The Effect of Self-Regulatory Mechanisms on Business Success In
a Randomized Control GroupExperiment
Kim Marie BischoffDr. Michael Gielnik
Prof. Dr. Michael Frese
Leuphana University of Lüneburg
S T E PStudent Training for Entrepreneurial Promotion
2The effects of self-regulatory mechanisms on busin ess success in a randomized control group experimen tKim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
The effect of self-regulatory mechanisms on business success in a randomized control groupexperiment
We study the effect of self-regulatory factors in the
relationship between an action-oriented
entrepreneurship training and entrepreneurial action
/ entrepreneurial success.
What is this study about?
3The effects of self-regulatory mechanisms on busin ess success in a randomized control group experimen tKim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
Action Training and Entrepreneurship
• Action plays a major role in entrepreneurship. “(…) entrepreneurship implies that people act to change the world (…)” (Frese, 2009, p.436).
• Literature assumes that an action training approach leads to improvements in the field of entrepreneurship (Barr, Baker, & Markham, 2009; Fiet, 2001)
Promoting entrepreneurship by action training is useful.
Action is essential in the field of entrepreneurshi p
4The effects of self-regulatory mechanisms on busin ess success in a randomized control group experimen tKim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
Self-regulation and Entrepreneurship
• Self-regulation has an important impact on performance (Lord, Diefendorff, Schmidt, & Hall, 2010)
• Entrepreneurs are able to affect the success of their businesses by means of self-regulatory mechanisms(Frese, 2009; Frese et al., 2007)
Self-regulatory mechanisms may have an impact on entrepreneurial action & success.
Self-regulation is essential for promoting entrepre neurship
5The effects of self-regulatory mechanisms on busin ess success in a randomized control group experimen tKim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
Promoting entrepreneurship by action trainingand self-regulatory mechanisms
• We base our theoretical model on
� action regulation theory (Frese, 2009;
Frese & Zapf, 1994; Karoly, 1993)
� theory of planned behavior (Ajzen, 1991)
6The effects of self-regulatory mechanisms on busin ess success in a randomized control group experimen tKim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
Promoting entrepreneurship by action trainingand self-regulatory mechanisms
T1 T2 T3
Strength ofEntrepreneurial
Intentions
Entrepreneurial Self-Efficacy
Action Planning
ProceduralKnowledge
Action-Oriented
Entrepreneurship Training
Entrepreneurial Action
H1
H2
H4
H3
H5: Mediation
7The effects of self-regulatory mechanisms on busin ess success in a randomized control group experimen tKim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
T2 T4
Business Owner
SubjectiveSuccess
Satisfaction withwork as business
owner
Entrepreneurial Self-Efficacy
Promoting entrepreneurship by action trainingand self-regulatory mechanisms
H6
H7Success (Sales,
Growth)
H8
H9
S T E PStudent Training for Entrepreneurial Promotion
9The effects of self-regulatory mechanisms on busin ess success in a randomized control group experimen tKim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
Action: The focal point of the STEP training
Knowledge / Skills Confidence / Self-efficacy
• Knowledge what to do• Skills how to do it
• Believing that “I can do it”
ActionUnsuccessful Entrepreneurship
Successful Entrepreneurship
1 2
10The effects of self-regulatory mechanisms on busin ess success in a randomized control group experimen tKim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
STEP’s two general principles: Action Knowledge and Action Training
Knowledge / Skills
• The STEP training teaches knowledge what to do in a way that the trainees know how to do it.
1
• Principle I: Action Knowledge (Principles of Action )
Confidence / Self-fficacy
• The STEP training creates a mastery experience to strengthen trainees’ belief of “I can do it”.
2
• Principle II: Action Training
11The effects of self-regulatory mechanisms on busin ess success in a randomized control group experimen tKim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
The STEP training is an Action Training
• The STEP training comprises 12 weeks, including 12 sessions (3 hours each).
• The trainees form start-up teams in the first session and engage in the start-up process of a real venture during the 12 weeks.
• They identify and evaluate new real-life business opportunities.
• They plan and prepare the start-up of a their venture.
• Making real money means getting real experience which is the basis for developing mastery and a belief of “I can do it”.
Trainees get real experience in starting and runnin g a venture; real experience is invaluable for future s tart-ups.
12The effects of self-regulatory mechanisms on busin ess success in a randomized control group experimen tKim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
Teaching entrepreneurial skills requires an interdisciplinary approach
• Entrepreneurship is a multifaceted field .
• 12 modules cover three relevant domains: business administration, entrepreneurship, and psychology .
Business Entrepreneurship Psychology
• Finding Starting Capital
• Book-keeping
• Marketing
• Managing Finances
• Strategic Management
• Identifying Opportunities
• Writing a Business Plan
• Registering a Business
• Leadership
• Planning
• Overcoming Barriers
• Persuasion & Negotiation
• Networking
13The effects of self-regulatory mechanisms on busin ess success in a randomized control group experimen tKim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
Method: Data Collection
T1Feb 2009
395 studentsInterview T1
T2Jun 2009
352 studentsInterview T2
TrainingFeb-May 2009
T4Aug – Nov 2011
227 studentsInterview T4
• Procedure: face-to-face interviews & questionnaires
T3Jan – Mar 2010
319 studentsInterview T3
14The effects of self-regulatory mechanisms on busin ess success in a randomized control group experimen tKim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
Method: Design and Sample
T1Feb 2009
395 studentsInterview T1
T2Jun 2009
352 studentsInterview T2
TrainingFeb-May 2009
T4Aug – Nov 2011
227 studentsInterview T4
• Randomized control group design: 197 students in training group and 198 students in waiting control group
• Trainees: Non-business students of Makerere University and Uganda Christian University (Kampala, Uganda), who were in their last semester
T3Jan – Mar 2010
319 studentsInterview T3
15The effects of self-regulatory mechanisms on busin ess success in a randomized control group experimen tKim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
Results
T1 T2 T3
Strength ofEntrepreneurial
Intentions
Entrepreneurial Self-Efficacy
Action Planning
ProceduralKnowledge
Action-Oriented
Entrepreneurship Training
Entrepreneurial Action
H1β=0.13*
H2 n.s.
H4β = 0.12 *
H5 sign. Mediator
H3n.s.
Note. n= 319, * p <. 05
16The effects of self-regulatory mechanisms on busin ess success in a randomized control group experimen tKim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
T2 T4
Business Owner
SubjectiveSuccess
Satisfaction withwork as business
owner
Entrepreneurial Self-Efficacy
Results
H6β=0.15*a
H7n.s.
Success (Sales, Growth)
H8β=0.34**b
H9β=0.26*b
Note. an=227. bn=90, * p <. 05, **
17The effects of self-regulatory mechanisms on busin ess success in a randomized control group experimen tKim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
Conclusions
• Procedural knowledge geared towards action, mediates the relationship between the action oriented entrepreneurship training and entrepreneurial action. Thus, learning what to do and how to do it is essential for undertaking entrepreneurial actions.
• The interaction of strength of entrepreneurial intentions and action planning predict entrepreneurial action. Only in combination with action planning can entrepreneurial intentions lead to entrepreneurial action.
Action-oriented training in entrepreneurship affect s self-regulation and enhances entrepreneurial action.
18The effects of self-regulatory mechanisms on busin ess success in a randomized control group experimen tKim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
Conclusions
• Self-efficacy predicts:
• the start-up of entrepreneurial businesses
• subjective success
• satisfaction with being and working as a business owner
Self-regulation affects entrepreneurial start-ups a nd success.
Entrepreneurship trainings should be action -oriented and train self-regulatory mechanisms
19The effects of self-regulatory mechanisms on busin ess success in a randomized control group experimen tKim Marie Bischoff, Dr. Michael Gielnik, Prof. Dr. Michael Frese
Acknowledgements
• Thanks to my colleagues at the Leuphana University of Lüneburg and National University of Singapore Business School• Prof. Dr. Michael Frese
• Dr. Michael Gielnik
• to the students, who supported us in data collectio n and rating:
• Melanie von der Lahr, Thorsten Dlugosch, Marie-Luise Lackhoff, Kristina Zyla, Eike Hedder, Andreas Heese, Diana Breé, SvenjaHaskamp, Mona Mensmann
• and to our cooperation partners at the Makerere University Business School (MUBS), Kampala, Uganda
Thank you very much for your attention
S T E PStudent Training for Entrepreneurial Promotion