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Exercising entrepreneurial opportunities: The role of information‐gathering and information‐processing capabilities of the firm
Author(s) -
Sleptsov Alexander,
Anand Jaideep
Publication year - 2008
Publication title -
strategic entrepreneurship journal
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 5.061
H-Index - 46
eISSN - 1932-443X
pISSN - 1932-4391
DOI - 10.1002/sej.60
Subject(s) - counterintuitive , information processing , information overload , information processing theory , business , cognition , knowledge management , marketing , psychology , computer science , cognitive psychology , philosophy , neuroscience , world wide web , epistemology
In this article, we study two capabilities that influence firms' effectiveness in exercising entrepreneurial opportunities: information‐gathering and information‐processing capability. We argue that their effects are not always positive or symmetrical. When the firm's information‐processing capability is low, high levels of its information‐gathering capability may result in lower effectiveness because of managerial cognitive overload. The effects of high information‐processing capability are more nuanced and depend on whether the firm's information processing has experiential or cognitive character. Our analysis offers a counterintuitive insight: the firm may fail to exercise entrepreneurial opportunities effectively not only when it has low levels of information capabilities, but also when its levels are high but unbalanced. Copyright © 2009 Strategic Management Society.