate to focus more on the upstream phases that largely determine the success of entrepreneurial projects.


This can be translated in this case by financing the first steps instead of financing only the phase when the entrepreneur is close to creating, generating confidence and self-esteem in the entrepreneur during his first actions or helping the entrepreneur to build meaning from his idea by trying to understand the intentionality that leads him to undertake.



Article translated from French with https://www.deepl.com/translator


 

Read also...


Christophe Schmitt's articles on The Conversation France.


Christophe Schmitt's articles & books on CAIRN.Info.



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