Strategic entrepreneurship in the public sector: fact or farce?

Much debate has centered on the existence, nature and application of entrepreneurship in the public sector (Bellone & Goerl, 1992; Borins, 2000; Terry, 1993). Those authors who argue that entrepreneurship has a place in the public sector, suggest that it may differ from entrepreneurship within private sector firms, explaining that its nature may be that of civic or social entrepreneurship (Bellone & Goerl, 1992), focusing on uplifting society; public entrepreneurship (Shockley, Frank & Stough, 2002), showing elements of democracy; or politic entrepreneurship suggesting a more deliberate approach to entrepreneurship (compare Mintzberg's, 1987 'ploy' strategy). Moon (1999) argues that political leaders are becoming more interested in fostering entrepreneurship in public sector firms in an attempt to improve government performance. Others such as Moe (1994) suggest the approach to improving government performance should be one of entrepreneurial policy rather than practice. A concept that has not been investigated in public sector firms is the combination of entrepreneurship and strategy, or strategic entrepreneurship. Hitt, Ireland, Camp, & Sexton (2001) are among the few who have considered this concept in detail, and refer to strategic entrepreneurship as 'entrepreneurship with a strategic perspective' (Hitt et al., 2001:480). Research in this area is in its early stages, and most researchers to date have either put forth conceptual papers (e.g. Hitt et al., 2001), or have examined the themes that represent strategic entrepreneurship in isolation (e.g. Amit & Zott, 2001). None of these authors have considered the scope of strategic entrepreneurship beyond private sector firms. This is perhaps due to its focus on growth and wealth creation; concepts or objectives not traditionally associated with public sector firms. Much of the research on entrepreneurship in the public sector focuses on academic institutions (e.g. Jones-Evans, Steward, Balazs & Todorov, 1998), or government organisations at the local or regional level (Teske & Schneider, 1994). One form of public sector firm that has received little attention, however, is state-owned enterprises (SOEs). While these public sector firms have traditionally provided core services on a national scale with an underlying profit motive, market forces and industry deregulation have increasingly exposed SOEs to competitive and commercial operations in both national and international markets. Hence the importance of entrepreneurial and strategic activity as a means of survival, sustainability, and growth emerges. This paper therefore investigates three SOEs for the existence of strategic entrepreneurship.