An enactment theory helps to explain why entrepreneurial commitment to emerging fields relevant to business and society such as energy efficiency and renewable energy persists despite the uncertain prospects for success. According to the theory, actions affect commitment through their effects on beliefs. Entrepreneurs in emerging fields take actions to influence relevant stakeholders and infuse them with a field’s norms and values.
The entrepreneurs frame problems and tell stories to justify the need for the field, firming up collective action in what is otherwise an under-organized domain. The entrepreneurs’ actions to influence stakeholders, in turn, shape and mold their own perceptions of the field. Their actions reinforce their beliefs that the field is attractive, that their endeavors have something valuable to contribute – a superior product or service – and that disruptive exogenous change will positively affect the field’s growth and development.
As these beliefs intensify, the entrepreneurs’ commitment to the field grows. This theory of enactment is one in which the actions entrepreneurs take to influence stakeholders shape the perceptions of the entrepreneurs, which in turn bolster the entrepreneurs’ commitment to the field.
An obstacle that entrepreneurs must overcome when legitimacy wanes is heightened hostility and opposition from competing fields. People involved in well-established fields – petroleum, coal, and natural gas – are inclined to take steps to either prevent an emerging field like energy efficiency and renewable energy from arising or to slow its progress. Entrepreneurs face resistance from incumbent organizations and institutions. Key constituents such as suppliers, customers, and regulators may lack knowledge of the field, be skeptical about the field’s prospects, and decide to withhold support. An emerging field encountering such difficulties faces skepticism about its viability.
Commitment to the field is essential because of these obstacles and the high likelihood of setbacks. Participants in the emerging field needed the resolve to overcome this type of difficulty. A lack of commitment may mean abandonment of the field, thereby decreasing the likelihood that it will become fully established. Given that many fields never really get off the ground, understanding the antecedents of commitment to socially important fields in period of doubt and skepticism about their future is important.
Such commitment is not about escalating commitment to a failed course of action, but about maintaining commitment to a domain that has promise. This post is about commitment at a point in the life cycle of a field when the resources needed for its survival are less than ample. This period in the field’s life cycle can last for decades.
During the elongated periods before take-off, questions arise about technology, market growth rates, prices, investment, and demand. Entrepreneurs active in these fields must search for answers to such questions as:
- Who will be the main adopters?
- What will be the design path for the technology?
- What role will government play?
- From where will trained employees come?
- Can sufficient capital be raised?
The answers to these questions will determine when an entrepreneur should commit to an idea and when he should let it go and move on to the next viable field.
Alfred A. Marcus is the Honeywell/Edson W. Spencer Chair in Strategic Management at the Technological Leadership Institute and Professor of Strategic Management and Organization at the Carlson School of Management at the University of Minnesota.