Structuration Theory and Entrepreneurship

"...the essential recursiveness of social life, as constituted in social practices: structure is both medium and outcome of reproduction of practices. Structure enters simultaneously into the constitution of the agent and social practices, and 'exists' in the generating moments of this constitution."

— Anthony Giddens

At first glance, Anthony Giddens' Structuration Theory seems purely academic. However, for the modern entrepreneur, it highlights a critical reality: opportunities are not just found; they are dynamic, subjective, and created through interaction with society.

According to Giddens—and later applied to business by Sarason, Dean, and Dillard (2006)—structure is not a physical building. It exists as "memory traces" in the minds of people. It is the rules, norms, and brands we all recognize.

For an entrepreneur, there are two distinct pathways to social action: Controlling existing structures or creating new ones.

Pathway 1: Leveraging Existing Structures (The "Easy" Way)

The fastest route to social action is to control structures that are already "routinized" in people's brains. Instead of starting from scratch, an agent buys an existing company, joins a non-profit leadership team, or leverages an established brand.

Entrepreneurs utilize these existing social structures for three specific purposes:

1. Power (Domination)

Concerned with ownership and resource control.
Acquiring a supplier is a classic example of using structure for power. Vertical integration provides greater control over inputs, improves production efficiency, and ensures consistent quality. By owning the supplier, the entrepreneur manages the supply chain and reduces the bargaining power of competitors.

2. Signification (Meaning)

Concerned with interpretive schemes and cognition.
Entrepreneurs can align with existing "meanings" to validate their business. For instance, aligning with environmentalism communicates significance. Consumers and investors are increasingly supportive of socially responsible companies. By tapping into this existing interpretive scheme, an entrepreneur differentiates their venture and attracts stakeholders who share those specific fears and ideals.

3. Legitimation (Norms)

Concerned with sanctions and acceptance.
Joining an incubator or accelerator is a method of borrowing legitimacy. These programs provide mentorship and funding, but more importantly, they signal to the world that experienced professionals have vetted the venture. This external validation provides a level of credibility (legitimation) that would otherwise take years to build.

Pathway 2: Creating New Structures (The "Hard" Way)

The second pathway involves creating new "imprints" in the collective mind. This requires the entrepreneur to build new structures from scratch. This is the path of the pioneer. It is significantly more challenging because it requires routinization over time.

The Risk: Pioneers often do the hard work of education, only to be overtaken by "fast followers" who jump on the wagon once the market is developed and the "structure" is established.

The Cycle of Emancipation

As entrepreneurs use social structures to enact change, they simultaneously reinforce and modify the routines associated with those structures. They do not just use institutions; by acting, they change them. This is the essence of Giddens' duality: the entrepreneur is shaped by society, but society is reshaped by the entrepreneur.