Entrepreneurship recognition is a very important aspect of the business. Therefore, to be a successful entrepreneur, one has to have the most vital entrepreneurial abilities which involve identifying and selecting the appropriate business opportunity. Entrepreneurship recognition is the most vital and viable abilities for achieving entrepreneurship objectives. Therefore, recognition of opportunities is an essential research necessity by an entrepreneur. The essence of identifying opportunities is such that the stakeholders pertaining to a new venture to acquire value. Literally, it is noteworthy that entrepreneurship is not just found, but rather made, though its elements are recognizable (Ramoglou & Tsang, 2016). The entrepreneurship investigation, the entrepreneur’s sensitiveness to the market needs as well as the capacity of an entrepreneur to recognize resources deployment in a continuous way are aspects leading to the development of opportunity and might or might not lead to the formation of a new venture. Essentially, there are various critical issues affecting the capacity of entrepreneurs in identifying and exploiting the opportunity for entrepreneurship (George, Parida, Lahti, & Wincent, 2016). Although an opportunity needs to be recognized so as to initiate the entrepreneurship process, it is mandatory for an entrepreneur to take advantage of the opportunity identified so as to establish a new venture. So, entrepreneurial opportunity recognizing and exploiting are two different concepts in the entrepreneurship process preceded by steps of developing a new venture. This paper will undertake a state-of-art-review on relevant literature about aspects that influence discovering and creating entrepreneurship opportunities.
To increase the understanding of entrepreneurial opportunities recognition, I carried out a systematic bibliographic analysis of peer-reviewed journals in the English language. These publications present scientific knowledge that is valid and highly influence the research field. SciVers SCOPUS database was utilized in identifying the key contributions associated with entrepreneurial opportunities. Essentially, the SCOPUS database is among the best database with the most inclusive published research including EBSCO articles, ABI/Inform as well as other search engines. With regards to the state-of-art review of literature on entrepreneurial opportunities, many keywords were determined that are nearly attributed to the study of entrepreneurial opportunities. Search terms were used on the keywords and the title. The application of these search terms led to the identification of relevant articles to be reviewed. During the search process, the subsequent keywords were utilized; opportunity discovery, opportunity recognition, opportunity AND entrepreneurship, entrepreneurial opportunity as well as opportunity identification. These were the main keywords that were left to be broad intentionally so as to cover several articles in the initial search to give several articles, even though several articles were somehow irrelevant to the current study. The first search provided 3,879 journal articles, whereby 213 were peer-reviewed articles. The following search was limited to specific fields include social science, business, management, economics as well as accounting whereby the primary topic attributed to entrepreneurial opportunity identification. This led to the identification of 2,837 articles whereby 17 were written in the French language, 15 in Spanish, 12 in German as well as 16 in other foreign languages. Articles written in foreign languages were omitted. Therefore, the search focused on searching for English language peer-reviewed articles amounting to 2,185 articles. After the review of titles, skimming through their abstracts and the entire articles, the scope was scaled down to analyze 180 peer-reviewed articles. The main conditions to include any article relied on whether the article discussed entrepreneurship opportunities or related concepts such as opportunity identification and provided insights on critical aspects than can be influential to entrepreneurial opportunity. The shortlisted article was empirical and conceptual articles with their publications between 2014 and 2019. The initial analysis showed that many terms have been utilized interchangeably in the discussion of entrepreneurship discovery, exploration, identification, recognition, formation, and enactment. In the course of the state-of-art review of literature, much significance was placed on making sure that the choices resulted in high levels of validity and reliability. To be specific, two steps were undertaken in this regard. Review of the literature considered articles reviewed by researchers both within and outside the field. The review process was focused on promoting a higher level of interrater reliability.
Opportunity recognition from entrepreneurship can be identified from prominent aspects like entrepreneurial alertness, environmental conditions, social capital, prior knowledge, systematic search and cognition.
A proposal that prior knowledge is an influencing aspect of opportunity finding has technologically advanced in the past few years. Gielnik, Krämer, Kappel, & Frese (2014)) noted that various individuals are capable to find opportunities since they have prior information as well as cognitive ability for valuing it. Furthermore, Shane & Nicolaou (2015) highlighted that a person’s lack of skills and understanding affects processes of identifying the opportunities. This confirms the importance of learning entrepreneurial by young people from the recognition of opportunity process. Prior knowledge is categorized into three measurements. They are the customer problems, the market prior knowledge and ways of serving the market. These dimensions assist individuals to discover and identify opportunities to satisfy or solve unmet conditions or requirements from the market. Recently, there has been a debate on the particular role played by prior knowledge during the process of opportunity recognition. Gumel (2018) proposed that prior knowledge should be joint with other data from numerous sources like social connections and education that helps individuals in recognizing, creating and finding opportunities. A person can get knowledge either through experience accumulated or through education and by putting into use the acquired knowledge in proper situations, an individual can exploit and recognize opportunities. In essence, prior knowledge is an important cognitive source that offers entrepreneurs insight for synthesizing information that assists in identifying opportunities (Ramoglou & Tsang, 2016). Learning studies are used to explain how well planned teaching curriculum facilitates recognition of opportunity and the way people differ through learning.
Alertness is the ability to have keen insights on the identification of entrepreneurial opportunities. Davidsson (2015) stressed the significance of using the theory of entrepreneurial alertness that assist understanding to be improved in opportunity processes. Scholars have approved that if an individual’s alertness level is high, identification of opportunities can be done without searching them or by observation of the phenomenon. People vary from their sensitive to developing value and creating new ventures from those ventures. Individual differences placed on the basis of issues such as networks, absorptive capacity, experiences, and prior knowledge. According to the scholars, when capitalizing on an opportunity, its effect or impact is known only by an aspiring entrepreneur. Nikraftar & Hosseini (2016) while trying to authorize construction empirically, got slight support for alertness and resolved measures for alertness in entrepreneurial alertness require to be created further. Choongo, Van Burg, Paas, & Masurel (2016) emphasized the understanding of alertness in a perception economic theory in which focus drops on arbitrage opportunities, also insisted in understanding the cognitive mechanism principal alertness. Alert people have adaptive and complex mental frameworks about their social environment, their industries, and change. These merits help to check a condition from a new perspective or in alternative ways more than individuals who are minor in alertness. Another perspective on alertness and explained its meaning from the creation view of an opportunity. It was identified that quality depends on a subjectivist perception whereby alertness is perceived as a social propensity comprising endogenous knowledge age bracket by means of a process of problematizing in a theory on staff perform (Choongo et al., 2016). This assessment suggests that opportunities are capable of being available in market as well as entrepreneur alertness at that minute has previously reached the understanding to abuse those opportunities.
A systematic search assists individuals to discover opportunities. Andersson & Evers (2015) suggested that discovery is suitable among individual’s previous knowledge about an identified domain as well as the venture formation idea. Practical guidance is lacking potential entrepreneurs concerning opportunity creation and discovery. Many intellectuals have claimed that individuals are not looking for opportunities instead they only recognize information value that is being received. It is concluded that the overall self-contradicting perspective is available concerning a perception of warning without searching and an efficient search for opportunities. There is an agreement from both views that rejecting opportunities is associated with the cognitive capacity of an individual. From the theory viewpoint, a study on systematic search is stuck in the Austrian economics opinion on market imbalances and conception of information irregularity. Discoveries mostly take place when there is access to private information by the entrepreneurs and their search behaviors assist him to come up with specific information that requires to fit prior knowledge (Angelsberger, Kraus, Mas-Tur, & Roig-Tierno, 2017).He came up with a model that controls potential entrepreneurs on how to look for opportunities. Issues highlighted from the model are ways to select facts channel, cost- proficiently shot for information and quick response. Opportunity cost is relevant because entrepreneurs require to consider the possible benefits of discovering an opportunity against incurred cost by the search. Zahra, Newey, & Li (2014) argued that organized exploration is not at all times the opposed to alertness. He created a multi-dimensional background to put forward that opportunities may be exposed to conditions that are low or high in both dimensions.
Environmental issues largely comprise society’s economic growth, cultural values, geographic location, social and political contexts. These factors may affect or influence an entrepreneur’s process of identification of opportunities. Economists agree that changes in demographic conditions, political climate, technology, and social moves assist in the discovery of opportunity process or creation. Rate of unemployment and income inequality are considered when assessing national economic surroundings. The influence of environmentally friendly conditions from the opportunity recognition process can adjust. Wasdani & Mathew (2014) highlighted that alteration in the economy creates opportunity recognition Feasible and stability of the economy is essential for creating an encouraging atmosphere for entrepreneurial action. Before the study has shown that to maintain the economic growth of a nation, the addition of innovative activity is crucial. Nevertheless, entrepreneurial opportunity existence depends on information concerning available resources in society. Mainela, Puhakka, & Servais (2014) suggested that information is inadequate regarding in what manner to utilize these resources resourcefully for discovering opportunity and process of exploitation. Individuals try to generate or discover opportunities in any governance situation. Regulations and rules in which an individual must work have an emotional impact on the value assigned by society to these opportunities. Having distinctive principles knowledge is pondered up a competitive benefit for an individual to create or discover. From certain conditions, Culture knowledge is used by individuals discovering or creating opportunities, therefore, environmental situations are vital to know the way individuals perform on entrepreneurship opportunities.
Entrepreneurs require resources and information for the recognition of opportunity processes that can be attained by utilizing social capital. Entrepreneurs associating with people from various locations and fields may use outline recognition and outlying vision to identify the opportunities from an expected situation. Social capital offers accessibility to few resources which in turn may assist in the exploitation of opportunities by interpreters. Although vital dichotomies are available from the literature about the type of network and impacts on recognition of opportunity. Karimi, Biemans, Lans, Chizari, & Mulder (2016) is grounded in the literature on the power of weak connections that dispute that entrepreneurs collect more information while interacting with weak ties than while interacting with strong connections. Greater strong ties that an individual has permits him or her to identify and obtain more opportunities and resources. Social capital plays an intervening part between opportunity recognition and human capital. Social capital is well thought-out as a precarious influential issue for recognition of opportunity research.
Studies on exploitations and opportunities focus on specific individual features that allow the creation of new firms. Zahra & Wright (2016) recognized that self-efficacy influences entrepreneurs to set greater objectives and accomplish them. Individuals who are not displaying less fear of letdown and are not shocked by achievement tend to gaze a new undertaking as an opportunity. Scholars have made known that more levels of creativity and intelligence are vital for ascertaining a niche opportunity (Zahra & Wright, 2016).It is has been established that optimism leads individuals to identify opportunities and imaginations, curiosity and open-mindedness are vital qualities. Incidence of an entrepreneurial doings or process hangs on identifying an opportunity. Incase expectations regarding the effects of psychological features on entrepreneurs have been declared insufficient or invalid, it’s still essential to emphasize the individual because no innovation is capable at all.
Conclusion and limitation
To sum up, it is evident that the discussion about entrepreneurship recognition has advanced significantly among researchers. This has led to the main publications regarding this topic to concentrate on entrepreneurship and management journals, such that it is probable to identify several published articles. Moreover, insights regarding entrepreneurial opportunity identification research have expanded over various areas of research. Due to this, this paper proposes that the current study offers a research synthesis and increases the understanding of an individual strategy to opportunity recognition. Furthermore, the paper highlight a holistic framework whereby it pinpoints the relationship of prominent aspects that have been identified to be influential to the opportunity identification process as well as highlighting some critical components within the discussion in this area of research. By placing more focus on these significant aspects, researchers attempt to answer the most recurrent question: “why is it that some individuals are capable of recognizing or discovering opportunities whereas others cannot?” We get to understand that significant aspects pave way for an individual in identifying opportunities in the course of the initial phase. Studies have made a significant contribution in establishing a better discussion on opportunity recognition in form of theory development utilizing various methodologies, as well as increasing the search topic regarding opportunity by emphasizing individual aspects. It is certain that empirical research is substantially focused on opportunity recognition and this paper’s analysis is inspiring to give directions for future research.
The current paper has indicated various important areas of research as well as highlighted vital aspects that researchers ought to take into consideration when undertaking opportunity research. Just like any other study, this paper suggests that results obtained from the current study ought to be interpreted with regard to some limitations. To begin with, the focus has been placed on six substantial aspects on the basis of the analysis of the literature. They were identified to be significantly discussed and tend to significantly impact the opportunity recognition process. Therefore, it is acknowledged that the proposed aspects are not representing a fixed listing. For instance, some aspects might have been undermined since they are unpublished in management research. Moreover, factors affecting limited attention were excluded which resulted in a few types of research indicating their influential role. Additionally, the opportunity recognition process mostly the results associated with analyzing and exploiting are not extensively incorporated in the current study. This is a limitation that calls for future research. To sum up, the aim of this paper is opening up and increasing our apprehension of opportunity recognition as well as making significant contribution to entrepreneurship.