Individual entrepreneurial capabilities as a driver of organizational and regional innovation ecosystems : Kymenlaakso perspectives

Abstract

Entrepreneurship and innovation are widely recognized as drivers of regional economic development, yet innovation outcomes remain uneven even within well-resourced ecosystems. Previous studies have investigated individual dimensions of entrepreneurship and the environment individually, but the pipeline from individual capabilities to innovation outcomes in regions is not well understood. This theoretical gap is exacerbated by a practical one: innovation support interventions do not necessarily lead to the desired results, even when seemingly good structural conditions prevail. This thesis explores how individual entrepreneurial capabilities shape innovation processes within regional innovation ecosystems, addressing a critical gap in understanding the micro-level mechanisms that link cognitive orientations to innovation outcomes. Employing a qualitative exploratory design, the study combines a systematic literature review following PRISMA guidelines with semi-structured interviews of nine entrepreneurs and intrapreneurs operating in the Kymenlaakso region of Finland. Thematic analysis, using abductive coding, identified five interrelated themes: Actor Mindset, Framing of the Environment, Action Orientation, Relational Embeddedness, and Institutional Context. The results indicate that entrepreneurial ability is not an absolute but conditional. A material resource threshold was identified as a boundary condition below which the whole innovation capability system collapses (e.g. minimum financial liquidity, cash flow or operational stability). At levels lower than this threshold, framing capacity decreases, action orientation becomes lost, and innovation stasis becomes regardless of the strength of the mindset or the availability of relationships. The study contributes to the cognitive appraisal theory, the dynamic capabilities theory, the self-efficacy theory, the social capital theory and the institutional theory by showing that these processes depend on enabling material conditions. The revised conditional process model brings a recursive, socially located and materially contingent conception of entrepreneurial capability. Practical implications are that institutional support needs to be provided in a lifecycle fashion beyond business creation, specific interventions are needed for immigrant entrepreneurs who are experiencing relational barriers, and financial viability is a necessary precondition for innovation activity. The findings inform regional development policy, support institution design, and entrepreneurial practice in contexts of economic transition.