The Entrepreneurial Process Networks as a New Theoretical Framework for Understanding and Analyzing the Practice of Creating a New Business Venture

Abstract

The major methodological gap is that most recent entrepreneurial studies are focusing on the causes or consequences of creating new business ventures rather than the process in which the entrepreneurship is generated, formulated, developed and implemented in the first place. Reviewing the extant literature has revealed that most studies of entrepreneurial process focused on two main different approaches: the entrepreneurial stages approach and the entrepreneurial networks approach. To bridge the gap between these different approaches this paper is aimed to introduce the Entrepreneurial Process Networks (EPN) as a new theoretical framework for understanding the effect of formal and informal networks on entrepreneurial process. EPN is derived from combining the advantages of the entrepreneurial process in stages (vertical) and the entrepreneurial networks approach (horizontal) which is located within a larger system idea of dynamic and interdependency. Our assumption here is that different formal and informal networks participate across entrepreneurial stages by influencing each other and giving accumulative outcomes for the whole entrepreneurial process. EPN would be a helpful methodology for future entrepreneurial research that enables an entrepreneur or practitioner to understand why the process of creating new business venture may succeed or fail to produce effective performance or predictable outcomes, as well as enabling the entrepreneur to start, develop and manage social networks as the holders to valuable resources such as: knowledge, information, skills and capital which entrepreneur really needs to achieve its objectives.