Credibility is a critical resource at start up and represents an important element of the entrepreneur’s personal contact network

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6 word format

document in English

management

presentation

published 14/12/2006

review : Completed

level : Expert

requested 9 times

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Summary

Traditionally, entrepreneurs have been considered as individuals with a strong, often charismatic, leadership as well as a high drive for individualism and independence. However, a business unit does not exist in isolation since it is, or will be, in contact with a whole range of other organisations. Porter and Ketels’ (2003, p45) study of British competitiveness noticed business networking often plays a particularly important role in the diffusion of new management best practice and innovation. This is particularly relevant for entrepreneurial start-ups if we consider Schumpeter’s analysis that the entrepreneur leads the way in creating new industries. Thus, entrepreneurs are bound to cooperate at most during the creation of their company, which is a critical step for businesses survival, as the initial resources on which they can rely on are limited. A means to overcome this is the credibility these businesses can get from their network. However, there are no studies on credibility in the fields of entrepreneurship, as research has been linked only with marketing and organisational behaviour (Ali & Birley, 1998, p750).
Sociological studies have suggested that credibility is made up of meriting trust or confidence, as well as being able to persuade as a person or message source, which is generally associated with prestige. This has an impact on a network that consists of single nodes (actors) and connections between these nodes (dyads), (Walker 1988, p228). Firstly, this paper reviews the existing literature on the credibility of the entrepreneur. Secondly, the problem encountered while entering the network will be discussed. Finally, the essay will analyse the structure of networks related to the services provided by partners and to start-up success. The paper critically examines empirical studies on the subject, in order to highlight the features and weaknesses which could possibly be the object of further research.