What color is your entrepreneurship spirit?

For nearly 20 years experts of Global Entrepreneurship Monitor (GEM) have been tracking the entrepreneurship dynamics across continents, specific development categories of countries or even tiny sub-economies. While focusing on various entrepreneurship framework conditions (such as cultural and social norms, education, market peculiarities, R&D transfer, and etc.) which affect entrepreneurs’ perception/ attitude, motives, activities and success, entrepreneurship is considered as a holistic and diverse topic, which requires ingenious case-by-case analysis, as data collection and research methods are sensitive to a specific context of a country. Given complexity of entrepreneurship, there are no perfect countries in terms of entrepreneurship dynamics, but acknowledgement of weaknesses and opportunities of economies and companies should be taken into account within entrepreneurship enhancement system.

In light of global business trends (such as use of robots and artificial intelligence, social innovation, environmental pressures, digitalization, and networks/ platforms), high-tech and low-tech combination becomes an engine of creating economic and social value-added. To respond to these market trends, companies rely on creative leadership (Ferguson, Ronayne and Rybacki, 2016), while global research organizations focus on measurement of economic and social value-added within different industries; in particular, in technologically more intensive sectors (for instance, in 2015 GEM started tracking and reporting  the entrepreneurship dynamics within specific categories of  industries). Thus, researchers try to examine how technologies affect  traditional industries.

Based on the strategy to provide a more sophisticated and technologically-advanced good or service via stronger R&D and marketing efforts, technological innovation also calls for new communication style among stakeholders; communication becomes more transactional and transformational rather than traditional/ mathematical (Hahn, Lippert and Paynton, 2016).

The whole national innovation system is being aligned with new perception, attitudes and communication; therefore, more holistic approaches, such as ‘Ecosystem’, ‘Symbiosis’, ‘Networks’, ‘Clusters’ or ‘Spirit’ emerge as key-terms for modern organizations. Notwithstanding that many of these aspects were covered by GEM data in previous reports, for the first time in the history, within the report 2017/ 2018 GEM introduces ENTREPRENEURIAL SPIRIT INDEX (GESI), which captures three aspects: entrepreneurial awareness, opportunity perception, and entrepreneurial self-efficacy.

According to GILE Experts, this index is particularly relevant nowadays, as in parallel with identification of people who started a business in the past year (entrepreneurial awareness) and business opportunities in the local area (entrepreneurial opportunity perception), this index also incorporates entrepreneurship education-related dimension of capabilities (knowledge, skills, and experience to start a business – entrepreneurial self-efficacy).

Entrepreneurship Spirit Index (work in progress) helps understand business environment from the perspective of entrepreneurs’ perception; it can serve as a tool for governments to position their countries among peers and later on to focus on improvement of entrepreneurship conditions via a set of tools (oriented to the fear of failure, entrepreneurship education, identification of niche or entrepreneurship impacts). GILE Experts will use this index in their future research, focused on the role of education or cultural and social norms on innovation processes.

Entrepreneurship Spirit Index is critical to efficiency-driven economies, such as Lithuania or Latvia, which face the necessity to establish smooth and efficient creativity enhancement and innovation processes as well as to be more proactive and dynamic. It is not surprising, that the five top-ranked countries in the index belong to efficiency-driven countries. Moreover, some innovation-driven economies have high scores in Entrepreneurship Spirit, which show the relevance of this indictor to any of the stages of economic development.

Based on GEM 2017/2018, the five top economies with the highest ranking in the GEM Entrepreneurial Spirit Index are: Saudi Arabia, Lebanon, Indonesia, Poland and Peru (which are efficiency-driven).  Among innovation-driven economies some of the countries demonstrate the dominance of entrepreneurial spirit: United Arab Emirates, Sweden, Netherlands, Israel, Estonia, Canada, USA, Australia, Cyprus, and Luxembourg.

Experts Lauzikas and Miliute (2017) make an assumption that a special attention should be paid to the role of education and cultural and social norms on entrepreneurship spirit, because education at both early-stage and post-school levels affects a set of entrepreneurship spirit-related dimensions, such as creativity, fear of failure, social trust, opportunity recognition and confidence in entrepreneurship capabilities. Therefore, any education reform or efforts to make education jobs prestigious should be centred on entrepreneurship spirit enhancement and transformational leadership (Uusi-Kakkuri, 2017), including alignment of perception and attitude.

A relatively higher expenditure for professors’ and teachers’ wages is important, but not sufficient precondition to improve the quality of education. Rather than focusing on tactical and short-term targets, the education systems should become entrepreneurship-oriented, interactive, digital and transformational, which is necessary for entrepreneurship spirit, particularly in the countries with high scores of young entrepreneurs or intrapreneurs (such as Lithuania). Technologically advanced, more digital and interactive education systems with strong creative leadership might be a perfect choice for efficiency-driven countries, which often lack human resources with specific entrepreneurship capabilities.

Bibliography

• Ferguson, J.; Ronayne, P. and Rybacki, M. (2016) Comparing Leadership Challenges: Civil Service vs. Private Sector, Centre for Creative Leadership, available online: https://www.ccl.org/wp-content/uploads/2016/02/ComparingLeadershipChallenges.pdf
• GEM Report 2015/ 2016. Available online: https://www.gemconsortium.org/report
• GEM Report 2017/2018. Available online: https://www.gemconsortium.org/report
• Hahn, L. K.; Lippert, L.; Paynton, S. T. (2016) Survey of Communication Study; Available online: https://en.wikibooks.org/wiki/Survey_of_Communication_Study
• Hovland, I. (2005) Successful Communication: A Toolkit for Researchers and Civil Society Organisations Research and Policy in Development Programme, Overseas Development Institute, ISBN 0 85003 776 X.
• Laužikas, M. (2018) Internal and External Communication Efficiency of Lithuanian Civil Service Organizations during Times of Change, working paper, will be available upon request.
• Laužikas, M.; Miliūtė, A. (2017) The Role of Education on Entrepreneurship in Lithuania. In: Sauka A., Chepurenko A. (eds) Entrepreneurship in Transition Economies. Societies and Political Orders in Transition. Springer, Cham; ISBN: 978-3-319-57341-0 (Print) 978-3-319-57342-7 (Online)
• Uusi-Kakkuri, P. (2017) Transformational leadership and leading creativity, Academic Dissertation at University of Vaasa, Faculty of Business Studies, Department of Management; Vaasan yliopisto, ISBN 978-952-476-748-4, ISSN 0355-2667, 283 p.; available online: http://www.uva.fi/materiaali/pdf/isbn_978-952-476-749-1.pdf