ARGENTINE
ENTREPRENEURIAL ECOSYSTEM:
DIFFICULTIES
IN THE ENTREPRENEURIAL ACTION OF INDUSTRIAL DESIGNERS
ECOSISTEMA EMPRENDEDOR ARGENTINO:
DIFICULTADES EN LA ACCIÓN EMPRENDEDORA DE LOS
DISEÑADORES INDUSTRIALES
Federico Del
Giorgio Solfa I *
I
National University of La Plata.
Scientific Research Commission of Buenos Aires Province. La Plata, Argentina
* Corresponding
author: delgiorgio@fba.unlp.edu.ar
JEL Classification: M12, M54, I19
DOI: https://doi.org/10.5281/zenodo.13882685
Received: 09/08/2024
Accepted: 21/09/2024
Abstract
Entrepreneurship in Argentina is a complex
phenomenon and the entrepreneurial ecosystem is made up of a wide diversity of
actors. Among the existing interdisciplinary relationships and practices, the
industrial designer is included as a strategic agent in innovation processes.
However, the figure of the entrepreneur that has been built by those who
promote this form of insertion into the labor market, is loaded with values
associated with optimism, creative freedom and personal development, minimizing
other negative aspects such as informality, self-exploitation and
multifunctional roles that blur the skills of the professional designer. These difficulties of the
Argentine entrepreneurial ecosystem are addressed in this article.
Keywords: Entrepreneurial Ecosystem;
Industrial Design; Labor conditions and self-exploitation; Argentine Republic
Resumen
El
emprendimiento en Argentina es un fenómeno complejo y el ecosistema emprendedor
está conformado por una amplia diversidad de actores. Entre las relaciones y
prácticas interdisciplinarias existentes, se incluye al diseñador industrial
como agente estratégico en los procesos de innovación. Sin embargo, la figura
del emprendedor que han construido quienes promueven esta forma de inserción en
el mercado laboral, está cargada de valores asociados al optimismo, la libertad
creativa y el desarrollo personal, minimizando otros aspectos negativos como la
informalidad, la autoexplotación y los roles multifuncionales que desdibujan
las competencias del profesional del diseño. Estas dificultades del ecosistema
emprendedor argentino se abordan en este artículo.
Palabras clave: Ecosistema emprendedor; Diseño
industrial; Condiciones laborales y autoexplotación; República Argentina
Understanding the functioning of the entrepreneurial ecosystem entails a
comprehensive assimilation of its constituent elements and the topography of
the complex framework that links them. One of the definitions with the greatest
consensus states it as:
a set of interconnected entrepreneurial actors (both potential and
existing), entrepreneurial organizations (e.g. firms, venture capitalists,
business angels, banks), institutions (universities, public sector agencies,
financial bodies) and entrepreneurial processes (e.g. the business birth rate,
numbers of high growth firms, levels of ‘blockbuster entrepreneurship’, number
of serial entrepreneurs, degree of sell out mentality within firms and levels
of entrepreneurial ambition) which formally and informally coalesce to connect,
mediate and govern the performance within the local entrepreneurial
environment.1
The approach to this concept includes the qualities and individual
motivations of entrepreneurs, as well as the regulatory conditions that
regulate innovation processes. These rules are dynamic and make up the game
rules of the ecosystem and in this context, the entrepreneur must take risks,
overcome obstacles that arise and act in an environment full of uncertainty.
That is why the rules of the game and the geographical and political
location will be key to define the sustainability and efficiency of an
enterprise, giving rise to productive, unproductive or destructive projects, in
terms of economic development.2 This aspect is of utmost importance,
especially for a country like Argentina, characterized by the instability of
political and economic conditions, and at the same time, it forces us to
reflect on what other roles or objectives each undertaking fulfills or ultimately
pursues, in the individual experience and training of the entrepreneur, beyond
the real economic impact.
Considering that traditionally, the evaluation of ventures is usually
carried out from a predominantly quantitative approach, in terms of the
performance of each project in the market (sales volume, billing, etc.). We
argue instead that entrepreneurship can be understood from a qualitative
perspective, as a seed from which an industry could be born; a young and
healthy industry that can be more supportive and environmentally responsible at
the local level.
Below is a comparative diagram of the main aspects of the Argentine
business ecosystem in relation to Latin America and the Caribbean (Figure 1).
Figure 1. Comparative diagram of the main aspects
of the Argentine business ecosystem in relation to Latin America and the
Caribbean
Source: Global
Entrepreneurship Monitor (2019)3
In the case of Argentina, there is a
favorable aspect in terms of support for entrepreneurs and specific government
policies. In 2017, the “Entrepreneurs Law” was enacted, through which “the
development of entrepreneurial capital will be promoted considering the
geographic presence of entrepreneurial activity in all the country's provinces,
in order to promote the local development of the different productive
activities." (Art. 1, Law 27,349 to Support Entrepreneurial Capital).
Although, this shows that apparently entrepreneurship is a matter of State, its
incipient implementation does not allow having clear indicators of its real
impact on the Argentine entrepreneurial ecosystem.
The conditions of entrepreneurial
viability in Argentina show a paradoxical scenario. Although, there is an
encouraging context for entrepreneurship at the regional level, due to the
growth of the entrepreneurial culture, the good conditions of demand and the
strengthening of this ecosystem (which position Argentina in the top 5 among
the entrepreneurial countries of Latin America ), there are limitations
associated with the lack of specialized human capital and low contributions
from science and technology to innovation, which allow building trust bases
that facilitate networking.4
A first approach to the concept of
entrepreneurial ecosystem allows us to glimpse the importance of geographical
and political delimitation, which makes it impossible to define a single type
of entrepreneurial ecosystem, which serves as a model for different regions, so
it is necessary that each environment be analyzed in a particular way.
Materials and Methods
The
entrepreneurial ecosystem in Argentina and Latin America
First, we must understand that the
entrepreneur is the protagonist of the entrepreneurial ecosystem, knowing his
motivations and self-perceptions is a key resource to understand the hidden
desire that leads him to undertake. Some of the variables that characterize
this unique productive actor are listed below (Table 1).
Table 1. Self-Perceptions of the Argentine Entrepreneur
|
Fees |
2017 |
2018 |
Average LAC* |
|
Perceived opportunities |
29.65% |
35 89% |
44.48% |
|
Perceived capabilities |
43.08% |
48.79% |
57.51% |
|
Fear to fail |
27.13% |
31.92% |
27.13% |
|
Business intentions |
13.36% |
14.83% |
32.64% |
Source: Adaptation based on Global
Entrepreneurship Monitor (2019)3
Although almost 50% of those interviewed
perceive opportunities and believe they have the necessary capacities to carry
out a company, the assumption of risks and the social shame associated with
failure, in Latin America, slows down innovation, discouraging the assumption
of risks on the part of entrepreneurs.5
In relation to these motivations, there is
also an increase in both Argentina and LAC, in enterprises driven by the
opportunity to improve or introduce new products, in contrast to those driven
by need. The latter are usually more linked to the search for self-employment,
by entrepreneurs who fail to enter the market in another way and the projection
of these long-term ventures is usually low (see Table 2).
The social values inherent to the
entrepreneurial phenomenon also play a relevant role in the entrepreneurial
ecosystem, since in some way; they shape in the collective imagination, the
projected status of entrepreneurs in the rest of society.
Table 2. Entrepreneur motivational imaginary
|
Variable |
2017 |
2018 |
Average LAC* |
|
Entrepreneurial motivation (opportunity / need) |
2.46% |
1.35% |
2.31% |
|
Association of entrepreneurial success with social status |
47,43% |
49,96% |
59,69% |
|
Entrepreneurship as a good career choice |
60,40% |
59,39% |
60,54% |
|
Innovation and impact of entrepreneurs ** |
13,98% |
32,17% |
24,71% |
|
Expectation in job creation *** |
12,68% |
11,75% |
21,40% |
|
** Entrepreneurs who indicate that their
product or service is new and that few or no companies offer the same
product. |
|||
|
*** 6 or more jobs in 5 years. |
|||
Source: Adaptation based on Global Entrepreneurship Monitor (2019)3
This aspect is specifically related to one
of the problems linked to the approach of this work, since the figure of the
"successful entrepreneur" is more often promoted, without making
visible those cases where the enterprises did not achieve virtuous performance,
which it generates stereotypes that are not representative of most businesses.
From an economic point of view, the
scenario in Latin America is paradoxical, since it is a region with many
entrepreneurs and little innovation. As stated in the 2014 World Bank report:
“Latin American and Caribbean companies introduce new products less frequently
than companies from other similar economies, the management of high-end
entrepreneurs is often far from best practices globally, companies invest
little in R&D and patent activity is clearly below reference levels”.6
This is reflected in the indicator of innovation and impact of entrepreneurs in
Table 2. In this table, it is also
verified that Argentine entrepreneurs have a low expectation in the generation
of employment in the coming years.
Finally, we must dedicate ourselves to the
high degrees of informality that are present within the entrepreneurial field.
As mentioned by the sociologist Agustín Salvia (UCA):
Not only is there a sector that is outside the regulations, which may be
for convenience, but it is also very expensive to enter formality. The real
problem is that the Argentine economy is dual: one part works outside the tax
system, not because it ambitiously avoids for profit, but because productivity
levels are very low in terms of competitiveness.7
Low capital investment ventures are not
exempt from this phenomenon. In addition, entrepreneurs who work under these
conditions, to a large extent, incorporate workers informally, which prevent
the employment or underemployment of skilled workers or those with some type of
specific training. In this way, a vicious circle is generated that threatens
the development of long-term enterprises and negatively impacts their
productivity.
Models of innovation and democratization of ideas
If a tour of the literature dedicated to the analysis of innovation is
made, it is observed that although there was a taxonomic expansion of the
various innovations according to their ontological character (technological,
social, organizational, marketing, etc.), it remains in force the Schumpeterean
idea of diffusion as a sine qua non condition to complete the innovation cycle.
That is, the novelty proposed by the entrepreneur must have a scope such that
it generates an impact on society, so that we can evolve from an invention to
an innovation.8
However, the most significant changes are reflected in the processes
through which these innovations occur. Some of the characteristics of this
transformation process that gave rise to new models of innovation are listed
below:
1.
It goes from a “science-push / top-down” model
based on R&D to a “bottom-up” model, where innovation can come from any
actor participating in the process.8
2.
The three-helix innovation model, made up of:
universities, the state, and the private sector, evolves, integrating civil
society into this scheme as the fourth helix to achieve innovation.
3.
The linear innovation model becomes a systemic,
multidirectional and interdisciplinary model, which is characterized mainly by
the plurality of actors and their hybridization.8
4.
Democratization of the innovation process and
the emergence of collaborative design and co-creation models that include users
in the design process: experience design (UX), design thinking methodology as a
creative tool in organizations, strengthening the open design and universal
design. Even the emergence of "maker culture" and social creativity.
As Rispoli affirms, thanks to these new practices: users go from being mere
passive informants to legitimate participants in the design process, and
designers transform from problem-solvers to facilitators of complex co-creation
processes, capable of sharing their conceptualization and formalization tools
instead of imposing them.9
In short, it is observed that the process of undertaking and innovating,
like any creative process, is necessarily collective. Although an idea may
arise from an individual, its socialization is necessary to achieve innovation
(social creativity). In relation to this, Jorge Wagensberg affirms that:
The creativity of the human mind requires three things: 1) have a good idea
2) realize that the idea is good 3) convince others of it. It is clear that the
second does not happen without the first and that the third does not happen
without the second. Each step is necessary to initiate the next, but none is
enough for an idea to finally transcend. The three things do not always occur
in the same person.10
Without going any further"71% of the new growth-oriented companies in
Argentina, Brazil and Chile are carried out by entrepreneurial teams".4
This aspect is important, since it contradicts (in good time), the installed
vision of the designer as a creative genius or bearer of inspiration and poses
creativity as a collective process fostering project culture.
From the training point of view, this democratization of innovation
generates an interesting challenge for educational and governmental
institutions, since spaces capable of providing tools to entrepreneurs, whose
starting points are diverse, must be created. These institutions usually direct
their efforts in three specific axes: training, mentoring or incubation and
financial aid.
The industrial designer as a strategic agent
Industrial design, as a project discipline, has the methodological tools to
fulfill a strategic role in the entrepreneurial ecosystem, however, during
undergraduate courses; products are developed with little or no contact with
other professional areas. This creates the illusion of self-sufficiency in the
professional future and hinders their insertion into the labor system.
In the reality of the market, industrial design is one more specialty
within a business system. It is vital that the industrial designer knows how to
perform in a heterogeneous environment and challenge the mental micro-climatic
models that were built in the span of his career.
In relation to this, we agree with Gerhard Trautmann that:
real interdisciplinarity implies the existence of several autonomous
specialties. A discipline that is defined as such assuming knowledge, methods,
etc., from other branches of science would be inconceivable. Design, without a
doubt, has had great difficulties from the beginning in creating a specific
identity on the basis of which interactions with other disciplines could take
place.11
Regarding the training of the entrepreneurial designer, López and Bergomi,
point out that entrepreneurship "has been installed as a necessity within
the socio-political system to mobilize the economy, with not always favorable
results", however, this condition transformed into a trend, "it
deepens and enters the educational field as a demand that must be covered
through courses, seminars and university extension to train entrepreneurs in
design".12
Traditionally, there has always been a tension between the designer focused
(engrossed) in the product and the designer focused on the production system.
This first disciplinary bias, many times, generates conflict in entrepreneurial
groups, since ultimately; any solution to a problem must manifest itself as a
specific product, service or experience.13
As stated by Kobrinsky:
The first ventures usually start with the product, thus assuming that the
demand is a consequence of the product. The reality of the market is
responsible for pointing out the opposite, that is, the product is a
consequence of demand. Industrial designers tend to lose sight of the
organizational system that sustains the product in the market environment. So
when the product doesn't work, you see the solution in the redesign of the
product. Perhaps the solution was given by a change in the places of distribution
of the product, or in the way of communicating the benefit of the product. This
situation indicates an area of knowledge that, if incorporated by the designer,
can radically increase its value in the market.14
In most cases, problems are complex and depend on multiple variables, among
which product design is just one of them. Understanding the complexity of each
production system is the great challenge for industrial designers. Therein lies
their potential success of participation as entrepreneurs, in inter and
transdisciplinary working groups.
In this logic, the designer must incorporate the systemic function of the
product and understand how his decisions affect the actors that make up the
system, which is intrinsically and extrinsically linked to the product he is
designing.15 That is, each decision made by the designer
strategically configures the way in which the product's materialization will
take place (intrinsic link), as well as its performance during use and its
behavior in the market (extrinsic link).
Achieving this objective is one of the keys so that the designer can insert
himself as a strategic actor, capable of interacting synergistically with other
actors and achieving solutions that promote local development, based on the
social capitalization of the resources and endogenous potentialities of a
community portion, to deal with unfavorable exogenous variables.16
On the other hand, the designer has two and three-dimensional communication
strategies to socialize his idea during the design process (models, prototypes,
etc.). In general, this generates a high tendency to the premature
materialization of solutions, which makes it not very participatory and leads
it to impose its ideas at an initial stage, when the group has not yet matured
the definitions of the problem and the possible solutions that require
recipients.
This aspect is aggravated when the designer is part of an entrepreneurial
team made up of actors who do not come from the project field and who have not
made a clear definition of the problem to be solved. These are often attracted
to these three-dimensional representations, which relegates the designer as a
mere configurator of the shape of the object, giving rise to what Bonsiepe
calls: "the spectacularization of design", a process in which the
term "design” is taken as a mere adjectival feature of an object, as if it
could be added to an object, showing only the design as a result and not as an
intelligent problem-solving process.17
Industrial design, which has been formed in this field and logically in
practice can give comprehensive answers (due to its multidimensional
reasoning), is capable of leading the feasibility analysis processes, which are
generally dominated by economics graduates.
Results and Discussions
The phenomenal complex of entrepreneurship in
Argentina
Between 2007 and 2016, approximately 70,500 companies were born per year
and 69,000 closed. That was the growth of companies in net terms. However, in
recent years, the number of new companies has decreased and closures have
remained constant, resulting in a net drop in the total number of active
companies.18
Likewise, we understand that sustaining a new venture over time is a
difficult task and this is reflected in the survival rate of new companies. In
Argentina, 8 out of 10 new companies reach 2 years of life and only 3 out of 10
reach 8 years. In comparison, in Chile, this value rises to 5 out of 10.
Generally, the companies that remain in the market tend to be the most
productive; they become stronger and gain scale, thus increasing their
probability of surviving another year.18
In the Special Report on Business Birth Rate and Productive Development,
prepared by the Observatorio Pyme, it is stated that the decision to undertake:
It is conditioned by the technical capacities and abilities of the
entrepreneurial potential (the “know-how”), the availability of own capital
(and of third parties) to finance the start of the activity, the tax burden
that weighs on the nascent companies and the level of “Environmental risk”
(labor relations, degree of certainty about the rules of the game, operation of
justice, etc.). All these conditions determine the business birth rate and,
consequently, determine the final stock of existing companies in a country.19
And continues;
If the individual chooses to undertake, there is still a second decision
that he needs to make: to start his business activity in the formal sector or
in the informal sector. The benefits of formal activity (such as access to
credit) are compared with the costs of formality (such as, for example, the tax
burden). The final result of this calculation determines the degree of
formality of the nascent company.19
In Argentina, in the entrepreneurial process, formality and informality
inevitably coexist as sides of the same coin. In 2012, 40% of the enterprises
operated informally and their managers stated that their main motivations for
formalizing their enterprises were: to comply with the law and make possible
agreements with clients and suppliers, which require this type of commercial
conditions, while that tax rates and the high degree of bureaucracy discouraged
this initiative.20
In many of these cases of ventures that cover up practices of informality,
job insecurity and self-exploitation, without which it would seem impossible to
carry out the venture, thus generating a certain form of
"self-deception" on the part of the entrepreneur, which in case of
regularizing these practices, would highlight the lack of real viability of the
venture and its respective business model.
These situations, which are first perceived as temporary or occasional
competitive advantages, which once removed, put the survival of the enterprise
at risk. Some examples of this problem could be: tasks performed by
entrepreneurs without accounting or assigning a value, use of physical spaces
provided by the entrepreneur's network of contacts, obtaining fortuitous and
discontinuous raw material (discarding), informal contracting or subcontracting
of labor (among others), which ultimately results in the entrepreneur
considering a fictitious cost structure, causing instability in the production
process and threatening the life of the enterprise.
In addition, the idea is being installed that the first years of the life
of the enterprise should be at a loss and highlights the close relationship
that exists between the growth of the enterprise and the (parental) wealth of
the entrepreneur who often acts as support. Above all, this advantage occurs
when access to credit is difficult and your network of contacts has greater
influence than that of an entrepreneur from the lower classes.20
This aspect puts in tension the idea that is sought to be transmitted, that
anyone who wants to can carry out an undertaking and only needs a proactive
spirit.
In addition, sustaining ventures in the early stage often forces the
entrepreneur to have more than one source of income. The number of hours that
entrepreneurs work in Argentina exceeds the 48 hours per week stipulated as a
working day in Law 11,544, hovering around 49.6 hours / week and increasing to
51.9 hours / week, in the case of Greater Buenos Aires.20
These data show side B of the "entrepreneurial dream",
contradicting the idealized notion of the path towards the creation of a new
company or industry, as a way to achieve work independence or individual
development.
In addition, this unfavorable scenario leaves us with some questions that
may guide future research, for example: do young entrepreneurs know the
potential of industrial design for the realization of products? Do they
consider it useful? And in any case: would they be willing to invest in design
in the initial stage of their undertaking, in which the budget is usually
limited? The answer seems to be discouraging and makes us think that this
situation also occurs in relation to other disciplines, that is, initially all
tasks are carried out by the entrepreneur, regardless of his training or
skills. This generates, in our opinion, a lack of professionalization and
consequent loss of efficiency in the ventures.
A tentative hypothesis can be argued with the fact that the design has
failed to massively legitimize its professional scope. Furthermore,
entrepreneurship is a phenomenon with a high degree of uncertainty and is not
exclusive to a particular profession. Rather, it is related to the spirit of
carrying out ideas, facing the risks involved in innovating, and anyone who
meets these characteristics will be considered an entrepreneur. This
discourages the possibility of nuclearizing all the necessary knowledge in a
single disciplinary field, and even more, it hinders the academic approach and
the insertion of these topics in the curricula of industrial design careers.
In this way, there is a mutual ignorance between the various agents of the
entrepreneurial system. On the one hand, in pioneering industrial design
careers, they still do not have a specific training in entrepreneurship, and on
the other, there are close project disciplines such as architecture and
engineering, which have achieved a greater degree of legitimacy and social
recognition and institutional. This inevitably generates a lack of demand for
industrial designers for projects in which they could perfectly act as a
strategic manager.
We even believe that the incorporation of the industrial designer in the
various constitutive areas of the entrepreneurial ecosystem would be conducive,
not only as a promoter of an enterprise but as part of an entrepreneurial team.
Among these constituent elements we can identify:
1.
Institutions / Organizations that provide
services directly or indirectly to entrepreneurs and whose organizational
charts are usually made up of professionals from the economic sciences.
2.
Companies (both to satisfy their demands and to
participate in projects incubated within them).
3.
Universities and Science and Technology Bodies,
through training and applied research, with real links to the productive
sector.21,22
Conclusions
The analysis carried out makes it possible to make visible the problems
associated with entrepreneurship in Argentina and shows a certain intention on
the part of those who promote this type of labor practice, to hide its most
vulnerable edges. Informality, self-exploitation, lack of tools on the part of
entrepreneurs, among other aspects, seem to be legitimate characteristics when
it comes to entrepreneurship.
In addition, the figure of the entrepreneur seems to be the dominant
discourse by those who define the productive destiny of some economies, to
disengage from the generation of employment, installing a meritocratic system
in which each entrepreneur must survive in the ecosystem of the "other
economy”.23
Finally, the democratization of innovation processes is made visible, which
represents a positive development in terms of inclusion, social creativity and
local development. However, inherently there is a training deficit on the part
of entrepreneurs, who are increasingly gaining prominence and seeking to
acquire new tools and resources to carry out their projects.
In short, meeting this demand represents the greatest challenge faced by
institutions linked to entrepreneurship (Universities, States and companies),
which must rethink their role in the productive system, as well as the role
that entrepreneurship fulfill, establishing an articulated dialogue with all
the actors, to achieve an efficient ecosystem, so that the enterprises improve
their conditions and are not just another expression of disguised
self-employment.
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Conflict of interest:
The authors declare that they have no conflicts of interest. Authors Contribution
·
Federico Del
Giorgio Solfa: Conceptualization, Data curation, Formal analysis, Research,
Methodology, Project administration, Resources, Supervision, Validation,
Visualization, Writing, Original draft, Writing: review and editing.
·
Enrique D´Amico:
Formal analysis, Methodology, Resources, Writing, Original draft, Writing:
review and editing.