Improvise to win: the relationship between entrepreneurial improvisation and start-up competitive advantage

In today’s ever-changing environment, entrepreneurial teams must be able to improvise when designing business solutions. Still, the way in which improvisation delivers firms a competitive advantage remains unclear. Drawing on action learning theory, this study empirically examines how entrepreneurial improvisation affects a start-up’s competitive advantage. Accordingly, we develop a moderated mediation model of ambidextrous entrepreneurial learning—a balance between exploratory and exploitative learning—and team reflexivity; and empirically test it on a two-wave survey of 149 Chinese start-up teams in the Yangtze River Delta. Our path analyses indicate that entrepreneurial improvisation may result in the ambidextrous learning of an entrepreneurial team, which in turn leads to a start-up’s competitive advantage. Furthermore, the positive relationship between entrepreneurial improvisation, ambidextrous entrepreneurial learning, and start-up competitive advantage becomes significantly stronger when the entrepreneurial team possesses a higher level of team reflexivity.