Allocating Resources for New Technology within Entrepreneurial Firms

Abstract

This study seeks to determine the influence of the underlying factors and barriers that may inhibit the implementation of new technological investments by entrepreneurial firms. These factors and barriers may include the potential costs, risk of failure, low technological awareness, lack of an outside organization to facilitate development, lack of approachable organizations with which to form partnerships, and lack of contact with other organizations that have implemented technology successfully. Using structural equation modelling (LISREL VIII), results revealed that the value and importance that entrepreneurs placed on learning and adopting new technologies, in addition to the risk of failure, mediated the relationship between many of these barriers and the firms' technological investment during the past year, as well as their willingness to spend on new technology in the future.

Keywords

technology investments innovation alliance formation

Get full access to this article

View all access options for this article.

References

Ariss

Raghunathan

T. S.

Kunnathar

(2000), ‘Factors affecting the adoption of advanced manufacturing technology in small firms’, SAM Advanced Management Journal, spring, pp 14–29.

Bentler

P. M.

Bonett

D. G.

(1980), ‘Significance tests and goodness of fit in the analysis of covariance structures’, Psychological Bulletin, Vol 88, pp 588–606.

Davis

Meyer

(1998), Blur: The Speed of Change in the Connected Economy, Warner Books, New York.

Drucker

P. F.

(1998), ‘The discipline of innovation’, Harvard Business Review, Vol 76, No 6, pp 149–157.

Gagnon

Y.-C.

Sicotte

Posada

(2000), ‘Impact of SME manager's behavior on the adoption of new technology’, Entrepreneurship Theory and Practice, Vol 25, No 2, pp 43–57.

Garvin

D.A.

(1993), ‘Manufacturing strategic planning’, California Management Review, Vol 35, No 4, pp 85–106.

Hartman

Sifonis

Kador

(2000), Net Ready: Strategies for Success in the Economy, McGraw-Hill, New York.

Hayes

R.H.

Wheelwright

S.C.

(1984), Restoring Our Competitive Edge: Competing Through Manufacturing, John Wiley and Sons, New York.

Hinkin

T. R.

(1995), ‘A review of scale development practices in the study of organizations’, Journal of Management, Vol 21, pp 967–988.

10.

Hirsh

Wheeler

(1999), Channel Champions: How Leading Companies Build New Strategies to Serve Customers, Jossey-Bass, New York.

11.

Hodgetts

R. M.

Luthans

Slocum

J. W.

Jr (1999), ‘Strategy and HRM initiatives for the '00s environment: Redefining roles and boundaries, linking competencies and resources’, Organizational Dynamics, Vol 28, No 2, pp 7–21.

12.

Joreskog

K. G.

Sorbom

(1993), LISREL VIII: A Guide to the Program and Applications, SPSS, Chicago, IL.

13.

Kelley

Rice

(1999), ‘Sustaining innovation in the new firm: The role of technology portfolios and alliance formation’, in Reynolds

, eds, Frontiers of Entrepreneurship Research, Babson College, Wellesley, MA.

14.

Marsh

H. W.

Balla

J. R.

McDonald

R. P.

(1988), ‘Goodness-of-fit indexes in confirmatory factor analysis: The effect of sample size’, Psychological Bulletin, Vol 103, pp 391–410.

15.

Maxwell

J. R.

Westerfield

D. L.

(2002), ‘Technological entrepreneurism characteristics related to the adoption of innovative technology’, SAM Advances Management Journal, winter, pp 9–13.

16.

Miles

(1999), ‘Dangers of dependence: The impact of strategic alliance use by small technology-based firms’, Journal of Small Business Management, Vol 37, No 2, pp 20–29.

17.

Narasimhan

Das

(1999), ‘An empirical investigation of the contribution of strategic sourcing to manufacturing flexibilities and performance’, Decision Sciences, Vol 30, No 3, pp 683–718.

18.

Neese

(2000), ‘Report gives new trends on e-commerce evolution, communication changes’, The Journal Record, 24 January, Website: http://www.journalrecord.com.

19.

Skinner

W.A.

(1969), ‘Manufacturing: Missing link in corporate strategy’, Harvard Business Review, Vol 47, No 3, pp 136–145.