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Purpose – The purpose of this paper is to expand upon existing theories of entrepreneurial cognitions. It constructs an information‐processing framework of entrepreneurship (I‐P e ) that holistically maps out the entrepreneurial opportunity recognition process. This framework demonstrates how various entrepreneurial needs and attitudes, as well as entrepreneurial motivators, impact on the diagnosis and assessment of informational cues. It describes how opportunity‐related information is processed by entrepreneurs in order to reach a decision of acceptance or rejection of potential business opportunities. Design/methodology/approach – The paper commences with a case study of New Zealand's winner of the Entrepreneur of the Year Award, Bill Day and his company Seaworks, a marine contracting firm. The case content is based on personal interviews by the authors as well as secondary data. The case describes how Seaworks achieved its current level of success. A number of Bill Day's uniquely entrepreneurial behaviours are then mapped into a cognitive framework describing influential elements of the entrepreneurial decision processes. This framework is derived from interdisciplinary research encompassing the study of entrepreneurship, psychology and cognitive neuroscience. Findings – Entrepreneurs have a heightened ability and awareness for recognising and audaciously exploiting business opportunities. They persistently and continually seek opportunity‐laden information in order to satisfy internal motivators such as need for achievement and the fulfilment of competitive urges. The case study describes an entrepreneurial mind that is attracted and stimulated by elements of excitement and fun. This entrepreneur is driven by business challenges that match and stretch his skills, knowledge, and abilities. Business related informational cues are sought and processed to calculate profit potential, the level of risk, and the cost of enactment. Final calculations are filtered. Benefits and potentially positive outcomes are amplified in the calculation process, while potential complications are regarded as challenges to be overcome rather than obstacles to be avoided. Practical implications – The I‐P e framework derived from this research clearly demonstrates uniquely entrepreneurial decision processes. It advances our understanding of entrepreneurial cognitions and entrepreneurial decision behaviours, which has applications for the teaching of business skills as well as increasing our understanding of the phenomenon that has been termed “entrepreneurship”. Originality/value – This paper is based on an original case study written by the authors and integrates cognitive theory within the context of entrepreneurial behaviour in order to explain why entrepreneurs are so successful at recognising and exploiting opportunities.
European Journal of Innovation Management – Emerald Publishing
Published: Jan 1, 2006
Keywords: Entrepreneurialism; Entrepreneurs; Decision making; Cognition; Psychology
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