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A STUDY ON ENTREPRENEURIAL INTENTION
AMONG INFORMATION TECHNOLOGY TECHNOPRENEURS
RAMESH K S @ MOHD ZAIDI BIN ABD ROZAN
Presented as a Partial Fulfillment of the Requirements
for the Degree of
Master Of Science
(Information Technology)
MSc. IT
FACULTY OF COMPUTER SCIENCE AND INFORMATION SYSTEM
UNIVERSITI TEKNOLOGI MALAYSIA
OCTOBER 2001
ii
“I hereby declare that this writing is the result of my own efforts with the exceptions of the quotation and summary, each of which source has been
stated”
Signature : Name of Author : Ramesh K S @ Mohd Zaidi Bin Abd Rozan Date : 18th October 2001
iv
DEDICATION
SPECIALLY DEDICATED FOR:
My Wife
Wan Jamilah Binti Wan Omar, For the Love, Support, Passion and
Through the Moments of Up and Down Together,
My Mom
Juanita Goh Shiu Moi,
For the Sacrifices and Kindness,
My Brother
Mohd Fadzli Bin Abd Rozan,
For Support and Assistance,
My Mother-in-law
Lijah Binti Ibrahim,
My Brother-In-Law
Ghazali Bin Muda
And Family,
For being Very Understanding and Helpful,
Relatives in Sabah and Terengganu,
Thanks a Million…
v
ACKNOWLEDGEMENT
Bismillahhirrahmannirrahim… Any major literary or research endeavour is
unlikely to be successfully completed without substantial help from others. This
study and the process leading up to it was certainly no exception. Firstly, Allah the
almighty has given me the consent to complete this study by giving me health,
energy and confidence. The past 2-½ years has been a very challenging but pleasant
momento to be kept in heart and mind.
I would like to thank my supervisor, Prof. Dr. Ahmad Zaki bin Abu Bakar
for the assistance and uncountable details during those tough and challenging
episode.
Prof. Madya Dr. Rose Alinda binti Alias for the motivation and confidence
building and Prof. Madya Dr. Mat Noor Bin Sap for the careful assistance. To our
Project Coordinator, Prof. Madya. Dr Noraniah, thank you for your advice.
Puan Rashidah and Puan Lijah of FSKSM, UTM, JOHOR for the kind
assistance.
I also like to express my appreciation to all the IT Technopreneur who
contributed their time. My best friend Tn. Haji Hashim bin Hj Yusoff, En.Mohd
Zakree bin Ahmad Nazri, En. Yahaya bin Abd Rahim and to those who have
involved either directly or indirectly.
Thank you to Pn. Hajah Rahmah Bt. Muhamad, the Principal of SMK Seri
Perling and to all SMKSP staffs for being supportive during my studies.
Lastly, Thank you to everyone.
vi
ABSTRACT
The purpose of the study is to investigate entrepreneurial intention among
information technology technopreneurs. The model of the study is based on
Shapero’s model of entrepreneurial event. Variables included in this model are
Perceived Desirability, Propensity for Proactive Behaviour and Breadth and
Positiveness of Past Entrepreneurial Experience that contributed towards
entrepreneurial intentions for technopreneurs. The differences in values and cultures
were believed to affect their entrepreneurial behaviour and intention. These served as
a building block on the upbringing of an entrepreneur. Hence, a test was needed to
prove this relationship. In this project, tests to compare entrepreneurial intention
between three major ethnic groups in Malaysia (Malays, Chinese and Indians) were
done. Self-report questionnaires were used as a survey instrument for 129
Information Technology Technopreneurs from Johor Bahru and Kuala Lumpur. The
data were analyzed using custom developed software. The results indicated that
perceived desirability and propensity for proactive behavior were positively related
to the formation of entrepreneurial intentions. In addition, positiveness of past
entrepreneurial experiences also supported positively to the perceived desirability of
starting a business. It was also found that there were no significant differences on the
perception of IT Technopreneurs’ towards Propensity for Proactive Behaviour and
Breadth and Positiveness of Past Entrepreneurial Experience related to Race. Only
Perceived Desirability showed significant values in relation to Race. Based on this
study, it showed that a specific way to view entrepreneurial intention towards starting
a business and the exposure to technopreneurship assessment were the practical
implications which assisted entrepreneurs’ educators to develop IT techopreneurial
programs and decision making among venture capitalists.
vii
ABSTRAK
Tujuan kajian ini adalah untuk menyiasat niat keusahawanan di kalangan
teknousahawan teknologi maklumat. Model kajian yang digunakan adalah
berasaskan “Model of Entrepreneurial Event” Shapero. Model ini mempunyai
beberapa pembolehubah iaitu Keinginan Tanggapan, Kecenderungan ke arah
Perilaku Proaktif dan Kualiti serta Kuantiti Pengalaman Keusahawanan yang
memberi petunjuk ke atas niat keusahawanan bagi teknousahawan. Perbezaan nilai
dan budaya sesuatu ras dipercayai memberi kesan kepada perilaku serta niat
keusahawanan mereka. Oleh itu, ujian perlu dijalankan untuk mengkaji sama ada
hubungan ini benar-benar memberi kesan atau tidak. Dalam projek ini, kajian
dijalankan berkaitan dengan niat keusahawanan, untuk mendapatkan perbandingan
antara kumpulan etnik utama Malaysia (Melayu, Cina dan India). Bagi tujuan itu,
survey telah dijalankan ke atas 129 teknousahawan teknologi maklumat dari Johor
Bahru dan Kuala Lumpur. Sebuah perisian yang dibina dalam projek ini telah
digunakan untuk menganalisis hasil kajian. Keputusan kajian mendapati bahawa
terdapat persekutuan yang positif antara Keinginan Tanggapan dan Kecenderungan
ke arah Perilaku Proaktif ke atas Pembentukan Niat Keusahawanan. Kajian ini juga
mendapati bahawa, Kualiti Pengalaman Keusahawanan juga bersekutu secara positif
terhadap Keinginan Tanggapan untuk memulakan sesuatu perniagaan. Tidak terdapat
perbezaan yang ketara antara tanggapan teknousahawan IT terhadap Kecenderungan
ke arah Perilaku Proaktif dan Kuantiti dan Kualiti Pengalaman Keusahawanan
terhadap Kaum. Hanya Keinginan Tanggapan sahaja mempunyai perbezaan ketara
terhadap Kaum. Berdasarkan kajian ini, suatu atur cara khusus untuk melihat niat
teknousahawan untuk memulakan sesuatu perniagaan serta pendedahan kepada
keteknousahawanan boleh diaturcarakan bagi membantu para penggubal program
keusahawanan teknologi maklumat dan pemodal teroka membuat keputusan.
viii
TABLE OF CONTENTS
CONTENT PAGE NUMBER
DECLARATION ii
ACCEPTANCE iii
DEDICATION iv
ACKNOWLEDGEMENT v
ABSTRACT vi
ABSTRAK vii
TABLE OF CONTENTS viii-xi
LIST OF TABLES xii-xiii
LIST OF FIGURES xiv
LIST OF APPENDIXES xv
CHAPTER PAGE NUMBER
I INTRODUCTION 1
1.0 Introduction 1
1.1 Entrepreneurs & Information Technology
Technopreneurs 3
1.2 Statement of Problem 9
1.3 Objectives of Study 10
1.4 Theoretical Framework 11
1.5 Hypothesis of this Study 14
1.6 Scope of Study 15
1.7 Significance of Study 16
1.8 Definition of Terms 18
1.9 Chapter Summary 21
ix
II REVIEW OF LITERATURE 23
2.0 Introduction 23
2.1 Malaysian Inter-Cultural Society 28
2.2 Common Cultural Values of Malaysian 30
2.3 Shapero’s Model of Entrepreneurial Event 35
2.4 Research Model and Hypothesis 37
2.4.1 Perceived Desirability and
Entrepreneurial Intentions 38
2.4.2 Breadth and Positiveness of Past Entrepreneurial
Experiences 40
2.4.3 Propensity for Proactive Behaviour
and Entrepreneurial Intentions 41
2.4.4 Race (Ethnic Group) 44
2.5 Chapter Summary 44
III METHODOLOGY 46
3.0 Introduction 46
3.1 Design and Reliability of Questionnaire 47
3.2 Respondents 48
3.3 Procedures 49
3.4 Measurement of Instruments 50
3.4.1 Entrepreneurial Intentions 50
3.4.2 Perceived Desirability 50
3.4.3 Breadth and Positiveness of Past
x
Entrepreneurial Experience 51
3.4.4 Propensity for Proactive Behavior 52
3.4.5 Demographic Data 53
3.6 Chapter Summary 54
IV DATA ANALYSIS AND RESULTS 55
4.0 Introduction 55
4.1 Descriptive Survey
(i) Background of Respondents 57
(ii) Subject Descriptive Analysis 62
(iii) Level Analysis 67
4.2 Inferential Analysis
(i) Correlation 69
Hypothesis 1 70
Hypothesis 2 71
Hypothesis 3 72
(i) Comparison
Hypothesis 4 73
Hypothesis 5 65
Hypothesis 6 75
4.3 Chapter Summary 77
V DISCUSSION
5.0 Introduction 79
5.1 Hypothesized Relationships-Hypothesis 1 79
xi
5.2 Hypothesized Relationships-Hypothesis 2 81
5.3 Hypothesized Relationships-Hypothesis 3 81
5.4 Hypothesized Relationships-Hypothesis 4 84
5.5 Hypothesized Relationships-Hypothesis 5 85
5.6 Hypothesized Relationships-Hypothesis 6 85
5.7 Implications of the Study 86
5.8 Theoretical Implications 87
5.9 Practical Implications 89
5.10 Limitations of the Study 91
5.11 Direction for Future Research 92
5.12 Chapter Summary 95
REFERENCES 97
APPENDIX A -Cover Letter 101
APPENDIX B -Questionnaire 102
xii
LIST OF TABLES
Table No. Title Page No.
2.1 List of Malaysian Ethnic Values 29
2.2 Common Value Orientations at Inter-Cultural Levels 33
3.1 Reliability Test Results Analysis 48
4.1 Respondents by Location 57
4.2 Respondents by Gender (Sex) 58
4.3 Respondents by Race 59
4.4 Respondents by Age Group 60
4.5 Respondents by Level of Education 61
4.6 The Number and Percentage of Respondents Answered every
Item in Section 1 –Propensity for Proactive Behaviour 62
4.7 The Number and Percentage of Respondents Answered every
Item in Section 2-Perceived Desirability 64
4.8a The Numbers and Percentage of Respondents Answered every
Item in Section 3- Breadth and Positiveness of Past Entrepreneurial
Experience 65
4.8b The Number and Percentage of Respondents Answered every
Item in Section 3- Breadth and Positiveness of Past Entrepreneurial
Experience (Degree of Positiveness) 66
4.9 The Number and Percentage of Respondents Answered in Section 4-
Percentage of Entrepreneurial Intention 67
xiii
4.10 Level Analysis of Respondents’ Perception towards Propensity for Proactive
Behaviour 68
4.11 Level Analysis of Respondents’ Perception towards
Perceived Desirability 68
4.12 Level Analysis of Respondents’ Perception towards Positiveness of
Past Entrepreneurial Experience 69
4.13 Correlation Analysis between Perceived Desirability and Entrepreneurial
Intentions 70
4.14 Correlation Analysis between Breadth and Positiveness of Past
Entrepreneurial Experience towards Perceived Desirability 71
4.15 Correlation Analysis between Propensity for Proactive Behaviour
and Entrepreneurial Intentions 72
4.16 Mean Score Analysis and One-Way ANOVA as a comparison of
respondents’ perception towards Perceived Desirability related to Race 73
4.17 LSD test Analysis for comparison of respondents’ perception towards
Perceived Desirability related to Race 74
4.18 Mean Score Analysis and One-Way ANOVA as a comparison of
respondents’ perception towards Breadth and Positiveness of Past
Entrepreneurial Experience related to Race 75
4.19 Mean Score Analysis and One-Way ANOVA as a comparison of
respondents’ perception towards Propensity for Proactive Behaviour related
to Race 76
5.1 Summary for comparison of respondents’ perception towards Perceived
Desirability related to Race 84
5.2 Summary of Hypotheses Tested 86
xiv
LIST OF FIGURES
Figure 1.1 Shapero’s (1982) Model of Entrepreneurial Event as a Theoretical
Framework for this study 11
Figure 1.2 Combination of Shapero’s (1982) Model of Entrepreneurial Event and
Race (Ethnic Group) Path Hypothesis 12
Figure 2.1 A Model of Culture and Ethical Behaviors Among Entrepreneurs 24
Figure 2.2 Shapero’s (1982) Model of Entrepreneurial Event and Race (Ethnic
Group) 27
Figure 2.3 Relating the Malaysian Inter Cultural Society 33
Figure 2.4 Shapero’s (1982) Model of the Entrepreneurial Event and Race
(Ethnic Group) Path Hypothesis 39
Figure 4.1 Pie Chart represents Respondents by Location 57
Figure 4.2 Pie Chart represents Respondents by Gender (Sex) 58
Figure 4.3 Pie Chart represents Respondents by Race 59
Figure 4.4 Bar Chart represents Respondents by Age Group 60
Figure 4.5 Bar Chart represents Respondents by Level of Education 61
Figure 5.1 Shapero’s(1982) Model of Entrepreneurial Event with Hypothesis
And Correlation Magnitude for Hypothesis 1 through 3 80
Figure 5.2 Shapero’s(1982) Model of Entrepreneurial Event with ‘f’ value based
on ANOVA for Hypothesis 4 through 6 83
xv
LIST OF APPENDIXES
Cover Letter sent to Respondents APPENDIX A
IT Technopreneurial Questionnaire APPENDIX B
CHAPTER I
INTRODUCTION
1.0 Introduction
The need to understand entrepreneurs has become more crucial today. In
Malaysia, private sectors, especially entrepreneurs are the catalyst of the nation’s
economic development. In the Malaysian Seventh Plan, strategic sectors such as
infrastructure, utility, transportation and information technology were better known
to be developed and targeted by entrepreneurs (Zainab Ahmad, et al., 1997).
Multimedia Development Corporation (MDC) has identified strategic thrust
areas to be funded under Eight Malaysia Plan, including the second flagship
applications, development of technopreneurs and small and medium-sized enterprises
(SMEs)(Dr Mohamed Arif Nun, 2001-Computimes).
With the advent and proliferation of the computer, creation of new
knowledge has increased geometrically. It is generally recognized as recently as only
the past decade. Technologies invented to simplify our lives have made it more
complex by accelerating the change and amplifying the effects upon society. This
complexity contributes towards the development of technology knowledge society.
This tremendous increment of technology knowledge society has contributed to the
development of Information Technology (IT) markets locally and globally. This IT
2
markets are now the medium of enterprise for Information Technology oriented
entrepreneur. IT entrepreneur in Malaysia are also known as IT Technopreneur
(derived from the word “technology entrepreneur”) will be interchangeably used
with the word entrepreneur in order to relate that technopreneurship are the subset of
entrepreneurship. This is for the purpose of continuity in this writing.
The level of industrialization obviously influences the entrepreneurial
behaviour in an enterprise and on society. This can be seen in the changes that have
taken place in Malaysia as it had developed. If we look back a few decades ago, the
major economic activities are mining, agriculture, and then come to industry. As
Malaysia developed, it has moved into the production of more high technology,
consumer electronics, and mostly towards Information Technology. As for
Malaysian IT Technopreneur, of necessity, must be internally innovative and able to
adjust to rapid technological changes. Malaysian entrepreneurs must be capable of
accommodating themselves in this fast paced environment. They must also stay
afloat in their enterprise in order to get the highest achievement as entrepreneurs.
Compared with Western counterparts, they appear to be strong work ethics,
self-discipline, and acceptance of hierarchy, obedience and respect towards the
enterprise. Although Malaysian is made up of three major ethnic and indigenous
groups, most entrepreneurs admit that they achieve comfortable level as business
owners. Most enterprise has heterogeneous mix of ethnic groups to form their
enterprise as employees. This three major ethnic group; Malays, Chinese and Indians
definitely have different upbringing and values among them. What makes their
enterprise successfully brought up and well managed although they have different
culture? Moreover, do they have some similarity in their entrepreneurial behaviour
although they came from different cultural environments? The similarity also known
3
as common culture contributes the entrepreneurial behaviour among Malaysian
entrepreneur.
Sekaran (1970) indicates that while research has yet to clarify and
conceptualize the concept of “culture”, the beliefs exist that culture has an impact on
organizations because of cultural norms, values, and roles are embedded in the way
that organizations develop, organizational structures emerge, and informal and
formal patterns of behaviour occur.
The aim of this study is therefore to better understand the intention to launch
a business as a physical firmness within the differences of values among IT
Technopreneurship that are consist of the three major ethnic groups in Malaysia. It is
based on research in Kuala Lumpur and Johor Bahru, Johor, which was conducted
between May 2001 and August 2001.
1.1 Entrepreneurs & Information Technology Technopreneurs
We need to further understand more on the definition of entrepreneur.
According to Kao (1995), the entrepreneur is a person who undertakes a wealth-
creating and value-adding process, through incubating ideas, assembling resources
and making things happen. Entrepreneurs must also function in a framework within
the environment, and must act in their interest and the interest of the society (Kao,
1995). There are not many people who can deny that we must create wealth and add
value. The wealth creating and value-adding responsibility is not just for
businessperson, but also for every single individual on earth. The enterprising culture
in Malaysia is the commitment of the individual to the continuing pursuit of
opportunities and developing an entrepreneurial endeavor to its growth potentials for
4
the purpose of creating wealth for the individual and adding value to the society. This
comes up the importance of entrepreneurship as a contribution to social
responsibilities. The common cultural relation among the three major ethnic groups
contributes as a special and unique framework within the environment. This indeed
has proven that cultural environment plays an important part in entrepreneurial
behaviour.
IT Technopreneurs must have the understanding that can develop enterprise
practices and development programmes that are aligned and in harmony with the
values that Malaysians have been “programmed” to internalize during the process of
seeding and growing up in Malaysian cultures. In Malaysian context, an entrepreneur
or a corporate entity is not only established to achieve a specific task and make
profit, but also demonstrate a sense of social responsibility for the advancement of
the community and the country. The task of building entrepreneurial enterprise or
business ventures that are truly Malaysian in its form, fixtures and features has now
become an on-going agenda for most entrepreneurs. What are the effects of culture
that contributes vital intentions among IT Technopreneurs in Malaysia? Social
relevance is for Malaysian society has, during the past few decades, moved from a
relatively stable state to one where the only constant is “Change”.
Entrepreneurship is transforming rapidly as it forges ahead towards the
accomplishment of their goals, profit making and importantly related to their
responsibility for the society.
Malicious code programmers, computer security hackers, people in business
who deliberately harm others for financial gains, and people exploiting the earth just
for the sake of making profit with no consideration for the future, claimed be IT
technopreneurs. They might be creating wealth as what Kao (1995) defined, but they
5
could not maintain the value-adding responsibility for every single individual on
earth. Do we consider them as IT Technopreneur? Do they have the cultural values
that can actually prevent them from acting in this behaviour? This is more to their
decayed values and unethical behaviour in making entrepreneurial decision.
According to Kao (1995) definition, this type of entrepreneur does not function in a
framework within the environment, because they just function for their own interest
and not the interest of the society.
Yet, who are these IT technopreneurs? The concept of technopreneurship,
with all its allure, is surrounded with quite a bit of mystique. Those persons who set
out to be IT Technopreneurs are often seen as special, brave, strong, or else well
connected to sources of start-up income beyond those that could reasonably expect to
obtain.
Technology entrepreneurship, the act and process of creating new,
technology-intensive start-ups, is a subject of increasing importance in many parts of
the world. Entrepreneurship in parts of South East Asia especially Malaysia has
recently undergone rapid revitalization. At present, little research has been executed
on this field related to Malaysian culture and distinct results are rarely known in
Malaysia. There is a shift of terms for technical entrepreneur that involves in
Information Technology based enterprise. The term Information Technology
Technopreneur (IT Technopreneur) arose from within Malaysian culture to describe
an individual whose entrepreneurial endeavours focus on to Information Technology
oriented enterprise.
IT Technopreneurial businesses are obviously an enormous part of Malaysian
economy. Where as, the government has embraced IT Technopreneurs and has
launched initiatives to promote IT Technopreneurship as a means of economic
6
catalyst to development. Multimedia Super Corridor or MSC in Malaysia has been
the breeding ground or incubator for the Small and Medium scale Industries (SMI) to
several Multi National Corporations (MNC).
Malaysian government through Multimedia Development Corporation
(MDC) is responsible for the establishment of MSC status companies. Until recently,
MDC are trying to push up as many SMI to be honored as the MSC status
companies. There are 546 locally owned and 45 international MSC status companies
as at August 2001 (Othman Yeop Abdullah, 2001-Computimes). The target would be
750 locally owned MSC status companies by 2003. This might be accelerated by
more venture capitalist supplying funds for this IT Technopreneurs.
Malaysian’s Vision 2020 comprise of nine challenges, the fourth is to
establish a developed nation, secure and psychologically liberated with faith and
confidence in itself, justifiably proud of what it is, of what it has accomplished, and
robust enough to face all manners of adversity. On the other words, establishing a
fully moral, liberal, and tolerant society, whose citizens are strong in religious and
spiritual values and imbued with the highest ethical standards. The values stressed
are religious, spiritual and ethical.
This challenge has impact the formation and development of unique
Malaysian entrepreneurial identity which able to express itself with pride and
confidence. Regardless of ethnic and religion, entrepreneurs at the Malaysian
enterprise have to understand what motivates their workforce to excel their work.
It is the challenge for entrepreneurs to predict their workforce intentions and
behaviour with regard to the motivation style acted to excel their entrepreneurial
endeavour. How to harness Malaysian cultural values at workplace? What are the
values at the individual, cultural and organization levels that are important for
7
Malaysians? These are just a few type of unstructured question that often produce
dilemma for entrepreneurs in Malaysia when they get involved in decision making
that affects on Malaysian culture. Discussion regarding this matter will be further
talk about in the literature review section.
Critical to Learned’s (1992) process is the formation of entrepreneurial
intentions. He added, the formation of intentions is the result of the interaction of
psychological traits and background experiences of the individual with situations that
are favourable to entrepreneurship. Previous research suggests that intentions are the
single best predictor of planned behaviour (Krueger, 1993).
Planned behaviour and intentions are to be found posits that entrepreneurs
will encounter situation that will interact with their traits and backgrounds such as
cultural values to cause an action on decision-making. (Krueger, 1993)
Therefore, the focus of this study is to test a model that explains the unique
combination of the individual entrepreneur and his or her experiences and
background that ultimately leads to the formation of entrepreneurial intentions to
start a business or towards venture creation.
This study will also examine the contribution of the different ethnic aspects
related to intention forming of entrepreneurs, this cultural aspect plays an important
role in the way entrepreneur think and it is assumed that the way one thinks has a
significant impact on the intention to start a business and managing a business.
Through this study, we will have a better understanding of the dynamics of IT
Technopreneur, in particular capturing their intentions regarding their behaviour.
Today, IT Technopreneurship seem to be on an upswing. As the rates of
corporate downsizing and layoffs increase, individuals who fear for their jobs find
the prospects of being their own bosses to be quite attractive. Even those persons
8
who have relatively stable employment reverie about setting their own schedules,
making their own strategic plans, and keeping all of their own profits.
However, the risks associated with IT Technopreneurship can be quite
daunting. Just as such a business can succeed and reap benefits for the
technopreneur, it can also fail, stripping the technopreneur of not only the business
itself, but often his or her personal assets as well. Moreover, just as it can be
tempting to be in charge of one’s own business, the reality of complete responsibility
for such an undertaking can be far from the daydream of short hours and long
vacations.
To fulfill the purpose of this study, research was conducted as an exploratory
basis to determine if the following had a relationship: (a) Perceived Desirability (PD)
towards Entrepreneurial Intentions (EI), (b) Propensity for Proactive Behaviour
(PPB) towards Entrepreneurial Intentions (EI), (c) Breadth and Positiveness of Past
Entrepreneurial Experience (BPPEE) towards Perceived Desirability (PD), and a
comparison between racial identification towards PD, PPB and BPPEE.
The elements identified in this entrepreneurial study were essential to the
Malaysian IT Technopreneurial intention and behaviour evaluation.
In this chapter, discussion of the statement of problems are the opening issues
that will be presented, secondly the objectives, thirdly theoretical framework,
hypotheses, scope, definition of terms used in this writing and the final part will be
the chapter summary.
9
1.2 Statement of Problem
The different value of inter-cultural society in Malaysia produces challenges
in the study of entrepreneurial intentions and behaviour. As for this study, the
entrepreneurial intentions that produce entrepreneurial behaviour among the three
major ethnic groups in Malaysia will be the main issues that are to be tested.
This study suggests that, it is more comprehensive to test those entrepreneurs
with different cultural background in order to come up with the Malaysian Culture or
Malaysian Values in entrepreneurship.
Considering the fact that new entrepreneurial organizations emerge over time
because of careful thought and action, entrepreneurship is an example of such
planned behaviour (Bird, 1988).
In addition, entrepreneurship is a process that does not occur in a vacuum but
is influenced by a variety of cultural and social factors as well as personal traits and
characteristics (Reynolds, 1992). Intention-based process models are able to capture
the complexity of entrepreneurship and provide a framework to build robust, testable
process models of entrepreneurship.
Researchers have developed intention-based models such as the theory of
Shapero’s (1982) model of the entrepreneurial event. Despite the interest in
intention-based models, few studies explicitly use theory-driven intention-based
process models of entrepreneurship (Gartner, 1988). Therefore, the current study
uses an intention-based model to answer the following research question:
“What are the relation between Breadth and Positivenesss of Past
Entrepreneurial Experience, Perceived Desirability, Propensity for Proactive
10
Behaviour towards Entrepreneurial Intention and also their comparison
between 3 major ethnic groups that are Malays, Chinese and Indians?”
1.3 Objectives of the Study
The study was designed to build effort in exploring the relationship among
inter-cultural society in Malaysia. This inter-cultural society contribute to their
personal traits and characteristics of the entrepreneur along with predisposing events
can be examined for their relationship with the formation of entrepreneurial
intentions. The study focused on using a theoretically sound intention-based process
model of entrepreneurship that includes traits and characteristics of the entrepreneur
along with predisposing events. The theoretical framework will be discussed in the
next section. The results are used as the first step in predicting entrepreneurial
behaviour.
The following chapter provides an overview of the literature that constitutes
the theoretical foundation for the study.
Given the significance of intentions, the objectives of this study was to
a. Investigate entrepreneurship dimension that are perceived desirability toward
entrepreneurial intention.
b. Investigate entrepreneurship dimension that are propensity for proactive
behaviour toward entrepreneurial intention.
c. Investigate entrepreneurship dimension that are breadth and positiveness of
past entrepreneurial experience toward entrepreneurial intention.
d. Compare those variables with three major ethnic groups in Malaysia that are
Malays, Chinese and Indians.
11
1.4 Theoretical Framework
Researchers have developed intention-based model such as the model of the
entrepreneurial event introduced by Shapero (1982)(Summers, 1998). The Shapero
Model of Entrepreneurial Event is used as the theoretical framework for this study,
as shown in figure 1.1. Selection of this model will be discussed further in the
literature review chapter.
Trigger Event
Breadth & Positiveness of
Past Entrepreneurial
Experience
Entrepreneurial
Intentions
Perceived Feasibility
Propensity for Proactive Behaviour
Perceived Desirability
Social
Support
Figure 1.1: Shapero’s (1982) Model of Entrepreneurial Event as a Theoretical Framework for this study.
As a purpose of comparing between three major ethnic groups in Malaysia
that are the Malay, Chinese and Indian, the model is modified to show the linkages
12
between the different ethnic groups and the variables involved for the development
of their entrepreneurial intention, as shown in figure 1.2.
H6
H5
H4
Race (Ethnic Group)
H3
H2 H1
Trigger Event
Breadth & Positiveness of
Past Entrepreneurial
Experience
Entrepreneurial
Intentions
Perceived Feasibility
Propensity for Proactive Behaviour
Perceived Desirability
Social
Support
Figure 1.2: Combination of Shapero’s (1982) Model of Entrepreneurial Event and Race (Ethnic Group) Path Hypothesis
In Malaysian context, the national culture, values, roles, norms and patterns
of thinking plays an important part in entrepreneurial perceived desirability and
propensity for proactive behaviour towards entrepreneurial intentions. This includes
the cultural values that are positively or negatively related to entrepreneurial
intention.
13
The figure also shows six symbols from H1 to H6 that represent the path
hypothesis of the study. The details of the hypothesis will be presented in the next
section.
Based on the theoretical foundation, the following specific questions can be
addressed in the current research study:
1. How does intention-based models such as Shapero Model of
Entrepreneurial Event (1982) can be used to explain the formation of IT
entrepreneurial intentions?
2. What are the relation between Breadth and Positivenesss of Past
Entrepreneurial Experience, Perceived Desirability, Propensity for
Proactive Behaviour towards Entrepreneurial Intention and the
comparison between three major ethnic groups that are Malays, Chinese
and Indians?
3. Is there any level of difference between the three major ethnic groups in
Malaysia that could in their own way contribute on entrepreneurial
intention for Malaysian IT Technopreneurs?
4. How does intention-based model such as Shapero Model of
Entrepreneurial Event (1982) can be used to explain the formation of
Entrepreneurial Intentions among the three major ethnic groups in
Malaysia that could in their own way contribute on entrepreneurial
intention for Malaysian IT Technopreneurs?
14
1.5 Hypothesis of this Study
The following Null Hypotheses (Hφ) and Research Hypotheses (HR) are
suggested as a statistical statement used for Chapter IV. Null Hypothesis support for
the non-association of the variables related to entrepreneurial intentions and their
comparison to Race according to the theoretical framework. Contrary to null
hypothesis would be the research hypothesis that support the positive association of
the variables related to entrepreneurial intentions and their comparison to Race
according to the theoretical framework.
Hφ1: Perceived Desirability is not associated with the formation of
entrepreneurial intentions.
HR1: Perceived Desirability is positively associated with the formation of
entrepreneurial intentions.
Hφ2: The Breadth and Positiveness of Past Entrepreneurial experience is not
associated with perceived desirability.
HR2: The Breadth and Positiveness of Past Entrepreneurial experience is
positively associated with perceived desirability.
Hφ3: The Propensity for Proactive Behaviour is not associated with the
formation of entrepreneurial intentions.
HR3: The Propensity for Proactive Behaviour is positively associated with
the formation of entrepreneurial intentions.
Hφ4: There is no difference on respondents’ perception towards Perceived
Desirability related to Race.
15
HR4: There is a difference on respondents’ perception towards Perceived
Desirability related to Race.
Hφ5: There is no difference on respondents’ perception towards Breadth and
Positiveness of Past Entrepreneurial Experience related to Race.
HR5: There is a difference on respondents’ perception towards Breadth and
Positiveness of Past Entrepreneurial Experience related to Race.
Hφ6: There is no difference on respondents’ perception towards Propensity
for Proactive Behaviour related to Race.
HR6: There is a difference on respondents’ perception towards Propensity for
Proactive Behaviour related to Race.
1.6 Scope of Study
This scope of this study covers a discussion on the Malaysian inter-cultural
society. Inter-cultural societies are the plural type of personality that is confined to
the three ethnic groups that are Malays, Chinese and Indians.
Secondly is the investigation of Intention-based models of entrepreneurial
behaviour that are the Shapero’s Model of Entrepreneurial Event (Shapero, 1982).
This shows the relationship of Malaysian IT Technopreneur toward Perceived
Desirability, Propensity for Proactive Behaviour, Breadth and Positiveness of Past
Entrepreneurial Experience towards entrepreneurial intentions. The comparisons
between three major ethnic groups are then analyzed for any differences between
those variables.
16
1.7 Significance of Study
The research study was designed to answer the call of researcher for better
understanding of the emergence of a new firm with the effect of their cultural
differences.
The development of this study towards inter cultural relationship according to
Shapero’s (1982) model of entrepreneurial event provides several potential benefits.
The research model contains both background and dispositional variables that
combine to form the intentions to start a business. The model will help researchers
understand how the background of the entrepreneur with regard of his cultural
differences and the characteristics of the entrepreneur combine to form
entrepreneurial intentions. This is important to researchers because it will provide a
framework to help answer a variety of questions, such as “Is there any level of
difference between the three major ethnic groups in Malaysia that could in their own
way contribute better waves on entrepreneurial intentions for Malaysian IT
Technopreneurs?” or “Is there any shared value or common cultural values that plays
the biggest role in Malaysian IT Technopreneurial intentions” or “What are the
intercultural values that might be positively or negatively related with the
entrepreneurial intentions for Malaysian IT Technopreneurs?”
For entrepreneurs and educators, knowing how entrepreneurial intentions are
formed within such values of culture will yield a wealth of practical applications. For
example, educators could develop entrepreneurial curriculum that would increase the
probability of intentions forming. Entrepreneurs could understand how their
intentions are formed and take steps to manipulate the critical variables such as to
increase desirability, and become more confident in their ability to take action. This
17
includes the cultural values that might be positively or negatively related to
entrepreneurial intention. Entrepreneurs will also develop into being more
resourceful in understanding the differences of intention forming among the three
ethnic groups.
Public policy makers will benefit from understanding the impact of policy
initiatives that would encourage the formation of intentions and ultimately, the
formation of new business. For example, the influence on entrepreneurial activity
created by special economic incentives or the formation of incubator programs will
be easier to assess. With the wave of corporate downsizing and outsourcing,
economic stability will hinge on new business formation (Krueger, 1993). This
demonstrated that huge corporation has deserted the policy of lifetime employment,
eliminating jobs of thousand of worker. Therefore, promoting entrepreneurial
intentions is both desirable and feasible for creating own business.
In Malaysian context, the national culture, values, roles, norms and patterns
of thinking plays an important part in entrepreneurial perceived desirability and
propensity for proactive behaviour towards entrepreneurial intentions. This includes
the cultural values that are positively or negatively related to entrepreneurial
intention. These cultural values can be assessed and harness to increase our
entrepreneurial workforce ability.
This study also suggest researchers to develop tool or psychometric
instrument to assess Malaysian IT Technopreneur that can be aligned with the
venture’s goals, such as better market, profit making and better understanding of
Malaysian culture that can be identified and nurtured in the knowledge based
economy.
18
The tools or instrument can be displayed using computer programs to ease the
process of entrepreneurial assessment this can be done by publishing as an electronic
form on the World Wide Web (WWW). As for the advantage of handheld hardware
and software, the survey instruments can also me programmed for the use of PDA
devices. The use of WWW and PDA as a medium for assessment is the most
efficient and productive way to test entrepreneur with regard to their intentions and
to evaluate their behaviour.
1.8 Definition of Terms
The following definitions are provided for key terms that are used throughout
the study.
a) Entrepreneur/Entrepreneurship:
The literature provides no universally accepted definition of an
entrepreneur (Gartner, 1989). In fact, the subject has developed a
great deal of controversy. Therefore, as Gartner (1989) suggests, each
research study should specifically define the type of entrepreneur that
is the focus for that particular study. Consequently, according to Kao
(1995), the entrepreneur is a person who undertakes a wealth-creating
and value-adding process, through incubating ideas, assembling
resources and making things happen. Specifically, entrepreneur is a
person who undertakes a wealth-creating and value-adding process,
through incubating ideas, assembling resources and making things
happen (Kao, 1995). Entrepreneurship is a process of doing
19
something new (creative) and something different (innovative) for
creating wealth for the individual and adding value to society (Kao,
1995).
b) Information Technology Technopreneurs:
The word derives form Technology Entrepreneur, Information
Technology Technopreneurs are entrepreneur that are based on
information technology oriented enterprise (Soota, 1998). IT
Technopreneurs are those entrepreneurs specifically involves in IT
solution, whether it engross software, hardware and communication
solution. Retail of computer products without IT solution is not
included in this definition.
c) Culture:
Culture is viewed here as a system of patterned meanings or the
collective mental programming of a social group (Hofstede, 1980).
d) Inter-Culture:
The relation among Malays, Chinese and Indians are likely to observe
some common cultural attributes as described by Asma, 1992.
20
e) Common Cultural Attributes:
A common culture agreed on for the three major ethnic groups in
Malaysia that are the Malays, Chinese and Indians. These accepted
values are listed according to Asma, 1992.
f) Entrepreneurial Behaviour:
For this study, entrepreneurial behaviour is defined as performing
behaviour that indicates a dedication to the physical creation of a
business venture (Behave, 1994).
g) Entrepreneurial Intention:
Entrepreneurial intention is defined as the commitment to performing
behaviour that is necessary to physically start the business venture
(Krueger, 1993). The probability, from 0% to 100% that the
entrepreneur will achieve MSC Status Company in the near future is
the measurement for this study.
h) Perceived Desirability:
This study will use Shapero’s definition of perceived desirability as
described by Krueger (1993). It is defined “…as the degree to which
one finds the prospect of starting a business to be attractive; in
essence, it reflects one’s affect toward entrepreneurship” (Krueger,
1993, p.8)
21
i) Propensity for Proactive Behaviour:
A person with a proactive personality is one who is relatively
unconstrained by situational forces and effects environmental change
(Crant, 1996). The proactive personality identifies opportunities and
acts on them; it shows initiative, takes action, and perseveres until it
changes the environment (Crant, 1996). Therefore, propensity for
proactive behaviour is tendency of individuals to act in a way
consistent with a proactive personality.
j) Breadth and Positiveness of Past Entrepreneurial Experience:
Shapero (1982) suggest that the quality and quantity of past
entrepreneurial experience indirectly influences entrepreneurial
intentions. Therefore, breadth of past entrepreneurial experience is
defined as to which a person has been exposed to entrepreneurship in
the past. Positives are defined as whether the past experiences are
perceived as positive, negative, or also known in this study as the
degree of positiveness.
1.9 Chapter Summary
This chapter is designed to provide a broad overview of the study. First, a
statement of the problem and the objectives provided an introduction to the study.
Next, the theoretical framework, hypotheses, scope is presented followed by
22
significance of the study, and definitions of the relevant terms used throughout the
study.
Chapter 2 provides a review of the literature and investigation of the research
model, specific research questions and hypothesis to be addressed.
Chapter 3 presents the methodology that introduces the design of the
research, respondents involved, procedures using questionnaires, the measurement of
instrument regarding entrepreneurial intentions, perceived desirability, propensity for
proactive behaviour and breadth and positiveness of past entrepreneurial experience
and also the chapter summary.
Chapter 4 presents the analysis of results in relation to the hypothesis that are
tested. The first part covers on descriptive analysis that are the respondents’
demographic information, percentage, mean, standard deviation and level analysis.
The second part covers the inferential analysis that comprise of correlation between
variables in H1, H2 and H3. The following will be the analysis of score mean and
one-way analysis of variance (ANOVA) to observe the variables in relation to H4,
H5 and H6.
The final chapter discusses on the hypothesized relationship, implications of
the study, practical implications, limitations of the study, and direction for future
research.
97
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