Miri Lerner

Israeli women entrepreneurs: An examination of factors affecting performance

Abstract This article examines individual factors influencing performance of 200 Israeli women-owned businesses. Whereas research on women entrepreneurs is extensive in developed countries, especially in the United States and Europe, there are comparatively few studies of performance of women-owned businesses in non-OECD countries. There is evidence that social structures (work, family, and organized social life) vary among developed and developing countries as these relate to women entrepreneurs. However, these differences have not been considered as they may relate to theories explaining performance of women-owned businesses. The extent to which existing theories are useful in the context of non-OECD countries is of increasing importance as women in these countries are assuming a greater role in enterprise creation and economic development as a result of radical geopolitical and economic policy changes worldwide. In Israel, women suffer from occupational segregation and typically earn less money than their male counterparts, despite a generally high level of education. Entrepreneurship offers a vehicle for Israeli women to achieve economic parity. Approximately 5.1% of Israeli women are self-employed (compared with 15% of Israeli men) of the 816,800 Israeli working women. This study is the first systematic investigation of performance variation among Israeli women entrepreneurs, thereby contributing to our understanding of womens entrepreneurship in non-OECD countries. Five theoretical perspectives explain performance: individual motivations and goals; social learning (entrepreneurial socialization); network affiliation (contacts and membership in organizations); human capital (level of education, business skills); and environmental influences (location, sectoral participation, and sociopolitical variables). Each of these perspectives is associated with empirical work showing relationships between these individual level factors and performance. Three questions directed this study: (1) Which factors influence the performance of Israeli women entrepreneurs? (2) Which factors explain any variance in performance among businesses established by Israeli women entrepreneurs? (3) How similar are these explanatory factors to those found in other countries? A sample of 220 Israeli women business-owners responded to a survey instrument originally composed by Hisrich and Brush (1982, 1985) that was translated into Hebrew and adapted to the particular conditions of the Israeli population. A majority of the questionnaires was distributed at meetings of professional associates of women entrepreneurs and returned by mail, but one-fourth was distributed to women who were not members of any professional association. No significant differences were found between the respondents who were members or non-members of associations. Reliability testing showed alpha coefficients of 0.65 and higher for scaled questions, which is acceptable for survey data. Statistical analyses, including Pearsonss correlations and multiple regressions, examined relationships between factors identified from theoretical perspectives and performance, which was measured by profitability, income, size (number of employees), and revenues. Demographic variables were examined, and the age of the woman entrepreneurs children was significantly related to profitability ( p Of the five theoretical perspectives, results showed network affiliation, motivation, human capital, and environmental factors affected different aspects of performance, whereas social learning theory or existence of a role model had no significant effect on performance outcomes. Network affiliation was significantly related to profitability ( p Motivations showed a strong relationship to performance. Factor analysis identified three basic groups of motives: achievement, independence, and economic necessity. Similar to findings in other countries, achievement motives were highly related to personal income, whereas economic necessity was significantly related to both profitability and revenue. Analyses of human capital variables showed mixed results; education level, areas of study, and previous entrepreneurial experience had no effect on previous experience. The fact that this population was highly educated (51% had university degrees) may have impacted on this result. Consistent with prior research findings, previous experience in the industry had a direct and significant effect on performance ( p p p This study supports previous research from the United States and Europe on women entrepreneurs, which found that performance is related to previous industry experience, business skills, and achievement motivation. However, the differential effects of network affiliations was significantly more important for women entrepreneurs in Israel. Affiliation with a single network was highly related to profitability, whereas involvement in multiple networks was detrimental to both revenues and the number of employees. These findings imply that to perform well, Israeli women entrepreneurs should gain related industry experience, develop business skills, and seek to achieve success. Most importantly, commitment to a single network for support and advice is better than a loose alignment with many support groups. This research has implications for studies of women entrepreneurs in other non-OECD as well as developing countries. In countries such as Russia or China, anecdotal evidence shows self-employment offers women an opportunity to improve their economic status as more capitalistic policies are adopted. The extent to which individual factors found important in this study, such as business skills, motivations, previous industry experience, and network affiliation, affect performance in these countries is a topic for future investigation. This study suggests that individual factors affect performance differentially as a consequence of variations in social structures, work, organized social life, and family. Future research should explore the extent to which this is the case. Examination of aspects of organizational strategies and government policies as these influence performance is another topic for future study.

Relationships among Strategic Capabilities and the Performance of Women-Owned Small Ventures

This study of small, life‐style ventures owned by women focuses on the strategic, firm‐level factors related to business performance. A theoretical model drawing on the resource‐based theory is developed and tested empirically. The model includes strategic capabilities, management styles, and their relation to performance. It is tested empirically on a sample of 220 Israeli female business owners. Analysis reveals that life‐style venture performance is highly correlated with certain aspects of the business owners skills as well as the venture&apops;s resources. Paradoxically, the owner/managers in the sample rate their skills and their ventures resources as being weak in precisely those areas that correlate positively with business performance. These findings suggest that performance of life‐style ventures owned by women depends more on marketing, financial, and managerial skills than on innovation.

Performance factors of small tourism ventures: The interface of tourism, entrepreneurship and the environment

Abstract Performance factors of small Israeli tourism ventures were examined using an integrated model that combines four theoretical approaches, each focusing on a different central facet: environmental milieu, institutional support, entrepreneurial human capital, and the ventures bundle of services. The current research developed an operational instrument for assessing environmental attractiveness components of tourism ventures and their relationship to performance. A factor analysis, based on this instrument, revealed three environmental factors: tourist-related infrastructure, options for excursions and scenery, including climate. An attractive environment contributed to higher revenues in tourism ventures; however, it did not assure profitability. The results indicate the dual nature of the impact of institutional support upon the tourism ventures performance. Regardless of the size and age of ventures, those obtaining the advisory type of assistance from the governmental tourism incubator performed less well than those ventures that did not obtain such support. By contrast, those tourism ventures that were financially supported by external sources performed better than those that were not financially supported. The explanation for this curious and seemingly contradictory finding may lie in the different criteria for receiving financial and advisory assistance. Success in persuading external sources to provide financial support would seem to be evidence of the soundness of the ventures planning and its economic viability. By contrast, insofar as virtually any venture in the area may apply for and obtain advisory assistance from the governmental tourism incubator, with no requirement to meet financial criteria of any kind, it could be that precisely the weaker ventures are being carried along by this form of assistance. Among the various entrepreneurs attributes examined, managerial skills provided the strongest association with the performance measures. The managerial skills were also found to be the most significant variable explaining performance relatively to the variables derived from the other three approaches. These results have implications regarding the nature of the support to be given by a governmental tourism incubator to entrepreneurs operating in the region. Given that lack of managerial skills is one of the main barriers to a ventures success, particularly in small businesses where the owners have to be involved in all areas of activity, the incubator needs to provide entrepreneurs with tailored regional business and management training tools to promote tourism venture development and success. The study also reveals that the number of services offered by a tourism venture made only a minor contribution in the revenues regression, which may indicate that providing a bundle of services for the tourist customer does not necessarily guarantee profitability. A noteworthy finding is the similarity in the differential association between the number of services offered and the performance measures, on the one hand, and attractiveness features with performance on the other. In both cases, these factors positively contribute to the revenues regression, but neither contributes to the profitability or income regression. This means that an attractive environment does contribute to higher revenues, in that more tourists choose to visit the tourist attractions; however, this does not assure profitability. Similarly, providing many services to the visitors may also contribute to higher revenues, but does not necessarily assure profitable business outcomes. The current findings indicate that small tourism venture profitability is contingent on human capital, especially the skills of the entrepreneurs running the venture. In accordance with our findings that managerial skills are so crucial for venture success, the main objective of advisory incubators should be to promote managerial competencies.

Examining Control and Autonomy in the Franchisor-Franchisee Relationship

This article examines the franchisor-franchisee relationship from two theoretical perspectives - agency theory and exchange theory. Taking the case of the fast-food industry in Israel, the research focuses on control and autonomy in a domestic hamburger chain - Burger Ranch - and two international chains - McDonalds and Burger King. The findings led to the design of a model that illustrates several aspects, such as the concept of franchising, the size and age of the chain, and the range of the contract, that relate to control and autonomy. The combination of agency theory and exchange theory enables us to focus on control and autonomy as multidimensional concepts, and to present various possibilities for judiciously balancing them. The case indicates that in some respects (e.g. master franchisee), the two global chains are more similar to each other than to the domestic chain. However, in other respects (e.g. size, growth rate), the domestic and one of the two global chains show more similarities than differences. The findings indicate different forms of integration of control and autonomy in the three chains.

Decredentialization and Recredentialization: The Role of Governmental Intervention in Enhancing Occupational Status of Russian Immigrants in Israel in the 1990s

This article addresses the question of the impact of governmental retraining programs on immigrants’ occupational incorporation. It proposes that immigrants’ loss of occupational status relates to decredentialization resulting from their foreign credentials’ being devalued and proposes viewing participation in governmental retraining programs as a process of recredentialization. The findings indicate the important role government can play in enhancing the occupational status of immigrants through recredentialization. Nine hundred ten immigrants from the former Soviet Union to Israel in the 1990s were interviewed in 1992 and again in 1995 to examine the effect of their participation in retraining programs on occupational integration and improving earnings. The effects were studied for salaried immigrants. The findings are discussed in light of the institutional perspective and the theories of human capital, screening theory, and credentialism.

New entrepreneurs and entrepreneurial aspirations among immigrants from the former U.S.S.R. in Israel

Abstract After the mass immigration from communist countries, such as the former U.S.S.R., to capitalist countries, such as Israel, questions concerning small business entrepreneurship among immigrants have become topical. The present research investigates entrepreneurship and entrepreneurial aspirations among immigrants after their arrival in Israel. It was undertaken during the second half of 1992 and conducted on a random sample of 1,530 immigrants residing in Israel for at least one year. The following analyses were carried out on the data: (1) comparison of immigrants who had become self-employed to those who had been absorbed into the salaried labor market; (2) comparison of immigrants aspiring to become small businessmen to those aspiring to become salaried employees; and (3) identification of factors influencing entrepreneurship and self-employment as well as factors influencing entrepreneurial aspirations.

Converting military technology through corporate entrepreneurship

The main purpose of this study is to examine the relationship between entrepreneurial behavior of employees and defense technology conversion (the use of military technologies for products aimed at the civilian market). The study was carried out at a hi-tech Israeli defense organization in which management encouraged employees to engage in internal entrepreneurial R&D activities aimed at the civilian markets. Surprisingly, our findings show that these management efforts were followed by an increase of the entrepreneurial proposals by the employees. However, the increase in the entrepreneurial activities was aimed at the defense rather than the civilian markets. The explanation for this result may be rooted in the negative relationship between entrepreneurial behavior and the level of effectiveness of perceived barriers to defense conversion. Two conditions are necessary for a successful attempt at defense conversion through corporate entrepreneurship. (a) Top management must ensure that employees and middle management are convinced of the importance of defense conversion to their organization, its effectiveness and feasibility. (b) Top management must convince employees of its commitment to the process of defense conversion. Lip service to defense conversion is certainly ineffective, and sometimes even counter-productive.

Does government matter

Purpose – Aims to examine the effect of government intervention programs in improving the occupational opportunities of new immigrants as self‐employed entrepreneurs or salaried employees, and to determine the effect, if any, of gender and ethnicity.Design/methodology/approach – To examine the effects of two major types of government programs – retraining courses and support for business creation – a sample of 1,195 immigrants from the former Soviet Union in Israel were interviewed in depth on two different occasions.Findings – The findings indicate that the impact of both government programs was more pronounced for women immigrants and immigrants from the Asian republics.Research limitations/implications – The study focuses only on two government programs in one country – Israel.Practical implications – In terms of immigrant incorporation into a society, government programs matter and matter more for disadvantaged groups. Participation in these programs helps diminish any gaps created by market forces.Or...

Paternalism and entrepreneurship the emergence of state-made entrepreneurs

Abstract This article considers the governments role in encouraging or hampering entrepreneurs. Following the analysis by Jurgen Habermas(16) of state regulated capitalism, the article will focus on a sociological analysis of paternalism in establishment-industrial entrepreneurship relations. A type of entrepreneur emerges as the result of establishment nurture, which we shall here call state-made entrepreneurs. The segmented labor market theory and its application to the field of entrepreneurship will serve as a theoretical starting point for the investigation of the problem of various patterns of entrepreneurship which develop in a society in which there exists massive paternalistic government intervention in the economy.

What Are Social Ventures? Toward a Theoretical Framework and Empirical Examination of Successful Social Ventures

As defined by the editors of this book, ‘non-market entrepreneurship’ consists of all forms of entrepreneurship not being undertaken solely for purposes of profit maximization or commercialization, and encompasses entrepreneurial activities such as social enterprise and entrepreneurship, public sector entrepreneurship, policy entrepreneurship, non-profit entrepreneurship, and philanthropic enterprise, among many others. The eminent cast of contributors gives coherence to the academic and public discussions on the topic, builds a theoretical edifice within the field of entrepreneurship and helps to establish and delineate the contours of the research field of non-market entrepreneurship.