Examining the Role of Entrepreneurial Experience and Entrepreneurial Self-Efficacy on SMTE Performance

Abstract

This research examines how entrepreneurial experience and entrepreneurial self-efficacy (ESE) of tourism entrepreneurs affect the performance of small and medium tourism enterprises (SMTEs). The conceptual structural model reflecting these interrelationships is examined in terms of data collected from 298 SMTE entrepreneurs in regional South Australia. Contrary to the findings of studies conducted in nontourism contexts, entrepreneurial experience was not related to ESE nor to enterprise performance. How long one has been in a tourism enterprise or how many enterprises an individual has owned is not a good predictor of whether that entrepreneur will be able to develop a high performing SMTE that contributes toward economic wealth and job creation in the community. Entrepreneurial self-efficacy, rather than entrepreneurial experience, is a significant predictor of enterprise performance among SMTEs. This raises a number of questions. If experience gained through operating an SMTE does not contribute toward entrepreneurial confidence or entrepreneurial performance, what does? Are tourism entrepreneurs so different from entrepreneurs found in other industries that theories require modification when applied in tourism? The findings suggest that destination managers and policy makers need to understand the importance of entrepreneurial self-efficacy if they wish to enhance performance within the industry.