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On the organizational design of entrepreneurial ventures: the configurations of the entrepreneurial team

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Abstract

Several studies claim that entrepreneurial ventures should pay attention to their organizational design in order to improve performance. However, a clear understanding of these ventures’ organizational design is still missing. In this paper, we borrow the key organizational design elements from the literature on established firms and we study them simultaneously to provide a first empirical overview on the organization of the entrepreneurial ventures. Specifically, we investigate whether and how organizational design elements cluster together in different organizational configurations. To do so, we analyze a sample of 255 Italian entrepreneurial ventures, focusing on their entrepreneurial team and on the most important organizational design elements: hierarchical structure, size, functional specialization, and allocation of decision authority. To this end, we first use t tests, ANOVA tests, and Scheffe post hoc tests to explore the associations between the organizational design elements and four contingency factors (i.e., entrepreneurial venture’s size, age, industry, and geographical location). Then, we adopt a two-step cluster analysis to understand whether and how the complementarities and interdependencies among organizational design elements give rise to organizational configurations. Results reveal the presence of three distinct configurations, which we named collaborative ET, centric ET, and professional ET.

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Notes

  1. While there is general consensus on the definition of the corresponding team in established firms [i.e., the Top Management Team, TMT, which is the team formed by the managers at the top of the corporate hierarchy and responsible for the strategic decision-making (Amason 1996; Collins and Clark 2003)], its definition is more ambiguous in the case of EVs. Here we consider as members of the ET of a focal venture all individuals who collectively or autonomously decide about the strategy of the venture. Accordingly, the ET includes the venture’s CEO and owner-managers but may also include other professional (i.e., non-owner) managers who report to the CEO.

  2. Please note that findings on these organizational design elements that have been found in the context of established firms may not necessarily hold for EVs. Indeed, EVs are typically smaller and younger so as organizational elements may need to be designed differently. Moreover, established firms have survived longer, meaning that we might expect to see less variance in organizational arrangements, and specifically only those that allowed the established firms to succeed and survive.

  3. SurveyMonkey (www.surveymonkey.com) is an online platform to conduct survey data collections.

  4. We considered 3 geographical areas—i.e., North, Center, and South of Italy—and 3 industries—i.e., manufacturing, services, and constructions.

  5. Early respondents are entrepreneurs who answered after the initial phone call and related email; late respondents are instead those that answered after at least one email reminder.

  6. It is worth mentioning that we ran our analyses also considering an alternative measure of EV age. Specifically, we distinguished EVs in four age classes: 1 year, between 2 and 5 years, between 6 and 9 year, 10 years. Results, which are available from the authors upon request, are consistent with those presented in the paper.

  7. While, given their low number, it is reasonable to consider together EVs located in the Center (3 EVs) and South (16 EVs) of Italy, we ran our analyses also dividing them into two distinct categories. Results are in line with those presented in the paper and are available from the authors upon request.

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Rovelli, P., Butticè, V. On the organizational design of entrepreneurial ventures: the configurations of the entrepreneurial team. J. Ind. Bus. Econ. 47, 243–269 (2020). https://doi.org/10.1007/s40812-020-00147-w

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