Entrepreneurial orientation and entrepreneurial performance of central Johannesburg informal sector street traders

Abstract

Informal sector participation has been described as a trap associated with \nimpoverishment (Cassim, 1982); as the survivalist responses of marginalised persons \nwith no alternatives (Habib, 2005); yet it has also been described as potentially \ndynamic (House, 1984). The former conceptions prescribe an identity to informal \nsector participants, with little consideration given to individual potential and \nindividual action as means to escape impoverishment and a survivalist condition. \nAn entrepreneurial orientation is associated with increased earnings in certain \nenvironments according to Lumpkin and Dess (1996), a process orientation that can \nbe learned. Research testing the relationship between entrepreneurship and \nperformance has been problematic due to the different definitions offered by different \nentrepreneurship scholars (Cunningham and Lischeron, 1991; Lumpkin and Dess, \n1996). In this context, entrepreneurial orientation as a construct was utilised to \novercome these challenges. Entrepreneurial orientation or certain of its dimensions \nhave been associated with positive effects related to performance (Chow, 2006; \nCoulthard, 2007; De Clerq and Ruis, 2007; Jantunen, Puumalainen, Saarenketo, and \nKylaheiko, 2005) or with negative relationships (Naldi, Nordqvist, Sjőberg and \nWiklund, 2007). \nInnovativeness, competitive aggressiveness, risk taking propensity, autonomy and \nproactiveness, the dimensions of an entrepreneurial orientation (Lumpkin and Dess, \n1996), and the effects of certain contextual factors were tested as to their associations \nwith entrepreneurial performance. Entrepreneurial performance was defined in this \ncontext as a construct comprising earnings and continuance satisfaction. In terms of \nentrepreneurial performance, the contention of Lumpkin and Dess (1996) that an \nentrepreneurial orientation is associated with learning: the how of entrepreneurship, or \nthe learnable process conception of Stevenson and Jarillo (1990), was also tested by \ninvestigating contextual factors and how they shaped an entrepreneurial orientation \nand contributed to entrepreneurial performance. \nii \nIn this context a quantitative investigation of informal sector street traders and \nproviders of street-side services was undertaken using a survey format. The specific \nrelationships influencing entrepreneurial orientation and entrepreneurial performance \nwere investigated. Results contested assumptions that prescribed a theoretically \npermanent and immutable survivalist orientation to certain informal participants in \nthat education and learning related factors were found to be associated with \nentrepreneurial orientation and increased earnings. Entrepreneurial orientation was \nfound to be associated with increased earnings along the dimension of risk taking \npropensity, and higher levels of autonomy were found to be associated with \ncontinuance satisfaction. The relationships between entrepreneurial and contextual \nfactors were investigated and insights developed regarding potential street trader \nupliftment.

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