Keywords

11.1 Introduction

In small and medium enterprises (SMEs) research stream, indigenous entrepreneurship is comparatively a less researched area. A major source of indigenous entrepreneurs’ social capital is their relationship and interaction with the non-indigenous entrepreneurs. However, the challenges of non-indigenous entrepreneurs to profoundly share their social capital with indigenous stakeholders/entrepreneurs is under-researched too. In this context, this chapter aims to develop insights on how the relationships and interactions between indigenous and non-indigenous entrepreneurs could be underpinned, in order to enable non-indigenous entrepreneurs to take advantage of their social capital. Following this background, this chapter reviews and presents literature at the intersection of indigenous entrepreneurship, socio-economic capacity building and stakeholder relationship management research streams to explore insights on the how stakeholder relationship management concept could strategically influence the indigenous entrepreneurs’ cause and consequence of relationships and interactions with their non-indigenous stakeholders in order to enhance the indigenous entrepreneurs’ business capacity. The analysis and synthesis of this chapter first present some early insights on the challenges and barriers of the Australian indigenous entrepreneurs. Second, the chapter discusses a research direction. Undertaking research based on this proposed research direction would be instrumental to address the challenges and barriers of the indigenous entrepreneurs, while developing insights on the under-researched indigenous entrepreneurship area under the broader SME and entrepreneurship research field.

11.2 Research Context and Research Aim

In Australia, the unemployment rate of indigenous people increased more than that of the non-indigenous people between 2008 and 2013, which leads to an increase in the unemployment gap (Australian Government 2015). In order to support self-employment, various government agencies in Australia provide services to small and medium enterprises (SMEs) of indigenous people (Shoebridge et al. 2012), which include grants and lower cost loans (Morley 2014). In social and cultural complexities in their business environment and entrepreneurial initiatives, indigenous entrepreneurs encounter several challenges, which include business relationship constraints and lack of business networks (Australian Taxation Office 2009; Shoebridge et al. 2012; Morley 2014). Business partnerships and networks are critical success factors to gain access to business advice, to gain suppliers in competitive price and to increase customers (Kuratko and Hodgetts 2001; Dollinger 2003; Shams et al. 2018, 2019a, b; Vrontis et al. 2018, 2019). However, indigenous people lack the partnership and networking opportunities in order to underpin their SME initiatives (Australian Taxation Office 2009; Morley 2014).

The Australian government has, however, implemented several initiatives to support an enterprising culture among their indigenous communities; in many cases, such initiatives failed to “provide sufficient ongoing support to indigenous entrepreneurs” (Morley 2014, p. 2), in order to identify, establish, maintain and enhance entrepreneurial opportunities for indigenous people. “There is no research evidence about either models of (stakeholder) engagement (to enhance networking) for national or other levels of policy development or the role of indigenous peak bodies in (stakeholder networking and) engagement strategies” (Hunt 2013, p. 4) for indigenous communities and their businesses. Although, the Australian Federal Government has a policy to increasingly support indigenous entrepreneurs, in order to reduce their socio-economic disadvantages; there is very little research on evaluations of indigenous entrepreneurs’ ventures, in terms of their entrepreneurial challenges and viabilities (Pearson and Helms 2013; Bruton et al. 2018). Therefore, a literature review research on the following issues has been undertaken to uphold the Australian Government’s (2015) commitment to indigenous communities and their businesses, in order to enable the Aboriginal and Torres Strait Islander communities (who are generally known as the indigenous people of Australia), with an aim to affluently engage this disadvantaged community in the wider economic activities:

  • To explore the barriers that the Australian indigenous entrepreneurs confront to develop and maintain stakeholder networking, relationships and engagements

  • And to explore a stakeholder-focussed research direction based on the Australian indigenous entrepreneurs’ business environment to advance research in this under-researched area

11.3 Literature Review

11.3.1 Research on the Australian Indigenous Entrepreneurship

Entrepreneurship, SMEs and enterprising initiatives are established research fields. However, we need ongoing research in different areas of broader entrepreneurship research, in order to advance our understanding, as well as to ensure the unprecedented progress of this field (Shams and Kaufmann 2016; Penco et al. 2019). It is generally acknowledged that the indigenous communities in any country struggle more than the mainstream communities for substantial social and economic disadvantages. “The challenge for indigenous communities and policy makers is to discover or create opportunities that will provide sustainable development” (Fuller et al. 2005, p. 891). Australian indigenous entrepreneurs fall upon two fundamental challenges for their business initiatives. One is from within their own communities, and another one emerges, once they attempt to interrelate with the Australian mainstream businesses. For example, “aboriginal community and cultural norms, is…(a) barrier to indigenous entrepreneurial success” (Pearson and Helms 2013, p. 51). To initiate a start-up enterprise, many indigenous people feel culturally and mentally separated, as they need to participate in an activity (i.e. enterprising endeavours), in which they have very few or no role models (Foley and O’Connor 2013).

In general, business opportunities did not exist within the indigenous social or financial sector that demonstrates limited bonding networks for entrepreneurship (within their communities). Interviews illustrated that it was a difficult social decision for the indigenous entrepreneur to immerse themselves within the dominant society. (Foley and O’Connor 2013, p. 283)

As a consequence, for indigenous entrepreneurs, networking and stakeholder engagement opportunities for business purposes are non-existent or less existent within their own communities. In this context, the necessity for launching and surviving with their enterprising initiatives propel indigenous entrepreneurs to network beyond their own community, and within the majority business culture of the mainstream Australian enterprises for sharing business expertise and information, which is fundamental to promote their SME ideas, products or services to a market that is dominated by that mainstream communities’ cultural norms and values. Therefore, the capability to access the social capital across the cultural barriers is a precondition for indigenous entrepreneurs’ success.

Social capital is an association “between people consisting of networks and associated norms that have an effect on the productivity of those involved, limited to positive associations in the development of participants” (Grootaert 1998; Putman 1993; as cited in Foley 2010, p. 67). For business enterprises, social capital complements many resources (Greve 1995; Greve and Salaff 2003; Greve et al. 2006), which helps entrepreneurs to have competitive alternatives for their businesses, e.g. collecting information about suppliers who offer highly competitive prices. Since indigenous entrepreneurs have no or less business networking opportunities within their communities (Foley and O’Connor 2013) to collect information about their market that is dominated by mainstream culture’s norms and values, the indigenous entrepreneurs only have the option to source their social capital from mainstream Australian business communities and enterprises. The Australian indigenous entrepreneurs face various challenges when they attempt to access their social capital from outside of their own communities. For example,

The ability to network across cultural and/or racial barriers…(is) essential…Accessing the dominant settler social capital and building bridging networks was an imperative for the Australian Aboriginal entrepreneur that came at a cost…the more experienced (indigenous) entrepreneurs confirmed that this (networking and social capital) arose only after years of experience and exposure to the mainstream business world…(also, the) history meant that many (indigenous entrepreneurs)…received negative backlash from their indigenous peers, which was compounded by many entrepreneurs exhibiting low cultural connections. (Foley and O’Connor 2013, p. 283)

Foley and O’Connor’s (2013) findings demonstrates that the key barriers of indigenous entrepreneurs from within and beyond their communities are cultural relations with networking, existence of second-generation entrepreneurs, family influence, relationships between social and business spheres, and bridging and bonding networks. “The literature discloses the installation of a substantial number of these programmes (the initiatives to promote the Australian indigenous enterprising activities) has not led to a significant increase in Australian indigenous entrepreneurship” (Pearson and Helms 2013, p. 45). In order to emphasise the urgency to understand the relevant issues to enable the indigenous entrepreneurs and their SMEs to prolifically interact with the mainstream business world of Australia, researchers (Ruhanen et al. 2015) use “time out for reality check” (p. 81) as a term to denote to develop greater insights on the indigenous entrepreneurs and their businesses. However, networking outside the indigenous communities is the key to survive for indigenous entrepreneurs; there are many issues yet to understood, in order to bridge such networking gaps of the indigenous entrepreneurs with their stakeholders in the Australian mainstream business world (Foley and O’Connor 2013). For example,

  • “the drivers or causes for social capital formation from an entrepreneurship perspective” (Foley and O’Connor 2013, p. 292) is unexplored.

  • The business contexts, e.g. the remoteness that propels to develop or hinder access to social capital, need to be examined (Foley and O’Connor 2013).

  • The influence of relationships among stakeholders across cultural settings needs to be understood to bridging and bonding networking practices (Foley and O’Connor 2013).

  • It is crucial to recognise the factors that either promote or hinder indigenous entrepreneurial initiatives (Shoebridge et al. 2012).

Portraying a conclusion from the discussion thus far, it could be argued that the indigenous entrepreneurs’ relationships and interactions with the mainstream business stakeholders in Australia, and the underlying business environments need to be investigated to streamline stakeholder engagements of indigenous entrepreneurs. Such an investigation would be instrumental to recognise the drivers, causes or factors that reinforce or hinder the indigenous entrepreneurs’ efforts, in order to develop capacity that would be useful to exploit the social capital from outside of their own communities, and to ensure their SMEs’ competitive advantage.

11.3.2 Entrepreneurship Research and Stakeholder Engagement

The previous section, however, concludes by acknowledging that the indigenous entrepreneurs need to engage with the stakeholders of the majority culture-dominated businesses; a succinct literature review demonstrates that the conventional entrepreneurship theories lack understanding of stakeholder relationship management and engagements. Most previous influential research on entrepreneurship (i.e. Cantillon 1755; Knight 1921; Kirzner 1973; Shapero 1975; Kets de Vries 1977) and several other present-day research in this established yet growing research field are principally centred on the innovative endeavours of individual entrepreneurs (Dana et al. 2008), whereas the present-day network economy (Asanuma 2013; Kollmann and Christofor 2014; Kaufmann and Shams 2015; Shams and Lombardi 2016; Trequattrini et al. 2016; Shams et al. 2018) emphasises on entrepreneurial alliance with an entrepreneur’s key stakeholders (Burns et al. 2014) with an aim to co-create value through entrepreneurial ingenuities. In this context, the “theories of entrepreneurship [that] most typically focus on characteristics specific to the individual (entrepreneur)” (Acs et al. 2013, p. 759) normally oversee the possibilities of entrepreneurs’ stakeholder relationship and networks to recognise entrepreneurial opportunities. Although the procedure of stakeholder engagement benefits entrepreneurs to identify entrepreneurial opportunities, work on the contexts that help entrepreneurs to influence their stakeholder relationships and networks is partial, and also fewer research on how entrepreneurs could influence the relations between stakeholder engagement and value co-creating opportunity identification (Burns et al. 2014). Value creation can be heightened by inter-organisational alliances, where stakeholders cooperate for enhanced strategic effectiveness in order to meet and exceed their reciprocally valuable diverse goals through co-created value (Gummesson 2002; Gummesson and Mele 2010; Grönroos 1996, 1997, 2004, 2012; Jaakola and Hakanen 2013; Hsiao et al. 2015; Shams 2016a, b). Therefore, the implication of stakeholder relationship and interaction in a network and flourishing opportunities from such stakeholder networks become vital for entrepreneurship research and practice to enable entrepreneurs to co-create value, in order to survive and prosper.

11.3.3 Enterprising Culture and Entrepreneurial Capacity Building

An enterprising culture is the predecessor of entrepreneurial achievement and a crucial element for overall economic performance (Hundley and Hansen 2012). Therefore, the meaning of an enterprising culture is an important issue to understand its significance for entrepreneurial innovation and an entrepreneur’s value-network. How can an enterprising culture cherish indigenous entrepreneurs’ aptitudes that could ensure productive and cooperative economic performance? How can an enterprising culture support an indigenous entrepreneur to integrate their dynamic capabilities and resources of the associated stakeholders in a value-network in a way that could create/co-create value through product and/or service innovation? Answering such and relevant other research questions would be instrumental in enabling Australian indigenous entrepreneurs to establish, maintain and enhance stakeholder network beyond their community. The features of an enterprising culture, such as self-reliance, innovation and profit-seeking propensity of an enterprise (Hundley and Hansen 2012) further stimulate the associated dynamic capabilities of an entrepreneur to establish and enhance enterprising culture and innovation for their value network, since research on European SMEs found that “innovation and corporate (or enterprise) culture indices were correlated” (Kaufmann et al., 2012; as cited in Shams and Kaufmann, 2016, p. 1257). In general, innovation is recognised as:

a firm’s tendency to engage in and support new ideas, novelty, experimentation and creative processes that may result in new products, services or technological processes. Innovativeness represents a basic willingness to depart from existing practices and venture beyond the current state of the art (in order to sustain the competitive advantage underlying the innovation). (Lumpkin and Dess 1996, p. 142, as cited in Vrontis et al. 2012, pp. 422–423)

As a consequence, it is crucial for indigenous entrepreneurs to understand how an effective and efficient enterprising culture nurtures their entrepreneurial mindset that encourages their allied stakeholders to commonly engage in and support new ideas, novelty, experimentation, creative proposition and other key elements of the overall innovation process through exploiting their social capital that helps to co-create value and ultimately facilitates business success and ensures successful economic outcome. In order to reinforce an enterprising culture, capacity building around the features of the enterprising culture, i.e. innovation, self-reliance and profit-seeking opportunities, would be crucial. “Capacity building is an iterative process that incorporates the building of frameworks, work cultures, policies, processes and systems enabling an organisation or individual to improve performance to achieve successful outcomes” (O’Rafferty et al. 2014, p. 170).

Capacity-building can be undertaken and achieved through a range of mechanisms, encompassing professional learning, within…specialist analysis of instructional quality and associated learning conditions, alignment of key (issues) within and between (the competitive) factors, and cross…clustering and networking. (Dinham and Crowther 2011, p. 621)

In the outcomes of new capacity building initiative, an added value to surplus the contribution of the preceding capacity is essential, so that the newly enhanced capacity can contribute better with greater advantage, compared to the foregoing capacity (Shams 2016b). Capacity-building is to improve the capability of a process in order to increase effects, so that the enhanced capacity would exemplify a ‘value added’ aspect (Hawe et al. 1997) is significant to mutually innovating value, and sharing that newly enhanced value among the stakeholders in a venture (Gordon 1998). In general,

value is an anticipated outcome of any sort of planned and organized activity. The activity could be derived from monetary, psychic, or physical resources. The more the outcome meets initial anticipation, the more the possibility of win-win outcomes or value optimization for all involved stakeholders. (Shams 2013, p. 244)

Therefore, capacity building should be valuable through a development/redevelopment of learning (understanding of the competitive market forces to recognise exceptional conditions) and development processes, aligned to the associated factors, where the processes are propelled by intra and inter-organisational collaboration and learning experience, in order to reflect the enhanced capacity through a realisation of value optimisation for entrepreneurs and their associated stakeholders (Shams 2016b). These stakeholders would include, but not limited to, customers, business partners, suppliers, employees, shareholders, complementors and so forth.

11.4 Research Direction

Research shows that there is a continuous assertion by the Australian Government about the demand of indigenous culture and products, e.g. as a tourism service there is no appropriate conversion of that demand into marketisation (Ruhanen et al. 2015). Networking and developing social capital through the cause and consequence of relationships and interactions (Shams 2016a) of indigenous entrepreneurs with mainstream SME stakeholders would be significant the for entrepreneurial success of indigenous entrepreneurs through a wide access to the mainstream market. In this context, the target sample participant groups for prospective future research studies to explore the phenomena on how indigenous entrepreneurs could establish, maintain and enhance their stakeholder network beyond their community would be among the indigenous and non-indigenous entrepreneurs, who interact among themselves at least to some extent, in comparison to other indigenous stakeholders who usually do not interact or interact less with non-indigenous stakeholders (Foley and O’Connor 2013).

Indigenous and non-indigenous entrepreneurs within particular rural or urban areas of an Australian state or territory, among these two groups of entrepreneurs, who mostly interact with each other would be the target sample participant group for a prospective research study to explore the novel phenomena from the experience of these two groups of stakeholders, in order to understand how indigenous entrepreneurs could prolifically leverage their stakeholder network and relationship. The indigenous and non-indigenous entrepreneurs, who have been operating an SME for at least 12 months would be considered for such research studies, considering that “survival for more than one year could be considered a success because survival is dependent on financial viability” (Foley 2006, p. 6).

Prior to collecting primary data from this sample group, relevant secondary data could be collected based on an industry review. Such secondary data collection and analyses would ascertain the current government and non-government supports that are available to the indigenous entrepreneurs. A relevant survey questionnaire for primary data collection from the aforementioned sample group would explore the contemporary barriers of the indigenous entrepreneurs more profoundly to prolifically exploit the available government and non-government supports to indigenous entrepreneurs.

The “openness to ideas from all sources” is a sub-factor, under “creativity” as an explorative factor of capacity building (O’Rafferty et al. 2014). In relation to such established capacity-building factors, and other emergent capacity-building factors for the indigenous entrepreneurs that could be recognised from the previously mentioned secondary data collection and analyses strategy, the survey questionnaire would be able to develop further insights to enable indigenous entrepreneurs to proactively and prolifically establish, maintain and enhance their stakeholder relationship and interaction beyond their community and with mainstream Australian SMEs that are administered by non-indigenous Australians. For example, an indigenous entrepreneur could mention that the business ideas they receive from their non-indigenous entrepreneurs is instrumental to expand their business capacity, e.g. sourcing more competitive labour from newly immigrant workers (Meldrum-Hanna et al. 2015; Tranfaglia 2015).

Similarly, an indigenous pharmacist, as an entrepreneur of her/his pharmacy business, could denote that their collaboration with a non-indigenous doctor, and both of their referrals, increases their customers from the mainstream Australian market, as well as patients for the doctors. In order to develop closed and open-ended survey questionnaires, first a generalised questionnaire would be developed, and then based on the understanding on the types of businesses, the questionnaire could be customised, related to the individual businesses of the indigenous and non-indigenous entrepreneurs. The cases of immigrant labour force and the indigenous pharmacist are used here just as examples. Such research studies could attempt to develop insights based on examples that would be similar to such issues and relevant hypotheses and research questions, through the proposed surveys, in order to examine the hypotheses and answer the research questions. The managerial decision-makers of government and non-government offices, related to indigenous businesses, and the academic and non-academic policy level stakeholders of this field could be asked to share their views and recommendations in relation to the challenges, issues and insights developed through such studies related to the discussed primary data, in order to reinforce the marketisation processes of the SMEs of indigenous entrepreneurs.

11.5 Conclusion

The aim of this chapter was to

  • To explore the barriers that the Australian indigenous entrepreneurs confront to develop and maintain stakeholder networking, relationships and engagements;

  • To explore a stakeholder-focussed research direction based on the Australian indigenous entrepreneurs’ business environment to advance research in this under-researched area.

The concise literature review in this chapter on Australian indigenous entrepreneurs develops a preliminary insight on the barriers that the Australian indigenous entrepreneurs confront to develop, maintain and enhance their stakeholder network, relationship and engagement. Also, the chapter provides a view from the extant literature related to the social and cultural barriers of the Australian indigenous entrepreneurs from both within and beyond their communities.

Following the arguments from extant literature, this chapter also proposes a stakeholder-focussed research direction based on the Australian indigenous entrepreneurs’ business environment to advance research in this under-researched area. For this, the chapter promotes the idea of Foley and O’Connor (2013) to collect primary data from a research sample (participants) comprising indigenous entrepreneurs and non-indigenous entrepreneurs who interact with each other, in comparison to other indigenous and non-indigenous entrepreneurs who interact less. Based on this particular sample group, the prospective future studies would be useful to first understanding further from the indigenous and non-indigenous entrepreneurs’ experience of the type of challenges and barriers the non-indigenous entrepreneurs encounter in the Australian business communities in order to expand their stakeholder relationships and interactions. Second, such proposed future studies would also be instrumental to know the indigenous and non-indigenous entrepreneurs’ recommendations on how the indigenous entrepreneurs could profoundly address the challenges and barriers associated with stakeholder networks. Some anticipated impacts are listed below that could be derived from the research studies relevant to the research direction summarised in this chapter:

  • Recognising a deeper insight into the contemporary challenges and barriers of indigenous entrepreneurs in obtaining government and non-government support

  • Exploring the capacity-building factors that could simplify the process for the indigenous entrepreneurs to prolifically exploit government and non-government support

  • Further recognising the challenges of the indigenous entrepreneurs to prolifically exploit the social capital from non-indigenous stakeholders

  • Recognising the challenges of non-indigenous entrepreneurs to prolifically share the social capital with indigenous stakeholders/entrepreneurs

  • Exploring the capacity-building factors that streamline the process for indigenous entrepreneurs to prolifically exploit the social capital, in order to co-create value and nurture competitive advantage through their cause and consequence of stakeholder relationships and interactions

  • Reinforcing marketisation of indigenous entrepreneurs’ SMEs

  • Contributing to the entrepreneurship research gap of stakeholder engagements

  • Contributing to capacity-building research to sustain or prolong the hard-fought gains in capacity building through enhanced competitive advantages