Avoiding Fetishism in the Study of Entrepreneurship

[We’re pleased to welcome Bill McKelvey of the University of California, Los Angeles. Dr. McKelvey recently published an article in Journal of Management Inquiry with co-authors G. Christopher Crawford of Ohio University and Dimo Dimov of University of Bath, entitled “Realism, Empiricism, and Fetishism in the Study of Entrepreneurship.”]

• What inspired you to be interest in this topic?

Our starting point was a Dialogue piece published by Alvarez et al. (2014) that dismissed all the prior theory and research focusing on entrepreneurship and seemed to be perpetuating a debate about the ontological nature of opportunities as a core issue in entrepreneurship. Our view was that the authors’ arguments not only discounted the everyday reality of practicing entrepreneurs, but also drew the research domain away from building theory that was relevant to practice. Yes, we agree that most academic research is useless to managerial practitioners. Why? To get a paper published, statistics wins out over practical relevance. For example, a strategy paper got published because its empirical sample of ~4000 was statistically significant (p<0.05), but only explained 1% of the variance. So, which part of a manager’s organization does the 1%-variance-explained result apply to? But this is not what our debate is about.

• We worry more about logic, what is real, and theoretical fetishism.

Our short Dialogue piece challenges a stream of thought that focuses on drawing what we see as a frivolous contrast between creation and discovery view of entrepreneurship. In the former, entrepreneurs create opportunities ex nihilo; in the latter they discover them as “luggage lost at a train station.” “Fetishism” is a label Roy Suddaby applies to articles that are “detached from the empirical world.”[1] The fundamental question is: “How to make entrepreneurial research more relevant and useful to entrepreneurs?” In the example of the iPhone, one can easily see how arguments to portray its opportunity as created or discovered effectively shun its reality. Reality before the iPhone was invented and manufactured was that: cellphone towers already existed; people already were using cellphones; people could connect with their friends, stores, restaurants, hotels, and transport services, etc., via the Internet and had access to all the other information available on the Internet; the app-making software was available before the iPhone was produced. In fact, all the technology Apple used to create the iPhone already existed in the real world before the iPhone came to market in June 2007. The story was the same with the steam engine, Ford’s Model T, Wright brother’s airplane, the ice-cream cone; the first computer, and on and on…. Apple’s success laid in making the existing ingredients work together in the most compelling way, by building strong functional relationships among them. In this sense, there is no opportunity without the relationships and, equally, no opportunity without the ingredients. We see opportunities as emergent structures, with ontologically real components, epistemologically real functional relationships, and requiring real human actions and interactions to come to fruition. In short, they are both discovered and created.

• How do you see your Dialogue piece influencing future research and/or practice?

Entrepreneurs are pragmatic enough not to worry about the ontology of the opportunities they see. They see tangible ingredients as well as imaginary ways in which these can be put to productive, functional ends. If this vision is compelling enough, they try to make it work, i.e. take the risk to turn it into a business opportunity. We aim to steer future research towards better alignment with this empirical reality.

[1] Suddaby, R. 2014. Editor’s comments: Why theory? Academy of Management Review, 39(4): 407-411.

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G. Christopher Crawford is an assistant professor of strategic management at Ohio University. He received his PhD in entrepreneurship from the University of Louisville in 2013. His dissertation, “Causes of Extreme Outcomes in Entrepreneurship” was awarded a Kauffman Dissertation Fellowship. His research interests include new venture growth, behavioral and business strategy, and understanding the mechanisms that generate power law distributions and outliers in social systems. His work has been published in Journal of Business Venturing, Small Business Economics, Best Paper Proceedings of the Academy of Management, Frontiers of Entrepreneurship Research, Journal of Organization Design, and Journal of Business Venturing Insights.

Dimo Dimov is a professor of innovation and entrepreneurship at the School of Management, University of Bath. Prior to joining the school in 2012, he was on the faculties at Newcastle University, University of Connecticut, and IE Business School. He holds a PhD in entrepreneurship from London Business School. His research focuses on understanding the entrepreneurial process, from initial idea to viable venture. He examines how potential entrepreneurs and investors think, act, and interact in the face of its uncertainty and how these interactions give rise to exciting new phenomena. His work is consistently published in world leading journals.

Bill McKelvey, PhD (MIT 1967), is a professor emeritus at University of California, Los Angeles (UCLA) Anderson School of Management. His book Organizational Systematics (1982) remains a definitive treatment of organizational evolution. He chaired the building committee that produced the US$110,000,000 Anderson Complex and co-founded UCLA’s inter-departmental program, Human Complex Systems & Computational Social Science. He has articles in Administrative Science Quarterly, Advanced Materials Research, Organization Science, Leadership Quarterly, Journal(s) of Bioeconomics, Behavioral Finance, International Business Studies, Economics & Organizational Behavior, among many others. He coedited the SAGE Handbook of Complexity and Management (2011) and was editor of Routledge Major Work: Complexity Concepts: Critical Concepts (2013; 5 volumes, 2447 pp.). He has 80+ papers about organizational complexity since 1997.