Elevating Entrepreneurship and Domestic Innovation in Oman

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In the age of the knowledge economy; elevating entrepreneurship and improving domestic innovation systems are the keys to promote a country's productivity, competitiveness, and economic growth. Nations have made it a priority to support entrepreneurial ideas, policies, services, and laws in the service of building a developmental environment. In recent years, the Omani Government has particularly made vigorous efforts to improve the domestic environment for entrepreneurship.

Audretsch and Thurik (2001) documented the fundamental shift that was taking place in the countries. It pointed out that improved economic growth rates plus reduced unemployment rates were accompanied by greater entrepreneurial activity within a country, and vice versa.

Entrepreneurial activities foster economic growth through innovation, reform, and knowledge spillover. Therefore, every dominant country or regional economic organization values policies that promote enterprise startups, such as reforming labor and capital markets; reducing governmental controls and administrative barriers; adopting competitive policies for new enterprises, special plans, and services for helping startups; and enhancing the teaching of entrepreneurship in educational systems.

With the rise of the entrepreneurial economy, the issue of entrepreneurial management has attracted a great deal of attentions from academics and practitioners. Within academia, entrepreneurial education and research have become a fundamental training. Elucidating complex entrepreneurial phenomena with tested theories and cultivating an entrepreneurial spirit within motivated students through well-designed instruction infuses strength into the innovation and entrepreneurial activities of Oman. Numerous signs indicate that the Omanese people are eager for such knowledge: more and more Omanese universities have set up entrepreneurial programs, the Omanese Government has increasingly encouraged entrepreneurial education, and countless books have been published on entrepreneurial experience.

The goal of entrepreneurial education is to cultivate future entrepreneurs and to develop students' entrepreneurial spirit such that they will be motivated to develop a business, enterprise, or other form of commerce (Chou, 2005).

While not all students will start up a business immediately after graduation, this type of education plants an entrepreneurial seed and helps them perform in future occupations. Smith (2003) has mentioned that the ability to start an enterprise would somehow become essential for students in vocational schools in the future. For practitioners, due to high level of competition in global markets and an ever-shortening product life cycle, entrepreneurial survival depends upon how to rapidly respond to the environment and to innovate continuously. Highly flexible new ventures have increased sharply because of the growing variety and new demands of markets (Dollingers, 2003).

Various types of entrepreneurship have emerged and become enormously popular (Liu and Hsieh, 2006). Individuals who have an entrepreneurial spirit are no longer content to simply be on a payroll.

McDougall and Oviatt (1997) suggested that entrepreneurs play a vital role in producing economic growth because they accelerate the generation, dissemination, and application of innovative ideas.

Can people be taught to be entrepreneurs? Traditionally, entrepreneurial drive and success have been viewed as rooted in individual motivation and talent. Some researchers, however, believed that entrepreneurship is an ability that can be cultivated. What factors determine entrepreneurial success or failure? Scholars and professionals have expressed differing opinions on this issue. However, a review of past literatures suggested that entrepreneurs' personalities play a crucial role in the entrepreneurial process (Doutriaux, 1992). Because personality traits such as persistence and consistency deeply influence personal behaviors, understanding and assessing entrepreneurial personalities can offer advice to help coach prospective entrepreneurs to choose their careers and begin their businesses.

Literature review

Entrepreneurs and entrepreneurship The first formal theory of entrepreneurship was developed by Richard Cantillon in 1725. He defined entrepreneurship as self-employed persons, and bearing the risk of buying at certain prices and selling at uncertain prices. Later, in 1803, the definition of entrepreneurship was broadened to include the concept of bringing the factors of production together. "An entrepreneur transfers resources from locations in which resources relatively abundant to locations with scare resources," wrote the eighteenth century French economist J.B. Say (Stevenson et al., 2000, p. 4). As societies and the fundamentals of business administration evolved over the next three centuries, scholars failed to reach agreement on a definition of entrepreneurship (Brockhaus, 1981), instead taking a broad perspective (Wartman, 1987). Bygrave and Hofer (1991) regarded entrepreneurs as people who can recognize opportunities and follow through on creating new business organizations. Others have viewed entrepreneurs as playing a critical role in enhancing a firm's productivity and helping it recover from an economic slump. (Drucker, 1985; Liu, 2002). Entrepreneurship also has been described as the chief engine of innovation (Drucker, 2002).

In recent years, scholars have focused the study of entrepreneurship on starting new businesses, which has lent greater consistency to entrepreneurship as a concretely study concept (Chen and Wu, 2007). Most scholars have commended the economic development contributions of entrepreneurs, whose entrepreneurial behavior has commonly been attributed to personalities and behavioral traits.

The entrepreneurial transformation

Entrepreneurship is a process which involves the efforts of an individual in identifying a viable opportunity in a market place and obtaining and managing the resources needed to exploit it. Successful action by the entrepreneurial individual to obtain and maintain a fit between these constituents will move the enterprise along a transformational life cycle. Entrepreneurship is largely a behavioral orientation and the entrepreneur is a person who creates and develops business ventures (Timmons, 1994; Barton-Cunningham and Lischeron, 1991; Gartner, 1989).

Such an approach recognises the central role that the entrepreneurial individual plays in the complex process of enterprise development from inception to maturity (Hill and McGowan, 1996; Chell et al., 1991; McGowan and Rocks, 1995; Carsrud and Johnson, 1989; Gibb and Scott, 1985; Stewart, 1983; Stanworth and Curran, 1986). Implicit in this is a need to be engaged in effective marketing planning. Entrepreneurs, therefore, if they are to succeed, need a combination of inherent personality traits, a propensity for creativity and innovation and appropriate managerial know how. Entrepreneurship is about change and the entrepreneur is primarily a change agent.

What then are the implications of change in the entrepreneurial transformation? Greiner (1972) argues that the entrepreneur's effectiveness in managing the transformation depends on his/her experience and knowledge of the history of the firm. This implies that knowledge and experience are the key personal competencies required for successful company development. It suggests also that such elements are an essential basis for the development of an additional competency of foresight. Foresight is central to both opportunity and crisis identification and preparing for the restoration of stability in the firm. Scott and Bruce (1987) contend that to be effective the entrepreneurial manager needs to be able to recognise and anticipate the pressures for change both inside and outside the enterprise, and to plan for them. Gibb and Scott (1985) suggest that the ability of the owner manager of an entrepreneurial firm to manage the changes arising from growth and development is arguably the key to successful negotiation of the transformation process. They add that a core element for success in managing this process, is the existence of what they call ``strategic awareness'' which enables the entrepreneur to recognise and appreciate the nature of the impact growth and change is likely to have throughout the firm. They conclude that, ``The essence of small company planning for new development and growth lies in an ability to project into the future the consequences of its present actions and to think strategically about these'' (Gibb and Scott, 1985, p. 619).

Timmons (1994) identifies a number of probable crises in the firm in transformation, for example, the erosion of the entrepreneurial culture and climate, the disappearance of entrepreneurial vision, confusion over roles, responsibilities and goals, the challenge to the lead entrepreneur and senior management of delegating versus autonomy and control, and the introduction of new operating mechanisms and controls. Kao (1991) adds that communication difficulties expose critical gaps in the portfolio of necessary personal management competencies. Addressing these gaps, particularly those that pertain to marketing planning activity, is clearly going to be of critical importance if the momentum for growth is to be maintained. Therefore, we need to consider the competency aspect to obtain some insights into what is involved.

The competency aspect Since the work of Boyatzis (1982) numerous studies point firmly to certain competencies as essential for the effective management of firms in transition. Carson et al. (1995), make the important assertion that the effective manager needs to be able to set and achieve objectives and to be sensitive to inter-personal and human dimensions through sound internal communication.

The literature offers a range of management competency spectra reinforcing the view that there may be tasks and techniques common to the effective performance of all managers (Boak, 1991; Burgoyne, 1989; Pearson, 1989; Cahoon, 1987; Klemp, 1980). In respect of the role of competency in the firm the impact of the entrepreneurial personality on any management competency spectrum must be recognised (Carson et al., 1995). The literature suggests that an entrepreneur's competency spectrum would include experience, vision, knowledge, communication, judgement, commitment, analytical thinking, motivation skills, leadership ability and organisational skills (Hill and Fallis, 1995; Hill and McGowan, 1996). These are consistent with later work which specifically addresses the competencies associated with effective marketing planning activity.

Adams and Chell (1993, p. 147) provide an apt summary of how the above literature dimensions can be synthesised, concluding that what is needed for the effective management of an entrepreneurial firm is a combination of the entrepreneurial personality and managerial competence. They state that: Entrepreneurial success appears to derive from two key sources: the first of these is the personality profile of the entrepreneur; with the second being the managerial competence of the entrepreneur.