Strategic entrepreneurship in New Zealand's state-owned enterprises: underlying elements and financial implications
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The concept of strategic entrepreneurship has received increased attention over the past ten years. Viewed as the intersection of entrepreneurship and strategy, this field of research is populated by conceptual studies which focus mainly on the nature and perceived benefits of strategic entrepreneurship. Similarly, the study of entrepreneurship in a public sector context has gained increasing support in recent years, but also remains underexplored. To address these gaps, this thesis considers: What are the underlying elements and financial implications of strategic entrepreneurship in New Zealand’s state-owned enterprises [SOEs]? New Zealand’s SOE sector, comprising 17 government-owned, commercially focused organisations, is considered to be a prime subject for this research. Well known for their implementation of new public management [NPM], many New Zealand SOEs have also been publicly recognised as both innovative and entrepreneurial. The research question is addressed by first developing a preliminary framework of strategic entrepreneurship from literature on entrepreneurship and strategy. This framework is then examined in the context of case studies on activity which is entrepreneurial and/or strategic within 12 of the 17 SOEs operating in New Zealand as at 2006. Transcripts from a series of interviews, and publicly available documents are analysed thematically. SOEs’ financial statements over a five year period are also analysed. The thesis contributes in two broad areas. First, much-needed empirical support is lent to the concept of strategic entrepreneurship. Key elements of strategic entrepreneurship identified include opportunity identification, innovation, acceptance of risk, flexibility, vision, growth, and leveraging from core skills and resources such that existing knowledge and skills are transferred and applied to create new products, services, and markets. Important supporting elements identified include an open, flexible, and progressive culture, operational excellence, and cost minimisation. The nature of each of these elements is also investigated. A detailed understanding of the relationship between strategic entrepreneurship and wealth creation reveals various internal and external factors which may influence the nature and strength of the relationship. These factors include changes within the organisation, as well as changes in the economic and political environment, and are important influences on the resulting returns realised. Second, this thesis offers valuable evidence in support of emerging change in the public sector towards the adoption of strategic entrepreneurship. Support for the value of NPM is provided, with clear evidence of financial returns from New Zealand’s SOE sector. Further, a key finding is the structured and systematic approach to entrepreneurial activity within the context of NPM in several New Zealand SOEs. Such behaviour is referred to in this thesis as new public entrepreneurship. This form of activity offers the potential for competitive advantage and financial gain traditionally associated with entrepreneurial activity, but also limits the respective risks through its structured, systematic approach.