Existing research on the advice function of incubating activities

In his article from 2002 Rice calls for more process-oriented research to understand interactions between participants and incubators (Rice 2002, 185). Nevertheless, despite the growing interest in business incubation – both from practice and within academia, the research that investigate, describes and evaluates the actors facilitating the incubating activities: advisors and managers employed by incubators and their relationship with participants, is still scarce (both from an entrepreneurial and consultancy perspective) (Hjalmarsson and Johansson 2003, Damgaard et al. 2004, 162, Warren et al. 2009, Lewis et al. 2011). In introductions to academic books and articles on management consultancy and consultancy issues, trends, analytical frameworks, intervention approaches and future predictions, I have not been able to find chapters on the topic of advising or collaborating with entrepreneurial actors as a consultancy theme (Greiner and Poulfelt 2005, Kipping and Clark 2012). That sort of material could help policy makers and incubating actors develop their services and interact with entrepreneurial actors, and we can only speculate as to why this is not a theme in the consultancy literature, despite the fact that consultancy is applied in a wide range of organisations, including emerging ones. I have found four articles of particular interest to this dissertation, in the sense of providing us with knowledge about the matter of relational aspects of business incubation;

• In his exploratory study on the co-production of business assistance in business incubators, Rice (2002) found that the impact of incubation is influenced by four factors:

o Total hours of co-production

o The intensity of engagement by incubator advisor and manager

o The breadth of co-production

o The entrepreneur’s readiness to engage in co-production (Rice 2002, 164).

The study highlights the importance of the relationship and the psychological dimensions at stake between advisor and participant including the factors of awareness, recognition and willingness, which very often are overlooked dimensions of incubator literature and entrepreneurship policy. This dissertation can be seen as an attempt to further contribute on how incubating activities works in terms of making a productive difference to entrepreneuring actors.

• Looking into the learning aspect of entrepreneurship, Sullivan (2000) has discussed learning issues, entrepreneur development, mentoring and matching up advisors and participants (Sullivan 2000, 160).

In his article, Sullivan emphasises that the mental approach of the participants is crucial to learning.

The concept of the traditional mentor-mentee relationship framed by trust, self-selection and respect based on experience is transferred to the relationship between entrepreneur and advisor in support programmes (Sullivan 2000, 170). This also emphasizes the importance of relationship and establishment of responsibility and roles. In Sullivan’s description of the advisor, the skills of the advisor have to be pretty comprehensive in terms of experience, knowledge and skills. Sullivan maintains that such advisors exist and that they can provide added value to participants and therefore society if the participants are open to advice (Sullivan 2000, 172).

• In their paper based on a study of a British incubator programme, Warren et al. (2009) focus on the relational aspects of incubation and find that the role and competences of the incubation advisor are paramount for a positive programme experience. The article stress that it is crucial for individual advisors to have industry connections and to know other professional advisors and potential financiers if they are to bring value to the company. In addition, an advisor should be able to help the company develop a business plan and help the participants develop sufficient business acumen to be able to communicate with professionals outside their field, across different communities of practice and for a variety of purposes. The study found that the internal networks of the incubator (between the participants) did not make a difference to business outcomes; however, the external network of the programme (which in this case was the same as the manager’s personal network) made a crucial difference to process and scope. A tipping point in the entrepreneuring process was when participants began to leverage/acquire social capital themselves, indicating that they acted on their own. Some owner-managers were less positive about the mentoring role of the advisor and were clearly concerned about interferences and issues of control (Warren et al. 2009, 492).

• McAdam and Marlow (2011) found similar tendencies in the different perspectives of incubator actors in their study of incubator influence on attracting investment capital. In their study, the collaboration between advisor and participant was not necessarily a harmonious process, since they found that participants focussed on the primacy of the technology/product/service, while the advisors focussed on the professional business package (McAdam and Marlow 2011, 463). A harmonious incubation processes is not necessarily a goal; however, to be able to co-construct or at least listen to each other with respect, it is important to be aware of the different perspectives influencing communication and learning. The authors also found that participants are somewhat reluctant to acknowledge the influence of the advisor after completing the programme.

Reviewing both the entrepreneurship policy and the incubation literature, I find that the existing articles on the relationship between advisors and client conclude rather vaguely on how to establish and make this relationship work. Researchers all state that the planners of educational programmes for start-ups and incubating practitioners should consider the findings. As an example, Hjalmarsson and Johansson (2003) suggest that ‘symmetric power relations are necessary in order to establish dialogue and genuine collaboration between client and consultant’ (Hjalmarsson and Johansson 2003, 95) – to which it is easy to agree. However, their recipe for achieving this symmetry is openness, which Hjorth and Johannisson (2006) also claims to be the source of entrepreneurial learning, and in that sense it valuable. Nevertheless, none of these above referred authors do really address or discuss why this openness is not present in the first place, how it may be established, and what is preventing the actors from establishing it. Few researchers enter into in-depth discussion of what it implies to be the advisor of uncertain dreams of growth adventures, or how

entrepreneuring actors act in the role as participant – or even student or client. How do entrepreneurial actors use advice, what kind of actors do they take advice from, whose advice do they ignore or reject, and are they able and willing to take in the advice that the supply side of the incubation industry wants to give them – and if so, under what circumstances? Accepting advice is a complicated and emotional matter for most people (Schein 1987) - and also for entrepreneurs.

It is not only the relationship between the advisor and the incubatee that has been neglected in the incubation literature, also the individual and team level has also received limited attention – or been taken for granted as a passive receiver as explained in previous chapter. In their analysis of business incubation literature, Phan, Siegel and Wright (2005) outline several avenues for further research, among them why incubators actually exist, the objectives of incubation and their relationship to performance, the need for strategic approaches to incubation research, a structural contingency perspective and an agency theory perspective. Lastly they point

out ‘the paucity of research on the individual entrepreneurs and entrepreneurial teams working for firms located on science parks and incubators is striking. The nature of entrepreneurs and their teams may have particularly important influence on the ability of ventures to graduate from these institutions’ (Phan et al.2005, 167). Considering the expectations of entrepreneurial actors of accomplishing growth and prosperity from support activities and encountering political dreams of the same, it is remarkable how little attention the individual/group and its actions have received from researchers. In most research on incubating activities, the incubator, rather than the incubatee, is the object of study. The individual level has mostly been addressed in relation to the governance of incubators and agency theory, and as a legacy from economic thinking, the notion of the rational economic (and thus predictable) man persists, favouring the institutional contexts. This constitutes a level-of-analysis gap in incubation literature.