Exploring entrepreneurial learning during formal business rescue processes: Insights from the South African experience

Abstract

ORIENTATION : Currently, little is known about entrepreneurial learning under turnaround and rescue conditions. A better understanding of the content dimensions as well as the factors that drive or restrain entrepreneurial learning during business rescue (BR) is relevant for theory and industry development. RESEARCH PURPOSE : BR is a fairly new regime in South Africa that extends beyond turnaround practices. It is acknowledged that business failure can fuel cognitive processes and subsequently entrepreneurial learning but to what extent in the context of formal BR proceedings requires exploration. Practice suggests that the role of the business rescue practitioner (BRP) as 'disproportionate influencer' can affect the learning of filing entrepreneurs. MOTIVATION FOR THE STUDY : In the absence of guidelines, this study set out to explore and make sense of the specific content dimensions that entrepreneurs learn during such proceedings to assist role players. RESEARCH DESIGN, APPROACH AND METHOD : The research question for this exploratory investigation obtained first-hand accounts from subjects that have been directly involved in BR proceedings. Semi-structured interviews were conducted. 'Investigator triangulation' was also used to extract as much richness and data as possible applying interpretative phenomenological analysis. FINDINGS : We extracted three key content dimensions which entrepreneurs learned during BR: rescue process, business related and personal learnings. Entrepreneurs with 'positive' experiences of BR learned more than those with negative experiences. The key driving and restraining factors to entrepreneurial learning were both associated with the behaviour of the BRP. PRACTICAL/MANAGERIAL IMPLICATIONS : BR has introduced another dimension to learning from business failure. Understanding the content dimensions learned by entrepreneurs during BR broadens insights of the Regulator, BRPs and educators about the potential long-term effects of BR on the factors that can either drive or restrain learning during BR proceedings. ORIGINALITY AND VALUE : The findings led to an enriched understanding of specific entrepreneurial learning content dimensions that take place under BR proceedings. It also directs future research into entrepreneurial learning when effected by BR.