Int. j. econ. manag. soc. sci., Vol(3), No (4), April, 2014. pp.

238-242

TI Journals

International Journal of Economy, Management and Social Sciences

www.tijournals.com

ISSN:
2306-7276

Copyright 2014. All rights reserved for TI Journals.

Structural modeling of organizational intelligence and entrepreneurship

(With an emphasis on creativity)
Ali. A. Firuzjaeyan
Department of sociology, Mazandaran University, Babolsar, Iran

Mojtaba Firuzjaeyan
MA student of executive management, Department of Commercial management, Semnan University, Semnan, Iran

Alieh Bakhshian
MA of Educational Administration, Mazandaran University, Babolsar, Iran

Sepide Nasiri
Department of Educational Administration, ayatollah amoli University, Amol, Iran
*Corresponding author: Mojtabafiruzjayan@gmail.com

Keywords

Abstract

Entrepreneurship
organizational intelligence
creativity

Creativity plays an important role in the evolution of human life. The evolution of organizations towards
intelligent organizations provides conditions for the efficiency of the organization. Accordingly, the purpose
of this study is to present a structural model of the relationship between organizational intelligence and
entrepreneurship with an emphasis on creativity and innovation. This is a correlation study. The population
of the study consisted of 230 educational administrators in university and due to the limited number of total
population, sampling has been used. The research instruments were questionnaire of organizational
intelligence (by Karl Albrecht) and questionnaire of entrepreneurship (by Stephen Robbins) which both of
them have reliability and validity. The results showed that there is a very high and positive correlation
between all the components of organizational intelligence and creativity. The results showed that from
among the components of organizational intelligence, strategic vision has the most influence on creativity
and innovation. Structural equation also shows at the correlation between organizational intelligence index
and creativity is 0/76. This means at the higher the organizational intelligence, the creativity of the people
will increase.

1. Introduction
Basically entrepreneurship is the stimulant engine of economic development and job creation, and society reform (Gurol& Astan, 2006).
Entrepreneurship is not a usual interdisciplinary subject, but a fundamental issue that relates the conceptual framework of the different social sciences
(Casson, 2010). In terms of Semantic, the word entrepreneurship is derived of the French word, means committing to doing something .This term has
a long history in the commercial sector. The most common definition of this term is creating value through innovation (drucker, 1985). As Peter
Drucker, Cole (1946) and Cooper (1946) also define entrepreneurship as creating value through innovation. Miller (1983) defined entrepreneurship
with risk-taking terms and basic innovation in the production and stated that" the entrepreneur-centered approach, is an approach that emphasizes on
the markets and product innovation, and risk-taking projects and with willingness to lead in innovation tries to gain advantage over rivals
(Miller,1983). Peterson and Berger(1971)argue that entrepreneurial activities help companies develop new businesses for increased profitability and
Burgman(1999)argues that entrepreneurial activities will improve the success of companies by increasing productivity and process of innovation
(Zahra & others,2008). Entrepreneurs had the top businesses, and are searching for opportunities and also creativity is regarded as a tool for their
success (dunphy,1994). Kurket(2004), considers creativity and innovation as the most important factor in entrepreneurship. Histrich and
Peters(2002), in addition to financial rewards, assume financial, psychological and social risks for entrepreneurship. From the perspective of
entrepreneurship, entrepreneurs are always in search for risks (Agarwal& Prasad,1998).
Entrepreneurship components include: creativity, risk taking, independence, motivation, determination, providence (ahmadpour,2008). The idea that
entrepreneurs are the key to a country's economic development has been stressed in this area by eminent scholars such as Schumpeter (1934),
Stevenson and Jarillo (1990). Entrepreneurs can push a society towards development by providing new products and services. Entrepreneurs who
play a major role in economic development are the origin of major developments in industrial, manufacturing and service contexts in organizations
(Duane, 2000).
Some researchers in the studies have shown that creativity has a very important role in entrepreneurship .For example, studies by Drucker(1985),
Shine(1994)and Postigo (2002) showed that creativity is the most important characteristic of entrepreneurs. Some researchers, such as
Drucker(1985)argue that innovation and entrepreneurship are interred late sows can say that entrepreneurship does not occur without in innovation

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Structural modeling of organizational intelligence and entrepreneurship (With an emphasis on creativity)

International Journal of Economy, Management and Social Sciences Vol(3), No (4), April, 2014.

and what causes innovation and creating new products and services are creative ideas and exploring new ways for looking at problems and
opportunities. Thus one of the characteristics of entrepreneurs is creativity (Saeedi kia,2006).
Creativity is defined by numerous and diverse interpretations. Gardner sees creative people, those who are skilled in solving problems, produce
artistic works, and their thoughts are considered new and unusual at first (gardner,1993). Amiable considers creativity as the process of developing
new ideas (Amabile,1988). Creativity is necessary for the survival of any organization. In brief, the literature of creativity in the context of
organization, represent different categories of influencing factors from inside and outside the organization, which affect the creativity of people
(Stanley & Tomas, 2008).
Despite a long history of creativity of human life, the organizations, due to rapid changes in innovation, global competition and economic uncertainty
in recent years, have discovered that a key and sustainable source of competitive advantage and survival is creativity (Oldham & cummings,1996).
Creativity is deeply related to human behavior. We need more than ever to pay attention to creativity. This mental process leads to new ideas and
ideal products (Louiz,2006).
Considerable evidence suggests that employees creativity has contributed much to innovation, effectiveness and survival of an organization
(Amabile, 1996). Consequently, researchers in caressingly were interested in recognizing the social condition affecting the creativity of employees
(Oldham & Cummings, 1996; Tierney, Farmer, &Graen, 1999). The amount that assists or encourages Creative performance of employees is one of
the supporting conditions for creativity (Amabile, Conti, Coon, Lazenby, & Herron, 1996). Bucking hamand Clifton(2001)believes that the capability
due to creativity is possible based on three elements of intelligence, knowledge and skill (Buckingham &Clifton ,2001).
karl Albrecht cited the intelligent organization, intelligent team and intelligent people as three influencing factors affecting business
(Eetebareyan,2007&Abraze). Organizational intelligence is the amount of possibilities of organizations and agencies in the integration, management
and use of information in order to make effective decisions (Riera,2007). Halal also stated, organizational intelligence have been defined as the
capacity to solve the problem of an organization made up of different subsystems (Halal,1997).
The concept of organizational intelligence comes from the analogy of interpersonal intelligence. karl Albrecht(2003), has defined organizational
intelligence as the ability and capacity of an organization to mobilize all the mental forces of the organization and focus this energy to accomplish
their mission. By this definition, the role of organizational intelligence is to succeed further in their environment. According to some experts, the idea
and concept of organizational intelligence will include other minor ideas like organizational learning and knowledge management (liebowitz, 2000).
McMaster also has defined organizational intelligence as the ability to navigate, being reason able and practice flexible, creative and adaptive ways
(mcmaster, 1998).
Looking at entrepreneur ship in the context of organizational Intelligence will pave the way for a broad perspective on entrepreneurship so that, it
draws attention to the unclear and less explored aspects that are creativity and innovation of the entrepreneurship phenomenon. In the evolving world
of today, the prosperity will be for the communities that can make a significant relationship between scarce resources and management capabilities
and the entrepreneurship of their human resources (Schumpeter,1943).
NarjesSadat Nasabi(2008) has done a research on the relationship between organizational intelligence and creativity at Shiraz University of Medical
Sciences. The results confirmed positive and significant relationship between organizational intelligence and its components with creativity, So that
for every unit increase or decrease in organizational intelligence and its components, creativity will increase or decrease.
Abdol mohammad Taheri(2010), in a study ,given the importance of the role of entrepreneurship in relation to creativity in organizations, concluded
that the organization entrepreneurship and innovation are complex phenomena that are influenced by different factors. Especially in technical and
professional organization requires a systematic, realistic and long-term approach and minor, short-term and temporary approaches will not be
effective. Azam Noferesti and Fatemeh Moeinolghorabaee (2010), in another study examined the relationship between emotional intelligence and
creativity in university students. The results showed that there is a significant and positive relationship between all three aspects of emotional
intelligence and creativity in both sexes and emotional intelligence can significantly predict creativity in both sexes.
As was said, organizational intelligence is as the potential for effective impacts in an organization. In a sense organizational intelligence can be
considered a spiritual power for effective management of organization. The focus of this power is on the transfer, control and management of
knowledge and information. However impacts of this organizational aspect on performance and success of organization is undeniable. Since
nowadays knowledge management is the basis of organizational innovation. Although the impact of organizational intelligence on organizational
entrepreneurship can be studied in different areas but given that the educational environments deal with production and transfer of knowledge,
investigating the impact of organizational intelligence on creativity and innovation is very important. Therefore, in this study we have tried to
examine the relationship between organizational intelligence and its components on creativity and innovation as one of the components of
entrepreneurship among educational administrators of Mazandaran University.

2.

Methodology

This is an applied study. one in such a way that its findings can be used to improve performance among university professors. It is a co-relational
survey in which data collection and data analysis techniques are employed (De Vaus, 1991).
2.1 Statistical population
Participants of this study are the administrative and instructional managers of the University of Mazandaran. 230 subjects participated in this study.
They all took a questionnaire for the study to be completed.
2.2 Instrumentation
A standardized questionnaire assessing organizational intelligence (OI) developed by karl Albrecht (2002) containing closed and open items was
employed. He mentions seven items in his explanation of OI :Strategic vision, shared fate , appetite for change , spirit ,Alignment & Congruence ,
knowledge deployment , performance Pressure (Albrecht,2003). Stephen Robin's standardized questionnaire was employed to assess innovation

Ali A. Firuzjaeyan, Mojtaba Firuzjaeyan *, Alieh Bakhshian, Sepide Nasiri

240

International Journal of Economy, Management and Social Sciences Vol(3), No (4), April, 2014.

among the participants. He defines innovation as a process of getting thoughts and changing them into products, services and new operational
methods (Robbins, 1999)
Data collected were employed for descriptive and inferential analysis using SPSS and AMOS statistical softwares. To test research hypotheses
regression analysis and path analysis (for preparing experimental model) was used. Meanwhile, to provide an experimental model the AMOS
software was used.
2.3 Data analysis
The whole statistical population of this study was 230 out of which 202 participants took the questionnaire and finally the data collected were
analyses. Descriptive statistics shows 79.2% of the participants were male and the rest were female. In terms of age, 6.9% of the participants were
below thirty years of age and 34.7% were between 30 to 40 and 41.1% between 40 and 50, and the rest were above 50. 83.7% of the participants
were married and the rest were single. 1.5% of the participants were BA holders, 23.5% MA holders, and 75% PHD holders. 12.1% of the
participants were managers of different sectors, and the rest were faculty members. 1.5% of the participants did not answer the questionnaire items.
In terms of job experience, 22.9% of the participants had 10-15 years of experience (the highest frequency) and the rest of the participants had 20-25
years of experience (the lowest frequency). In terms of academic status, 19.3% of the participants were instructors, 20.3% were assistant professors,
49% were associate professors, and 6.9% were full professors. 4.5% did not answer the questionnaire.
2.4 Testing research hypotheses
For testing the research hypotheses, the data were analyses using SPSS and AMOS. Correlation test was used for vicariate analysis and structural
equations for multivariate analysis direct and indirect relationships between independent and dependent variables have been used.
Table 1: The Pearson's correlation between background variables and Creativity
Variables

significance

correlation

age
Educational level
experience
academic status

0/08
0/04
0/09
0/04

0/04
0/14
0/12
0/15

As the above table shows there is a significant, positive relationship between educational level, academic status, and innovation. Although there is a
relationship between job experience and innovation this relationship is not significant. There is no significant relationship between age and
innovation.
Table 2: Pearson Correlation coefficient between organizational intelligence and innovation
Variables

Significance

Correlation

Strategic vision
shared fate
Appetite for change
Mood
Alignment & Congruence
Knowledge Deployment
performance Pressure
Organizational intelligence

0/00
0/00
0/00
0/00
0/00
0/00
0/00
0/00

0/62
0/53
0/66
0/57
0/68
0/52
0/54
0/76

The above table depicts there is a highly significant relationship (0.76%) between OI and innovation. In other words, the more the OI among the
participants, the more their innovation.
2.5 Multivariate analysis
In this study, using the OMOS, the relationship between dependent and independent variables was studied according to a structural model. As given
in the model, four variables have direct impacts on innovation and three variables have indirect impacts on innovation. Coefficient of determination
or total impact of independent variable on dependent variable is 0/47.

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Structural modeling of organizational intelligence and entrepreneurship (With an emphasis on creativity)

International Journal of Economy, Management and Social Sciences Vol(3), No (4), April, 2014.

Figure 1: The experimental model of the relationship between OI and innovation

e2
0/46
0/14
Shared
fate

Strategic
vision
0/23

0/18

.0/35 e3
0/50
Knowledge
Deployment

0/59

0/16

0/73
Alignment &
Congruence

0/46

0/32

e1
0/47

0/43

e4

0/20/

0/00
creativity
0/21

0/58

spirit

0/16/
0/30

Performance
Pressure

0/14
0/22

0/27
Appetite for
change

.0/61
e5
Table 3: Different impacts of OI on innovation
Variables
Strategic vision
Alignment & Congruence
Appetite for change
Performance Pressure
spirit
Knowledge Deployment
Shared fate

Direct effect
0/15
0/32
0/21
0
0/21
0
0

Indirect effect
0/25
0
0/10
0/27
0/04
019
0/13

Total effect
0/40
0/32
0/31
0/27
0/25
0/19
0/13

The above table shows the different impacts of OI on innovation. According to the data in the table, the strategic perspective shows the highest
overall impact. This is while the highest direct impact is for unity and agreement perspective.

Ali A. Firuzjaeyan, Mojtaba Firuzjaeyan *, Alieh Bakhshian, Sepide Nasiri

242

International Journal of Economy, Management and Social Sciences Vol(3), No (4), April, 2014.

3.

Results and discussions

Innovation and intelligence are best characteristics existing in each member of the organizations. OI is a social outcome and related to individual
intelligence. Therefore, OI is related to individual intelligence and exist in the minds of individuals. In spite of existing similarities in variables and
methodologies, the limitations related to time and place perspectives in humanities and social sciences made the findings and research results have
differences. In a study, Torrens (1993) showed that there is a revolutionary trend in innovation and innovation increases with an increase in age, and
there is a downward trend in the ten-year-old groups. However, this study shows there is no significant relationship between age and innovation.
Developments and advances in different perspectives in today's world are indebted to scientists and their innovations. If today societies are assessed
based on capabilities in creating changes in social, economical, scientific, technical and cultural issues, only countries that can create innovative
individuals can stand highest among other countries. Thus, innovation is regarded an important issue for development in societies. In definitions of
innovation, all emphasize characteristics such as deep, different and original views, and the creation of new thoughts. Meanwhile, in an organization,
people are not able to work unless the importance and key role of science and technology in organizational intelligence is paid attention to. For
improving innovation in organizations there is a need for a particular science or technology.
Matura and Valera (2004) have conducted a study about the positive relationship between knowledge management and OI and stated that these two
characteristics are inseparable and improvable by practice. The current study has investigated the effect of OI on innovation. Results of the study
show that there is a positive and high correlation between OI and innovation, meaning that high OI among the staff and managers also results in their
innovation. This study also showed that there is a significantly positive relationship between educational level and academic status and innovation.
As a result, paying attention to OI and innovation in organizations is an unavoidable job.

4.
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