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Improving Start-up Entrepreneur Decision Making Process

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Nationalism can be transformed to many aspects. One of them is in entrepreneurship spirit. Entrepreneurs take a significant role in the development of a country. Entrepreneurs create jobs (Fölster, 2000; Shane, 2009). They drive and shape innovation, speeding up structural changes in the economy (Bosma & Levie, 2010). By introducing new competition, they contribute indirectly to productivity. Entrepreneurship is thus a catalyst for economic growth and national competitiveness (Kelley et al., 2011).

Many start-up ventures fail at an early stage due to poor entrepreneurial decision-making that lacked practical business knowledge, skills, and experiences. Especially when they were hit by crisis. Unlike Chief Executive Officers (CEO) of large and mature organizations, who make important decisions collectively, a Start-up Entrepreneurs (SE) has to make decisions on his own. However, his decision-making could be improved significantly if he is able to consult a virtual network of advisors, mentors, business partners, relevant parties, and information systems that is termed as Human Virtual Intelligence (HVI). The main issue is how can an ad-hoc decision-making SE be transformed into a consultative decision-maker who can make effective business decisions in multiple contexts during crisis?


To find out, an in-depth study on SE decision-making practices was conducted to determine their decision-making lifestyles. The study employed mixed methods including crowdsourcing, psychometric profiling and a lifestyle field study. Using Checkland’s Soft System Methodology and Snowden’s Cynefin Framework, a transformation model was developed. To validate this model, Action Research was conducted on members of the Indonesian Young Entrepreneurs Association. In the validation, a pre-test comprising of questions on business decisions was used to determine the SE decision-making competency. From the test, the worst performers were selected as candidate for transformation. An HVI awareness program was developed and then provided to the candidates for them to quickly learn how to utilize HVI to make consultative business decisions. After finishing the program, a post-test was conducted to determine if the candidate’s business decision-making has improved. From the study, it was found that more than 80% made effective decisions in multiple contexts during crisis, confirming that the consultative decision-making transformation model can improve SE business decision-making practices.


The general situation and the nature of an SE’s lifestyle and decision-making practices can be derived from the crowd perspectives. The issues are depicted to acknowledge, explore, define, and express the complexity of SE’s situational decision-making practices. Pictures are a better medium than linear prose for expressing situations. They can be taken in as a whole and help to encourage holistic rather than reductionist thinking about a situation (Checkland & Scholes, 1990).

The success of MSEs depends to a large extent on strategic decision-making practices (Robinson & Pearce, 2006). However, compared to big and mature organizations, where the decision making process is more defined and well-understood as well as supported by an abundance of policy and regulations, MSEs are not well-understood. The issues that these organizations confront are normally complex, unstructured, and, in most cases, totally new depending on the areas that the venture is exploring. The decisions require creativity and innovation, and they are highly dependent on the leading entrepreneurial decision-making style. Policies and regulations have not been setup and, in most cases, are regarded as not important in the early stages of an organization’s life cycle.


The output of this research was a decision-making model, so further research is needed to create a real computing system to support SE’s decision-making. Creating an intelligent decision support system (DSS) – small office home office (SOHO) community-based computing system for entrepreneurial endeavors would be very challenging. The SSM ensures what needs to be accomodated in user requirements and then follows up with a software development method to construct the computing system.

The computing system should have connectivity to traditional and social media sites. With business productivity tools, the entrepreneur can do work (sending quotes and invoices) in a shorter amount of time. When in need of quick advice, the entrepreneur can directly call or e-mail his or her personal virtual intelligence community. For harder issues, the crowdsourcing method can be used; however, crowdsourcing appeals can only be made after a thorough search has been done by a data mining system to detect whether the problem has not been answered before.

Problems, answers, actions, and experiences should be stored and managed by a knowledge management system. A problem should also be defined more clearly by a problem composition system. The draft problem can then be sent to a smaller community identified by the system for advice and recommendations. The final appeal would then be sent to a social media site that the system identifies based on certain criteria. This will ensure a high response rate from the knowledge agents identified in the crowdsourcing exercise. This could be very useful during crises.


This paper attempts to provide a way to improve the decision-making practices of SE by utilizing HVI in order to achieve a successful business venture. This research includes three steps: determining the current decision-making lifestyles of SE, developing a transformation model, and validating the model empirically. From the lifestyle study, it can be concluded that SE have a tendency toward ad-hoc decision-making. Based on this fact, a consultative decision-making model was developed using the SSM. The model was validated by implementing it into the SE decision-making lifestyle, and the results confirmed that there was a significant improvement in the decision-making practices of the SE when the consultative model was implemented.

The consultative decision-making model is a guide for SE to solve business problems in crises by utilizing HVI. In this very complex business world, the speed of entrepreneurial learning cannot follow the dynamics of the new situations that SE face. The competency gap will widen rapidly unless SE can use virtual intelligence to help improve their situation. SE should not be alone in facing fierce competition and crises or chaotic problems: they must consult their virtual agents to access and exploit the available knowledge and information. Decisions should not be made in a social vacuum. Collective brain power is stronger than individual brain power.


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