What is business failure

1: Definitions of business failure from various perspectives.Source publication +5 Business Failure and Entrepreneurship: Emergence, Evolution and Future ResearchArticleFull-tex

What is business failure

1: Definitions of business failure from various perspectives.Source publication

Table 2 .2: Failure versus exit explored.
Table 2 .1: Definitions of business failure from various perspectives.
Table 3 .2: Organisational decline models.
Table 3 .2: (Continued)

+5

Table 3 .2: (Continued)

Business Failure and Entrepreneurship: Emergence, Evolution and Future ResearchArticleFull-text available

  • Jul 2016
Grace S Walsh

Grace S Walsh

James A Cunningham

James A CunninghamBusiness failure research has been the focus of renewed interest in the entrepreneurship field. It is complex, being both a sign of economic vibrancy and the source of great individual trauma. An understanding of these complexities is important to academics, practitioners and regulators. This monograph provides a review of the literature to date. I...CiteDownload full-text... Beaver introduced another term for predicting financial failure called "predictability", which is essentially the usefulness of the data element in determining failure before it occurs (Wilson, 2012). (Parkinson, 2018), (Walsh and Cunningham, 2016) argue that there is no specific definition of financial failure, as the legislator uses the term "inability to repay the debt" to describe a situation in which a company may be subject to formal insolvency proceedings such as termination of judicial intervention. (Abbas, 2010) refer to the causes of failure and its relative importance as described in table 2.   ...JOURNAL OF CRITICAL REVIEWS THE ROLE OF FINANCIAL FLEXIBILITY IN FACING THE FINANCIAL FAILURE CAUSED BY THE CORONA PANDEMIC: AN ANALYTICAL STUDY OF A SAMPLE OF COMPANIES LISTED ON THE IRAQI STOCK EXCHANGEArticleFull-text available

  • Feb 2022
Mohanad Hameed Yasir

Mohanad Hameed Yasir

Zaid M Alabassi

Zaid M AlabassiThe study aims to measure the impact of financial resilience on the financial failure caused by the Corona pandemic, and 12 of the companies listed on the Iraq Stock Exchange were selected as a sample of the study, and the study was based on a nine-year time series (2010-2018). The problem of the study was that studies and intellectual problems among researchers and intellectuals did not reach the level of cognitive maturity in trying to explain the failure of companies, and a number of statistical methods and methods were used to analyze the study variables and test hypotheses, the coefficient of multiple linear regression and test (f) and the coefficient of interpretation (R2) and through the outputs of statistical programs adopted in this field (EViews-9). After analyzing the data and hypotheses of the study, a number of conclusions were reached, most notably the existence of a morally significant adverse effect of financial resilience in financial failure, and based on the conclusions a set of recommendations, the most important of which is the need to increase the debt capacity and retain cash holdings to face negative shocks (due to low stock prices) and to face crises caused by abnormal circumstances.View... In that sense, we gather the contribution of the attributional theory. This theory defines "attribution" as the "perceived cause" of an event (Walsh and Cunningham, 2016). Based on this, the attributions that individuals make influence their cognitive, behavioural and affective response when they try to explain their behaviours or those of others, as well as certain situations (Dweck and Leggett, 1988).  ...Entrepreneurial bricolage: crowdfunding for female entrepreneurs during COVID-19 pandemicArticleFull-text available

  • Dec 2021
Edgar Alva

Edgar Alva

Vanina Vivas

Vanina Vivas

María Urcia

María UrciaPurpose The crisis generated by the COVID-19 pandemic has had unprecedented effects around the world and particularly on vulnerable populations, such as female entrepreneurs in developing countries. They are facing a new normal, characterized by high uncertainty and resource constraints. This paper aims to use the experiential learning theory applied to entrepreneurship to propose the entrepreneurial bricolage approach to study how female entrepreneurs can overcome this type of crisis. Design/methodology/approach Within the research designs of conceptual papers, the study is situated within the model approach because the authors propose novel relationships between constructs to answer the research questions through the development of theoretical propositions. Findings The analysis suggests that the entrepreneurial bricolage process represents a type of strategy that allows these women to adapt to this new normal. Based on this approach, the authors suggest that crowdfunding represents a financial resource at hand for both pre-existing female entrepreneurs and new female entrepreneurs. Practical implications The theoretical implications suggest an alternative conceptual framework of the entrepreneurial bricolage process to analyse the female entrepreneurial activity in developing countries and during crisis contexts. The managerial implications suggest that crowdfunding is a financial resource at hand for female entrepreneurs that allow them to perform well, innovate or implement growth strategies and have more chances of surviving and growing during the crisis. Finally, the policy implications are oriented to the promotion of this kind of financial alternative and the generation of trust for users, along with the strengthening of a regulatory framework to attract more investors and entrepreneurs. Originality/value This study provides useful information on how the crisis generated by the COVID-19 pandemic has been affecting female entrepreneurs in developing countries. It also expands on the literature on crowdfunding in terms of its advantages as a non-traditional funding source for women.View... Firm success or failure often depends on the effective interpretation of uncertain information, processes and environments (McMullen and Shepherd, 2006). Whilst this is true for all firms, nowhere is this more evident than at entrepreneurial firms (Walsh and Cunningham, 2016). Unlike large, stable organisations, founders at entrepreneurial firms must navigate the complexities of the entrepreneurial process, often under high levels of uncertainty, which stems from scarce resources, age-based vulnerability and volatility, (Sarasvathy, 2001;Shane and Venkataraman, 2000;Stinchcombe, 1965).  ...... Generally speaking, celebrating success is easy; acknowledging and learning from failure is difficult. Understanding how entrepreneurs and firms respond to failure is of particular interest McKelvie, 2016, 2017;Walsh and Cunningham, 2016). Event failure is a crucial consideration for firms of all sizes but is particularly inherent to the entrepreneurial process (Hunter et al., 2021;Jenkins and McKelvie, 2017).  ...... Interpretation and acknowledgement provide the opportunity for entrepreneurs to make sense of failure which in turn, affords the opportunity to learn from failure (Walsh and Cunningham, 2016). Stories of failure have become recognised as important emotional and sense-making devices (Byrne and Shepherd, 2015;Mantere et al., 2013;Wolfe and Shepherd, 2015b).  ...Interpretation of successful and failed events at entrepreneurial firms: Acknowledgement practice under uncertaintyArticleFull-text available

  • Dec 2021
  • INT SMALL BUS J
David Johnson

David Johnson

Adam Jay Bock

Adam Jay Bock

Alex Thompson

Alex ThompsonEvent interpretation and acknowledgement drive behaviour and identity formation in organisations. Extant studies exploring this link have focused on large, stable organisations. We extend these studies to entrepreneurial contexts where individual behaviour and or-ganisational identity are especially fluid. We analyse narratives of success and failure in en-trepreneurial firms to identify and explore acknowledgement practice, which is the ad-hoc action (or inaction) of organisational actors and groups responding to observed events. We explore how uncertainty affects event interpretation and acknowledgement. Within entre-preneurial contexts, we show that event interpretation and acknowledgement biases influence responses to success and failure. The combination of these biases reveals four broad emergent organisational characteristics, which have important implications for organisational identity.View... For instance, considering the business cycles and that lead times for eventual closures do not occur immediately, it is possible that a substantial portion of the economic units delayed their decisions as to whether to stay in business or not, hoping for a rapid industry recovery. Particularly in crises for which a foreseeable time horizon is unknown and to the extent of their available resources and capabilities, businesses will normally make extra efforts to maintain the enterprise afloat (Walsh and Cunningham 2016), in many cases for weeks or months before deciding to close permanently. A definite, outright closure may be further postponed if business managers and/or owners harbor an expectation that operations could resume soon, trying to remain in business for some time longer in hopes of a reactivation.  ...Effects of COVID-19 on Variations of Taxpayers in Tourism-Reliant Regions: The Case of the Mexican CaribbeanArticleFull-text available

  • Dec 2021
Oliver Cruz-Milan

Oliver Cruz-Milan

Sergio Lagunas-Puls

Sergio Lagunas-PulsGiven the tourism industrys risk and vulnerability to pandemics and the need to better understand the impacts on tourism destinations, this research assesses the effect of the COVID-19 outbreak on the variation of taxpayer units in the Mexican Caribbean region, which includes some of the major sun-and-sand beach destinations in Latin America. Using monthly data of registered taxpayer entities at the state and national levels as the analysis variable, probability distributions and definite integrals are employed to determine variations of the year following the lockdown, compared with previous years data. Results indicate that despite the governments measures to restrict businesses operations and a reduction in tourism activities, registered taxpayers at the regional level did not decrease for most of 2020. Further, as business activities and tourism recovered, taxpayer units increased at the end of 2020 and beginning of 2021. Surprisingly, such a pattern was not observed at the national level, which yielded no statistically significant variations. A discussion of factors influencing the resilience of the tourism region in the study (e.g., outbound markets geographic proximity, absence of travel restrictions, closure of competing destinations) and implications for public finances are presented.View... Gordian and Evers [38] argued that the few ways to prevent failure are increasing business aptitude and compliance with the laws and regulations. Similarly, Walsh and Cunningham [39] also asserted that having appropriate managerial tools helps managers to improve their decision-making and planning capabilities which may prevent failure. Nevertheless, the lack of managerial tools can have obvious damages to a company's innovation efforts.  ...The Benefit of Innovation for Small BusinessesArticleFull-text available

  • Nov 2021
Dr. Desire S Luamba

Dr. Desire S Luamba

  • Dr. Marvin L. J. Blye
Dr. Irene A. Williams

Dr. Irene A. Williams

Joel Chagadama

Joel Chagadama

  • Prof. Dr. Edouard M MwemaThe purpose of this qualitative multiple case study was to explore strategic managerial tools small business owners or managers use to sustain growth over time through Schumpeter's innovation theory. Five small business owners located in North America were interviewed through face-to-face open-ended interview questions. The results from data analysis collected through interview responses indicated that small business owners or managers attested that their businesses were developed when using innovation as a strategic managerial tool. By contrast, small business owners or managers agreed that the lack of using innovation and understanding the reality of the current business context had an adverse impact on business growth. The findings of this study may also provide small business leaders or managers with critical information to ensure success and better understand strategies small businesses need for long-term growth.View... Startups can potentially shape our economic future (Walsh and Cunningham, 2016); however, many of them fail to do so and face bankruptcy in their early stages (Cantamessa et al., 2018). Therefore, understanding the dimensions of EO and MCS package elements is useful for policymakers so as to help startup firms manage the context they face, promote better performance, and consequently, achieve successful outcomes.  ...Packages of management control systems, entrepreneurial orientation, and performance in Brazilian startupsArticleFull-text available
  • Oct 2021
  • J Account Organ Change
Anderson Betti Frare

Anderson Betti Frare

Ana Paula Capuano da Cruz

Ana Paula Capuano da Cruz

Carlos Eduardo Facin Lavarda

Carlos Eduardo Facin Lavarda

Chris Akroyd

Chris AkroydPurpose This study aims to understand the relationship between the elements of a startup firms management control system (MCS) package, its entrepreneurial orientation (EO) and firm performance. Design/methodology/approach The authors collected survey data from a sample of 100 Brazilian startups who had exited technology-based parks and incubators. The authors used two data analysis techniques, namely, partial least squares structural equation modeling (PLS-SEM) and fuzzy-set qualitative comparative analysis (fsQCA). Findings The findings show that cultural and planning controls were the only two MCS elements that were included in all high-performing startup firms MCS packages. The authors also found that EO has a positive influence on firm performance through the MCS package. Research limitations/implications The mixed-method approach allowed for a holistic view of the analyzed phenomenon. PLS-SEM analysis was applied to the symmetric relationships between the proposed relationships while fsQCA was used to analyze the asymmetric combinations between EO dimensions and MCS package elements, which promoted high firm performance. Practical implications The authors show how different combinations of MCS elements form a package, mediating EO, which can enable high performance. Originality/value Using fsQCA and PLS-SEM, the authors were able to better understand the important role that MCS package adoption has on a startups performance and provide new evidence regarding the interface between MCS and EO. This extends the understanding of the importance that cultural and planning controls have in an MCS package to support startup performance.View... After failure, potential re-entrepreneurs possess a competitive advantage from knowing how the market and the entrepreneurial ecosystem work (Guerrero and Espinoza-Benavides 2020). Therefore, the entrepreneurial re-entry decision depends on market conditions that are crucial for identifying new opportunities in similar or different sectors (Atsan 2016), on the creation of mentorship programs with exentrepreneurs for reducing the personal barriers of new entrepreneurs Edmondson 2001, 2005;Cope 2011;Walsh 2017), on the regulatory framework that defines the procedures, duties and support programs for new entries o re-entries (Westhead et al. 2003), on the re-evaluation of financial practices for accessing public/private sources of capital (Chakrabarty and Bass 2013;Cuthbertson and Hudson 1996;Walsh and Cunningham 2016), on the tax policies for entrepreneurial new entries or re-entries (Gentry and Hubbard 2000), and on the attraction/retention of talented people that are required for building teams (Hsu et al. 2017b). As a consequence, entrepreneurial ecosystems influence the identification of opportunities and the quality of re-entries (Mair et al. 2007).  ...Do emerging ecosystems and individual capitals matter in entrepreneurial re-entry' quality and speed?ArticleFull-text available

  • Sep 2021
  • Int Enterpren Manag J
Maribel Guerrero

Maribel Guerrero

Jorge Espinoza

Jorge EspinozaThis study analyses the influence of environmental and individual conditions on the quality and the speed of entrepreneurial re-entries in emerging economies after a business failure. We propose a conceptual framework supported by the institutional economic theory to study the influence of environmental conditions; and human and social capital to study the influence of individuals' skills, experiences, and relationships. A retrospective multiple case study analysis was designed to test our conceptual model by capturing longitudinal information on occurred events, trajectory, and determinants of twenty re-entrepreneurs. Our results show that the entrepreneurial experience and type of venture influence the accelerating effect of re-entrepreneurship, as well as how environmental conditions moderate the quality and speed of entrepreneurial re-entries. We provoke a discussion and implications for multiple actors involved in the re-entry of entrepreneurs after a business failure.View... Nevertheless, the dominant views tend to ignore the importance of emotional intelligence (EI) which affects an individual's intention (Tiwari, Bhat & Tikotia, 2018;Tiwari, Bhat & Tikotia, 2017a, Tiwari, Bhat & Tikotia, 2017b. In fact, emotional factors are the major cause for business failure (Walsh & Cunningham, 2016;Shepherd, Patzelt & Wolfe, 2011, Shepherd, Wiklund & Haynie, 2009).  ...TRAIT EMOTIONAL INTELLIGENCE AND SOCIAL ENTREPRENEURIAL INTENTIONS: MULTI MEDIATORS ANALYSISArticleFull-text available

  • Aug 2021
  • WAN MOHD HIRWANI WAN HUSSAIN
SITI DALEELA MOHD WAHID

SITI DALEELA MOHD WAHID

ABU HANIFAH AYOB

ABU HANIFAH AYOB

  • MOHAMMAD NAIM ISMAILView... The process an entrepreneur faces when launching a new venture is characterised by significant complexity and uncertainty. Start-ups fail for numerous reasons such as bad management, no demand for the product/service or financial restrictions (McGrath, 1999;Sarasvathy et al., 2013;Walsh and Cunningham, 2016). With technological advances, manufacturing innovations and increased competition from international competitors, the pressure on new businesses is higher than ever.  ...The application of business models by entrepreneurial start-upsArticleFull-text available
  • Aug 2021
David Fearon

David Fearon

Simon Stephens

Simon StephensIn this paper we explore if and how existing business models and frameworks are used by entrepreneurs during the start-up phase. The purpose of this paper is to explore three issues: understanding of business models; the use of models in practice(s) and how effective the models are in ensuring a successful start-up. The twelve case studies presented in this paper involve micro enterprises based in Ireland. Data collected during depth interviews provide insights into understanding, practices, motivations, behaviour and attitudes during the start-up phase. What emerges from the interviews is that certain support structures and foundations arent apparent in new business creation. We present an appropriate conceptual framework to guide entrepreneurs during the start-up process. It is envisaged that the conceptual framework will serve as the basis for further thought and empiricism. The paper enriches our understanding of the experience of start-ups through the use of narrative structuring. The outcome is a new model for business start-ups (the Focus Stepping Stone). The framework provides start-up entrepreneurs with a simplified guide to the challenges they will face and how best to structure their business.View... The definitions of business exit are dominated by the financial perspective (Shepherd, 2003), but its non-financial perspectives are not neglected (McGrath, 1999). Although originating in the finance literature and later adopted by entrepreneurship scholars, the concept of business failure has neither a "universally accepted definition" nor "an underpinning theory" (Walsh and Cunningham, 2016). However, this study adopts the definition of Ucbasaran et al. (2013, p. 175) that business failure is a "cessation of involvement in a venture because it has not met a minimum threshold for economic viability as stipulated by the entrepreneur".  ...Journey's end: a dynamic framework of entrepreneurial processes and capitals relating to early stage business exitArticle

  • Aug 2021
Richard Hanage

Richard Hanage

Pekka Stenholm

Pekka Stenholm

Jonathan M. Scott

Jonathan M. Scott

Mark A.P. Davies

Mark A.P. DaviesPurpose The purpose of this paper is to respond to the call by McMullen and Dimov (2013) for a clearer understanding of entrepreneurial journeys by investigating the entrepreneurial capitals and micro-processes of seven young early stage entrepreneurs who all exited their businesses within 3 years of start-up. Design/methodology/approach The authors analysed empirical data from concurrent in-depth interviews which generated rich longitudinal case studies. Theory-building then led to a proposed Longitudinal Dynamic Process Framework of entrepreneurial goals, processes and capitals. Findings The framework builds on prior studies by integrating entrepreneurial processes and decisions into two feedback loops based on continuous review and learning. It thereby enhances understanding of the dynamics of new business development and unfolds the early stage ventures entrepreneurs' business exits. Research limitations/implications The findings are based on a small purposive sample. However, the main implication for research and theory is showing how the entrepreneurial capitals are dynamic and influenced by entrepreneurs' environment, and also separating entrepreneurs' personal issues from their business issues. Practical implications The findings challenge some assumptions of policymakers and offer new insights for practitioners and early stage entrepreneurs. These include having more realistic case-studies of the entrepreneurial journey, recognizing the need to be agile and tenacious to cope with challenges, understanding how capitals can interact in complementary ways and that entrepreneurial processes can be used to leverage them at appropriate stages of the start-ups. Originality/value The concurrent longitudinal analysis and theory-building complements extant cross-sectional studies by identifying and analysing the detailed processes of actual business start-ups and exits. The proposed framework thereby adds coherence to earlier studies and helps to explain early stage entrepreneurial development, transformation of capitals and business exit.ViewShow moreJoin ResearchGate to find the people and research you need to help your work.

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