Inspired or Foolhardy:Sensemaking Confidence and Entrepreneurs' Decision-Making

Cunningham, James and Anderson, Alistair (2018) Inspired or Foolhardy:Sensemaking Confidence and Entrepreneurs' Decision-Making. Group Decision and Negotiation, 27 (3). ISSN 0926-2644

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The purpose of this paper is to investigate the role of confidence in how both new and experienced entrepreneurs interpret and make sense of their business environment to inform decision-making. We illustrate our conceptual arguments with descriptive results from a large-scale (n = 6289) survey on entrepreneurs' perception of business performance and their decisions taken at a time of uncertainty in an economic downturn. Quantitative findings are stratified along experiential lines to explore heterogeneity in entrepreneurial decision-making and directly inform our conceptual arguments, while qualitative data from open questions are used to explain the role of confidence. Newer entrepreneurs are found to be more optimistic in the face of environmental risk, which impacts on their decision-making and innovative capabilities. However, the more experienced entrepreneurs warily maintain margin and restructure to adapt to environmental changes. Instead of looking directly at the confidence of individuals, we show how confidence impacts sensemaking, and ultimately, decision-making. These insights inform research on the behaviour of novice and experienced entrepreneurs in relation to innovative business activities. Specifically, blanket assumptions on the role of confidence may be misplaced as its impact changes with experience to alter how entrepreneurs make sense of their environment.

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Journal Article
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Group Decision and Negotiation
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Deposited On:
22 Jun 2019 09:19
Last Modified:
22 Nov 2022 07:41