An Exploratory Study of Entrepreneurial Opportunity Recognition of Small and Medium Sized Enterprises

Abstract

Small medium sized enterprises (SMEs) have been playing a crucial role in enhancing the economic development and growth in most countries. The ways in which SMEs recognize their entrepreneurial opportunities need to be investigated. This paper aims to explore different patterns in the processes of entrepreneurial opportunity recognition from SMEs’ founders. The study adopts qualitative method and conducts 16 semi-structured in-depth interviews with the founders of currently operating SMEs to identify opportunity for entrepreneurship in Vietnam. As the result, a successful process of entrepreneurial opportunity recognition requires an aggregation of prior knowledge and network ties which have been nurtured for years before, along with the employment on either or both use of entrepreneurial alertness and market analysis. This study proves that possessing an ability to analyze the market is as much important as staying alert toward opportunities. Besides, a level of creativity of entrepreneurs will be triggered to respond to situations in which the entrepreneurial opportunities arise. However, founders of SMEs generate more adaptive style of creativity than innovative one since being market driven.