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Innovation and entrepreneurship: An empirical study of Moroccan firms
Jamal ELBAZ Associate Professor, Ibn Zohr University,
Email: [email protected] Mohammed Binkour
Associate Professor, Ibn Zohr University, Email: [email protected]
Ilias Majdouline Research Professor, Universiapolis,
Email: [email protected]
Abstract:
Many researchers have discussed the relation between entrepreneurship and innovation based
on the process, structure, and strategy of either entrepreneurship or innovation (Littunen,
2000, Cornwall and Perlman, 1990, Caird, 1988; Casson, 1982). While others have touched
on the conceptual relationship between entrepreneurship and innovation (Schumpeter, 1934,
Drucker, 1994, Legge and Hindle, 1997, Kanungo 1999, Sundbo, 1998), there have been few
empirical studies that explore the synergies between the two.
This study adopts a qualitative approach in exploring the presence of innovation in
entrepreneurship process and actions. Therefore, interviews with senior managers of
Moroccan entrepreneurial and innovative organizations and were conducted. The main
findings of our empirical study will be presented and discussed in order to analyze how they
would add to an understanding of the existing theories and practices of entrepreneurship and
innovation.
Key words: Entrepreneurship, Innovation, Moroccan companies, Qualitative study.
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Introduction
The growing importance of innovation to entrepreneurship is reflected by a dramatic increase
in literature that addresses the role and nature of innovation (Drazin and Schoonhoven, 1996;
Drucker, 1994). Innovation is the specific tool of entrepreneurship by which entrepreneurs
exploit change as an opportunity for a different business or service. There is considerable
overlap between entrepreneurship and innovation (Kanungo, 1999, Sundbo, 1998, Drucker,
1994, Schumpeter, 1934).
A review of the literature reveals that some studies have dealt with the process, structure, and
strategy of either entrepreneurship or innovation (Littunen, 2000, Cornwall and Perlman,
1990, Caird, 1988; Casson, 1982), and that others have touched on the conceptual relationship
between the two (Schumpeter, 1934, Drucker, 1994, Legge and Hindle, 1997, Kanungo 1999,
Sundbo, 1998). However there have been few empirical studies that explore the synergies
between the two.
This study adopts a qualitative approach in exploring the presence of innovation in
entrepreneurship process and actions. Therefore, case studies of Moroccan entrepreneurial
and innovative organizations and in-depth interviews with senior managers were conducted.
The main results of our empirical study will be presented and discussed in order to analyze
how they would add to an understanding of the existing theories and practices of
entrepreneurship and innovation.
1. The conceptual framework: interaction between innovation and entrepreneurship
Over the last decades, entrepreneurship has become established as a legitimate field of
research and managerial practice (Hoskisson et al., 2011). However, despite an increasingly
abundant literature, there is still no unanimous definition of entrepreneurship within the
scientific community, and the concept is often used loosely (Audretsch, 2002; Friis and
Paulsson Karlsson 2002; Iversen et al 2005). Therefore, there is a large number of
perspectives or definitions of entrepreneurship (Morris, 1998; Verstraete and Fayolle, 2004;
Lucke et al, 2007; Welter and Lash, 2008). Here are some definitions:
- “Entrepreneurship is the field that studies the practice of entrepreneurs : their
activities, characteristics, economic and social effects of their behavior and modes of
support are made available to facilitate the expression of entrepreneurial activities”
(Filion, 1997) ;
2
- “Entrepreneurship, in its narrowest sense, involves capturing ideas, converting them
into products and, or services and then building a venture to take the product to
market” (Johnson, 2001, p. 138).
- “Entrepreneurship is the result of any human action undertaken in order to generate
value through the creation or expansion of economic activity” (OECD, 2007).
In fact, entrepreneurship can only be understood as a multidimensional reality, even if that
reality is often difficult to identify (Landström, 2005; Friis et al., 2002; Fayolle, 2004; Julien,
2005).
Therefore, we might adopt the definition of Shane (2003) for whom entrepreneurship
examines activities involved in the conception (various modes of opportunity recognition),
launch, development, and operation of new ventures (resource formation process). In this
regard, the perspective of our study is focused on the notion of creation that can be articulated
in terms of value creation, the creation of a new company, a new organization, a new market
or a new product or service.
Because entrepreneurship involves human agency, where individuals act to pursue
opportunities they have recognized (Baron, 2007), much research in entrepreneurship has
focused on the cognitive aspects of how individual entrepreneurs recognize the opportunities
noted above for new business creation (Baron, 2008; Ucbasaran et al., 2010). Likewise,
because many new ventures have been initiated in established corporations, a large segment
of research focused on corporate entrepreneurship (Covin and Miles, 1999; Guth and
Ginsberg, 1990; Ireland et al., 2009) that has emerged at the firm level. Also, more recent
research within established corporations has focused more broadly on entrepreneurship,
including corporate innovation activities (Ireland et al., 2003; Kuratko and Audretsch, 2009).
1.1. Defining Innovation
Examination of the innovation literature confirms that there is enormous diversity in views
and approaches to what actually constitutes innovative activity, and also highlights some of
the confusion that exists within the discipline itself. Confusion seems to stem from the fact
that many definitions introduce peripheral concepts, which may deflect attention from the
core components of innovation and make its application difficult. Many definitions have been
proposed to explain innovation, and as a result the term has gained greater ambiguity (Garcia
and Calantone, 2002).
For example, both Cannon (1993) and Gurteen (1998) introduce paradigmatic change and
creative thinking. While Rogers (1995) concentrates on perception, Henderson et al.(1996)
3
feature invention, and Koontz and Weihrich (1990) and Zahra (1995) put forward definitions
that highlight marketing and entrepreneurial philosophies.
A number of process models have been developed in the literature suggesting that innovation
consists of a variety of different phases: idea generation, research design and development,
prototype production, manufacturing, marketing and sales (Dooley and O’Sullivan, 2001;
Knox, 2002; Poolton and Ismail, 2000; Rothwell, 1994). However, theorists have suggested
that there is more to innovation than the process (Amabile, 1996; Couger, 1995).
Innovation thus has many facets and is multidimensional. The most prominent innovation
dimensions can be expressed as dualisms:
- Radical versus incremental;
- Product versus process; and
- Administrative versus technological (Cooper, 1998).
Innovation can be radical and incremental. Radical innovations refer to path-breaking,
discontinuous, revolutionary, original, pioneering, basic, or major innovations (Green et al.,
1995). Incremental innovations are small improvements made to enhance and extend the
established processes, products, and services. However, this contradistinction does not
“necessarily [correspond] to the more fine-tuned reality” because “radicality is a continuum”
(Katila, 2002, p. 307). Product innovation, as the name suggests, “reflects change in the end
product or service offered by the organizations, [whereas] process innovation represents
changes in the way firms produce end products or services” (Utterback cited in Cooper, 1998,
p. 498). Some researchers have categorized innovation into technological and administrative
innovations. Technological innovation is about “the adoption of a new idea that directly
influences the basic output processes, [whereas] administrative innovations include changes
that affect the policies, allocation of resources, and other factors associated with the social
structure of the organization” (Daft, 1978 cited in Cooper, 1998, p.497).
Also many definitions of innovation focus on the concept of newness. Slappendel (1996)
argues that the perception of newness is essential to the concept of innovation as it serves to
differentiate innovation from change. The newness theme is especially important to
understanding the link between innovation and entrepreneurship as suggested by prior studies
that emphasize its pivotal role in new venture creation and management: “new business
startup” (Vesper, 1988), “new entry” (Lumpkin and Dess, 1996), “new organizations”
(Gartner, 1988) and “organizational renewal” (Stevenson and Jarillo, 1990). With these
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innovation concepts in mind, Johannessen et al., (2001) developed a study that investigated
six different types of innovative activity:
(1) New products;
(2) New services;
(3) New methods of production;
(4) Opening new markets;
(5) New sources of supply; and
(6) New ways of organizing.
Consequently, innovation in new ventures requires entrepreneurs to imagine something novel,
refine those ideas, make an initial investment, and justify their venture to key stakeholders
who can offer support and legitimacy (Cornelissen and Clarke, 2010).
Therefore, for the purpose of the present study innovation can be defined as a process that
provides added value and a degree of novelty to the organization and its suppliers and
customers through the development of new procedures, solutions, products and services as
well as new methods of commercialization (Knox, 2002; Lumpkin and Dess, 1996).
1.1. Innovation and entrepreneurship
The conceptual relationship between entrepreneurship and innovation has been discussed in
the literature for many years. According to Nelson (1993, p.4), innovation encompasses “the
processes by which firms master and get into practice product designs and manufacturing
processes that are new to them.”
Such a broad understanding of innovation is particularly meaningful within the context of
innovative entrepreneurship insofar as upgrading technology or improving skills may lead to
more efficient uses of resources or higher-quality outputs, but not necessarily to new products
or patents. That is why Lundvall (2007) emphasized that it is important to avoid a high-tech
bias when thinking about innovation.
When innovation is included in the analysis, it is important to distinguish between innovation
and invention (Fagerberg, 2006). As Fagerberg (2006) shows, both are closely linked, and it is
very difficult to distinguish one from another1. But in many cases, there is a considerable lag
between the two. However, a main difference between invention and innovation is that the
former may be carried out anywhere, while innovation occurs mainly in firms that need to
1 From his point-of-view (Fagerberg, 2006, p. 4), “Invention is the first occurrence of an idea for a new product
or process, while innovation is the first attempt to carry it out into practice.”
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combine several different kinds of capabilities, knowledge, resources and skills (Fagerberg,
2006, p. 5).
As Herbig et al. (1994 pp. 37 and 45) have observed: “Innovation requires three basic
components: the infrastructure; the capital; and the entrepreneurial capacity needed to make
the first two work”. Moreover, innovation has to address market needs, and requires
entrepreneurship if it is to achieve commercial success (Zhao, 2001). For this reason, it is
important to introduce in the analysis the role played by the entrepreneur and to determine
those elements or factors that would have any effect on him (Oakley, 1990; Aghion and
Howitt, 1998).
In general terms, when the entrepreneurship factor is considered the economic agent’s
behavior must be taken into account. This is not an occupation but an activity, and it must be
considered the different circumstances and aspects of a person and the role of uncertainty and
obstacles inherent in the business creation process (Devece et al., 2011; Giacomin et al., 2011;
Nielsen and Lassen, 2012; Bettiol et al., 2012). The entrepreneurship factor also includes
persons that search information or ideas about efficient production processes, as well as new
organizational forms.
Taking into account these ideas, different types of entrepreneurships can be considered
(Nissan et al., 2011). First is the innovator, following Schumpeter’s (1911, 1950) thesis.
Schumpeter considers that entrepreneurship activity implies innovation in the introduction of
a new product, organization or process, generating a destruction process. Thus, the
entrepreneur is an actor who initiates and implements innovations (Docter et al, 1989;
Hyvärinen, 1993; Lefebvre et al, 1997).
Second is the entrepreneur that takes advantage of profit opportunities (Kirzner, 1973, 1999).
Kirzner agrees with Schumpeter that an entrepreneur tries to take advantage of profit
opportunities, but, contrary to Schumpeter’s view, Kirzner says the entrepreneur learns from
past mistakes and tries to correct them, driving the market toward equilibrium.
Third, uncertainty element must be taken into account (Knight, 1921). Knight distinguished
between risk and uncertainty, believing uncertainty to be an important factor considered by
entrepreneurs. They have to take it into account and adopt decisions in an uncertain world.
Their profits are a reward for bearing this uncertainty.
And fourth, productive and non-productive entrepreneurships must be also considered
(Baumol, 1990). From Baumol’s point-of-view, entrepreneurs are creative and ingenious,
searching for the most effective and appropriate means to increase their wealth, power and
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prestige. The existing environment around them has an important influence on their decisions
(Farinos et al., 2011).
Finally, it is also interesting to take into account the Drucker (1998) perspective. Drucker
points out that innovation is at the heart of entrepreneurship activity and it is due to
innovation that many entrepreneurships carry out their activity. One of the factors considered
in the strategic growth of the company and the promotion of entrepreneurship is innovation
(Freel, 2000; Freel and Robson, 2004; Hoffman et al. 1998; Hsueh and Tu, 2004; Qian and Li,
2003; Verhees and Meulenberg , 2004). Hamel (2000 cited by O'Regan et al., 2006: 254) goes
so far as to say that innovation is the most important component of a company's strategy.
Entrepreneurs seek opportunities, and innovations provide the instrument by which they
might succeed. Corporate entrepreneurship often refers to the introduction of a new idea, new
products, a new organizational structure, a new production process, or the establishment of a
new organization by (or within) an existing organization. From this perspective, we can
presume that innovation would promote their activity, creating a feedback effect. That is,
entrepreneurships innovate and the innovations stimulate other entrepreneurs to carry out their
activity (Caceres et al., 2011; De Cleyn and Braet, 2012; Zortea-Johnston et al., 2012).
2. Empirical Study
Despite the development of works on entrepreneurship in Morocco in recent years, the
literature on the entrepreneurship and innovation of Moroccan firms is still lacking. To our
knowledge, there have been no previous studies of entrepreneurship and innovation
interaction of Moroccan firms. Our study is an endeavor towards exploring the presence of
innovation in entrepreneurship process and actions of Moroccan companies. In the following,
we present the methodology of our research and the main results found.
2.1. Methodology and research design
Based on inductive logic, our approach is qualitative in nature because of its effectiveness in
the context of exploratory research (Charreire and Durieux (1999). Consequently, following
the recommendations of several researchers (Quivy and Campenhoudt, 1995; Baumard et al.,
1999; Demers, 2003), the data gathering method used in our study is based on semi-structured
interview in which we used an interview guide (Appendix 1).
Accordingly, nine semi-structured interviews were conducted to examine the perceptions of
senior managers regarding entrepreneurship and innovation.
2.1.1. Sampling
7
Following the recommendation of Patton (2002), we selected nine Moroccan firms for this
study (Table I). The criteria of selection were:
- The companies had to be actively engaged in entrepreneurship and innovation
activities; and
- The companies had to be of different size, in different industry sectors, and of different
ages (years of establishment).
Business/Activity Size (number of employees) Year of establishment Distribution +5 2006 Freight Forwarding +10 2011 Printing +15 2001 Food processing +300 1990 Advertisement +5 2008 Insurance +3 2010 Consulting +7 2000 Software solutions +3 2007 Holding group +250 1989
Table I. Overview of Moroccan companies interviewed
A semi-structured interview with a senior manager from each organization was conducted and
the conversations were recorded and subsequently transcribed. The following step after
conducting interviews was to select, sort and process data in transcripts. In this process the
researcher decides what data should be extracted from the coded texts (Bardin, 1996).
For our part, data processing was performed using the content analysis described by Allard-
Poesi et al. (1999) and Voynnet Fourboul (2004). Therefore, after each interview, we were
able to extract the meaning conveyed from transcripts of conversations with the interviewees.
2.2. Results
Perceptions on entrepreneurship and innovation behaviors in Table II summarize the key
responses obtained from the interviews.
Interviewee/industry Responses Interviewee 1 – Software solutions “We started as a start-up and we still have that spirit within, I remember the
beginnings were difficult and many talked about how risky it was, but being an entrepreneur means you have to cope with risk and the only way to survive and to prosper is to innovate and offer something new.”
Interviewee 2- Distribution If the company wants to have a comfortable position at the start, it should start with innovative ideas. This could open market niches or might attract new customers instead of going to fight on the same markets as competition. My first innovations have been instrumental in my survival as an entrepreneur. When I started my business, I was in a hyper-competitive segment. Believing in the importance of continuous innovation, I found myself in other segments, and other various sectors.
8
Interviewee 3- Printing I think innovation is not necessary when creating a new venture. On the other hand, it is important to be innovative ensure the sustainability of the company. Innovation has allowed me to distinguish myself in the market. Many clients expect innovative proposals. Adopting a culture of innovation approach was strategic for my business. It allowed me to diversify my services and to adapt them to the demands of my clients.
Interviewee 4- Holding group I think innovation is an ongoing activity/experience that the entrepreneur must go through permanently. The entrepreneur should be focused on product/service innovation whether on the extrinsic or on the intrinsic level. But the manager must expand its field of innovation to focus on ways of organizing its business, processes and markets. On a large scope, innovation is essential. An emerging company must study its competitors and find ways to distinguish themselves otherwise it will not survive. As an entrepreneur, the innovations that I have launched have always been a way for me to move on to new course. The evolution of my group has undergone several qualitative leaps and each with an innovation in the broadest sense of the term.
Interviewee 5– Freight Forwarder “There was (and still remains) a fierce competition when we opened our venture but we made it because we offered something new to customers, not in the sense of creating new offers but rather with enhancing the “service”, our customers become satisfied because we knew what they wanted and were ready to deliver. For me entrepreneurship and innovation are linked together and my experience proves it to me”.
Interviewee 6 – Food-processing “You can’t be competitive if you don’t add value to customers. That’s what entrepreneurship is all about. From product conception to delivery, we try to be effective, to reduce shortage and lead times. The hardest thing for me when I started this business was to grasp the importance of continuous improvement and what it takes. You have to be prepared to change the way things get done and processes whenever that was needed, that is why I consider innovation as an important component of entrepreneurship…”
Interviewee 7– Advertisement agency “When I got back to Morocco friends and acquaintances objected and thought that I would be disappointed by work conditions… now I am happy that I proved them wrong. My agency is doing fine right now and we’re working on more projects than last year. Entrepreneurship is about individuals who had different visions and were not afraid to take it to the next level…probably the same “ingredients” that innovators and inventors are made of, except that successful entrepreneurs have a certain quality that is resilience, they don’t give up and always find a way to make it happend no matter how things are difficult”.
Interviewee 8 – Consulting “I started doing business since I was in the university and I’ve been through ups and downs, and all along this journey I had many experiences and I learnt a major lesson, market is always unpredictable and volatile, to succeed you have either to follow the wave or to “create” it. Not all companies are capable of being leaders of market of course, but one way to improve their KPI is to offer something different or something new. In a word they have to differentiate their product/service. Successful entrepreneurs can do that for a long period of time, so in a way you can’t be an entrepreneur if you are not innovator enough”.
Interviewee 9 – Insurance “Innovation and entrepreneurship are synonymous to me…you can’t be an entrepreneur if you don’t innovate and especially in our case, there are many companies trying to take as much market share as they can, and it’s a buyers market essentially, so the only way to survive is to innovate and invent new ways to attract customers or to gain their loyalty”
Table II. Perceptions of managers on innovation and entrepreneurship behavior On the basis of these interviews, the responses of interviewees seem to tend towards a general
consensus that entrepreneurship and innovation are closely related. Indeed, the two words 9
were used interchangeably by the managers in describing their perception of how their
organizations were created or how they achieved a competitive advantage. Regardless of size,
industry or sectors, the Moroccan companies had to create new products and services,
projects, new business opportunities, and markets in order to prosper or to survive. We might
say then that they integrated innovation into their entrepreneurial approach and actions.
2.3. Discussion
Our results seem to confirm other studies of other researchers. For instance Zhao (2005) has
carried out a qualitative study on 6 Australian organizations in order to understand the
complementary nature of entrepreneurship and innovation. Consequently, he established three
main propositions about the relationship between entrepreneurship and innovation, and the
environmental factors:
P1. Innovation and entrepreneurship are complementary because innovation is the source of
entrepreneurship and entrepreneurship allows innovation to flourish and helps to realize its
economic value.
P2. Entrepreneurship uses innovation to expand business scope and boost growth. Therefore,
entrepreneurship and innovation are dynamic and holistic processes that are not confined to
the initial stage of a new venture.
P3. The development of entrepreneurship and innovation, and interaction between them for
the successful commercialization of innovation, require an organizational culture and a
management style that are innovation-focused and supportive.
Our findings confirm the first proposition, since all Moroccan companies had to create and
snare a new market with a new product or new service, new ways of doing business, and new
management strategies. The findings of the present study support Schumpeter’s (1934)
entrepreneur paradigm, and the concept that entrepreneurship is about creating and building
something that did not previously exist (Johnson, 2001).
Similarly, the second proposition is confirmed as well by our study. Innovation is viewed as a
permanent process by Moroccan managers; it is not limited to the creation stage but is more
likely to be continuously pursued. Also, regardless of size and industry, Moroccan companies
seem to engage in an incremental innovation process. This seems to contradict what Herbig et
al. (1994) suggested in their research; namely that there is a high correlation between the
creation of new companies and innovation potential and that small new ventures produce
more innovations and bring innovation to the market more quickly than do large companies.
10
The continuous pursuit of innovation underpinned the growth of the nine companies studied
seems to lean towards a similar entrepreneurial approach/attitude towards innovation (for
instance: incremental innovation, proactivity to market dynamics, and a willingness to take
risks). In this perspective, entrepreneurship continuously looks for and creates opportunities,
thus stimulating the generation of innovations (Drucker, 1994).
Although we weren’t able to conduct a longitudinal study of the level of entrepreneurship and
innovation of the nine firms at different stages of their lives, we might provide the examples
of the Holding group and the Food processing companies that illustrate how established large
organizations can be sustained through corporate entrepreneurship. Indeed, the food
processing company has initiated a new business and began working on 3 new projects in
2013. Similarly, the Holding group continues to launch new projects since its establishment in
1989.
Also, the small consulting and training company as well as the advertisement agency have
faced fierce competition from a large number of similar consulting companies since their
creation. They have both survived, grown viably, and achieved considerable business
turnover. According to the director of the company, the keys to its success are its uniqueness
and creativity in providing highly customer-tailored products and services. In order to do that,
the consulting company has developed a strong culture of innovation. Being unique and
creative are the primary criteria for staff recruitment and motivation. The same vision is
adopted by the advertisement agency. “Innovation is viewed as everyone’s responsibility and
as the source of every employee’s job satisfaction”. To win bigger contracts and new
customers, the company is trying to explore new ways and different approach to “doing things
other people don’t do” (interview data from the present study). These examples show that
entrepreneurship and innovation are continuous processes in organizations, and that
entrepreneurship and innovation are complementary in enhancing business performance.
Concerning the 3rd proposition, the issue of innovation culture has always been ambiguous.
National culture and organizational culture have a profound influence on the level of
entrepreneurship and innovation in organizations. Culture is a primary determinant of
entrepreneurship and innovation (Herbig et al., 1994). Organizational culture also has an
important impact on entrepreneurship and innovation (Slevin and Covin, 1990).
Organizational culture has been defined in different ways in the literature. Broadly, it could be
defined as the norms and deeply rooted values and beliefs that are shared by people in an
organization (Zhao, 2005).
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Organizational culture can affect levels of entrepreneurship and innovation through
socialization processes that influence workplace behavior, and through structures, policies,
and procedures that are shaped by the basic values and beliefs of the organization (Martin and
Terblanche, 2003). Buckler (cited in Ahmed, 1998) viewed innovation as an environment and
a culture that drives value creation in an organization. Slevin and Covin (1990) emphasized
the importance of an appropriate organizational culture in developing effective
entrepreneurial and innovation behavior to address market dynamics.
However, concerning the empirical plan, Chandler et al. (2000) found in their study of 429
employees in 23 small-to-medium companies that there was no direct correlation between an
innovative culture and business performance. It seems though that when the competitive
environment became more dynamic, company’s earnings were increased by an innovative
culture (Zhao, 2005). Concerning the results of the present study, we can say that they are
inconclusive regarding the importance of an innovative culture to business performance.
Definitely, there is a need to assess how Moroccan companies have developed an
organizational culture that promotes and rewards new ideas and new ways of doing business.
Many elements regarding hierarchy and the management structure of the organizations and
how they affect innovation can be studied. Nevertheless, the interviewee’s responses showed
clearly that there is indeed an innovation culture in their organizations. All Moroccan
companies were engaged in innovative efforts, allocated resources to innovations, and shared
similar strategic vision with respect to innovation and entrepreneurship. They also shared an
open attitude with respect to new ideas and new ventures. The findings are similar to those of
Roberts et al. (1989), who explored the relationships among organization size, technology
implementation, and organizational culture through a survey of 35 American and Canadian
manufacturing firms. They showed that there is much in common in the area of technological
implementation between large and small businesses, and between hierarchical and non-
hierarchical organizations.
2.4. Issues and hindrances to innovation in entrepreneurship
Moroccan context seems to present many obstacles to managers engaged in entrepreneurship
and innovation. The main problems disclosed by senior managers in the present study can be
stated as follows:
- None of the nine companies has a formal specific structure in place for the
implementation of innovation and entrepreneurship, and none has set up a position of
“innovation manager” or “entrepreneurship manager”, or an independent function
12
dedicated to innovation inside their firms. The responses of managers indicate that, at
present, the systems of innovation and entrepreneurship were very “informal” in their
organizations.
- Sometimes innovations aren’t well received by clients. In the words of the Distribution
company manager “the customers are sometimes reticent towards new idea and stuck
to the same old formula”.
- Innovation cannot prosper without suitable culture. According to the printing manager
“the brakes are in the culture. Our employees have not evolved in a favorable
innovation culture, as in their educational and training they were not encouraged to be
creative, to take initiatives and propose new ideas”.
- Lack of Government support. For many senior managers, it is hard to innovate
because there is no aid from the government side to encourage companies to “think
outside the box” and to create something new or something different in the words of
the software solutions manager. The freight forwarder stated that “history shows that
big technological and managerial breakthrough were directly or indirectly backed up
by the government, if we want an innovation culture, the government should be
willing to help by subsidies or preferential taxes and other facilities”.
- There is lack of innovation culture as well that prevents Moroccan companies to go
further in their plans. According to the advertisement agency owner, innovation and
entrepreneurship need a suitable environment and a different set of culture and values,
that emphasis more individualism, ambition and transparency…there will be time
before these values become common in [Moroccan] society.”
- It is impossible to measure the consequences/outcomes of innovation and
entrepreneurship on the companies because it is very difficult to separate them from
the overall business of organizations.
- Lack of Funding. As one manager stated: “It is very hard for a small company like
ours to be innovative in product development because it is hard to find the needed
capital [funds] required to promote that product”.
- Managers do not like to lose control. As one interviewee observed from other
managers’ behavior in his firm, they can feel “a bit of a threat if you become too
creative”, and this can hinder the development of innovation.
There were many endeavors to stimulate innovation in entrepreneurship. An integrated
framework for innovation and entrepreneurship studies show that organizations can foster
13
entrepreneurship and innovation internally through their strategy, structure, and processes
(Cornwall and Perlman, 1990). On the basis of management texts by Bartol et al. (2001),
Robbins et al. (2000), and Drucker (1994), Zhao (2005) has proposed an integrated
framework for innovation and entrepreneurship for companies. The framework involves the
“5Ss” of strategy, system, staff, skills, and style. However, due to the complex and evolving
nature of entrepreneurship and innovation in Morocco, it will be interesting in the future to
compare the proposed model with practices of Moroccan firms on a large sclae. The model
should therefore be seen as a starting point in developing effective organizational strategy,
structure, and culture to stimulate entrepreneurship and innovation in Moroccan
organizations.
Conclusion
This empirical study has explored the synergies between entrepreneurship and innovation
through a review of the principal literature in this field and interviews with nine
entrepreneurial and innovative companies in Morocco. The main findings of the study are the
following:
- Entrepreneurship and innovation are positively related to each other and interact to
help an organization to prosper;
- Entrepreneurship and innovation are complementary, and a combination of the two
might be vital to corporate success and sustainability in today’s dynamic and changing
environment;
- Entrepreneurship and innovation are not confined to the initial stages of a new
venture; rather, they are dynamic and holistic processes in entrepreneurial and
innovative organizations.
The study also shows that the entrepreneurial and innovative organizations studied in this
research are facing problems with the implementation of entrepreneurship and innovation.
Because entrepreneurship and innovation are systematic behaviors (Drucker, 1994),
systematic efforts are required to incorporate them into the operations of organizations.
Entrepreneurship and innovation should be regarded as ongoing, everyday practice in
organizations, and this paper has contributed to enlightening the innovation attitude of some
Moroccan firms. It is also apparent that cultural issues should be addressed when examining
the level of entrepreneurship and innovation in Moroccan organizations. Moreover, more
systematic and comprehensive studies are required in the future to study how innovation
culture might influence firms’ performance.
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Appendix 1:
Interview Guide
1: What does “innovating” mean to you? What is your perception of innovation?
2: Is innovation essential for the creation of businesses and the success of start-ups?
3: What was the role of innovation in creating your business?
4: In your opinion, does the Moroccan context (the political and socioeconomically
environment) promote innovation?
Company:
Industry/activity:
Date of creation:
Number of employees:
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