Contents Page: NZJER, 2010, 35(1)NameMartina Battisti andDavid Deakins

Title

Page
Number
Editorial: Employment Relations Issues
1-3
in Small and Medium Enterprises(SMEs)

Thierry Volery andJanine Pullich

Healthy Entrepreneurs for Healthy
Businesses: An Exploratory Study of
the Perception of Health and WellBeing by Entrepreneurs

Josephine Bourke,
Karl Pajo and Kate
Lewis

Elder care and Work-Life Balance:
Exploring the Experiences of Female
Small Business Owners

David Deakins andJanette Wyper

A Longitudinal and Dynamic Approach
to Entrepreneurial Learning

Rachel Lowry andGraham Elkin

Using
the
Human
Capability
Framework and Opinions of Dairy
Farmers to Explore the Shortage of
Dairy Assistants in the New Zealand
Dairy Industry

Dennis Foley

The function of Social (and Human)
Capital as antecedents on Indigenous
entrepreneurs networking

Erling Rasmussen andColin Ross

Chronicle: October, 2009–January,
2010

4-16

17-34

35-47

48-64

65-88

89-97

New Zealand Journal of Employment Relations, 35(1):1-3

Editorial: Employment Relations Issues in Small and Medium
Enterprises (SMEs)
Martina Battisti* and David Deakins**
The latest Ministry of Economic Development report, “SMEs in New Zealand: Structure andDynamics”, lists 474,415 small- and medium-sized enterprises (SMEs)1 in New Zealand,
representing 99 percent of the business population (Ministry of Economic Development,
2010). It is therefore understandable that the SME sector is often referred to as the backboneof the economy. In this issue the emphasis is on a relatively overlooked area of research; thatis the people who own and operate these firms – the entrepreneurs or owner-managers – andtheir relationships with their employees, rather than the SME. Much of the research to datehas focused on identifying characteristics of the firm (e.g. size, sector, performance andpractices, etc), in an attempt to understand their survival, growth and failure (Massey, 2007).
Yet the characteristics of the entrepreneur and owner/manager and SME labour force haveattracted far less attention, which is surprising given that one of the defining characteristics ofSMEs is their dependence on the entrepreneur or owner/manager as a leader, decision maker,
manager and day-to-day operator of the firm (Storey and Greene, 2010; or Down, 2010). The
other feature of SME research is the predominance of large scale, quantitative surveys which
often fail to capture the complexities and diversity that constitutes employment relations inthis sector (Curran and Blackburn, 2001).
Another criticism of SME research is the lack of theoretical development and focus(Sarasvathy, 2004; Blackburn and Kovalainen, 2009). One of the possible reasons for thesedrawbacks is the heterogeneous nature of SMEs and entrepreneurs and owner/managers, who
are as diverse as the businesses they run. A number of commentators have begun torecognise this lack of theory and focus and have suggested that research in this area should
concentrate just on key aspects. It is argued that instead of attempting to research theentrepreneur and the owner/manager and the SME sector, attempts should perhaps be madeto identify commonalities within subgroups and differences between subgroups in order todevelop more robust and differentiated theories (Curran and Blackburn, 2001; Sarasvathy,2004).
Against the background of these debates, this special issue endeavours to unpack the “blackbox” of SMEs by presenting papers that examine employment relations within this sector.
Applying a mainly qualitative research approach, the papers investigate the motivations ofowner/managers in formulating behaviour and employee relations. The papers illustrate theneed for additional conceptual developments in Human Resource Management (HRM) andemployment relations that is targeted specifically at SMEs. At the margin, larger SMEs may
share some of the attributes of larger enterprises but overall it is inappropriate to treat small
firms simply as ‘shrunken down’ large firms and to apply a “large firm” theory (Massey,2005). The papers also highlight the need to develop conceptual frameworks based on theexperiences of entrepreneurs and owner/managers in the context of their business.

* Dr Martina Battisti is the Deputy Director of the New Zealand Centre for SME Research, Massey University** Prof David Deakins is the Director of the New Zealand Centre for SME Research, Massey University
1

SMEs are defined as employing zero to 99 staff (Cameron & Massey, 2004)
1

New Zealand Journal of Employment Relations, 35(1):1-3
Recognising that the discipline of employment relations is broad, this special issue focuses on
three aspects: human capital; social capital; and personal health and wellbeing and draws oninterdisciplinary approaches, theories and themes. This reflects the necessity for multiple
approaches to the study of employment relations in SMEs. The papers also share a couple ofcharacteristics. Firstly, they all focus on the entrepreneur or owner/manager as being distinct
from the firm. Secondly, they are all exploratory in nature which is reflected in the use ofqualitative methodology. However, the five papers are different in that each focuses on aparticular group of entrepreneurs or owner/managers, namely women, indigenous and small
dairy farm entrepreneurs/owner/managers, set within a variety of industries. Further, they areplaced in different national and cultural contexts, for example, Scotland, Switzerland,
Australia and New Zealand. It should be noted that three of the papers were first presented atthe 2009 SEAANZ Conference in Wellington and form the basis for the special issue and thiseditorial.
The first two papers tackle the difficult and related subjects of wellness and work-lifebalance. In the first paper, Thierry Volery and Janine Pullich investigate entrepreneurs’
perceptions and awareness of their own health and well-being and whether this is crucial for
entrepreneurial success. Drawing on a multiple-case study of six high growth entrepreneurs,
their findings indicated that the entrepreneurs interviewed had a limited awareness of theirhealth and of the impact that their health status could have on the survival and success of
their business. In the second paper, Josephine Bourke, Karl Pajo and Kate Lewis explore how
women small business owners juggle their twin responsibilities of their business roles andcaring for their elderly relatives and how this impacts on their business activities. Building on
boundary theory, the authors found that despite the flexibility of self-employment, the often
unexpected nature of elder care did in fact impacted on the ability of the woman participants
to organize their roles and activities, thus resulting not only in feelings of both guilt andfrustration but also resulting in decreased business performance.
In the next paper, David Deakins and Janette Wyper examine the dynamic nature ofentrepreneurial learning by drawing on two case study entrepreneurs that have been tracked
over a five year period, from venture formation to becoming global players. Using a criticalincident approach, the authors demonstrate the importance of learning from the experience
gained in critical events and the importance of having sufficient quality of networks andadvice where previous experience is more limited. Their findings contribute to theunderstanding of transformational aspects of entrepreneurial learning and places importanceon how entrepreneurs transform their experience into entrepreneurial knowledge.
In the fourth paper, Rachel Lowry and Graham Elkin explore dairy farmers perspectives on
the capabilities required from farm assistance. Due to the changes in dairy farming
technology, the capability profile of farm assistance has changed resulting in a shortage ofskilled people. Results showed that although there have been changes in the skills required
and a need for further training, dairy farmers were more concerned with the attitudes of dairy
assistants than their skill level.
In the last paper, Dennis Foley sets out to explore the networking ability of two indigenous
groups of entrepreneurs – Australian Aboriginal and New Zealand Māori entrepreneurs. The
author argues that when the relationship between social and human capital attainment wasaddressed within the majority settler society business culture, the networking ability ofindigenous entrepreneurs can differ.

2New Zealand Journal of Employment Relations, 35(1):1-3
Finally, we would like to thank all the contributors, referees and editors of the NZJER for
their time, commitment and help in putting this special issue together.

References
Audretsch, D., van der Horst, R., Kwaak, T. & Thurik, R. (2009). Annual report on EU small
and medium-sized enterprises. Zoetermeer, Netherlands: EIM Business and Policy Research.
Blackburn, R. & A. Kovalainen (2009). Researching small firms and entrepreneurship: Past,
present and future. International Journal of Management Reviews, 11(2), 127-148.
Cameron, A. & Massey, C. (2004). Small and medium-sized enterprises: A New Zealandperspective. Auckland: Pearson.
Curran, J. and R. Blackburn (2001). Researching the Small Enterprise. London: Sage
Publications.
Down, S. (2010). Enterprise, Entrepreneurship and Small Business. London: Sage.
Massey, C. (Ed.). (2005). Entrepreneurship and small business management in New Zealand.
Auckland, New Zealand: Pearson Education.
Massey, C. (2007). Growing small and medium enterprises in New Zealand: He tangata, hetangata, he tangata. Inaugural Professorial Address, 2 August, Massey University,
Wellington.
Ministry of Economic Development. (2010). SMEs in New Zealand: Structure and Dynamics
2010. Wellington, New Zealand: Ministry of Economic Development.
OECD. (2009). Measuring entrepreneurship: A digest of indicators. Paris: OECD.
Sarasvathy, S. (2004). The questions we ask and the questions we care about: reformulatingsome problems in entrepreneurship research, Journal of Business Venturing, 19, 707-717.
Statistics New Zealand (2010). Business Operations Survey 2009. Wellington, New Zealand:
Statistics New Zealand.
Storey, D. & Greene, F. (2010) Small Business and Entrepreneurship. Harlow, UK: Pearsons
Education.

3

New Zealand Journal of Employment Relations, 35(1): 4-16

Healthy Entrepreneurs for Healthy Businesses: An Exploratory
Study of the Perception of Health and Well-Being byEntrepreneurs
THIERRY VOLERY∗and JANINE PULLICH∗∗
Abstract
With this paper, we want to emphasise the importance of healthy entrepreneurs forsustainable business development. We contribute to the field of entrepreneurship and show
how entrepreneurs assess their own health state. We contribute to the field of occupational
health by explicitly focusing the social dimension of health besides the physical and mental
well-being. Drawing on a multiple-case study of six entrepreneurs, we show that
entrepreneurs’ rarely perceive their health as a resource for business performance. Whereas
the concept of physical well-being is relatively well understood by the entrepreneurs, they
have a very limited awareness and understanding of the mental and social well-being
dimensions.

Introduction
For many people, the opportunity to own and operate their own business is seen as the chance
to realise one or more of a number of different opportunities: either to realise a dream, getadequate financial reward, work with family, or to focus on lifestyle aspirations. Suchbusiness operators are a significant group of any population. Estimates suggest thatapproximately 10% of the adult population in many industrialised countries are involved inrunning a small business venture (Reynolds et al, 2005). Setting up or running a small
business is a rigorous activity, not only physically but also mentally. A clear separation ofwork and non-work is generally hard to achieve, and a normal work day can extend to 10 or
12 hours. This involvement also influences individual well-being. However, with a few
notable exceptions (Boyd & Gumpert, 1983; Jamal, 1997) scant research has been conductedso far about the impact of business ownership upon individual well-being.
Depending on the perspective adopted, the individuals involved in business ownership havebeen identified in the literature as entrepreneurs, small business owner-managers, or selfemployed. The term “entrepreneur” is usually used to describe a a person who sets up abusiness, taking on financial risks in the hope of profit (Gartner, 2001). Entrepreneurs
typically invent new products or services and introduce them to the marketplace by launchinga business venture. The small business owner-manager is someone who runs a small scalebusiness, and the self-employed is a person working for oneself as a freelance or the owner of∗Professor of Entrepreneurship and Director of the Swiss Institute of Small Business and Entrepreneurship,
University of St. Gallen, Switzerland; thierry.volery@unisg.ch.
∗∗Research and Teaching Assistant at the Swiss Institute of Small Business and Entrepreneurship, University of
St. Gallen, Switzerland; janine.pullich@unisg.ch.
This paper was first presented as a working paper at the SEEANZ Conference 2009.

4

New Zealand Journal of Employment Relations, 35(1): 4-16
a business rather than for an employer. By definition, an entrepreneur is self-employed, butsomeone who is self-employed is not necessarily an entrepreneur. However, both
entrepreneurs and small business owner–managers are the corner stone of their businessventures and they are required to be familiar with many of the same technical skills andbusiness concepts (Schaper & Volery, 2007). Therefore, although we primarily focus on
entrepreneurs in this article, we also included small business owner–manager and selfemployed in the scope of the research.
This article is of an exploratory nature. We want to find out whether entrepreneurs are awareof health, according to the World Health Organization’s definition of occupational health(WHO, 1986), and whether this resource is perceived as crucial for entrepreneurial success.
We further investigate what determinants influence the physical, mental, and social
dimensions of entrepreneurs’ health, and how they maintain a positive life balance. We draw
on a series of in-depth interviews with six entrepreneurs.

Health Dimensions
In medical terms, the most widely agreed definition of health is as “… a state of complete
physical, mental and social well-being and not merely the absence of disease or infirmity”(WHO, 1986: 2). MacIntosh, MacLean, and Burns(2007) remarked that the WHO definitionof health is adequate for most purposes. It offers a holistic interpretation of health that is not
rooted in a medical or pathological paradigm solely. In addition, it expresses health infunctional terms as a resource that permits people to lead individually, socially, andeconomically productive lives. Nevertheless, the authors criticised that this definition does
not consider the dynamic nature of health.
“The notion of an individual as healthy if they exist in a state in which they feel welloverlooks the reality that well-being is the result of a series of processes in which theindividual interacts with other people and the environment.” (MacIntosh et al., 2007:
207)
We support the view that health is a process rather than a static state. Furthermore, we would
argue that health is created through the interaction of biological, psychological andorganizational processes (Brief, Butcher, George & Link, 1993). To view individual health asa state may unduly limit our expectations of the opportunity to create both health and illhealth within organisational settings. Health has been conceptualised in many different ways.
Besides objective indicators for an individual’s health state, such as the number of surgicaloperations a subject had undergone, the frequency of doctor visits, the number of times a
subject had been hospitalised, and the total days spent in a hospital, self-assessed overall
well-being serves as an overarching concept. Therefore, health involves more than not being
ill. It involves actually feeling well and healthy (Daley & Parfitt, 1996).

The Influence of Working Conditions on Health
It is widely recognised that employees are affected by experiences, be they physical,
emotional, or social in nature (Danna & Griffin, 1999). Within work and organisational
psychology, there is broad evidence that individuals’ evaluation of work conditions varies
with their autonomy to shape these conditions. Numerous studies have shown that stressful

5New Zealand Journal of Employment Relations, 35(1): 4-16
work situations, including high work demands and low control, are related to poor individual
health and well-being (Kahn & Byosiere, 1992; Lee & Ashforth, 1996; Van der Doef &Maes, 1999). Therefore, working conditions should support individuals’ engaging
behaviours, that is to channel personal energies into physical, cognitive, and emotional labour(Kahn, 1992).
Various studies have shown the importance of positive social interactions at work and theirinfluence on the human body (Heaphy & Dutton, 2008). Likewise, a healthy body is
supposed to be a preliminary condition for social interactions and cognitive performance atwork. This perspective builds on the established and relatively simple linkage between
individuals’ experiences of positive social interactions and salutary physiological processes
and their relevance to organisational contexts. In this respect, Heaphy and Dutton (2008)
pointed to the importance of ‘physiological resourcefulness’ as a form of positive health inwhich the body can build, maintain, and repair itself during times of rest and can more easily
deal with challenges when they occur. Similarly, (Sonnentag, 2001: 198) remarked:“… an unfavourable work situation threatens or harms an individual’s resources, suchas well-being, health, and functioning in other life domains. For example, during theprocess of working long hours, vigour decreases whereas tension and fatigue increase.
Subsequently, individuals will strive to restore their resources. To restore one’s
resources, one must invest additional resources.”
The job demand-control-support model (Johnson & Hall, 1988; Karasek, 1979; Morrison,
Payne & Wall, 2003; Van Yperen & Hagedoorn, 2003) has become a dominant model of therelationship between work and well-being. According to the model, employees working injobs characterised by high job demands, low job control and low social support will
experience a higher than average number of health problems over time than workers in otherjobs. The model focuses on specific aspects in the complex psychosocial work environment
to explain how individuals perceive and react to their job. Karasek and Theorell (1990) alsostressed the importance of using a broader perspective for the relationship between work andhealth, and proposed a dynamic version of the demand-control model, which integrates
environmental effects with person-based information such as self-esteem. One basic
assumption of the job demand-control-support model is that the relationship between workand health is one-directional, such that work characteristics as measured at one point in time
influence health at a later point in time. De Lange, Taris, Kompier, Houtman and Bongers(2004) criticise this view and suggests that work characteristics and health may also be
explained by reversed causal relationships.
Overall, Ganster and Schaubroek (1991) noticed that there is indirect support for a
detrimental effect of work stress on individual health and well-being. On the one hand,occupational studies show differences in health and mortality that are not easily explained byother factors than stress. On the other hand, within subject studies indicate a causal effect ofwork experiences on physiological and emotional responses.

Health and Entrepreneurship
Whilst management and entrepreneurship research has rarely addressed health-related issues,
occupational health psychology has well established constructs and measures to assess
employees’ health status or degree of individual well-being. However, most recent studies in

6New Zealand Journal of Employment Relations, 35(1): 4-16
this field do not question their implicit understanding of health. This seems to be problematicas most of the constructs heave been developed in a context where mostly employees of largeorganisations were under investigation. In addition, the influences of job characteristics haverarely been taken into account (Ferrie, Shipley, Marmot, Martikainen, Stansfeld & Smith,
2001; Jones, O’Connor, Conner, McMillan & Ferguson, 2007). The extent to which anorganisation influences the individuals’ health or well-being has traditionally lay outside thescope of management scholars. Integrating existing concepts and constructs in order to assess
health-related issues seems to be a promising approach in the field of management sciences.
Only few studies investigated health-related issues in entrepreneurship, and their results areambiguous at best. Eden (1975) conducted a pioneer study in the field by comparing national
survey data for 1,902 members and 183 self-employed workers. While no major differenceswere revealed in respect to work values, the self-employed enjoyed more enriching job
requirements for self-fulfilment, better physical working conditions, and more authority overother persons, and more resources with which to do the job were amongst the most highly
prized features of job settings. On the surface, the self-employed reported higher job
satisfaction, but Eden (1975) pointed out that this may in part be determined by the moreautonomous work performed by the self-employed. When the jobs of the salaried were
statistically adjusted to be equal in autonomy and control of working conditions to those selfemployed, no significant difference in job satisfaction emerged. This suggests that salaried
workers in participative structured jobs might be even more satisfied than the self-employed.
Thus, self-employment, despite its numerous advantages, does not provide workers with thegreater psychological benefits promised by the American dream.
That study, however, contradicted a similar report published by Naughton (1987) who foundthat entrepreneurs reported higher levels of job satisfaction and autonomy than salaried
managers despite the fact that the self-employed spent significantly more hours on the job. In
the mid 1990s, Jamal (1997) investigated the differences between salaried employees andself-employed people. He found that the self-employed experienced higher job stress, nonwork satisfaction, and psychosomatic health problems, and spent more time voluntaryorganisations than non-self-employed. However, no significant differences were found in job
satisfaction and mental health between the self-employed and salaried employees.
More recently, Stephan and Roesler (2009) found that entrepreneurs showed significantly
lower overall somatic and mental morbidity, lower blood pressure, lower prevalence rates ofhypertension, as well as higher well-being and more favourable behavioural health indicators
in comparison to employees in a nationally representative sample in Germany.
Boyd and Gumpert (1983) used a different research design and investigated solely the healthstatus of 450 entrepreneurs. Their study showed that entrepreneurs express a high job
satisfaction. However, this comes at a price – at least once a week 60% of those surveyedreported back problems, indigestion, insomnia, or headaches. They identified four causes ofstress amongst entrepreneurs: loneliness, immersion in business, people problems, and theneed to achieve.
Overall, there is some evidence that on average, self-employed put in 20 to 30 percent moretime at work per week than the salaried employees do. However, the few studies onentrepreneurs’ health have yielded rather sketchy and contradictory findings. The
contradictions are likely to occur due to the use of different reference groups and the relianceon self-reported health measures. In other words, it is very difficult to ask people about

7

New Zealand Journal of Employment Relations, 35(1): 4-16
subjective things like how healthy or happy they are. The answers change based on when andwho you ask.

MethodIn this paper, we use the WHO (1986) definition of health to investigate the physical, mental
and social well-being of entrepreneurs. The research is of an exploratory nature and amultiple case study approach was adopted. The case study is a research strategy which
focuses on understanding the dynamics present within single settings (Eisenhardt &Graebner, 2007). It is considered an appropriate strategy for answering research questions
that ask ‘how’ and ‘why’ and that do not require control over events because such questions
deal with operational links that need to be traced over time, rather than mere frequencies orincidence (Yin, 2003). This methodology is a potentially powerful means to examine many
issues across many cases and avoid chance associations (Eisenhardt, 1991).
We used a theoretical sampling method to identify the cases. As opposed to probabilistic
sampling, our goal was not the representative capture of all possible variations, but to gain adeeper understanding of analysed cases and facilitate the development of analytical frame andconcepts (Glaser & Strauss, 1967). We purposefully chose six entrepreneurs from a
population of high growth business ventures. These entrepreneurs had recently received
various awards for their achievements in the field of entrepreneurship, innovation, orinternationalisation. This sampling frame was chosen because these achievements are likely
to affect the health and well-being of the entrepreneur. The six entrepreneurs comprised of
two categories: younger versus older entrepreneurs on the one hand, and small versus
medium-sized businesses on the other. All respondents were male, ranging from 35 to 57
years old. They had launched their own business venture and still actively involved in theoperative management. All interviewees were married with children.
Data were collected through semi-structured interviews with the entrepreneurs. We received
sixty-three responses out of a possible eighty-four. Twelve questions remained unanswered
due to the interviewees’ inability or unwillingness to answer the questions directly.

Findings
Work load and activities
Popular literature has long stated that entrepreneurs work long hours. This is not a myth. On
average, the entrepreneurs in our sample worked 55 hours per week. This great quantity ofwork was performed with little free time for breaks, and the entrepreneurs activities werecharacterised by brevity and fragmentation.
Some of the entrepreneurs had regular working hours (e.g. they typically start their day at
8am and leave their office at 6pm) which still amount to 10 hours of work during a ‘normalday’. However, the number of activities that often took place outside regular working hours –networking events, marketing and sales meetings, and exhibitions which often implied
travelling to clients and partners – often overseas, quickly increased the number of working
hours.

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New Zealand Journal of Employment Relations, 35(1): 4-16
There were striking differences in the work-life balance of the entrepreneurs we interviewed.
While two entrepreneurs (A and C) struggled by their own admission to keep a healthy worklife balance, the others had a rather positive assessment of their health and work. The positive
work-life balance was typically reflected by a high level of job satisfaction arising from
intrinsic motivation, varied tasks, a high degree of autonomy, and the possibility to follow
tasks through from the beginning to their implementation. Entrepreneurs B, D, E and F
enjoyed a high degree of autonomy and decision latitude: the large majority of their activities
was self-initiated. This sense of freedom was reinforced by the mere fact that they could
choose to leave their office earlier in the day or to take a day off – although they rarely choseto do so. As entrepreneur B remarked:“Being your own boss gives you a free hand to make decisions regarding the hours
put in. You can be likened to a manager, but the difference between you two is thefact that you decide when to go to work. Working in the corporate world may not giveyou control over the timetable.”
The situation of entrepreneur E, a wine merchant, was somewhat paradoxical. While thisentrepreneur tremendously enjoyed his job and “couldn’t imagine for a moment doing
something else,” he recognised that his work habits, such having drinks with clients andsmoking, were not conducive to a healthy life-style.
“I sometimes feel the strains of these bad habits, but honestly life is short and I reallyenjoy every second of it. My work is my passion, but I am able to keep my work andmy private life separate. And I know when to take a break and spend some quality
time my family and friends. That’s why I’ve got a good work-life balance…”
All the entrepreneurs observed were living in a stable relationship. In addition, all of themhad a family with several children for which they dedicated regular time (e.g. an entrepreneur
stressed the importance to have dinner with his family every night, to put his children to bed
and to spend regular holidays with his family; another entrepreneur made the commitment
not to work during the weekends). In other words, entrepreneurs can preserve sufficientregular ‘moments of freedom’ despite their hectic work schedule. Further indications of ahealthy life-style were; regular and balanced meals and regular physical training by the
majority of the entrepreneurs observed.

Perception of health and well-being: The results of the semi-structured interviews
Entrepreneurs had a rather vague idea of health and its key dimensions. When asked to give a
personal definition of health, their perceptions varied greatly and a range of definitions were
offered, such as: “If you have the necessary energy to work. If you are able to work, then you
are healthy. If you feel mentally vigorous.” or “Being powerful and highly productive, noabsenteeism or sick days.” or “Being free of pain, which I’m not.” or “To be able to perform
all the tasks I planned without experiencing too much external pressure. Being able to havetime out and enjoy doing nothing.” There was a general perception that health is intrinsicallyrelated to the ability to perform their tasks as an entrepreneur. In addition, health was often
described from the negative side —’sickness’, ‘pain’, or ‘pressure’ are often mentioned in thedefinitions offered, thereby emphasising a pathological dimension of health.

9New Zealand Journal of Employment Relations, 35(1): 4-16
One entrepreneur had a broader perception of health: “It’s definitely more than the absence ofsickness. We will never be totally free of sickness or deficiencies. The body must be able tobalance. Health is the basis for a successful life and a successful business.” This entrepreneur
was also fully aware of the importance of his personal health to successfully run his
company. A summary of the results describing the physical, mental and social dimensions ofhealth and well-being is shown in Table 1.
There is a significant overlap between the perception of physical well-being and thedefinitions of health outlined previously. Here again, it is the negative side of well-being
which is often mentioned (‘exhaustion’, ‘pain’, ‘fatigue’, and ‘ache’ are prevalent in thedefinition offered). Physical well-being is often mentioned in the context of (physical)
performance, which can relate to work (e.g. “Having the energy to fulfill my obligations.”) or
to sport (“Being able to hike up a mountain.”). The entrepreneurs perceive the main threats totheir physical well-being as being long working hours and stress at the workplace. In
addition, two entrepreneurs mentioned eating habits (unhealthy meals, drinking alcohol) as apotential cause of their suboptimal physical health status.
The entrepreneurs were quite aware of the measures which could improve their physical wellbeing. The measures identified were well-known for people to have a ‘healthy life style’ andthey fall in three categories: sufficient rest, eating balanced meals, and exercising regularly.
We see from Table 1 that only three entrepreneurs were able to formulate a definition ofmental or psychological well-being. The definitions offered are vague at best, such as“Having a good mental ability, thinking fast, responding to people I come across in a way tounderstand them by putting myself in his/her position.” or “Mind and soul must be in order,
must be well structured. You feel strong if your inner world is cheerful.” One entrepreneur
offered a definition which, prima facie, has no direct relevance to mental health: “Being able
to catch up with innovation and technical advances. Being a part of society, being informed
about what’s going on in the world.” It was only after the entrepreneurs were prompted todescribe the threats and opportunities to their mental well-being that a broader, meaningfulperspective of this health dimension emerged.
All the threats mentioned by the entrepreneurs are in line with previous research about stressfactors (Danna & Griffin, 1999; Jamal, 1997). The threats mentioned fall into the three maincategories identified by Boyd and Gumpert (1983): loneliness (“There is nobody in the firm
to whom I could fully delegate my tasks and duties. The job is somehow unnerving. There isa lot of strain”); immersion in business (“It is hard to relax and get away from business
related problems. Sometimes I work too much”); and people problems:“I would like to test new approaches or find new solutions and products, but whatever
I suggest it is not appreciated by my colleagues. I get the feeling that my decisions are
not accepted by the co-owners of the business. But they would never state theiropinions frankly. They just show their discomfort.”

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New Zealand Journal of Employment Relations, 35(1): 4-16
Table 1: Overview of perceptions of physical, mental and social well-being by entrepreneurs
andWhat does physical ‘wellbeing’ mean to you?

Where do you see threats
to your physical well-being
at work?

What does mental ‘wellbeing’ mean to you?

A
55
years
70
hours/
week
married,1child
14
employees
Turnover: €2.7m

Having the energy to fulfill
my obligations. Being able towalk for quite a while without
feeling exhausted. When I
feel vigorous, when I don’t
have any backaches.

Working long hours; having
irregular, big meals. Only
three days of vacation per
year. Not being able to relax,
sleeping disorders. Only a
few days off the job [living on
the company site].

Being able to catch up with
innovation and technicaladvances. Being a part ofsociety,
being
informed
about what’s going on in theworld.

Entrepreneur
business profile

B
57
years
50
hours/week
married,3
childrenMBA
140
employees
Turnover: € 20m

C
37
years
60
hours/
week
married,2childrenapprenticeship, exec ed.
20
employees
Turnover: € 3m
D
35
years
50
hours
/
week
married,childrenapprenticeship
15 employees
E
42
years
55
hours/
week
married,childrenapprenticeship
4 employees
F
54
years
50
hours/
week
married,childrenapprenticeship
50 employees

Where do you see threats
to your mental well-being
at work?
I would like to test new
approaches or find new
products, but whatever I
suggest it is not appreciatedby my colleagues. I get the
feeling that my decisions are
not accepted by the coowners of the business. But
they would never state theiropinions frankly. They justshow their discomfort.

What does ‘social wellbeing’ mean to you?

Where do you see threats
to your social well-being atwork?

No clear statement. The
entrepreneur mentions his
wife, his daughter, and theextended family. Friends arealso important. It would benice to have some friends to
go on holidays to improve
my social well-being.

Bad communication patterns
between me and the coowners.

Being free of pain, having agood night’s sleep, notfeeling
fatigued,
being
resilient and able-bodied.

Problems at work influencemyphysicalwell-being,strain and tension.

Having a good mental ability,
thinking fast, responding topeople I come across in a
way to understand them byputting myself in his/her
position.

I perceived my lack of
hardiness, optimism, andself-esteem is a serious
threat to my mental health

Keeping a close-knit family,
cultivating friendships, trustin family and friends. Having
a good reputation in society.

It’s all about the time that isavailable to be spent withfamily and friends. Friends
often miss out but they are
no less important. Once
there was a person I could
not work with and thatcaused a lot of strain. When
we finally decided to fire her,
I felt this was better for thebusiness and for me.

Being able to hike up a
mountain. Reaching its peakwith a small break every now
and then. Due to myoverweight I need too many
breaks at the moment.

Overall, I struggle to keep agood work-life balance. I am
10 kilos overweight andhave a high blood pressure.

Depression - the edge of
darkness, the bane of thebold and restless. It strikes
hard, fast and deep, and noone’s immune

There is nobody in the firm
to whom I could fully
delegate my tasks andduties. The job is somehow
unnerving; there is a lot ofstrain.

Being well integrated withina social network. Having
good relationships with myfamily and friends.

None.

Long working hours, stress.

Mind and soul must be inorder,
mustbewell
structured. You feel strong if
your inner world is cheerful.

It is hard to relax and getaway from business related
problems. But by seeking
help, I could stop being a
victim of my own making.

None.

If an employee is not in linewith me, I think that’s achallenge. If we cannot
settle on a task in the longrun, that’s a problem.

Dining out, drinking wine andsmoking is somehow part of
the job [wine merchant], but
it’s definitely not healthy.

The absence of depression,anxiety, stress or burnout.

Confronted with the financial
crisisI
feel
under
considerable strain.

None.

I don’t feel like I can fully
trust my employees. There isno one to whom I could handover the business.

None. The contrary. [ownshis own health centre, works
part-timeasfitness
instructor]

None.

None.

None.

There are people around me
that can make me sick.

Being free of pain, being
resilient and powerful.

Being free of pain. When I
wake up with backaches or ahead ache I would prefer notgetting up at all. Having agood night’s sleep, which I
seldom have.
I have to pay attention to thesignalsofmybody.
Everyone needs to find out
what is good for him or her.
We tend to ignore thesesignals.

11

New Zealand Journal of Employment Relations, 35(1): 4-16
Stress, however, is not exclusively a reaction to unpleasant experiences, nor does it stop
being a problem after one achieves financial success. The entrepreneur must carefully weighlong hours and personal deprivation against sizeable – but elusive – rewards. Twointerviewees seemed to be well-aware of this tradeoff: “My job is not only about making
money, it’s my hobby as well” or “Being successful enhances my mental well-being. But
being successful does not only imply gaining money. If someone calls and says our firm wasrecommended, or if one of our apprentices gets a good grade that means being successful
too.”Once entrepreneurs acknowledge that stress is a problem they face, they can begin to dosomething about it. Two different approaches are suggested to reduce stress. The best
antidote to immersion in business is getting away from it at all: one entrepreneur for example
tries to do something that is different to his daily routine, i.e. going to see an exhibition.
Another approach is to find satisfaction through other activities outside the company. One
entrepreneur said in this respect: “In the evening I retreat and read the newspaper for about
half an hour. I try to be positive about every challenge; I think every problem can be achance.” Another says: “I try to educate myself.”
Social well-being is even less understood than mental well-being. Only three entrepreneurs(A, B, and C) were able to formulate a definition of social well-being. One entrepreneur saysthat social well-being essentially entails “Keeping a close-knit family, cultivating friendships,
trust in family and friends, having a high reputation in society.” Another entrepreneur madeno clear statement, but he mentioned his wife, his daughter, and his extended family. He alsostressed the positive role of friends.
Worryingly, employees and co-owners are mentioned by four of the six entrepreneurs as oneof the major threats to their social well-being. One entrepreneur says for example: “I don’t
feel like I can fully trust my employees. There is no one to whom I could hand over thebusiness.” Another entrepreneur remarks: “There are people around me that can make mesick.” Conversely, two entrepreneurs perceived their employees as a source of positive
influence on social well-being: “Good employees, a good team which has a positive impact
on the business and the customer relations,” says one. Another entrepreneur points out: “Myjob and our team encourage me. We achieved a lot in recent years with the team. That is
empowering and a confirmation that we are on the right track.”
Just as with mental health issues, entrepreneurs try to cope with social issues by finding
emotional support – having contact and/or interaction with others who show concern,
listening, displaying empathy, or assisting in self esteem or the individual sense of mastery(Joudrey & Wallace, 2009). Three entrepreneurs mention social support as a form ofinterpersonal coping resources whereby one person helps another to enhance and improvetheir well-being. One entrepreneur says: “I try to meet with all stakeholders on a regularbasis. I try to undertake as much as possible with my family, skiing with my children. My
office door is always open for employees.” Another mentions: “I try to balance work, family
and friends. It’s sometimes hard to find this balance.” Yet another remarks: “I try to balance
work, family and friends.”

12

New Zealand Journal of Employment Relations, 35(1): 4-16

Conclusion
The purpose of this explorative paper was to get an insight into the nature of entrepreneurial
work and to shed some light on the physical, mental and social well-being of entrepreneurs.
Our findings indicate that entrepreneurial work is characterised by a heavy workload withlittle free time for breaks, and jobs characterised by brevity and fragmentation. The
entrepreneurs observed worked on average 55 hours per week. They have a hectic work
schedule, and high decision latitude. Hence, the two most frequent costs of businessownership are the overwhelming dominance of professional life and the personal sacrifices it
entails.
Our findings also suggest that entrepreneurs have a limited awareness that their health is a
resource which can influence their long term business performance. They define health froma negative side (i.e. not being sick) and perceive health as a means to perform their tasks. In
general, entrepreneurs are mainly aware of the physical dimension of health and well-being,
and able to identify the threats and opportunities pertaining to this dimension. They are lessaware of the mental and social dimensions of health. Given the demand of starting andgrowing a business, entrepreneurs often feel that they are too immersed in their business andare, hence, deprived of outside activities. Consequently, stress is a major factor affecting themental well-being of entrepreneurs. Consistent with previous research (Boyd & Gumpert,
1983), we found that stress arises from loneliness, immersion in business, and interpersonal
problems with business associates and subordinates. A minority of entrepreneurs were awareof emotional support as a form of interpersonal coping and a way to improve their social wellbeing.
A number of implications have emerged from the results of the present study. First, when astressful, adverse situation arises in business field some preventive strategies such asenhancement of entrepreneur’s emotional intelligence, strengthening cognitive and emotional
regulation coping mechanism (positive perception, appraisal and expression of emotion,
understanding and analysing emotion) may have a buffering effect on the stress. Also,
cultivating interpersonal relations skills in managing others’ emotions help people to regulate
moods in positive direction and try to establish intimacy with them. Strengthening theinternal resources such as hardiness, optimism, positive health and self-esteem will mediate
the choice of coping strategies by altering the individual’s cognitive appraisal process in sucha way that the entrepreneurs are able to reframe or reinterpret adverse experiences in theirbusiness venture.
Furthermore, it is evident that entrepreneurs with such strong internal resources prefer relying
on functional coping strategies such as acceptance, positive focusing, refocus on planning,
positive reappraisal and putting into perspective to dysfunctional coping strategies such asself blame, or blaming others which may facilitate to transform cognitively negative event
into a potential growth generating experience. From a health point of view, it is expected thatthe entrepreneurs who are engaged in problem-focused coping strategies generally
demonstrate fewer indication of distress and maladjustment.
This study suffers from three main limitations. First, the small sample of entrepreneurs
observed and interviewed makes it difficult to generalise the results. Second, we were able toprovide only a ‘snap-shot’ of entrepreneurs’ work load and their view on well-being. Third,
interviews can provide self-reported answers which do not always reflect the reality.

13

New Zealand Journal of Employment Relations, 35(1): 4-16
Clearly, given the importance of entrepreneurship in today’s economy, further research isneeded addressing the well-being of the entrepreneurs who are the corner stone of so manybusiness ventures. Future research about the health of entrepreneurs should, therefore,
comprise larger, representative samples and be longitudinal. It would also be of interest tomeasure key physical health indicators (e.g. blood pressure, cholesterol, body mass index)
and to control for key factors which have a well-known influence on well-being (e.g. age,education, smoking habits, and chronic diseases). We support the view that health is aprocess, not a static state. Furthermore, we would argue that health is created through theinteraction of biological, psychological and organisational processes. As suggested by
MacIntosh et al. (2007), this approach would allow a detailed and holistic view of thepossible relationship between the individual health of the entrepreneur and organisational
health.

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16New Zealand Journal of Employment Relations, 35(1): 17-34

Elder care and Work-Life Balance: Exploring the Experiences ofFemale Small Business Owners
JOSEPHINE BOURKE*, KARL PAJO** and KATE LEWIS***

Abstract
Many women seek self-employment as a way to better manage their work and family needs,
particularly when they have children. However, the requirements of self-employment may
compromise work-life balance in ways which are not always recognised. This is particularly
true with elder care, because the general awareness of work-life balance issues for small
businesses has not translated into understanding elder care. This exploratory study focussed
on a small group of self-employed women with elder care responsibilities, finding that these
women proactively managed their role challenges. However, the complex inter-relationshipbetween such responsibilities, and the strategies utilised to both manage and mitigate theirimpact, was found to have implications for both the individual (in terms of identity andemotion) and the firm (in terms of performance).

Key words: work-life balance, small business, elder care, women, boundary theory

Introduction
The potential for self-employment to allow women to create solutions to address issues they
face in managing both work and family responsibilities is well established (Heilman & Chen,
2003; Kirkwood & Tootell, 2008; Loscocco & Smith-Hunter, 2004; Wellington, 2006).
Research in this tradition has frequently focused on the implications of self-employment for
how women conceive their role (and identity) as a mother and how they manage their
responsibilities in caring for children (DeMartino, Barbato, & Jacques, 2006; Marlow, 1997;
Parasuraman & Simmers, 2001). However, with changing population and social trends, it
may be that now (and in the future) women are likely to spend more time caring for theelderly than they do caring for children (Doressworters, 1994). New Zealand, like many otherdeveloped nations (Maestas & Zissimopoulus, 2010) has an ageing populationi, and statistics
indicate that, alongside a marked increase in those aged over eighty (Department of Labour,2007), an age group which often requires significant daily support, there is also a decreasing
availability of non-working women, the group who previously provided much of the familycare-giving in the community (Department of Labour, 2007; Merrill, 1997). Government
policy, which favours ‘active’ or ‘productive’ ageing’, also relies on family support to be
successful (Gadson, 2003; Ministry of Social Policy, 2001) yet there appears to be little
understanding of how these changes will affect working women, and more particularly, what
the impact might be on female small business owners. This is a critical gap in understanding
given that New Zealand has a business population that is dominated by small firms (97% of*Josephine Bourke is a Lecturer in the School of Business at the Open Polytechnic of New Zealand.
Dr. Karl Pajo is a Senior Lecturer in the School of Management at Massey University.
***
Dr. Kate Lewis is a Senior Lecturer in the School of Management at Massy University.
**

17

New Zealand Journal of Employment Relations, 35(1): 17-34
all enterprises employing fewer than 20 people) and 36% of the total number of selfemployed are women (Ministry of Women’s Affairs & Ministry of Economic Development,
2008). It is, therefore, important to explore more fully the challenges associated with eldercare and the implications it may pose for female entrepreneurs looking to manage their lives
and grow their businesses, especially given that one of the dominant reasons women enter
self-employment is to find the flexibility that will allow them to better juggle their multiple
roles (Smith, 2000).
Despite the growing likelihood of an increase in elder care responsibilities for many
individuals, including small business owners, self-employed and other entrepreneurs; eldercare issues have largely escaped the attention of researchers interested in the dynamics ofwork-life balance. Nevertheless, there exist a small number of studies that have highlighted
significant personal and work-related issues for employees with elder care responsibilities(Davey & Keeling, 2004; Fast, Williamson, & Keating, 1999; Merrill, 1997). The present
study extends this research through a small-scale, exploratory project that concentrates on
examining the lived experience of elder care on the work-life balance of self-employed
women. We were especially interested in documenting how female small business owners
establish and negotiate boundaries between domains, how they seek to harmonise theirmultiple roles, and to understand the impact elder care responsibilities might have on theirbusiness. In addressing these questions, we also respond to calls for more in-depth,
qualitative studies investigating the dynamics of work-life integration (see Kreiner,
Hollensbe, & Sheep, 2009) and look to contribute to the embryonic body of knowledge
pertaining to elder care and work-life balance – and specifically in relation to entrepreneurial
women who own their own business. The remainder of the introduction and literature review
is organised as follows; firstly, we provide a brief rationale for the relevance of studies
investigating work-life balance issues for self-employed female entrepreneurs. We note thatthe potential impact of elder care has not been widely investigated before reviewing the only
major New Zealand study that has addressed elder care and employment issues. We conclude
with a discussion of boundary theory; highlighting two recent studies that provide usefultheoretical concepts to frame our analysis.

Elder Care and Self-employment
While the relationship between work and non-work activities has sparked the interest ofcommentators and researchers alike for many decades now (Eby, Casper, Lockwood,
Bordeaux, & Brinley, 2005; Kossek & Ozeki, 1998), it is also the case that work-family
issues have been a particular concern of investigators engaged in entrepreneurship and small
business research. Jennings and McDougald (2007) argue that investigations into the workfamily nexus are highly relevant to entrepreneurial and small business scholarship for at least
three reasons. Firstly, they note that there is a considerable body of research suggesting thatmany small business owners are motivated to start their new ventures by a concern toenhance congruence between their work and non-work lives. Secondly, there is also evidence
that achieving work-life balance remains an important objective for many small businessowners, and features prominently in assessments of the success of their start-ups. Finally,
Jennings and McDougald (2007) note that numerous studies have demonstrated that elements
associated with the family or non-work domain can influence activities and outcomes in thework sphere. Moreover, they go further and propose that aspects of the work-family interface
may partially explain pernicious gender differences in the ‘success’ of male-headed andfemale-headed business ventures that have not been fully accounted for by existing theories.

18

New Zealand Journal of Employment Relations, 35(1): 17-34
More specifically, Jennings and McDougald speculate that female small business owners arelikely to experience much greater levels of work-family conflict than their male counterparts,
and are therefore more likely to respond by adopting coping strategies that inhibit businessgrowth and development.
Consistent with Jennings and McDougald’s thesis (2007), studies that have examined worklife balance issues for female entrepreneurs often identify care-giving roles (primarily thoserelated to children) as being associated with increases in the intensity of work-life conflict
and as affecting the intentions and practices of female small business owners (Kim & Ling,
2001; Stoner, Hartman, & Arora, 1990). What is notable, however, is that these studies have
paid scant attention to the possible effects of elder-care responsibilities despite widespreadacknowledgement of changing population demographics which suggest that older women
will remain involved in the workforce for longer, while continuing to have increasing
responsibility for elder care (Davey & Keeling, 2004; Ministry of Women’s Affairs, 2008;
Statistics New Zealand, 2005). This is not surprising given that the impact of elder care on
work-life balance in general has attracted only limited interest (Murphy, Schofield,
Nankervis, Bloch, Herrman & Singh, 1997; Nikzad, Zarit, Pearlin & Gaugler, 2005;
Romoren, 2003). Moreover, much of the published research has concentrated on investigating
health issues for the elderly, with only passing attention given to families and to theimplications of elder care for the working care-giver or small business owner (Fast, et al.,
1999; Gilhooly & Redpath, 1997; Matthews & Rosner, 1988; Merrill, 1997). Researchers
who have addressed elder care issues from the perspective of the working carer havesuggested that it might lead to a loss of income for care givers if they have to give up work
(Bacik & Drew, 2006; Evandrou & Glaser, 2004; Wakabayashi & Donato, 2005), difficulties
in making a return to the workforce if they take time out for care-giving (Merrill, 1997) andcould contribute to personal health issues (Fast, et al., 1999; Kossek, Lautsch, & Eaton, 2006;
Lee, Walker, & Shoup, 2001).
The major published New Zealand research that has investigated work-life balance issues for
employees with elder care responsibilities sought information from participants employed in
two large city councils (Wellington and Christchurch) (Davey & Keeling, 2004). It wasestimated that elder care was a relevant concern for approximately 10% of the employees,
and although this may not seem like a large number, most of the respondents reported that
their involvement in elder care was ongoing and long-term. While attitudes towards caregiving were generally positive, many participants expressed concerns for what the future
might hold and it was notable that those with greater commitments were much more likely toreport negative attitudes, emotions and experiences. Crises associated with care giving werecommon, with many of the respondents indicating that these often necessitated taking time
off work. Consistent with Jennings and McDougald’s (2007) arguments for the salience ofgender, women were much more likely to report greater levels of involvement in elder care(in terms of type of care, hours invested, and frequency) than their male counterparts,
highlighting the importance of further studies that focus specifically on the experiences ofwomen. Finally, although the two councils that served as case-study organisations for Daveyand Keeling’s study were generally perceived as supportive of their employees’ efforts tomanage work and elder care commitments and while care-giving responsibilities were notoverly intensive, nonetheless, it was also evident that balancing work and elder care often
resulted in considerable strain and stress. Noting the need for further research, Davey and
Keeling (2004) suggested that investigations into the implications of elder care in a wider
variety of workplaces would be useful.

19New Zealand Journal of Employment Relations, 35(1): 17-34

Boundary Theory
Much of the existing work-family literature has focussed individuals’ experiences of thework-family interface, and especially on conflict and negative spillover between role domains(Clark, 2000; Jennings & McDougald, 2007). This research stream tends to view thecompeting demands of the different spheres of life as incompatible and regards individuals’
efforts to reconcile their various life roles as laden with difficulty and inherently problematic.
Efforts to satisfy the responsibilities and expectations associated with different roles creates
tension and strain and can lead to negative cognitions, emotions and behaviour spilling fromone domain to another. Many of the researchers in this tradition are interested in quantifying
strain, measuring the negative outcomes associated with conflict, and specifying thedeterminants of work-family interference (Eby, et al., 2005). However, the preoccupation
with negative spillover and work-family interference has been criticised for overlooking
possibilities for cross-domain enrichment and facilitation, for treating individuals as mostly
passive recipients of environmental influences, and for objectifying the work and non-workspheres of life and encouraging the reification of work-life balance (Clark, 2000; Cohen,
Duberley, & Musson, 2009; Frone, 2003; Lewis, Gambles, & Rapaport, 2007; Parasuraman& Greenhaus, 2002).
However, work-family researchers have also been interested in exploring individuals’
conceptions of work-life integration and investigating how they cope with, transition
between, or manage multiple role demands. Boundary theory has often been applied in thisresearch tradition (Clark, 2000; Cohen, et al.,; Kreiner, et al., 2009; Nippert-Eng, 1996). It is
generally accepted that conceiving and enacting boundaries around the different realms of ourlife allows us to impose a measure of order and assists us in making sense of the world(Ashforth, Kreiner, & Fugate, 2000; Nippert-Eng, 1996). Boundaries are useful because they
set limits on the parameters of a given domain. A common approach amongst boundary
theorists is to distinguish between boundaries that are strong (or thick) versus those that are
weak (or thin) (Ashforth, et al., 2000; Kreiner, et al., 2009). Strong boundaries are evident
when role domains are impermeable (that is, when domains cannot exert influence on one
another) and when there is very little scope for flexibility or individual control. Strong
boundaries both reflect and promote segmentation, and encourage individuals to view therealms of work and non-work as separate and quite distinct entities. In contrast, weakboundaries are those that are highly permeable (permitting cross-domain influence) and allow
for considerable flexibility and autonomy. Weak boundaries both reflect and promote
integration between domains, and encourage us to view the various spheres of life asinterconnected.
Like others who have explored relations between the domains of work and non-work we useboundary theory as an orientating conceptual framework to inform our understanding of how
our participants might create, maintain, and experience the different spheres of elder care andwork (for examples see Clark, 2000; Nippert-Eng, 1996). We believe that boundary theory isan especially useful heuristic device as it places emphasis on the agentic, negotiated andsocially constructed nature of efforts to differentiate, and to manage transitions between,
various role domains. Boundary theory directs attention to how individuals attribute meaning
to their various roles, how they negotiate with others to delineate domains, and the highly
dynamic and situated nature of this process.

20

New Zealand Journal of Employment Relations, 35(1): 17-34
Two recently published qualitative studies utilising boundary theory provide helpful
frameworks to guide our own research agenda. In the first of these studies Kreiner et al.,(2009) drew on the experiences of Episcopalian clergy to develop a grounded model of workhome boundary work. They proposed that individuals have generalised preferences for thetype of boundaries that they enact, but that preferences for either segmentation or integrationinteract with environmental affordances to create potential mismatches. Incongruence
between an individual’s desired level of segmentation or integration and what is experienced
affects overall levels of work-home conflict both directly, and indirectly through perceptionsof specific behaviors, events or episodes that violate boundaries. These specific boundary
violations can either be intrusions, where efforts to maintain segmentation are unsuccessful,or they can be distance violations, where greater integration is desired in the face ofsegmentation. However, most relevant to our research is Kreiner et al’s (2009) explorationand categorisation of various boundary work tactics that respondents use to address workhome boundary violations and to reduce work-home conflict. These tactics include a variety
of interrelated behavioural, temporal, physical and communicative strategies that individuals
adopt to respond to, and to preempt, the negative effects of work-home challenges. Because
boundary work tactics appear to play a pivotal role in the experience of work-life conflict wefelt they would provide a useful lens to interpret and better appreciate how female
entrepreneurs actively negotiate and manage their elder care and work responsibilities.
Our study was also informed by the autoethnographic account of home-work dynamics
presented by Cohen et al. (2009). They suggest a metaphorical framework for understanding
work-life experiences that distinguishes between two broad groupings reflecting contrastinglevels of control over the work-home interface. The first broad grouping, which they labeled‘maintaining order’, entailed the purposeful use of strategies that enabled feelings of control
and the exercise of personal agency. In contrast to traditional conceptualisations that view
segmentation and integration as polar opposites and as reflecting quite distinct modalities foraddressing relationships between home and work (see Nippert-Eng, 1996), Cohen et al(2009), instead, highlight how both are conscious strategies that can be used jointly to createa sense of orderliness. The second broad grouping, which Cohen et al (2009) labeled‘experiencing disorder’, is distinguished by the occurrence of episodes and events that leadindividuals to feel a loss of control over connections between the different realms.
Experiences of disorder can range from relatively mild loss of control (seeping) to situations
where control is perceived as virtually non-existent (overwhelming). Cohen et al (2009) notethat a key characteristic further differentiating situations associated with an increasing senseof a loss of control is a corresponding escalation in the emotional intensity of the experience.
The framework developed by Cohen et al (2009) shares many similarities with Kreiner et al(2009)’s model of work-home boundary work. More specifically, the purposeful strategies
used to maintain order correspond to boundary work tactics and experiencing disorder isanalogous to the concept of boundary violations. This suggests that focusing on these key
features of the home-work nexus is appropriate. In addition, Cohen et al (2009)’s study
highlights the potentially vital contribution of agency, control, emotions and identity to the
lived experience of home-work dynamics.
Using qualitative and narrative approaches we concentrate on exploring how female smallbusiness owners conceive of and manage their elder-care and business roles. We focus on theimplications of elder care for business activities, elucidate common boundary work tactics
and consider the role of emotions and identity. In so doing this paper responds to recent calls
for more research on the work-home interface for entrepreneurs and the owners of small
firms (Jennings & McDougald, 2007) and to appeals to broaden the work-family research

21New Zealand Journal of Employment Relations, 35(1): 17-34
agenda to include more in-depth, qualitative studies that explore different dimensions ofwork-home conflict (Kreiner, et al., 2009).

MethodThe study was small-scale and exploratory in nature (i.e. seeking to identify patterns andthemes) (Collis & Hussey, 2003). The chosen data collection strategy was in-depth
interviewing with key informants (Kvale, 1996). This choice was consistent with the type ofstudy and research question, as well as being congruent with the interpretive perspectives
underpinning the study (Schwandt, 2000). This approach allowed for an emphasis on the
different voices, perspectives and experiences of the self-employed women who participatedin the study.
A purposive sampling approach (Patton, 1990) was taken to identify self-employed womenwith elder care responsibilities who might wish to participate in the study. Recruitment
strategies utilised included advertisements and e-mail invitations to lists of members oforganisations (e.g. Chambers of Commerce). However, the most effective approach proved to
be a combination of word-of-mouth and snowball sampling (Marshall & Rossman, 2006).
The interviews were semi-structured and focused on a number of themes including: the selfemployment experience; multiple roles and overlaps/tensions between them; and, work-lifebalance needs and strategies. Interviews took place in a variety of locations and the choice ofvenue was made by the participant in order to alleviate any nervousness they might befeeling, and to ensure they felt safe when revealing their experiences to the interviewer. On
average, the interviews were one hour in length. Informed consent was obtained via a written
form and anonymity, along with other rights, was assured. With the permission of eachinterviewee, the interviews were recorded and transcribed in order to facilitate effective data
analysis.
Data analysis was an inductive process that combined iterative cycles with processes of data
reduction (Miles & Huberman, 1994) and focused on content and thematic analysis.
Emphasis was given to the identification of patterns in the data and quotations from theinterviewees have been used to illustrate and support the themes/ideas that are presented.

Participants
The participants in this research were eight women from the Wellington region of New
Zealand1. These women owned a variety of businesses, predominantly in the service sector.
Most of these ventures were micro-businesses, with only two employing additional staff. The
participants had a wide range of business experience, including several who had just recently
started new ventures and others who had been operating their business for many years. Mostof the women reported ongoing involvement in elder-care for the last 5-6 years (for asummary see Table 1).

1

No real names have been used.

22

New Zealand Journal of Employment Relations, 35(1): 17-34
Table 1: Description and background characteristics of participants
Name

No. of Employees(including ownerBusiness Style

Dorothy
Stephanie
Jocelyn
Terri2Mary
Jasmine1111
1
22 (including
part-time)1
4 (pluscontractors

Charlie
JackieElder careinvolvement

Years inelder careSelf-employed
Self-employed
Self-employed
Self-employed
Self-employed
Owner/Manager

Years inBusiness(approx)
15
2
9
20
8
3

MotherMotherMotherMotherMotherParents

5
5
5
20
6
6

Self-employed
Owner/Manager

1
6

FatherFather6
6

Most of the participants had already dealt with the loss of one parent at some stage and theirsurviving elder(s) were now requiring considerable assistance, with several in rest home careand others needing ongoing support from their family and also from external care providers.
We briefly elaborate on the background of each participant below:

Dorothy is the only sister still available in her mother’s home town, although she does have abrother who is within commuting distance. She visits her mother daily (she lives in a
residential care facility) even though there are difficulties with increasing dementia.
Dorothy’s business is focussed on individual client interaction and she needs to be available
when appointments are made.
Stephanie has a brother who is active in sharing their elder care responsibilities, although it
appears that Stephanie is often the first point of call. Stephanie’s mother is still in her own
home which is about twenty minutes away. Stephanie has a fairly new home-based writing
business which she is actively seeking to grow.
Jocelyn’s mother used to live some distance away, but with encouragement from her adult
daughters, has now moved closer to them. Sharing elder care responsibilities with her sisters,
Jocelyn is a self-employed contractor who works as a policy analyst.
Terri has a successful business which requires her to be available for clients in theworkplace. Terri’s mother has recently moved into an apartment within a residential carecomplex, but still has her own home. Terri has been involved in caring for her grandmotherand then her father, so has had considerable experience in managing elder care alongside selfemployment.
Mary, the eldest in a large family, runs her own business as a consultant. Mary’s siblings arevery active in their care of their mother, who lives some five hours’ drive away from Mary’s
own home, in a residential care facility. Mary contracts in the human resources industry, andis well-established as a service provider in this area.

2

Terri had been involved in caring for her grandmother and father before her mother.

23

New Zealand Journal of Employment Relations, 35(1): 17-34
Jasmine is the only sibling in her family still living in New Zealand, with both parents
requiring support, and a business in its early years. Alone among the participants, Jasmine issupporting both parents, who live in their own home, in a smaller centre some five hours’
drive away. Dealing with full-time employment to support the business development,
Jasmine is partner in a medium-sized retail business.
Charlie manages the support of her elderly father who is in residential care in another city.
Although Charlie has brothers located in the same city as her father, she nonetheless takes
much of the care-giving responsibility herself. Charlie has recently started up her own
business providing personal services, but also works part-time while she seeks to get herself
established.
Jackie makes a special journey every Saturday to visit her elderly father, who lives alone.
The journey is about an hour, and Jackie has a sister who lives closer, and who is usually the
first to be called in an emergency. Jackie has a number of employees who work for her small
consultancy business.

Results and Discussion
The aim of this exploratory study was to examine the lived experience of self-employed
female business owners who also manage elder care. We do so by considering three vital
aspects of this experience. Firstly, we consider the implications of elder care for the owner’sbusiness. Secondly, we elucidate boundary work tactics used to address challenges associatedwith managing elder care and a business at the same time. Finally, we consider emotional andidentity-related aspects of elder care. We found these three aspects of the work-family nexus
to be closely interconnected, often with reciprocal relationships. For example, decisions tolimit business growth often had emotional and identity-related consequences, andsimultaneously aspects of identity and the emotions associated with elder care could also
shape owners decisions to prioritise elder care responsibilities. Likewise, boundary work
tactics implemented to address boundary violations and work-home conflict associated withelder care and business responsibilities enabled our respondents to mitigate negative
emotional spillover, and were often focused on providing opportunities or space forcontinued involvement in the work domain. We elaborate on the main findings in relation toeach of these elements in the relevant sections below.

Elder Care and Business Performance
It is notable that many of our respondents sought to reconcile the competing demands of eldercare and self-employment by prioritising the non-work domain and adopting strategies thatwere likely to restrict the performance and/or potential of their firm. Illustrative of this areseveral women who had elected to severely limit their business commitments, often at a time
when business growth was eminently possible. For example, Mary, a contractor in humanresources, indicated that in response to a crisis associated with her elder care responsibilities
that she had completely relinquished her business for a significant period of time. Moreover,upon resumption of her business role she elected to only accept contracts that would allow
her the necessary flexibility to provide care for her mother when it was required. Mary
commented that she “…had to factor Mum, and the fact that I might need to have time out or
flexible time. I actually turned down some work.” and was matter of fact in her assessment of
those lost opportunities to grow her business. Similarly, Dorothy, who had been successfully24

New Zealand Journal of Employment Relations, 35(1): 17-34
running her own small business for many years, simply decided that she needed more
flexibility and time to cope with her elderly mother. Accordingly, she limited the number of
appointments she made with clients and over time gradually reduced her business to virtuallynothing.
Other respondents were less extreme in their response to the demands of elder care, butnonetheless adopted strategies that were likely to be detrimental to business growth. For
example, Terri, who chose to work a four-day week, estimated that losing a full day of
appointments had cost her upwards of $20,000 in one year. Jocelyn, a business contractor,
had also felt the impact of elder care, pointing out that the time she took off work to assist her
mother directly impinged her income as the following quote illustrates “I’m self-employed, sowhen I’m not at work I don’t get paid.” Jasmine, who was involved in the establishment of a
new business with her husband, had reluctantly decided to invest more time caring for her
elderly parents. She was conscious that this decision had taken her away from her husband
and their business at a critical time and was concerned that her husband had been trying to
run the business with “… absolutely no support from anybody for this..”. While not able tospecify the commercial effects as clearly, Charlie also noted that her developing business had
been affected by her elder care commitments, with trips to tend to her elderly father living inanother city requiring her to block out periods of time and to make herself unavailable toclients.
It was apparent that even for those women who were still strongly focused on expanding theirbusiness that elder care was perceived as a significant concern with potential to hinder
continuing growth. For example, Stephanie was finding that her elderly mother was placing
increasing demands on her for support and care. At the same time, Stephanie was keen togrow her client base and was mindful of the importance of reputation in the marketplace forher emergent business. Not wanting to turn down work and unwilling to advise clients of her
need for flexibility, because as she indicated “I’m at the stage in my business when I want tolook pretty damn reliable”, Stephanie was simply starting work earlier in order to free uptime during the day to manage her elder care, a strategy that did not appear to be a sustainable
in the longer term. Likewise, Jackie was aware of the importance of founder involvement andpersonal input as a factor in the success of her business, but also realised that maintaining thisinvolvement was going to be challenging as her elder care responsibilities increased. Her
dilemma is clearly captured in the following quote; “you are part of the ongoing viability ofthat business, so I think that there is a cumulative effect over time that you keep having tosustain your business and put that energy in, but you’ve got an additional load that isincreasing.”
Several aspects of our data are consistent with Jennings and McDougald’s (2007) conceptualmodel of the likely effects of gender on entrepreneur’s work-family interface experiences,
coping strategies and business performance. For example, Jennings and McDougald suggestthat female entrepreneurs are liable to experience higher levels of work-family conflictbecause they tend to own businesses in the retail and personal services industries, and thatthese client-centered businesses offer less opportunity for work schedule autonomy andflexibility. It is notable that the majority of women in our study operated businesses requiringconsiderable client contact and interaction, and that many explicitly commented on the strain
that this imposed when also trying to meet the demands of elder care. Jennings andMcDougald also suggest female entrepreneurs are prone to greater levels of work-family
conflict as a consequence of gendered role expectations. That is, because women are
generally expected to fulfill nurturing and care giving roles they are likely to feel more

25

New Zealand Journal of Employment Relations, 35(1): 17-34
pressure to assist with elder care and to feel that their business role is incongruent with caregiving responsibilities. This was evidently the case for several of our respondents, who
despite having brothers who lived closer to the elderly parent had nonetheless assumed
responsibility as the primary care giver. Other studies have also shown that women are much
more likely to take up elder care duties than are men (Davey & Keeling, 2004).
The tendency amongst the women we interviewed to prioritise elder care and to scale backtheir business involvement is congruent with Jennings and McDougald’s (2007) suggestionthat female entrepreneurs are more likely to make accommodations within the work sphererather than the family domain. This is not necessarily unexpected as extensive literature andempirical research describes how, for female entrepreneurs and small business owners, thedecision to move to self-employment and to start their own business is often driven by adesire to enhance overall quality of life and improve work-life balance (Boden, 1999;
Wellington, 2006). In pursuing this goal, women often adopt a strategy of compromise,settling for a capped growth environment and restricting their aspirations for businessdevelopment (Loscocco & Robinson, 1991; Watson, 2003). However, whereas previous
research has suggested that as childcare obligations decrease, women may look to develop
their personal lives and business opportunities (Emslie & Hunt, 2009; Grady & McCarthy,
2008), we show that elder care responsibilities may also lead women to decide to limit or
reduce their work commitments. This raises the prospect that for some female entrepreneurs
the opportunity or time frame available for them to concentrate on expanding their businessmay be quite narrow.

Boundary Tactics, Agency and Autonomy
Our findings are consistent with a growing body of research that challenges conventional
notions of individuals as passive recipients – simply reacting to the assorted stressors andtensions associated with efforts to integrate the various spheres of work and family (Clark,
2000; Cohen, et al., 2009; Kreiner, et al., 2009). The participants in this project were
proactive agents whose attempts to gain control in their own lives underscores the complex
and nuanced nature of work-home relationships, particularly when elder care is involved.
Consistent with the propositions of Kreiner et al (2009) and Cohen et al. (2009) we found thatthe women we interviewed enacted a range of specific tactics to manage challenges
associated with elder care and business ownership. These tactics appeared to be a critical
vehicle through which the women were able to exert control, reduce uncertainty andunpredictability, and where necessary restore a sense of orderliness to the work-familyinterface.
Kreiner et al. (2009) classify tactics into several broad categories, reflecting a variety of
behavioral, temporal, physical and communicative strategies that can be implemented
proactively in anticipation of potential conflicts, and also reactively in response to specificboundary violations. Our respondents identified several of these tactics that they also used.
One of the most commonly employed strategies was the behavioral tactic of actively ‘using
other people’ as a resource to address boundary conflicts. Many of our respondents spoke ofthe significant contribution of spouses in supporting and assisting them to fulfill work-related
and elder care role demands. Likewise, some participants used extended family networks tohelp with elder care obligations. For example, Mary mentioned how she coordinated with her
siblings and used rosters to facilitate the care of her elderly mother. Others commented on theimportant contribution of professional care givers working in residential care facilities. In

26

New Zealand Journal of Employment Relations, 35(1): 17-34
other studies (see Davey & Keeling, 2004; Kreiner et al., 2009) mobilising support frommanagers and work colleagues has been mentioned as playing a crucial part in employee
efforts to maintain work-home balance. However, this underlines the distinctive context of
self-employment and small-business ownership where such resources may not be available orare more difficult to marshal.
Another behavioural strategy commonly used was that of ‘invoking triage’. Kreiner et al.
(2009) describe this as the ongoing process of prioritising competing demands from thedifferent spheres of life. Entailing a kind of mental calculus carried out ‘on the fly’ it wasused by our participants to diagnose the urgency of problems or issues and as a trigger for
appropriate action. Stephanie articulated this strategy when she noted that she would often
have to compromise her work because of her mother’s needs, but she tried to do this only if it
was urgent. She went on to comment “For minor health issues, bog-standard sort of help, I’ll
juggle that – you know, get her to wait. If it’s major, I would get the work to wait.” Of
course, these decisions were not always easy and prioritising one domain often entailed costs
for the other. Jasmine summed up this dilemma when she explained that her efforts toprioritise demands in the different domains was “…sometimes to the detriment of thebusiness and sometimes to the care that I would like to give to my parents, but most of thetime you’re able to manage.”
The salience of temporal tactics (‘controlling work time’ and ‘finding respite’) for boundary
management was also obvious from the comments of our respondents. As Kreiner et al.
(2009) note, individuals are able to make strategic choices regarding the use of time including
when, and how much time is devoted to activities in different spheres. ‘Controlling work/caretime’ was a commonly employed tactic used by our respondents that was manifested inseveral ways. For example, as already discussed, Mary enacted regular scheduling of herelder care duties via the use of rosters so as to minimise disruptions to work. Jocelyn
protected her work time by refusing to take personal calls while at work while Terri’s
approach was to reduce her normal working week to free up an additional day to care for her
mother. The second major temporal tactic identified by Kreiner et al, ‘finding respite’, was
not often pursued by our participants. This is not to say that the prospect of amelioratingstrain by taking breaks from work and/or elder care responsibilities was not recognised asimportant as the following quote from Jasmine makes clear; “Occasionally, I will say to myhusband that I’ve got absolutely no ‘me’ time. Absolutely no ‘me’ time”. However, it seems
to be the case that the intensive demands of self-employment and small business ownershipcoupled with the strong emotional ties and imperatives of elder care make it difficult for these
women to truly get away or to take time off. The situation of Charlie illustrates this point. Her
new business typically required her to work weekends, and during this establishment phase
she was also undertaking separate paid part-time work to allow her to meet her own income
requirements. Moreover, although her father was in residential care in another city Charlie
often found that her father’s needs were uppermost in her mind as the following quotereveals; “It’s because he does occupy my headspace. Not in a bad way, but just thinking, youknow, I should be making more contact; I should be doing more proactive things. But you
know, I just need to get ahead and build this business”.
We found that the communicative tactics of ‘setting expectations’ and ‘confronting violators’(Kreiner et al., 2009) were not used extensively. There were of course, some exceptions. For
example, Mary typically made it a point to communicate her preferences and expectations forflexibility to clients before accepting work. However, this was quite unusual andcommunicating with key stakeholders regarding preferred levels of work-home integration or

27

New Zealand Journal of Employment Relations, 35(1): 17-34
confronting those that punctured boundaries were not tactics preferred by the women weinterviewed. We note that negotiating boundary preferences can be more complex in thecontext of elder care as older persons are often supported by a number of external agencies
and other providers that may not be as responsive to the desires of the care giver. Moreover,other family members are often significant actors and the dynamics of family relations, which
can sometimes be fraught (Davey & Keeling, 2004), may make implementation ofcommunicative tactics challenging. Finally, we observed that in some cases the elder person
may have dementia or other conditions that make the effective use of communication tactics
problematic.

Emotions and identity
While some researchers have been critical of approaches which emphasise the emotional
links or connections between work and family (Clark, 2000), we observed that emotions werevery much central to the lived experience of work-family conflict amongst the women weinterviewed. In fact, one of the main reasons that participants experienced some difficulty insegmenting work and elder care appeared to be the high levels of emotional involvement
associated with elder care. Emotions that were highlighted by the participants included guilt
and frustration, sorrow and loss, and love and concern. Illustrative of the strong emotional
connections is the following quote from Dorothy where she talks about the emotional fallout
related to her mother’s illness and gradual decline; “I don’t want to feel happy….I don’t feel
happy… I don’t feel lively at times….I don’t feel like talking at times, because I’m going
through losing my mother.”Feelings of guilt, frustration and inadequacy were also common amongst our participants. In
some cases, efforts to juggle demands in both spheres meant that they felt that they were notgiving enough to any of their roles. For example Charlie commented that “I sometimes havefeelings of guilt that I don’t do either well.” In other cases, participants indicated that theywould like to spend more quality time with their elders, but expressed frustration that instead
they often ended up doing practical things such as providing transport to appointments or
sorting clothing. In addition to feeling guilt and frustration at times, all participants
mentioned feelings of sorrow, grief and loss. These feelings came from seeing the increasing
dependence of their elderly parents, and having to come to terms with the eventual loss of
beloved members of their families. Dorothy expressed this in the following way; “You wantto scream and cry and say ‘life’s really not that fair”.
Although there are situations that can arise where “…gratitude can easily take on a taste of
bondage…” (Lewinter, 2003:359), the emotions around elder care were not all negative.
Most participants indicated that they had strong feelings of love and gratitude towards theirelders, and a desire to reciprocate the care provided to them in earlier times. Lewinter (2003)
has commented on the value and importance of inter-generational reciprocity, but most worklife balance research has concentrated on negative spillover between the domains of work andhome. In the following quote, Dorothy encapsulates the importance of reciprocity as she
reflects on her decision to limit her business activity;“…it’s something I wanted to do, because she was there for me… She was always
there for me, no matter what. And I feel that she sacrificed a lot of her time and herlife for me, and it’s my turn. It’s something I want to do and I enjoy doing it”.

28New Zealand Journal of Employment Relations, 35(1): 17-34
Unsurprisingly, since boundary work is intimately tied to identity (Cohen et al., 2009;
Nippert-Eng, 1996), we found that the emotional aspects of elder care often sparked
fundamental reappraisals of self-identity. For some of our participants the move fromdaughter to caregiver was a stimulus for them to reassess their relationship and role vis-à-vis
their elderly parent. Jackie felt this change keenly as the following quote shows;“It’s very difficult, watching your parents lose their independence, and watchingthem struggle. To actually accept that there are certain things that they just can’t do
any more, and that you are going to have to help them do those things, or findsomeone else who can.”Charlie was also conscious of how her relationship with her father had altered as aconsequence of assuming care responsibilities. She commented as follows; “I very much feltthat change of role – that I became the parent, and it was like parenting a child in someways”. All of the women we interviewed indicated that their identity as businesswomen wassalient for them, but some (like Dorothy) were clearly recasting themselves and constructing‘new’ identities in response to the demands of elder care. For others, elder care appeared tohave much less of an impact. For example, when asked how she viewed herself and hervarious roles Stephanie offered the following comment; “I think of myself as a businesswoman who is a daughter. I don’t want another care-giving tag (I was a mother for such along time). She’s pretty important, but I don’t use it to define myself.”

Conclusion
All of the self-employed women in this research believed that they had achieved some formof balance in their lives. However, their pursuit of some quality of life and work-familybalance appeared to involve what other research has noted as being significant personalnegotiation and also compromise (Dallimore & Mickel, 2006). Work-family border theory
suggests that, in seeking some balance in their lives, most people are proactive or enactive(Clark, 2000), yet while the participants in this project were trying to be proactive inmanaging their commitments, this appeared to demand daily confrontation with the various
requirements of their activities. The often unexpected nature of elder care impacted theability of the participants to organise their roles and activities, and appeared to force theminto reactive behaviour in all domains.
The continual disruption of the efforts of these women to proactively seek some organisationin their lives was leading to lack of balance, and increasing feelings of guilt and frustration.
The frustration alluded to in the women’s stories show that they experienced difficulties in
identifying their roles. They all found it difficult to move from a ‘child’ role to caregiver for
an elderly parent. They also often found it hard to deal with the attitude of the border keepers– those people who influenced their ability to move between roles (Clark, 2000). There
included the elderly themselves, but also formal caregivers, medical staff and others whose
expectations of the family caregivers were often significant. Further research into theseareas would be useful. Additional studies exploring the interface between elder care and selfemployment for participants from a wider variety of cultural and economic backgrounds
would also be valuable (Davey & Keeling, 2004; Te Pūmanawa Hauoroa, 1997). Although
all the women who participated in this study indicated that they felt some measure of success,this appeared to be very much an individual perception tempered by the strategies they had
adopted to manage their lives. Their feelings of success may have arisen from an

29New Zealand Journal of Employment Relations, 35(1): 17-34
understanding that they had reached an acceptable compromise on a daily basis. The
emotional cost of elder care was also profound, as all participants indicated that they carried
their many roles with them, and usually responded immediately to the needs of their elder(often putting their own health issues second). It is also particularly interesting to note that,
despite the increased flexibility of self-employment, every participant indicated that theirbusiness had been affected by their elder care responsibilities. The businesses were not goingto grow and develop, and in some cases they were shrinking – the constraints of family
commitments combined with the flexibility of self-employment may simply have contributed
to the need to work longer and harder just to stay a small business.

Notes
i

The number of New Zealanders aged 65 years and over (65+) has doubled since 1972, to 510,000 in 2006. The increase is expected tocontinue with the population aged 65+ years likely to exceed one million in the late 2020s and reach 1.44 million by 2061. The largest
growth will occur between 2011 and 2037 as the baby-boomers move into this age group. From the late 2040s, the 65 years and over age
group will make up about one-quarter of all New Zealanders, compared with 12 percent in 2006. (Statistics New Zealand, 2008)

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New Zealand Journal of Employment Relations, 35(1):35-47

A Longitudinal and Dynamic Approach to Entrepreneurial Learning
DAVID DEAKINS* and JANETTE WYPER**
Abstract
The paper analyses in depth qualitative case material, in the light of previous research and in thecontext of a dynamic, longitudinal approach. The analysis takes a longitudinal approach to a small
number of case studies that have been tracked over an extended period of time to yield insights into
the nature of entrepreneurial learning over such a temporal period. It is arguable that previous
research, even where qualitative case studies have been used, has been limited in terms of longitudinaland dynamic insights (Harrison & Leitch, 2005). The research has followed the development of the
key entrepreneurs involved in the case studies from formation, through discontinuous growth periods,
innovative product development, critical incidents, from local to global player.
The paper contributes to our understanding of the particular role of critical incidents in the process ofentrepreneurial learning. It takes a dynamic framework approach to entrepreneurial learning (Cope,
2005) to examine the nature of entrepreneurial learning in two case study firms that have undergone
considerable transformation from the development of technology-related products. The two case study
firms have been the subject of a series of in-depth interviews over a period of five years, allowing
unique insights into the nature of entrepreneurial learning over an extended period of time. The paper
contributes to our knowledge by developing increased understanding of the process of entrepreneurial
learning specifically through the tracking of small innovative and technology-based firms from startup to global player over an extended period of time. The importance of entrepreneurial learning andknowledge acquisition in such growth has been highlighted recently by Fletcher (2010) and pointed toa research gap in longitudinal work in this area. This paper provides a contribution to that researchgap.

Key words:
Entrepreneurial learning, internationalisation, technology-based small firms, longitudinal study

Introduction
This paper systematically reviews the academic literature and research evidence on entrepreneurial
learning in order to place in-depth case study research in context and provide a basis for further
research and investigation into the nature of entrepreneurial learning. Recently, several articles haveattempted to provide conceptual frameworks to build upon earlier but limited research into
entrepreneurial learning (Cope, 2005; Politis, 2005; Thorpe, Gold, Holt & Clark, 2006; Zhang,
MacPherson & Jones, 2006). Each of these articles started from a premise that existing learningtheories are not adequate for providing an explanatory conceptual framework for entrepreneurial
learning. For example, Thorpe et al, (2006: 233) consider that “current learning theories often fail toadequately account for the social, historical and cultural contexts in which people learn”. The paper
will review these recent conceptual developments, the nature of previous research and reflect upon thecase study analysis in the light of this literature. As the title of the paper implies, we consider it*David Deakins is Professor of Small Business, NZSMERC, Massey University Wellington. d.deakins@massey.ac.nz** Janette Wyper is a Researcher, PERC at the University of Paisley, Paisley, Scotland

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necessary to take a dynamic approach to understand the process of entrepreneurial learning. We
concur with Politis, who considers that to do so (ie: understand learning) there is a “need to moveaway from static approaches to more dynamic ones” (2005: 400) In a recent paper, Kempster andCope (2010) argue for dynamic entrepreneurial learning approach for explaining leadership in theentrepreneurial context.
In this paper, we examine case study evidence taken over a period of time where we have been able to
track a small number of entrepreneurial case studies. These cases were originally developed tounderpin new curriculum development, but have since been explored through repeated interviews as
an interest as developed in the process of dynamic entrepreneurial learning. The case study
entrepreneurs have been tracked from formation to global players. In terms of internationalisation,
dynamic entrepreneurial learning helps us to understand knowledge acquisition of SMEs and thedevelopment of strategy (Jones, Dimitratos, Fletcher and Young, 2009; Fletcher, 2010). Researchinterviews have been analysed with the assistance of the QSR Nvivo software to shed further light on
how entrepreneurial learning informs the actions of entrepreneurs in the selected case study firms.
In summary the paper aims to:• Systematically review the literature on entrepreneurial learning to inform on-going case study
research.
• Analyse selected case study material.
• Discuss the analysis in the light of the existing literature.
• Review the paper’s contribution and identify further research issues.

Review of the Academic Literature
The existing academic literature, as mentioned, has recently expanded as interest has grown rather
belatedly in this area, which has an important contribution to make to explaining entrepreneurial
behaviour. However, the literature can usefully be divided into the following three main areas:
1. From the application of theories of adult learning;
2. From the application of environmental and social explanations;
3. From applications of organisational behaviour and (hence) organisational learning theories.
These headings are used in this section to organise our review of the academic literature. Further
illustration of this framework is provided later in Table 1 which provides a summary of the academic
literature using this framework.

1. Application of Theories of Adult Learning
Despite the comment by Thorpe et al (2006) on the value of such theories for explaining
entrepreneurial learning, much of the conceptual literature in this area draws upon and modifies
theories of adult learning. Partly, this is because entrepreneurial learning is assumed to be experiential
in nature. Politis (2005) considers that there is a need to consider how experience (gained) istransformed into knowledge. Cope (2006) considers that entrepreneurs adapt and develop new
behaviours over a period of time so that there is a need to consider adult learning theories that allow
for the cumulative nature of learning. Within this vein of experiential learning, Kolb’s learning cycle(Kolb, 1984) has been adapted by a number of writers to explain the self-reflective nature ofentrepreneurial learning over time, as illustrated in Figure 1 (Corbett, 2006; Cope, 2005).
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Figure 1: Kolb’s Experiential Learning Cycle

Concrete Experience

Changed behaviour
and experimentation

Personal reflection

Conceptualisationand identification ofactions

The insights provided by some writers is to examine the nature of the entrepreneurial learning
experience and note how this differs through critical learning ‘episodes’ or ‘events’ (Rae & Carswell,2001; Deakins & Freel, 1998). It is recognised that the experience provides an essential ‘situatedlearning’ context within which these developments have been formulated (Zhang et al, 2006). The
importance of this situated learning experience in a temporal context has been emphasised recently by
Politis (2006: 399), “[This] implies that the complex process by which entrepreneurs learn from pastexperience is of great importance to consider if we are to increase our understanding ofentrepreneurial learning.”
Thus, it is arguable that dynamic, rather than static and longitudinal, rather than cross-sectional or
survey approaches are necessary to increase our understanding of entrepreneurial learning. In Rae’s(2003) study, he focused upon the life stories of the interviewed entrepreneurs to understand how
individual respondents learned to develop entrepreneurial behaviour. In a related paper, Rae andCarswell (2001) suggested that such ‘learned entrepreneurial behaviour’ could be identified throughthe dynamic nature of ‘learning episodes’, involving discrete extended periods of time in which
entrepreneurs drew upon learning and reflection from experiences that have formulated theirapproaches and behaviour. Other writers have identified dynamic ‘critical events’ as the catalyst forlearning and changes in entrepreneurial behaviour (Deakins & Freel, 1998). Cope and Watts (2000)
and Cope (2003) have applied critical incident methodology to a longitudinal case study approach andclaim that, although very diverse in nature, critical provide the basis for the development of ‘higherlevel’ learning, where the concept of deep learning is the outcome of the experience of the identified
critical events leading to changed entrepreneurial behaviour. However, Cope and Watts also conclude
that, because of the complex and diverse nature of entrepreneurial learning; “in terms of theory
building we are a long way from the development of sufficiently broad-based frameworks to illustrate
this diversity” (2000:118). Kempster and Cope have undertaken recent work on entrepreneurial
learning, but conclude that further work on the importance of dynamics of entrepreneurial learning isrequired and conceptual developments (of entrepreneurial learning) are still “embryonic” (2010: 9).

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2. Environmental and Social Explanations
Environmental and social explanations of the nature of entrepreneurial learning identify behaviouralfactors affecting both the firm and the entrepreneur. Within these approaches, there are social
constructionist theorists that recognise entrepreneurial learning as a product of the social environment
within which the entrepreneur operates. These are not necessarily separate from the conceptual writers
mentioned in the first category and elements of such approaches have been used by Rae (2000) and
Cope (2003). However, another sub-category is those who place the emphasis and influence on
external factors in the entrepreneurs’ environment and include notably Gibb’s (1997) stakeholder
model of entrepreneurial learning in which the entrepreneur does not progress unless they ‘learn’ fromstakeholders in the external environment. However, the emphasis of such approaches may also be on
the nature of the individual entrepreneur to adapt and learn from their environment. For example,
Thorpe et al. (2006) take a constructionist approach but that the ability of entrepreneurs depend on
their ‘maturity’, a complex concept that indicates the extent of among other things the ability of theentrepreneur to self-reflect from their interaction with the environment.
More clearly within this approach are those writers who explain entrepreneurial learning from external
networks and social capital approaches. For example, Taylor and Pandza (2003) have applied network
theory and a number of writers have started to explore the influence of social capital on
entrepreneurial behaviour (Rose, Cope & Jack, 2007). Lee and Jones (2008) have also identified theimportance of the role of social networks for entrepreneurial learning at the start-up and early stage ofbusiness formation. The contribution of evolutionary theories (or organisations) have also been
identified within this category, although such theories may perceive the entrepreneur as tied in, or pathdependent, within their technological development (Nelson & Winter, 1982). However, suchapproaches do support the necessity of dynamic approach to entrepreneurial learning (Deakins &Freel, 1998).

3. Organisational Learning Theory Applications
Finally, in this section, we have separated those writers who have adopted organisational learning(OL) theories to explain small firm behaviour as these are less clearly situated within social
constructionist and environmental approaches. Of course, OL theories stem from explanations ofcollective learning within large organisations (Easterby-Smith, Crossan & Nicolini, 2000), however,more recently Zhang et al have used an OL approach to explain learning processes on innovation
within manufacturing SMEs and claim that: “[Our] findings confirm early studies on the importanceof organisation-wide (intra-organisation) learning in innovative firms” (2006: 312). They also claimthat the application of OL theories in SMEs helps to explain those that were ‘innovative’ compared tothose that were ‘stable’. A number of writers, including the present authors, have questioned therelevance of OL theories for explaining entrepreneurial behaviour, but an earlier study by Wyer,
Mason and Theodorakopoulos (2000) have also argued that OL theories can provide insights into‘collective learning’ within small firms.
Although we have used a framework of three categories to systematically discuss and categorise thepublished academic literature; it should be noted that there is considerable overlap and that a numberof papers cover more than one of these categories, as illustrated and summarised in Table 1.

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Table 1: Categorisation of the Academic Literature
Paper
Adult learning Environmental
theoriesand socialKempster & Cope 2010
Lee & Jones 2008
McPherson & Holt 2007
(review paper)
Devins et al 2006
Thorpe et al 2006√√
Zhang et al 2006
Cope 2005√√
Corbett 2005√√
Politis 2005√√
Cope 2003√√
Taylor & Pandza 2003√
Rae & Carswell 2001√√
Cope and Watts 2000√√
Rae 2000√√
Wyer et al 2000
Deakins and Freel 1998√√
Gibb 1997√

Organisational
learning theories

Research
evidence


√

√


√
√

√
√
√
√
√
√
√

The Nature of Previous Research Evidence
Despite the recent increase in the number of papers in the academic literature, the previous research
evidence directly on entrepreneurial learning is limited and recent papers have been conceptual,
aiming to provide a framework for further research or to set a research agenda (Cope, 2005; Corbett,2005; Politis, 2005). Given some of the features of the nature of entrepreneurial learning, which havebeen discussed in the academic literature, it is not surprising that the investigations that have involved
direct research evidence have been based upon largely qualitative approaches and with the main focus
on entrepreneurial case studies. For example, Cope (2003) reported findings from six case studies andRae (2000) reported narrative life stories from 12 interviews. However, more recent research has
employed programmes of interviews or surveys; for example, Thorpe et al. (2006) report the findingsof 44 e-mail ‘postcard’ responses and Zhang et al. (2006) discuss the analysis of 26 interviews.
A strong common feature of previous research has been the use of critical incident methodology toidentify key learning events or episodes in that have been significant in entrepreneurial learning. This
technique has been used by Deakins and Freel (1998), Cope and Watts (2000) and Zhang et al (2006).
In addition, the research has been conducted within a social constructionist paradigm to investigate thereality of entrepreneurial experience, development and learning (see Thorpe et al. 2006, for
discussion).
In summary, previous research has been characterised by similar approaches, by necessity, often havesmall number case design with interpretative methodologies and analysis.

39New Zealand Journal of Employment Relations, 35(1):35-47

Research Method
Our research methodology is no exception to previous investigations by adopting a social
constructionist paradigm and a qualitative case study approach. Although with case study
investigation, it is difficult to avoid the retrospective nature of the of the research interviews with theentrepreneur; by maintaining tracking studies of those cases that we have been able to track over a
period of time, it is arguable that we have been able to develop and verify a realistic record ofentrepreneurial learning. As commented upon by Rae “Given that learning is a continuing process,there is a need to follow people over a period of time rather than relying solely on perspective” (2000:
150). We have been able to achieve such tracking although the initial design of the research was toachieve the development of course and curriculum-based material. The initial interviews have been
supplemented by further interviews to supplement the material on entrepreneurial learning. In
addition, we have continued to use a ‘critical incident’ analysis which has previously been beneficial
in gaining initial insights into the nature of the process of entrepreneurial learning, which is in linewith previous research work in this area (Rae and Carswell, 2001; Cope, 2003).
The qualitative software QSR Nvivo has been employed to assist analysis but at this stage, it should
be noted that this paper provides some first stage findings. A framework was utilised to provide
guidance for analysis (see the following section), although this was not meant to be prescriptive andfurther work will allow a more ‘grounded approach’. The intention is to continue to utilise thecontacts established with identified case study firms for additional research interviews, which will be
continued to achieve the tracking and provide a more complete dynamic and longitudinal analysis.
The aim has been to achieve a comparative case study analysis as suggested by Yin (2003). Links withthe key entrepreneurs in the case study firms have been carefully nurtured over a period of time,
which has helped to overcome issues of access (Bryman, 2006). Repeated interviews with key
entrepreneurs have enabled the verification and validation of research data (Easterby-Smith, Thorpe &Lowe, 2002).
For this paper, we focus on the discussion of two case studies. Uniquely, we have been able to track
their development over an extended period of time, from inception through to global operations.
Although technology-related issues are not the focus of this paper, both case study firms aretechnology-based and have had to deal with issues related to new product development, innovation
and IP-related areas.

Discussion of Findings
We adopt a framework suggested by the lead author’s previous research and work and by theacademic literature to discuss the initial findings. This framework consists of the nature ofentrepreneurial learning from three sources: from experience and critical events; from social andbusiness networks and from the entrepreneurs’ previous experience.
1. The nature of entrepreneurial learning from experience of critical events
Previous research work by the authors and from the academic literature has suggested that insights canbe gained into the nature of entrepreneurial learning from the experience of significant critical events.
In essence, the argument is that the entrepreneur is forced to reflect upon existing practice or strategy
to consider alternative strategies and ultimately to change behaviour. Such significant critical events
have concerned problems with employees, with customers, with accounting for liabilities such as
taxation and the experience from dealing with new product markets. For example, with one of the40

New Zealand Journal of Employment Relations, 35(1):35-47
cases, one of the founding entrepreneurs commented on a critical incident with an employee in dealing
with regulations as they sought to expand their operations in a new entry country, Italy:“One major incident [occurred] with an Italian employee where there was a total
misunderstanding on who was responsible for what, which got us into significant issues with
the Italian tax authorities, because he was supposed to pay tax – and he didn’t, things like thatmake you much more wary”.
The importance of reflection on the experience from critical events was also important for thisfounding entrepreneur who commented that issues would be mulled over during times when she andher founding partner could get together with some free time; one opportunity for this process waswhen they were travelling:“The best time for reflection is on a plane on a long haul flight, you have a chance away fromthe phones and everything else, to think what we have achieved so far, how we can achieve it
differently, where we would like to go – and went on to consider...
With the economy crashing in 2000, it made us think very hard about if we wanted to sell thebusiness, but we decided we were too young – there was a lot of learning to do, lots of newprocesses to explore.”
Both the case study firms became international players rapidly in their development so-called ‘born
globals’, Fletcher, (2010) has pointed to the importance of the role of entrepreneurial learning ininternationalisation. In both cases, technology and new product development was at the forefront of
their development. In one firm, this meant several years of development of dedicated softwaredevelopment which was funded by the re-invested profits from the operation of an internet provider,whilst their development (R&D) arm was loss-making. During this stage, they took every opportunity
to “learn from contacts, from seminars and from events”. However, the founding entrepreneurs
quickly learned that they needed additional assistance to break into “larger customers” and then global
markets. Yet, despite attempts to talk to advisers, such as consultants and business angels, during aperiod a founding entrepreneur described as a “whirlwind of meetings”, they considered that theirdevelopment internationally was always a strategic aim to “create a global company”, but learning
came from ‘experience’, from dealing with overseas customers and contacts. When faced with acritical period of development, there was insufficient local experience that could provide advice; as
one of the founding entrepreneurs commented: “They just do not have what it takes to grow a global
company, that is my biggest gripe against the [local agencies], they do not have the right level ofcontacts to grow a global company”.
The technological environment was significant for both of the case study firms in critical events that
affected the process and nature of entrepreneurial learning. Both firms were in developments that
required IP protection. The nature of having to obtain patents, across global markets and across time
became critical events. For example, a founding entrepreneur commented on the experience of the
expiry of protection from patents.
“In the first 10 to 12 years of our existence, we had a patented product that was protected andtherefore, we didn’t have to deal with competition and one our biggest learning moments waswhen the patent expired – having to deal with competitors in the market place”.
Overall, in comparison to alternative stimulants to entrepreneurial learning, the nature of criticalevents provides the basis for reflective ‘deep learning’ suggested by Cope (2003) and Rae andCarswell (2001), which in turn is the basis for a period of significant strategic change andentrepreneurial development.
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New Zealand Journal of Employment Relations, 35(1):35-47

2. The nature of entrepreneurial learning from social and business networks
It is arguable that a relatively under-researched area in entrepreneurial learning and development is therole of social networks and more specifically social capital (Lee and Jones, 2008). In both our casestudy firms, the role of social networks were important for their initial development but surprisingly,
perhaps, these social networks continued to play an important role in the later strategic developmentof both the case study firms. The nature of the learning process that this involved was commented on
by one of the founding entrepreneurs as providing support during the learning process:“At the start, all the people employed were all family and friends or people who knew – [thetwo founding partners]. Both had a wide social network, and it was them who came to startwith and some of them are still with us today. They came in to do any job that was needed,
there was no demarcation on what was done and we grew from there. So that was the learningbit. You had made your mistakes with friends”.
In the second case study firm, which had more founding entrepreneurs (four), social networks were
wider, but also more close knit. They received support from their close families at start-up, having
given up promising careers in alternative occupations. Although the founding entrepreneurs were keen
to learn from business networks, the role of social networks remained important during later phases ofdevelopment of the firm, bringing in close contacts in their social community to provide development
stage finance as they were seeking global expansion, yet without a direct advisory role “They areshareholders and do not have seat on the Board, we wanted hands off investors and they trust us to go
forward-it is absolutely hands off. We said to them, here is the proposition, if you want to take part init, that is the deal on the table”. Such networks would seem to have diminished importance forentrepreneurial learning in this case, although the mentoring role may have been understated by thefounding entrepreneurs. The role of social capital indeed can be contradictory, other research hassuggested that acts as hindrance (or restriction) as well as a benefit at different stages and in different
circumstances in entrepreneurial development (Deakins, Ishaq, Smallbone, Whittam & Wyper, 2007).
It is arguable that business networks are a more important influence on the nature of entrepreneurial
learning. Within this category we include Gibb’s stakeholder learning model which includes
customers, suppliers and funders. For both sets of founding entrepreneurs from our two case study
firms, events that brought them into contact with customers, competitors and suppliers, such as
exhibitions and trade shows had important roles in the learning process. One founding entrepreneurcommented:“In fact one of our bigger learning places is the trade shows. Trade shows and customers’
plants. The [technical product] has so many applications in so many industries that we are very
fortunate that that we get into different types of plant – we have a great bank of technicalexperience which enables us to find solutions or think of new products. That’s been the mainlearning...”Contact with funders through raising finance or with advisors on raising finance was a further area
referred to by both sets of founding entrepreneurs at particular stages in their development, although
in both cases, each had a distinct strategy towards raising external finance. In the first case, one firm,
which had relied on their social networks for funds for their early stage development but delayed
raising bank finance for five years until a contact with a business adviser, changed their approach andalso increased their confidence to approach external funders.
“It was an issue of confidence more than anything else – we believed in the product, believedin our skills and there was a buzz about high tech at the time. We employed X as an adviser,42

New Zealand Journal of Employment Relations, 35(1):35-47
you could say it was because of the employment of X as a financial adviser. He advised us toraise money, at the time it was the shortest route to raising finance.”
The second case study firm also commented that: “There is one major learning curve that [the firm]has been through; raising outside finance.” It appears that the mere experience of raising finance,
especially venture finance, provides a learning curve, not just in preparation for dealing with thefunder, but from new relationships and perhaps the imposition of new financial disciplines.
The entrepreneurial learning process was also influenced, in both firms, by the need to protect andpatent the IPR involved in their NPD worldwide. For one of the case study firms, the learning
experience had caused them to reflect and change strategy in line with the process suggested adultlearning theory. For example one of the founding entrepreneurs commented from their experiencethat:“It has made us think very carefully about the stage we apply for protection. We decided that
we applied too early, when we reviewed the whole IP issue – but we believe that it isworthwhile to do it, but we now do it later – big learning curve, but it has made us stronger”.
In summary, both case studies demonstrated that networks and the interaction with ‘stakeholders’ hadsignificant dynamic roles in the process of entrepreneurial learning over time. Their role varies
temporarily and can affect the way that learning through time is transformed into knowledge andtherefore, they do have a key role in the transformational aspect of entrepreneurial learning identified,for example, by Cope’s (2005) conceptual paper. What would seem also to be significant is that
entrepreneurs need to have a strategy that allows flexibility and reflection from this experience toabsorb the knowledge gained from such contacts and experience.

3. The nature of entrepreneurial learning from the entrepreneurs’ previous experience.
In the two case studies, the nature of previous experience of the founding entrepreneurs was very
different, although in both cases, the way that the entrepreneurs adapted behaviour as a result of
acquired experience was similar. In both cases, it was case of observing how others operated andlearning from that. One founding entrepreneur commented on how their present strategy had been
partly derived from previous experience.
“He had worked for other companies and saw how they ran their businesses, but the way [thecase firm] runs is probably different from other commercial businesses. It is because he wants
to do it his way. He has a philosophy he believes very strongly in. Although what we make isvery technical, this is a sales and marketing company, who sells technical products anddevelops technical products. He knows the sales business, he knows what customers want andhow to negotiate with them and I think it is one of the biggest things - a lot of start up
companies, start up entrepreneurs don't necessarily have sales skills. JK is a really, really goodsales person and negotiator and because of that, and because of his technical knowledge as
well, he is able to combine these two skills, but he has had to learn what sells any particular
product, but he has a sales formula he uses and that is why we were able to get the product into
the market relatively quickly.”
The second case study’s founding entrepreneurs had little previous experience, being relatively young
and moving from careers in different sectors. However, in terms of entrepreneurial development, there
were distinct transformational stages that have been followed. The initial start-up was a small
publishing company where the admitted objective was to gain and learn from business experience. A
second stage was the formation of an ISP company, the objective being to gain revenues that could be
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New Zealand Journal of Employment Relations, 35(1):35-47
invested in R&D. This company was eventually sold once the founding entrepreneurs had gained
sufficient knowledge and experience to break into global markets. It was the lack of preparation thatforced the founding entrepreneurs to gain additional advice and experience eventually leading to theappointment of leading consultants. They considered at a critical stage when they were attempting to
break into global markets and develop and protect IPR that: “Our biggest barrier to achievement is[getting the right] technology people – and getting [the right] global advisers.” The nature of the rapid
growth of this firm meant that there was little time to learn from experience, their networks, contacts
and advisers became crucial to gaining additional knowledge and developing new global strategies.

Further Discussion and Conclusions
Given that this is a developmental paper, there is obviously the need for further research withadditional insights to verify some of the conceptual papers discussed in our review of the academic
literature, that have been a welcome addition to this literature. However, the discussion of the dynamic
nature of the case study evidence, drawn from interviews conducted over a period of time,demonstrates in one case, the importance of learning from the experience gained in critical events andin another, the importance of having sufficient quality of networks and advice where previous
experience as more limited. Networks may be part of the key to understanding the transformational
aspect of entrepreneurial learning identified in the conceptual papers (Cope, 2005; Politis, 2005). The
findings provide support for Cope’s suggested five areas of significance for entrepreneurial learning
illustrated in Figure 2.
Figure 2: Cope’s Five Areas of Entrepreneurial Learning
Learning about oneself

Learning about the business

Learning about theenvironment andentrepreneurial networks

Learning about small
business management

Learning about the natureand management ofrelationships

It is arguable, however, that from our discussion that although these five areas are reflected in aspectsof the findings from the two case studies, they are insufficient to capture the full dynamic nature ofentrepreneurial learning over time. For example, it is arguable that with technology-based companies
there is a further dimension of entrepreneurial learning that is shaped by the nature of the technology
and its uses in customers and by how to deal with the IPR process. It is arguable that this should beclassified as an additional area. It is also arguable that some firms may grow very quickly as with oneof our case studies and some areas are constrained and by-passed. Therefore, the nature of technology
and the IPR process adds an additional dynamic learning dimension.
Our discussion of findings from the case study analysis also give some support to Politis’ (2005)
concept of the importance of the transformational aspects of entrepreneurial learning as illustrated in
44New Zealand Journal of Employment Relations, 35(1):35-47
Figure 3, which places a focus on how entrepreneurs transform their experience into entrepreneurial
knowledge.
Figure 3: Politis’ Transformational Concept of Entrepreneurial Learning
Entrepreneurs’
careerexperiences

Entrepreneurial
knowledge

Transformation
Process

Factors influencing
the transformation
process

However, we argue that this is an incomplete representation of the entrepreneurial learning process.
Although it is important to understand the factors affecting the transformation process, the model, as
presented in Figure 3, does not include the initial trigger which leads to reflection and thetransformation required to acquire entrepreneurial knowledge.
We suggest a refinement of earlier work, which placed emphasis on critical events as triggers fortransformational change, to include the additional concept of transformational change as suggested by
Politis’ article. This is represented as Figure 4 and gives a more dynamic and cyclical model ofentrepreneurial learning.
Figure 4: A Dynamic Model of Entrepreneurial Learning
Trigger Event:
Such as contact with customers,
action by employees, contact withcompetitors, action bycompetitors, technological change
and the IPR process, raisingfinance, contact with advisers

Implementation andobservation:
Transformation of knowledge
into new entrepreneurial
strategies

Reflection and
Assimilation:
Consultation and discussioninternally and externally withsocial networks

Review of Entrepreneurial
Strategies and Resources:
Transformation into acquired
knowledge

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New Zealand Journal of Employment Relations, 35(1):35-47
The emphasis in this model is still on experiential learning through trigger events. Further research is
required on how entrepreneurs are able to transform the information acquired and successfully reflect
on this cyclical process. We will then be able to gain better insights to the dynamic nature over time ofthe process of entrepreneurial learning.

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New Zealand Journal of Employment Relations, 35(1):48-64

Using the Human Capability Framework and Opinions of Dairy
Farmers to Explore the Shortage of Dairy Assistants in the New
Zealand Dairy Industry
RACHEL LOWRY∗ and GRAHAM ELKIN**

Abstract
This article uses the Human Capability Framework (Department of Labour, 1999) to explore
dairy farmers’ perspectives on the failure to match labour capacity (supply of labour) andlabour opportunities (demand for labour) in the New Zealand dairy industry. A severe matching
failure is reported by dairy farmers (both in terms of numbers of people, and in the knowledge,
skills and attitudes (KSA) of dairy assistants). This gap was explored through structured
interviews focusing on the KSAs required by dairy farmers. The results focus attention on a gap
in terms of personal characteristics (attitudes) rather than knowledge and skills. The educationand training provision in the industry was also examined and a number of changes identified
which might reduce the gap and facilitate the growth of the industry.

Introduction
The New Zealand dairy industry has been an important part of the economy since the early
1800s. The industry employs approximately 34,000 people, equivalent to 31,500 full-time
employees and produced almost 20% of total merchandise exports and 33% of the world dairy
trade (Dairy Insight, 2007). Moreover, the dairy industry has expanded considerable since the1980s, driven by the economic growth in New Zealand’s Asian markets and the emergence of
dairy consuming middle classes in these countries. By 2020, the Chinese middle classes will
increase in number by 200 million and will begin to consume dairy products. The expansion in
the industry (both in volume and in new technology) has fuelled demand for new anddifferently skilled staff. Dairy farmers report extreme and growing difficulty in appointing andretaining dairy assistants. This may slow the development of the industry and the New Zealandeconomy.
Dairy farming is becoming a complex process that is heavily reliant on the knowledge, skills
and attitudes (KSAs) possessed by those who work in the Industry (Dairy Insight, 2007;
Valentine, 2005). The increase in demand for skilled labour has not been met by acorresponding increase in labour supply. This is despite periods of less than full employment in
New Zealand. Anecdotal evidence from farmers suggests they are becoming frustrated with theshortage of skilled farm workers, which acts as an obstacle to expanding milk production. Little
research has been done into this pressing need (Clark, 1998).
∗

Rachel Lowry, Statistics New Zealand.
Associate Professor, Department of Management, University of Otago, PO Box 56, Dunedin, New Zealand.
graham.elkin@otago.ac.nz**

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New Zealand Journal of Employment Relations, 35(1):48-64
We briefly explore five areas:
1) The Human Capability Framework as applied to the dairy industry.
2) The changes within parts of that framework that have led to the lack of sufficient capacity in
the New Zealand dairy farming industry.
3) An exploration of dairy farmers perceived needs with respect to dairy assistants.
4) The performance gap between the current level of capability and opportunities.
5) Farmers’ views of New Zealand’s formal agricultural training for dairy assistants in New
Zealand as a matching mechanism.

The Human Capability Framework (HCF)
Tipples (2004) wrote about the launching of the Department of Labour’s Human Capability
Framework at the ninth New Zealand Labour, Employment and Work Conference in 1999 as asurprise to many. He says it was put forward as an important research model that was to guide a
range of different government employment and social policy. The Department of Labour (1999)
noted that the term capability is about the ability of people to do things – not just the capacity
but the opportunity to do things as well. Sen (cited in Tipples, 2004) suggested that the use of
the framework moves discussion beyond the human capital ideas. This human capital literature
is difficult for some people as it may be seen to imply the commoditisation of people andtreating them as economic objects or things. The framework was claimed to be a more open andholistic and realistic for research. Bartley, Dupuis & de Bruin (2001) crystallises this by saying
the HCF allows a view of individuals that is less mechanistic and sees them as embedded insocial relations that can lead to choices that are not necessarily economically rational. He
subsequently used the HCF to explore future dairy farm employment (Tipples, Wilson, Edkens& Sun, 2005).
Figure 1: Human Capability Frameworks Components (Department of Labour, 1999:4)

CAPACITY

MATCHING

OPPORTUNITIES

Tipples (2002) defined capacity as to do with the knowledge skills and attitudes that people
have to bring to the labour market. Opportunities are the alternatives available to people toprofit from their capacity and matching processes link people’s capacity to the opportunities.
Each of these processes is unpacked in Figure 2 (Department of Labour, 1999). In 2010, theframework remains on the Department of Labour website as central to the labour market policyof the government.

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New Zealand Journal of Employment Relations, 35(1):48-64
Figure 2: Elements of the human capability framework (Department of Labour, 1999, p.
19)

Changes to the Labour Market Opportunities in Dairy Farming
Many changes impacted on the labour market opportunity and are identified through the HCF
when applied to the dairy industry. A large number have occurred in the past 20 years,
particularly in the past 10 years. Most of the changes have been outside the immediate controlof the farmer. The HCF identifies eight influences that have changed the opportunities available
in the industry: entrepreneurial attitudes, innovation, the international environment, technology,
the business environment, the regulatory environment, finance and capital and consumer
preferences. These categories clearly overlap. Our study explored an overlapping subset ofthese: technology (with some innovation included), the macro business environment (including
capital, finance and the international environment), the regulatory environment andinternational factors.
Technology has played a pivotal role in the development of the New Zealand dairy industry
since the mid-1980s and is likely to continue to do so (Clark, 1998). Developments are evident
under the broad areas of information technology; animal health and communication methods.
Technological advances have provided farmers with lower production costs, increased
productivity and greater financial success (El-Osta and Morehart, 2000). Some economists also50

New Zealand Journal of Employment Relations, 35(1):48-64
suggest that such changes were a major determinant of the structural change within the global
dairy industry, which has seen a shift towards fewer and larger dairy farms (Cochrane, 1965;
1979, as cited in El-Osta & Morehart, 2000). New Zealand dairy farmers are now able to accessmilk quality test results and synchronise herd records using the internet (Livestock
Improvement Corporation, 2006); prevent the spread of harmful disease (Rosenberg & Cowen,1990); and spend less time milk harvesting (Clark, 1998). Innovation has led to an increase in
the technical efficiency of dairy farms, suggesting that farmers are adopting more advanced
levels of technology and becoming better at using it (Jaforullah & Whiteman, 1999). The
discovery of low-fat milk producing heifer cows (MSNBC, 2007) has also led to a new level of
specialisation.
When technology changes in any business, the capacity (or KSAs) needed by employers
change, which in turn requires some form of response in terms of a matching of the supply tothe new demands. Typically this is in the form of training and development (Delahaye, 2005).
The macro-economic environment, with its concerns with inflation, interest rates, the recession(Bartol, Tein, Matthews & Martin, 2003) has affected the cost and availability of finance andcapital. The mid-1980s marked the start of an era of economic reform in New Zealand dubbed“The New Zealand Experiment” (Barnett & Pauling, 2005). 1984-1996 was marked with theliberalisation of the economy, with the removal of interest rate and foreign exchange controls;
the floating of the exchange rate; deregulation of the labour and financial markets; and the saleof a number of state-owned assets (Barnett & Pauling, 2005). All of these changes impacted
upon the dairy industry, including the abolition of subsidies to agricultural producers and tariffs
on agricultural imports (Barnett & Pauling, 2005). Some of these things required change whichcame about through innovation and a growth in entrepreneurial attitudes.
The New Zealand dairy industry came through the large scale changes of the 1980s relatively
unscathed due to prior efforts in the 1960s and 1970s by the New Zealand Dairy Board (NZDB)
to develop and consolidate markets for their products in Asia and Europe (Stringer, 2000) andto provide a united and coherent governance structure that allowed the dairy industry to flourish
under a neo-liberal arrangement. This resulted in an increase in farm conversions to dairy andthe intensification of the dairy process over the last two decades (Barnett & Pauling, 2005).
Economic and political changes have consequences for how farmers manage their business.
Dairy farmers were no longer protected from outside forces with subsidies or tariffs. Thisrevolutionised the farming structure and forced farmers to consider their farm as a business,rather than a way of life (Reid, Gray, Kelly & Kemp, 1999). This led to a shift towards larger
farms and the increased costs associated with entering the industry. Larger dairy farms require
more land, cows and capital to make them profitable as well as time to complete various farmtasks (Clark, 1998).
Legal-political regulatory factors also impact on the opportunities for the industry. They include
the influence of government and the legal system. National legislation such as The Resource
Management Act 1991; The Employment Relations Act 2000; and The Dairy Industry
Restructuring Act 2001, (which saw the creation of Fonterra), were all important because they
provide the foundations that ultimately guide the behaviour of New Zealand dairy farmers and51

New Zealand Journal of Employment Relations, 35(1):48-64
also impacted upon desired capability (the KSAs of dairy farm assistants) (Lamm &Rasmussen, 2004; Barnett & Pauling, 2005). There are also government policies that impacted
the New Zealand dairy industry such as an immigration policy that seeks to reduce the skilled
labour supply shortage within the industry. Essentially it was an attempt to raise capacity.
Within the government agencies which provide services and monitor whether dairy farmers arecomplying with laws and regulations at local, regional and national levels there have been anumber of significant regulatory changes (Bartol et al., 2003). This means that farmers are more
involved with local and regional governments, the Ministry of Agriculture and Fisheries and theDepartment of Labour.
The final element in the change of labour market opportunity was international trends, which
fuelled expansion and drove the demand for more human capability. Three key changes havebeen identified – China’s booming dairy market, with dairy products becoming recognised as
an essential part of any healthy diet; a growing market for high protein foods and global
warming. There is increasing demand for New Zealand dairy products. Global animal diseases
such as Foot-and-Mouth lead to a premium on clean green New Zealand dairy production(Cheung & Grant, 2006). Each of these changes has the ability to affect demand for New
Zealand dairy products, driving up the demand for skilled farm assistants.

Capability Influences
The capability (level of KSAs) in the potential work force is very significant. Societal, cultural,community (iwi) and whanau (family) influences surround the availability of the capability.
The macro-environment has a socio-cultural element, concerned with the attitudes, values,
norms, beliefs and behaviours that characterise a given geographic area (Bartol et al., 2003).
There were three areas of change; changes to family, community changes, and the changes in
the nature of dairy farming models – particularly the growth in technological sophistication andsize.
One change reported in the literature suggests a reduction of the skilled rural labour supply
Dairy (Dairy Insight, 2007; Penno, 1999; Reid et al., 1999; Tipples et al., 2005). In the early
1980s, prior to the economic reforms that transformed New Zealand and the dairy industry, thefamily who owned a farm were able to provide all the labour that was required (Penno, 1999).
Dairy farming was a family business! This is no longer the case (Reid et al., 1999). As average
herd and farm size have increased (Livestock Improvement Corporation, 2006), so too has thedemand for skilled dairy farm labour (Reid et al., 1999). This has not been matched by supply.
Part of this supply problem can be attributed to social changes, which include both the womenand children of dairy farmers seeking careers away from the home (Reid et al., 1999). Whereas
in the past, women have helped their husbands by working on the dairy farm, they are now
pursuing other employment opportunities, as are their children. This change is importantbecause their absence from the industry removes from the dairy farm employer an importantsource of skilled labour. This is recognised in the HCF as growing non-labour market
opportunities. In fact they are different and non-dairy farming opportunities that reduce the poolof potential employees by giving a choice of occupation.

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New Zealand Journal of Employment Relations, 35(1):48-64
There has been a shift to larger farms. Larger farms tend to have a completely different social
structure to smaller dairy farms and as a result, the involvement of family changes (Fairweather,1994). This shift from a ‘family’ to an ‘industrial’ farm, has also seen greater levels of labour
specialisation; a more businesslike approach taken by the dairy farmer; an increased importanceof labour; and less scope for family involvement (Gilbert & Akor, 1988, as cited in Fairweather,1994). It is no longer adequate to have a family member who is able to help out on theweekends because due to larger properties, farm employment structures have altered, rendering
it more difficult for them to fit into the farm labour pool even when they are available(Fairweather, 1994). This is a profound change in small rural communities and on family farms.
The informal skill development methods where are children and young people learned how to
be a farmer from infancy are declining. They are particularly lacking where the farmer is older,less technologically switched on and more specialised knowledge is required. The ‘learn on thejob from the experience of a lifetime’ approach is unlikely to work as well as it did in the past.
As labour becomes a more significant and specialised component of the dairy farming system,
so too does the need not just to have more people and for them to stay, but to have employees
who are equipped with the necessary qualitative capability (KSAs). With increased levels ofworker specialisation on larger dairy farms, it may become necessary to have employees who
are familiar with the knowledge and skills required for a smaller number of tasks. This can have
major implications for the need to develop capability.
Fonterra (the dairy corporate which accounts for more that 90% of the milk produced) is thedominant customer but some registered companies such as Westland and Tatua exist. Changes
that have occurred include the merging of dairy co-operatives under the Dairy Industry
Restructuring Act 2001 and the introduction by Fonterra of a tactical milk pricing regime inareas such as Waikato in an attempt to fight competition (Barnett & Pauling, 2005). Fonterra
inevitably has a huge impact on the industry.
The conversion of sheep and beef farms into dairy properties as this industry becomescomparatively more profitable changes the capacity required (Reid et al., 1999). As more farms
are converted into dairy properties the desired skill set changes as the capabilities required for adairy farm are different to those needed on a sheep or beef farm
There have been a number of changes leading to an increased gap between the demand for andsupply of skilled dairy farm employees. The national labour market is aging, more diverse andmore female. There has been an absolute decline in the rural population (Dairy Insight, 2007).
Traditionally, employees in the dairy industry have been male, ethnically European workers
aged between 15-35 years (Dairy Insight, 2007). Statistics New Zealand projects that between
now and 2016, there will only be a small increase in the workforce, but that this longestablished source of farm labourers will at best remain static (Dairy Insight, 2007). Tipples etal (2005) suggested that future capability is compromised by a small and declining number ofentrants from a more urban and ethnically diverse pool of potential staff. Retention rates werepoor and the number of people reaching competence inadequate. He suggested moremechanisation and once a day milking may help matters. We roughly trace changes that havelead to a human capital shortage in the industry in Figure 3.

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New Zealand Journal of Employment Relations, 35(1):48-64

Figure 3: A developing human capital capability and opportunity gap

The Study
Twenty-four dairy farmers participated in this study. A snowballing sampling technique wasused, described (Saunders, Lewis & Thornhill, 2003 as a non-probability sampling procedure inwhich subsequent respondents are obtained from information provided by initial respondents.
One participant lead to another and a research sample was built up. In order to ensure we had anational sample, we asked 28 farm consultants operating in different geographical areas tosuggest farmers in their area who met the criteria for inclusion. This initial contact produced
seventeen names and contact details of New Zealand farmers who were then contacted andasked to suggest the names of other farmers until thirty participants were found. Participating
farms had to be dairy farms (according to the categorisation used by Jaforullah &Whiteman,1999) and employ at least one farm assistant. A pilot study involved four dairy farmowners to validate the interview structure. Interviews were used to collect the information
because they allow for the complex social organisation of farms and the variation between
properties to be captured, while still allowing for the research questions to be answered(Fairweather, 1994). The dispersion of farms throughout New Zealand made face-to-faceinterviews difficult. Some interviews were carried out face-to-face, some by telephone. Semistructured interviews were used because they allowed for the creation of questions that would
fulfil research objectives while still providing scope for the discussion with each farmer todevelop accordingly (Saunders, Lewis & Thornhill, 2003; Silverman, 2000). They allowed for

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New Zealand Journal of Employment Relations, 35(1):48-64
additional questions to be asked that were in line with the development of the interview andinformation being collected, so that a richer source of data was gained.
The interview had three parts. Part one of the interview concerned the things farmers sought
when seeking dairy assistants. In the second part of the interview we conducted a formal
training needs analysis (TNA) for the dairy assistants on the participating farms. A task analysis
approach was using job analysis, job description, and person specification information provided
by Dexcel (2003). This was supported by information collected from New Zealand Career
Services (2007) and discussions with dairy farmers. Employers were also asked to describe
what frustrated them most about the current performance of their farm assistants and the things
that they were unable to do. The third part of the interviews collected data from dairy farm
employers in regard to formal training and development programmes in New Zealand for dairy
assistants. In particular, they were asked what they liked and disliked about current
programmes; suggestions for improvement; whether such programmes prepared farm assistants
for working in the dairy industry; and whether the design of these programmes has kept up withchanges in the industry.

Results
Participating dairy farm employers were first asked to identify the most important things thatthey look for when employing a farm assistant. Employers made sixty references tocharacteristics which are shown in Table 1. We have shown them as first, second and thirdorder priorities.
Table 1: First, second and third order characteristics desired of dairy farm assistants bydairy farm employers. (First order ≥ 11%; second order 6-10%; third order ≤ 5%)
First order Characteristics
Overall personality (15%)
Honesty (13.3%)
Reliable (13.3%)
Positive attitude (13.3%)

Second order Characteristics
Can perform farmtasks/experience (10%)
Willingness to learn (6.7%)
Gets along with me (6.7%)
Wants to be in industry (6.7%)

Third order Characteristics
Takes pride in work (1.7%)
Communication skills (3.3%)
Can follow instruction (1.7%)
Punctual (1.7%)
Conscientious (1.7%)
Consistent (1.7%)
Personal values (1.7%)

The most commonly looked-for characteristics for a dairy farm assistant are personal attributes
such as honesty, reliability, overall personality and a positive attitude. Their ability to perform
farm tasks and the amount of previous experience on a dairy farm appeared to be lessimportant. This is shown in the division of those characteristics according to frequency into
first, second and third order characteristics.
The most frequently cited desirable characteristic was the farm assistant’s overall personality.
‘Personality’ is the “relatively stable pattern of behaviours and consistent internal states that
explain a person’s behavioural tendencies” (McShane & Travaglione, 2007: 52). Personality is

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important because it helps to determine how we interact with one another or in this case, how
the farm employer and the farm assistant work together.
So, whereas one might expect that dairy farm employers are looking for a farm assistantdisplaying an all-round balance of appropriate knowledge and skills, they actually place moreof an emphasis on attitudes.

The Training Needs Analysis: Knowledge, Skills and Attitudes
While accepting the importance of personal characteristics to farmers, we used a formal
framework based on published material and our first enquiries of farmers to investigate theknowledge and skills part of capability. From a task analysis, eighty six different tasks were
specified by employers as important. Within these five tasks stood out: milking (referred to by21%), feed management (17%), animal health (16%), farm and vehicle maintenance (16%) andstock work (14%).
Knowledge Required
Results suggested that the top four things for a dairy farm assistant to know (in order ofimportance) are a knowledge of pasture management; knowledge of how to milk cows;
knowledge of animal health; and a knowledge of farm routines, which includes specificprocesses that a dairy farm might follow and the reasons for doing so. This list is significant
because it relates well to the important tasks previously identified. For example, milking wasseen to be an important task for farm assistants and this is supported by them needing to haveknowledge of how to milk cows, animal health and farm routines.
One of the most interesting findings was that farm assistants needed to have knowledge of farm
specific routines, which is something that can only be gained once the assistant is on aparticular farm. This is an important finding because farm-specific knowledge cannot be
formally taught to farm assistants.
Table 2: Important knowledge for dairy assistants
Types of knowledge
Knowledge of pasture management
Know how to milk cows
Knowledge of animal health
Knowledge of farm routines
Know how to drive farm vehicles
Maintenance knowledge
Feed management knowledge
Safety knowledge
Know how to ask questions
Know how to operate machinery; know how to
ask listen; knowledge of milk quality; know how
to take responsibility for tasks.

Frequency mentioned
10 (16.4%)
9 (14.8%)
8 (13.1%)
7 (11.5%)5 (8.2%)4 (6.6%)4 (6.6%)4 (6.6%)4 (6.6%)
Less than 5%56

New Zealand Journal of Employment Relations, 35(1):48-64

SkillsSkills have an important place in the role of a dairy farm assistant according to dairy farm
employers. Eighty-three references were made to skills by dairy farm employers. They
considered driving (16.9%) and stockman skills (14.5%) to be the most important for farmassistants to possess. Once again, this confirms the earlier findings, which require farmassistants to be able to drive around the farm and work with animals!

Table 3: Important skills in the role of a dairy farm assistant from the perspective of dairy
farm employers
Types of skills
Driving skills
Stockman skills
Maintenance skills
Other
Milking a cow
Administering medication
Communication skills
Machinery skills
Literacy skills

Frequency mentioned
13
11
9
9
8
7
6
6
5

Space prevents discussion of the theoretical model (Dexcel, 2003) since it contains 11 major
categories and 60 elements listed by KSAs. However when compared with the list of skills in
the theoretical model for the role, there were a large number of these that dairy farm employers
did not mention. However, driving and stockman skills are evident in the majority of the tasks
listed in the theoretical model, which suggests that they are important. The identification ofthese skills as being important is significant because it pinpoints the type of things that need to
be included in training and development programmes targeted at the New Zealand dairy
industry.

Attitudes
Important attitudes in the role of a dairy farm assistant were also sought by farm employers, theresults of which are shown in Table 4. In total, employers made seventy-four references todifferent attitudes.
In this long list, five attributes stand out from the others as being more significant – reliability,
honesty, commitment, an ability to think for themselves; and a positive attitude.

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New Zealand Journal of Employment Relations, 35(1):48-64
Table 4: Important attributes in the role of a dairy farm assistant from the perspective of
dairy farm employers
AptitudeFrequency mentioned

ReliableHonestCommitted
Thinks for themselves
Positive attitude
Motivated; gets along with others; commonsense; teamplayer; efficient; hard-worker; adaptable/flexible;
responsible; calm; punctual; willingness to learn;
confident; respectful; takes pride in their work; sense of
humour; focus

16
12
7
5
5
Less significant attributes (I.e. mentioned
by less than 5 employers)

The Gap
Employers made 32 references to key shortcomings in dairy assistants. 25.7% of these wereconcerned with farm assistants who ignored tasks that needed doing, while a further 20.8%
refer inability to do the unasked tasks and to think for themselves as an issue. These problems
are interesting, given that they are not actual knowledge or skills problems identified formally.
Results regarding this current performance gap can be combined with earlier findings, toproduce a model providing an overall summary of the performance gap in New Zealand dairy
farm assistants. Figure 4 shows the most important tasks in the role of a dairy farm assistant in
the outer ring of the diagram. In the middle is the performance gap, in that farm assistants areunable to do the unasked things and ignore those that need doing. In other words, farmassistants are doing the tasks that are asked of them, but are not being proactive while they arecompleting one task, being able to incorporate other dairy farming skills to complete others
simultaneously. For example, if a dairy farm assistant is getting the cows in (fulfilling the taskof milking) and fails to check and therefore fix the water-trough which is leaking water (thetask of farm maintenance), then this is a problem in the eyes of dairy farm employers.
Results from this study again suggest that employers want an all-round dairy farm assistant who
is able to combine a number of important tasks together and while doing one, still be able tocomplete others. This is important because if this is what employers in the New Zealand dairy
industry desire, then formal training and development organisations need to design theirprogrammes to cater for such needs.

58New Zealand Journal of Employment Relations, 35(1):48-64
Figure 4: The performance gap within New Zealand dairy farm assistants from the perspective of
dairy farm employers

Performance gap:
Ignoring the tasks
that need doing &those not asked ofthem.

Dairy Industry Formal Education and Training - A Matching Opportunity
52% of dairy farm employers had no formal agricultural qualifications. 42.9% of farmassistants also had no formal qualifications, although the majority of this group were studying
towards an Agriculture Industry Training Organisation Certificate. This suggested that formal
agricultural qualifications were not necessary in the past for success in the New Zealand dairy
industry, as represented by those that own their own farms. Given that many farmers gained
their skills before the development of substantial training regimes their remarks and views may
apply more to the past than the present. Trade Certificates were phased out in the 1990s with
the introduction of industry training organisations by the New Zealand Government(Agriculture Industry Training Organisation, 2004).
Participating farms allocated no more than 10% of their total expense budget towards thetraining and development of their farm assistants. 54.2% of participants quoted that they
allocated 0.0% of their budget towards this area. Despite this majority, this study found thatsome dairy farm employers do pay for the training and development of their staff.
Overall, this suggests that New Zealand dairy farm employers do not contribute muchfinancially towards the formal training and development of farm assistants. This suggests thateither the costs of attending formal courses outweighs the benefits; that formal training anddevelopment is perceived to be the responsibility of the farm assistant; or there are other morefavoured and less costly ways to train farm assistants.

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New Zealand Journal of Employment Relations, 35(1):48-64
The state of formal training and development was evaluated through the collection of
information (opinions) from dairy farm employers. This is reflected in the force field analysisof the results shown in Figure 5.
Force field analysis was developed by Kurt Lewin for therapeutic use in the 1930s (French &Bell, 1984). It allows thinking about an issue and what drivers (the upward arrows) would
improve things if they were not held back by the restrainers (the downward arrows) It shows thestatus quo as a line part way up a scale. In this case, it is a scale of satisfaction with industry
education. The horizontal line represents the overall result and is located halfway along thesatisfaction scale, due to the presence of both positive and negative feelings from dairy farm
employers, creating an ‘in two minds’ feeling. They were ambivalent towards the state offormal dairy farm training and development in New Zealand.

Figure 5: Force-field analysis of dairy farm employer opinions regarding the state of dairy
farming education and training in New ZealandCoursecontent

Assessment
standards

High

Satisfaction with state ofeducation

Number ofprovidersCaters for avariety ofpeopleIt exists
Low

GeneralReadily
availableWellpublicised

Offers recognised
qualifications

CoursevarietyIn this graphical illustration, the upward arrows represent positive forces that will increase thelevel of satisfaction that dairy farm employers have with training and development. Downward
arrows portray the negative forces that drive down these levels. The different widths andlengths of the arrows symbolise the different strengths of each factor, so the more popular theanswer was from farmers, the thicker and longer the line was.

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New Zealand Journal of Employment Relations, 35(1):48-64
The positive forces identified in this study were that formal training and development
programmes exist; they are readily available; there is a large amount of variety in the types ofcourses available; they cater for a wide variety of people; they are well publicised; and they
offer recognised qualifications.
The feeling that course content of training programmes is inappropriate was the most common
answer from dairy farm employers. By pinpointing these positive and negative forces,
opportunities for improving satisfaction levels towards formal training and development can betaken by either capitalising on the positive forces, or mitigating the negative ones.
One of the interesting findings was that New Zealand dairy farm employers were satisfied withthe processes associated with the courses, rather than their content. This is significant because
when one refers back to the force field analysis, formal training and development programmes’course content was something that dairy farm employers were unhappy with. ‘Course content’refers to the types of KSAs that are taught (as part of capability) within such programmes and,in particular, refers to the differing amounts of theoretical and practical training that theseprovide. Employers felt that courses were getting away from the basics; they taught trainees tohave too much of a reliance on technology; there is little emphasis on the importance ofcommonsense in dairy farming and the standards of assessment are inappropriate. These
negative points are worthy of note because they need to be mitigated if dairy farm employer
satisfaction levels with formal training and development programmes are to be increased. To
discover ways this could happen, dairy farm employers were asked to make suggestions for
improvement
Of the 49 suggestions made for improvements to formal training and development programmes,
the most common suggestion made was to include more practical training in them. This
supports the earlier finding that dairy farmers are unhappy with the current course content ofthese programmes. Dairy farm employers do not think that there is a large enough practicalcomponent, which is significant given that many of them consider dairy farming to be a job thatcan only be learnt by doing. This has repercussions for dairy industry training providers
because to earn employer credibility, they need to be providing courses that have the practicalcomponent integrated into it, to teach trainees how to actually be a dairy farmer.

Conclusions
We have used the Human Capability Framework to identify the changes in the environment thathave led to a gap between capacity and opportunity in the dairy interest. While some of thesechanges are likely to be one-off adjustments, the world has changed and there is a criticalshortage of people and skills likely to hold the industry back.
Although there is a shortage of people – the need is to not only address the shortage of people
but to build the right attitudes rather than the current an emphasis on knowledge and skills. Our
study made it clear that although there have been some changes in the skills required and a needfor further training, dairy farmers were more concerned with the attitudes of dairy assistants
than the skills required. While the tasks have not changed greatly there has been a significant

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New Zealand Journal of Employment Relations, 35(1):48-64
change in that more and more dairy assistants are unable to, or chose not to, carry out tasks
unasked of them. One suggestion we make is that the continual breaking down of the job tosmaller and smaller components has led to what is regarded by educationalists as reductionism,
by which we mean the assumption that if you know all the component parts you know a whole
job and can be successful at it.
Further research could now explore how to develop rounded aptitudes and characteristics in theindustry.

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New Zealand Journal of Employment Relations, 35(1):65-88

The function of Social (and Human) Capital as antecedents on
Indigenous entrepreneurs networking
DENNIS FOLEY*
Abstract
A possible knowledge gap in entrepreneurship literature became evident during acomparative qualitative study of two Indigenous groups of entrepreneurs; Australian
Aboriginal and New Zealand-Aotearoa Māori entrepreneurs. When the relationshipbetween networking and social and human capital attainment was addressed within the
majority settler society business culture it would appear that the networking attributes ofIndigenous entrepreneurs differ. This suggests that the underlying social and humancapital attainments are unique to their individual cultures. Possible differences between
the attainment of social and human capital is directly related to the ongoing impact ofcolonial practice which has directly influenced the networking ability of the Indigenous
entrepreneurs and their business positioning within comparative markets. This paper
seeks to provide discussion and preliminary data for future modelling and development of
human, social, financial and natural capitals for Indigenous entrepreneurial success.

Introduction
Indigenous enterprise development has been a catch cry for successive governments
around the globe that strive to repair the poverty and social injustice that have been
forced on Indigenous people under the tyranny of colonial dominance combined with thedesire among many of the world’s 300-500 million Indigenous people to rebuild theircommunities or to provide for their families (University of Minnesota 2003; Peredo,
Anderson, Galbraith, Hoing, & Dana, 2004). Within this process, all too often,
government practice is short-term, reactionary, lacking empirical evidence to support
economic and social policy. It is proposed, if in this work we can understand the interrelationship between human and social capital and Indigenous entrepreneurial activity,
then Indigenous driven research may assist program development to deliver rigorous
Indigenous economic reform for Indigenous business based on socio-cultural
understanding. As Brough and Bond have argued, a problem exists whereby;“…the deficit-based, non-Aboriginal ideologies surrounding Aboriginal identity
and communities, social capital can be in danger of simply being added to a long
list of shortfalls in Aboriginal resources … Poor social capital becomes a marker*
Professor Dennis Foley is a Research Academic in the School of Humanities and Social Sciences at the
University of Newcastle. Faculty of Education and Arts, University Drive, Callaghan, NSW 2305,
Australia. Dennis.foley@newcastle.com.au

65New Zealand Journal of Employment Relations, 35(1):65-88
of inactive citizenship … it is not long before the inferior characteristics ofAboriginal social formations once again become the source of scrutiny from a‘superior’ non-Aboriginal position” (Brough & Bond 2009: 248-9)
This is compounded by the limited research in Australia into social capital (Brough &Bond 2009) and this is why Australia and its near neighbour Aotearoa (New Zealand)
have been chosen for this study. The aim of this project is a comparative analysis thatexamines Indigenous networking, levels and types and any connection between humancapital and social capital. Understanding Human capital is important from the Indigenous
standpoint as the majority of our Aboriginal youth still only obtain a primary level
education (Australian Bureaus of Statistics 2008). Prior to 1972i most of the authors’ own
generation were institutionally un-educated – educated only to be labourers, unskilled
people with nominal human capital. When you are socially stratified at the sub-terrain ofhuman society; the difficulty of the climb up, out of poverty and freedom from welfare
dependency is then exacerbated. If we can understand how successful Indigenous
entrepreneurs overcome this colonial impediment and multi-generational manufactured
social phenomena then, as mentioned previously, we can better inform the policy maker.
Previous studies (Evald, Klyver & Svendsen 2006; Foley, 2005b; 2006) have shown thatcross-cultural interaction and the legacy of colonisation can impact on the Indigenous
entrepreneur’s day-to-day operations. An important finding of this research, which has todate received little attention – an exception being the Australian Taxation Office (2009),
is the possible relationship between human and social capital and environmental factors
such as discriminatory practices and racial stereotyping in business. This social
impediment, when combined with reduced levels of business expertise (when the
Indigenous entrepreneur is compared to settler society) and vastly inadequate financial
resources both in savings and access to borrowings, is the environment within which
Indigenous entrepreneurs operate (Australian Taxation Office, 2009; Foley 2008a)
highlights the difficulty that the Indigenous entrepreneur faces. Social norms and cultural
practice shape business practices and decision-making processes, and these are the key
attributes to social capital for mainstream settler society (Burt 2005; Keast, Brown &Guneskara 2009; Putman 1993). Yet for the Indigenous entrepreneur little is known.

Literature Review
The wealth of literature on social capital is described as a slippery concept (Jones, 2005),
and those who use it are often accused of adopting questionable means of measurement
without sufficient regard to the theoretical underpinnings to ensure its validity or
reliability. A lack of theoretical precision has led to general confusion about what issocial capital (Durlauf, 1999; Portes, 1998; Stone, 2001). It seems that it has also been so
widely applied that it is often referred to as an elastic term, or umbrella that can accountfor a wide range of socially based phenomena (Keast et al, 2009). It is acknowledged that
there is no consensus on the aspects of interaction, validity and merit that the label ‘social
capital’ describes (Grootaert, 1998), however, it does deserve investigation, especiallywhen applied to Indigenous economic development.

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A comprehensive literature review is beyond the scope of this paper so a focused review
of literature will be applied. A solid knowledge base exists in the literature about social
networks and entrepreneurship (see Hoang & Antoncic, 2003 and O’Donnell, Gilmore,Cummins & Carson, 2001) and it is generally accepted that social networks can have astrong influence on entrepreneurial activity, influencing the decisions which
entrepreneurs take and their chances of success (Davidsson & Honig, 2003; Evald et al,
2006; Greve, 1995; Jack & Anderson 2002; Jenssen, 2001; Jenssen & Greve, 2002;
Jenssen & Koenig, 2002). Entrepreneurs obtain resources from those in their social
networks (Greve & Salaff, 2003; Jenssen, 2001; Jenssen & Koenig, 2002) and it is thecomposition of an entrepreneur’s network that determines available resources. Different
social networks provide different resources. However, this paper does not address social
networking, for to do so would complicate the key issues, and it will be evident that theAustralian Indigenous entrepreneur has two distinct social networks in the early stages ofthe business lifecycle; the cultural – community, family kinships, and the businessnetworks that are within the dominant ‘settler society’ society. The Māori social networks
between family and business are more homogenous – blurred somewhat, so that businessnetworks are an extension of cultural networks.
Developed social networks for the Indigenous Australian incorporating both cultural andbusiness networks appears to be a stage after the entrepreneur acquires satisfactory levelsof human and social capital, possibly related to a mature phase of the business life-cycle(and the subject of future research).
To discuss the function of social (and human) capital as antecedents on Indigenous
entrepreneurs networking in general, it is important to understand the distinct relationshipbetween human and social capital in the Indigenous scenario.

What is Social Capital?
Social capital can be a set of horizontal associations between people consisting of
networks and associated norms that have an effect on the productivity of those involved,
limited to positive associations in the development of participants (Grootaert, 1998;
Putman, 1993). From an economic perspective, social capital can be framed in thecontext of the distribution of knowledge. Leibenstein’s (1968) X-efficiency theory
focused on the role of information and the inefficiency of dissemination, acquisition andcollection of information that leads to gaps in knowledge within networks of people, thus
creating entrepreneurial opportunities. Yet, how do you measure it as “… there has been
little agreement in its measurement, or in terms of which elements of social capital arecore to the concept, and which are peripheral (Onyx, Bullen & Edwards, 2009: 152)
The complexities of measuring social capital were partly addressed in Australia when
Onyx and Bullen (2000) developed a scale of social capital aimed at the community
structure. Their more recent work involves the examination of empirical data of casual
paths towards social capital development. Significant findings indicate social agency and67

New Zealand Journal of Employment Relations, 35(1):65-88
trust as the most important casual factors (Onyx, Bullen & Edwards, 2009). Thesefindings, however, are based on the examination of community participation linking tofamily, friendship and neighbourhood connections without ethnic sample data or
specifically analysis of the individual. The findings suggest that communities differ intheir social profile and the factors contributing to “social capital development also varyfrom community to community” with “historical factors” influencing the process (Onyx,
Bullen & Edwards, 2009: 166). They espouse firstly that, “the structure of social capitalis remarkably stable across communities and groups” and secondly “it is possible toidentify plausible causal paths to the development of social capital” (Onyx, Bullen &Edwards, 2009:168). This research appears unrelated to this paper, however, their need to
identify the implications of the causal paths in the development of social capital isindirectly the very aim of this paper. Before we address these issues further, explorationis required defining social capital.
A simplified entrepreneurial scholarly definition of social capital is “… investment insocial relations with expected returns in the marketplace” (Lin, 2001:19). This definitionreflects the entrepreneurial school of scholarship writings on social capital (Bourdieu,
1983; Bourdieu and Kreckel, 1983; Burt, 1992; Coleman, 1988; Lin, 1982; Portes, 1998).
Burt (2000), however, distinguishes two classes of model of social capital. One is basedon network closure as a contingency factor essential to realising the value in agency andis derived from the writings of Bourdieu and Coleman (1991). The second focuses on
structural holes and advantage through social structure that accrues through brokerage or
combination of resources (Burt, 2005). When this literature is applied to Indigenous
entrepreneurs, social capital is the complex interaction of networks that channel and filter
information about the Indigenous entrepreneur’s cultural identity — the complex
brokerage or combination of resources described by Burt (2005). This controls the
allocation of the meagre resources that are available to Indigenous entrepreneurs (Foley,2000). If social capital shapes behaviour (Fernandez-Kelly & Schauffler 1994), one
would expect a positive interaction with cultural values; hence the stronger the presenceof social capital, the result is an increased level of cultural values. Correspondingly, theutility function of a ‘relationship good’ that is found within culture ensures that it isconsumed only with others and is trust-intensive in both its production and thecorresponding consumption of the relational good (Antoci, Sabatini & Sodini, 2009).
It would seem that the stronger the presence of social capital within Indigenous groups
then the stronger the level of cultural values. This is a positive foundation that enables
policy makers to build a platform from which to understand Indigenous economic
development. Yet in doing so, it is important to include Schuller’s (2007) argument thatsocial capital cannot be reduced to economic capital alone. For the values of social
capital may depend on human, financial and natural capital and social capital are, indeed,capable of producing positive outcomes beyond economic advantage such as improved
health, good educational outcomes, lower incarceration and crime rates and a stronger
community overall (Halpern, 2005). These are findings commensurate with the author’s
previous publications on the social impact, or ‘outcome’ of successful Indigenous
entrepreneurs (Foley, 2000; 2003a; 2005ab; 2006; 2008abc).

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New Zealand Journal of Employment Relations, 35(1):65-88
If we accept that positive social capital development is attributable to positive social
attributes (Halpern, 2005) then we need to define social capital from the Indigenous
entrepreneurs’ standpoint. Commencing with the well known Naphapiet and Ghoshal’s(1998:243) definition of social capital as a platform, which is:“the sum of the actual and potential resources embedded within, available
through, and derived from the network of relationships possessed by an individual
or social unit. Social capital thus comprises both the network and the assets that
may be mobilized through that network”
When we begin to understand the impact of continuous colonisation (Pearce, 2010:14) on
the Indigenous entrepreneur that is touched on in the following case studies and based on
the authors previous research in the specialised area of urban based Indigenous
entrepreneurs, then a definition of social capital from the Indigenous standpoint wouldbe:“For the Indigenous entrepreneur social capital is the sum of the actual andpotential resources, both embedded within and available through their own sociocultural networks, that to a large degree is subject to colonisation and thecontemporary socio-cultural environment within the dominant society. The
dominant society determines the Indigenous entrepreneur’s ability to function
outside of or within structures of cultural oppression, often born of negative
stereotypes. Social capital is also subject to both ‘material’ and ‘relational’
functions within a varying trust-intensive relationship between the subject
parties”.
If you are Indigenous, social capital is a variable dependent (Halpern, 2005; Schuller,2007) subject to the levels of ‘social inclusion’ within the wider ‘settler’ society which isin the two case studies the dominant culture. It is important to remember that Bourdieu(1986) was among the first to discuss social capital as a concept in other than economic
terms, encompassing elements that include trust, common values, norms and social
resources within a social structure. We have taken this to include both ‘material’ and‘relational’ functions within a varying trust-intensive relationship (Antoci et al, 2009).
Indeed, social capital is “iterative” as the more it can be developed then the more can be
developed (Onyx et al, 2009:166). The specific definition of social capital used in thispaper is a development of this concept based on Indigenous entrepreneurs obtaining
resources from their social networks that allow them to survive within a post-colonial
environment, which will differ from country to country and possibly region to region
depending on the social carnage that is the direct result of aggressive colonisation
practices (Reasons & Pavlich, 1995). For the nascent Australian Indigenous entrepreneur,
financial capital and natural capital and to an extent developed human capital within theirown cultural ‘kinship’ networks is very low to non-existent (Foley, 2008c; Fryer-Smith
2002). The emphasis in this discussion is that the Australian Aboriginal entrepreneur isforced to develop social capital connections from outside of their own cultural base
(Foley, 2008c).

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Before closing this section, it would be remiss of me not to repudiate one of the urban
myths held by some within the Academy. Not all Aboriginal people have access to strong
kinship systems and networking alliances through ‘community’ associations ascommonly believed. My research over the last 15 years (Foley, 2000; 2003a; 2005ab;
2006; 2008a) has revealed that the majority of Australian Indigenous people haverelatively low social and human capital within their Indigenous personal networks thatare applicable to commercial ‘business’ undertakings. In traditional (pre-European
contact) Aboriginal social networks through complex kinship, relations were wellestablished. However, the impact of colonisation, dispossession and urbanisation has
resulted in the destruction of many cultural ties and traditional practices (Fryer-Smith,2002). Traditional kinship based levels of social and human capital are diminished tounrecognisable levels in the colonised urban environment (Fryer-Smith, 2002). In an
entrepreneurial context, the urban Indigenous business person is forced to seek social
capital, business assets and human capital in business expertise from within the dominantsettler society networks through a shared relationship (Klyver & Foley, 2010; Ottoson &Klyver, 2008).
In conclusion, it is important to recognise that the majority of literature, to date, on social
capital has been based on the loosely defined and conceptualised “virtuous cycle” (Onyxet al, 2009: 166) called the ‘community’ which in reality is, “… largely [a] white, middleAmerican notion … romanticised, ethnocentric ideal” (Brough & Bond, 2009: 248).
Having stated this as the foundation or basis of much of the known social capital research
to date, it is also despairing to read that it would appear that social capital as a concept inAustralia is in decline, reminding “us of the unfortunate resemblance between scholarshipand fashion” (Brough & Bond 2009: 247). It is not surprising to read that there has been“… limited research into the nature of social capital and its meanings for Aboriginal[people]” (Brough & Bond, 2009: 249). It is important that the reader recognise that thispaper qualifies the individual Indigenous entrepreneur and is seeking to understandqualitatively social capital issues impacting on the Indigenous entrepreneur, not‘community’ issues. This paper is striving to achieve scholarship that Altman, Biddle andHunter (2008) write of, in that it is seeking a new discourse emphasising “evidencebased” over “anecdote or ideology” (2008:18). The lack of evidence based research has
plagued Indigenous research and neo-conservative assumptions (Brough & Bond, 2009)

The Influence of Human Capital on Social Capital
It is the author’s belief that if we are to discuss social capital regarding Indigenous
entrepreneurship, then we should include a consideration of human capital literature, as
one has an impact on the other (Ottoson & Klyver, 2008). Social capital is, to someextent, predicted by human capital (Boxman, Degraaf & Flap, 1991; Ottoson & Klyver,2008) as, while we acquire human capital, social capital is co-produced. Classicalsociological literature links the two as complements (Rooks, Szirmai & Sserwanga,2009). To take education as an example, it not only creates human but also social capital(Fedderke, De Kadt & Luiz 1999; Ottoson & Klyver, 2008). Human capital, in economic
terms, generally describes a person’s productive attributes. In entrepreneurial terms, it is70New Zealand Journal of Employment Relations, 35(1):65-88
measured by classifying the elements of human capital that include the investment ineducation, the cost of attaining management skills and training, acquiring industry
knowledge, obtaining entrepreneurial knowledge and skills, the cost of business start-up
experience, and how these can be translated into increased economic returns on theinvestment (Becker, 1993; Dyke, Fisher & Reuber, 1992). To extend this, some scholars(Greve, Benassi & Sti, 2006; Ottoson & Klyver, 2008) postulate that entrepreneurs need
the investment in human capital to take advantage of social capital.
As mentioned in the introduction, for Indigenous Australians the ongoing colonisation
process until the late 20th century ensured human capital was only developed in
education that relegated Indigenous Australians to menial labour and transient existences(Connell et al, 2007). These educational policies are seen as a major contributing factor to
the enforced welfare dependence of Indigenous Australians, a history that continues tocontribute to socio-economic disadvantage (Beresford and Partington 2003).
Understanding this aspect of Australian history, we must then consider the developmentof Aboriginal human capital in relationships that matter based on people’s happiness oroverall well-being. The individual’s social sphere will influence their economic position
and action (Antoci et al, 2009). Antoci et al state that “… a social environment rich ofparticipation opportunities which allow people to meet frequently, creates a fertile groundfor nurturing trust and shared values” (2009: 4). Social interactions are a vehicle in the
diffusion of information and trust that impacts on economic activity, creating social wellbeing (Smith, 1763/1978).
Accepting that social capital emerges from the norms, networks and relationships of thesocial structure (Coleman, 1988), we must consider ethnicity as a distinct form of social
capital constructed on people’s cultural endowments, obligations and expectations,information channels and social norms (Giorgras, 2000; Zhou & Bankston III, 1994). The
hypothesis is that colonisation destroys or subjugates most if not all Indigenous nations,and eradicates whole generations, destroying the complex Indigenous social networks
that pre-existed the colonisation process and obliterating Indigenous educational
practices. Hence, the human capital that once existed to nourish and endow the resourcebase of Indigenous social capital would evaporate following ongoing processes of
genocide, denial of language, destruction of habitat, incarceration (including on missions
and reserves), which would ensure that any attempt to resuscitate social capital would be
difficult and dependent on the benevolence of the dominant – ‘settler’ – society. This
paper allows the reader to gain an ‘insider’ view into Aboriginal society through the penof the Aboriginal researcher. How this is achieved is explained in the methodology.

Methodology
Exploring phenomena in theoretically sparse fields involves moving from empirical data
outward toward generalised theory and is referred to as an inductive process (Eisenhardt,
1989; Glaser & Strauss, 1967; Strauss & Corbin, 1990). For this research, a crosscomparative case study approach has been applied (Yin, 2002; Eisenhardt, 1989) to71

New Zealand Journal of Employment Relations, 35(1):65-88
emerge theory through the empirical examination of data. Two representative
independent groups of minority/dominant contextually located cultural case-studies were
contrasted. These were characterised by 60 Indigenous Australian, and 25 Māori
entrepreneurs. Each study involved a range of data collection techniques such as review
of official documents, review of mass media documents, society observation, interviews
with experts, and interviews with the entrepreneurs.
Grounded theory (Strauss & Corbin, 1990; 1998) provided a useful base that informs thestudy. However, the research departs from the strict application of grounded theory byadopting a semi-structured interview format with the individuals representing each casestudy to attain commonality in key data sets and strengthen validity, consistency andreliability (Weiss, 1994). A two-step process was then used to analyse the one-on-one
interviews with Indigenous entrepreneurs who were representative of theminority/dominant cultural cases and the official and media documents, observations andexpert commentary. First, substantive coding (open coding and constant comparativecoding) was used (Glaser, 1992) and second, theme analysis was applied to collate andcontrast the findings between the representative data sets of the two individual countries.
Due to the relative low number of Indigenous entrepreneurs and the specialised
methodology required in identifying them and gaining their participation in research, it
was considered that a quantitative research approach at this point of time would not be
rigorous or effective. Instead, this research employed qualitative methods to explore, in
relative simple parameters, the existence and use of social capital by examining the
networking activity of Indigenous entrepreneurs in contrasting cultural environments. An
important contribution is the use of Indigenous Standpoint Theory (IST) (Foley, 2002;
2003bc) that features an epistemological process that respects Kaupapa Māori
epistemology (Smith, 1999). IST is flexible and applicable for numerous Indigenous if
not all-Indigenous nations. It is deliberately emancipatory and not a blanket clone ofexisting discourses. The theory has arisen from discussions with Indigenous peoples ofseveral lands, from Indigenous academics, the ‘educated’, the non-educated in westernformal schooling (but well versed in Indigenous knowledge), and seniors including‘Elder’ Indigenous advisers.
The Australian study is ongoing and is based on several prior research projects (Foley,
2000; 2003a; 2005ab; 2006) spanning a period of approximately 10 years. It involves
sixty ‘snowball selected’ urban Indigenous entrepreneurs from geographical regions
ranging from Hobart to Darwin. The participants covered a broad range of industries,
several of them far removed from the art, craft and tourism ventures that are
stereotypically associated with Indigenous business activity. This included entrepreneursin the motor vehicle industry, trade and retail in the building industry, manufacturing andservice industries. Selective review was undertaken to reduce industry concentrations ofparticipants.
The Aotearoa research is also ongoing, however, for the purposes of this paper, only casestudies undertaken from July 2007 until January 2008 are included. Participants were allfrom the North Island in a geographic area that included the Northlands, East Cape, down72New Zealand Journal of Employment Relations, 35(1):65-88
to Napier and Hawkes Bay, and across to Taupo and its surrounds. Snowball sampling
was also applied with 25 participants selected, representative of a broad range ofindustries that included financial services, manufacturing, transport, information
technology, and engineering, hospitality - tourism that included bed and breakfasts,
motels and established tour operations.
Participants were sole traders, partnerships, and registered corporations. Interviews
involved individuals, partners, families or senior corporate partners. No trusts, Indigenous‘community’ type groups or Indigenous groups established on a communal basis werestudied. Participants were stand-alone commercial operators.
For the purposes of this paper the specific research question investigated is: How doessocial and human capital influence the networking of Indigenous entrepreneurs?
The research question findings are explained briefly in the following case study
summaries and further summarised in Table 1 below.

Comparing the case studies
On analysis of the data and comparing the two separate Indigenous groups, five key
indicators of discussion emerged from the case studies. These are: cultural links with
networking; the existence of second generation entrepreneurs; education levels; role offamily; the business relationship between social and business spheres. The comparative
data is summarised in Table 1 and explained in more detail in the following discussionsections.
Table 1: Comparative analysis of the cases
Cultural links with
networking

Whether second
Generation
entrepreneurs
Education levels
Role of family
Business Relationshipbetween social andbusiness spheres

Australian Indigenous
entrepreneurs
Weak. Subject to acceptancein dominant society.
A necessity.
16% of total

Approx 75% tertiary
Negligible, most cases
negative.
Separated. Dependent on thedominant society, therefore
there is a power imbalance

Māori entrepreneurs
Very strong. Culturally accepted,
interwoven within existing belief
systems. An extension of daily
practice.
Some 80% family members

Approx 20% tertiary
Very important andSupportive.
Highly integrated.
Numerous relationships, somevery personal, they take an avid
interest in their networking
partners

73

New Zealand Journal of Employment Relations, 35(1):65-88

Case study 1: Australian Indigenous Entrepreneurs
To better understand the research findings, let us first understand some brief
demographics of Indigenous Australia. The Indigenous Australian population represents
only 2.4 percent of the whole (Australian Institute of Health and Welfare, 2003), some
500,000 people of whom:•

160,000 live and work in cities in towns, and are relatively well educatedenjoying a wide range of occupations. Proud of our culture, they enjoy
mainstream living standards and participate fully in Australian society. Theirchildren have educational opportunities on a par with suburban middle class
Australia.

•

250,000 (approximately half of the population) existing on the fringes of towns
and cities or in the major city ghettos. They are the low labour force participants,
suffering high unemployment and high welfare dependency with poor educationand poor health. They often live in overcrowded derelict public housing with theireveryday life prone to violence, substance abuse and societal dysfunctions. Theirchildren have poor access to education opportunities.

•

90,000 live in some 1,200 ‘homeland’ settlements established in remote Australia
from the 1970s. These are the most deprived group, usually totally dependent on
welfare, with generational gaps in western education delivery, appalling health in
sub-standard housing, poor sanitation, even lack of access to clean water in someinstances. They live in conditions normally associated with third world countries
and suffer preventable diseases that in some cases are worse than third world
conditions (Hughes, 2007: 3).

The entrepreneurs subject to this study were found predominantly within the first group,
which we could loosely refer to as middle class Aboriginal Australia, and the nascententrepreneurs within the second group. These are the impoverished, the ‘necessity
entrepreneurs’ who see entrepreneurship as the conduit that enables them to escape the‘welfare rut’ (Martin, 2004). Aboriginal entrepreneurs considered networking to be an
essential business activity. However, in the Australian study, networking did not takeplace within other minority groups or their own. Networking was predominately, in fact,
exclusively undertaken with the dominant society of Anglo-Australia, or better known as‘settler society’. There were no alternatives for these entrepreneurs. The reality is it was anecessity as their creditors were non-indigenous, their debtors were non-indigenous, andthe business environment in general is dominated by the non-indigenous.
One of the most important factors influencing entrepreneurs during their years in businessis their identification of role models and networks (Hisrich & Peters, 2002). Now
consider, only 16 percent of participants in the Australian study were second-generation
entrepreneurs; the remainder had no history of family members in business. The majorityof Australian Indigenous entrepreneurs were the first in their respective families todisplay entrepreneurial tendencies that led to business activity. On entering business,

74New Zealand Journal of Employment Relations, 35(1):65-88
many felt culturally, spiritually and physically isolated as they were participating in an
activity in which they had limited to no previous family history. Their experience
conclusively illustrated limited business acumen and reduced social capital. Networking
was a key contributor to their survival; however, it was networking involving nonindigenous business people. Most drew on the experiences and the skills of nonindigenous mentors who helped them establish key industry contacts that arguably would
not have been possible previously due to negative 19th century stereotypes anddiscrimination. Networking opportunities with Indigenous peers were non-existent as theentrepreneurs worked within a business environment managed by non-indigenous people.
One respondent’s Indigenous staff worked in reception or low-level menial positions as
the participant felt that the expertise and knowledge that they needed could only be foundwithin the non-indigenous sector. This was a common situation as Indigenous businesses
were forced to find expertise outside of the Indigenous community. Necessity drove themto network with mainstream business contacts. The ability to network across cultural
and/or racial barriers was essential; however, the more experienced entrepreneurs
confirmed that this arose only after years of experience and exposure to the mainstream‘settler society’ business world. In general it was only when they became established andsuccessful that they could invest in training Indigenous staff outside immediate family orwell-qualified non-indigenous staff to take on more senior/specialist key roles within
their businesses. This indicates an initial ‘substitutability’ of social capital outside of their
Aboriginal networks similar to the findings of Rooks et al, (2009) in Uganda – asubstitutability not found nor apparently necessary in the Aotearoa case studies. Luthans,Luthans and Luthans (2004) found that when human capital development is aligned withthe corporate strategy of the business there is a positive impact on corporate performance.
In Australia, this was being adopted in older, well-established businesses, and wasevident in the Aotearoa case studies.
The Australian sample highlighted widespread racial discrimination. Female Indigenous
entrepreneurs faced additional problems when dealing with male trade suppliers, as many
did not seem to want to listen to or communicate with them. The female entrepreneurs
recognised the importance of networking, but they were possibly precluded fromreaching their full potential due to a general lack of social inclusion be it race and/or
gender discrimination.
Networking enabled the participants to develop and make use of relationships with
suppliers and other organizations and provided increased opportunities to build
credibility, a positive image and customer access (Zhao & Aram, 1995). Building
credibility and a positive image were important, especially when one had to confront
discrimination within the business world. Networking provided role models, industry
advice, the sharing of experiences, and access to suppliers and customers (Dollinger,
2003; Kuratko & Hodgetts, 2001). It is seen as a strategic and a purposeful activity by
Indigenous entrepreneurs to gain entry into markets that are non-indigenous, but it is adifficult social decision for the Indigenous entrepreneur to make, to immerse themselves
within the dominant society as many in this study received a negative backlash from their
Indigenous peers as a result.

75

New Zealand Journal of Employment Relations, 35(1):65-88
How did social capital influence the networking of Australian Indigenous entrepreneurs?
The high levels of tertiary/vocational education in the Australian group in comparison
with the other studies would indicate that educational attainment was important to accessthe settler society’s social capital. The act of colonisation in Australia was one of open
frontier slaughter, of mass killing nothing short of genocide that has reduced Aboriginal
populations and social structures to a mere shadow of their former positions. The
survivors of the slaughter in most cases were forcibly removed from their lands andplaced in missions. This was followed by generations of Government intervention that
attempted to ‘breed out’ the Aboriginal, and there was an almost total disruption to
Aboriginal society that has impacted on cultural values (Reynolds, 1981; 1989), thus
reducing Indigenous social capital levels. Negative racial attitudes, the lack of social
inclusion combined with a lack of business role models, low numbers of second
generation entrepreneurs, and a history of racial segregation also support the hypothesisthat existing Aboriginal entrepreneurs have limited Indigenous social capital, andtherefore the reliance on the social capital of the dominant (settler) society takes
precedence in business start-up, as the literature suggests (Fernandez-Kelly & Schauffler,
1994; Grootaert, 1998; Putman, 1993).
Piazza-Georgi (2002) argues that the process of acquiring capital requires an investment,
especially in building human capital by obtaining education, and then investing less timein social capital. In the Australian Aboriginal example, the investment is also adevelopment in social capital as there are few pre-existing levels (if any) available to theIndigenous entrepreneur. The difference between the subjects of Piazza-Georgi’s (2002)
work and those covered in this paper is that his entrepreneurs are not the minority withina dominant society. Bruderl and Preisendorfer (1998) believe that entrepreneurs who lackother sources of capital (including human and financial) will mobilise resources throughtheir core social network. This study shows that in the Indigenous Australian scenario it
is in fact the settler society ‘social network’ that provides other sources of capital. It
would appear that for Indigenous Australians social and human capital (and financial forthat matter) are entwined, with one generating the other – subject of course to the social
inclusiveness of the dominant settler society and its social policies. This is a difficult
concept to measure but can be deduced in the comparative analysis of case studies fromthe two societies.

Case study 2: Maori Entrepreneurs
Based on the data gathered, networking and networking skills of the Māori entrepreneur
were essential business attributes and an extension of their cultural life skills. One inseven New Zealanders are Māori, 14 percent of the total population (Statistics NZ, 2002).
Most Māori continue to live in northern regions with nearly approximately 90 percent in
the North Island and around 60 percent concentrated in the Northland, Auckland,
Waikato and Bay of Plenty areas. ‘Business networking’ is an extension of their existingskills in the interaction with whanau (family) and appears effortless and natural; this is
supported by the New Zealand Global Entrepreneurial Monitor 2005 study (GEM)(Frederick & Chittock, 2005) which concluded “social-cultural norms such as positive76

New Zealand Journal of Employment Relations, 35(1):65-88
and confident attitude assist in meeting social-economic expectations” (Reihana, Sisley &Modlik 2007:637). Even in the absence of support from traditional social networks, suchas in the case of the urban Māori or the entrepreneurial Māori, they create their own
networks and develop new forms of social institutions (Barcham, 1998; Walker, 1995).
The history of colonisation for Māori is very different from that of Australia. In the earlyyears, Māori were allowed economic independence, in fact the survival of both thefledgling New Zealand colony and the Australian colony in Sydney was dependent on
Māori commerce and agricultural skill as the Maori enterprise fed and maintained thefledgling settler economies (Petrie, 2006). Māori were the innovators and the leaders incommerce, adopting the plough, flour mills, and boat construction, becoming owners ofnumerous ocean-going vessels; they were conversant with international trade andintensive land-use management practices (Petrie, 2006). Economic decline commenced in
the 1840s for a myriad of reasons. The overall loss of military power in the 1860s and therapid loss of traditional lands ensured that by the end of the 19th century Māori were
facing an ever-decreasing economic base (Maaka, 1997) which was not reversed until the
1980s and 1990s when there was a reversal of government policy (Barcham, 1998). The
population during the 19th century also followed a rapid decline, a similar fate with other
Indigenous peoples colonised by the British (Petrie, 2006). The establishment in 1985 of
the now defunct Mana Enterprises programme to assist Māori into business was the
beginning of several government and Māori initiatives to promote Māori economic
development (Jones, 2007).
The New Zealand study showed that the relationship between power and communication(Orbe, 1998) within the Māori culture is a key factor. Māori display an ability to deal
with all layers of society, their businesses are positioned across niches to access resources
necessary to exploit opportunities (Waldinger, 1985), showing the applicability ofcultural theory to the dominance of a culturally accepted group with a resultant powerand communication ability over both Pakeha (non-Māori New Zealanders) and theirpeers (Orbe, 1998). From the observer’s position, the Māori in effect have no peers otherthan the participants in the economic and cultural circle of Māoridom. Their strong
utilisation of Māori resources and networks is synonymous with aspects of Ethnic
Enclave theory (Portes & Bach, 1980). This is not suggesting that all Māori entrepreneurs
follow Ethnic Enclave theory in their lack of conformity with mainstream (New Zealand‘settler’) society; rather, it is their ability to resource goods, services, labour and markets
in both mainstream, Māori and other-minority markets that is their strength. Non-Māori
in general however, are the consumers of Māori products or services. It is important tounderstand that New Zealand is multicultural, having the world’s second highest
proportion of immigrants in its workforce. The census of 2006 showed that only 67 inevery 100 New Zealanders were of European ethnicity.
Māori entrepreneurs did not normally experience discrimination in their businesspursuits; when specifically asked, they said that only when racism was physical or
exclusionary was it apparent. In business undertakings, none had specific examples;
rather, their experiences were in the social services, education or in dealing with77New Zealand Journal of Employment Relations, 35(1):65-88
government institutions. Racism (or social exclusion) in New Zealand was thought to be
more covert than in Australia.
How does social capital influence the networking of Māori Indigenous entrepreneurs?
Very few Māori entrepreneurs had tertiary education; the existence of second-generation
entrepreneurs was very high, and it would appear they had suffered the least social
destruction in the colonisation process. Social capital in business appeared highest in the
Māori case studies when compared with the Australian. Gaining an education and thereby
increasing human capital was far less important, as social capital levels were already high– as shown by Coleman (1988), social capital in the family and community promotes theformation of human capital, with the two complementing each other (Burt, 2001).

Conclusion
The importance of networking is universally accepted in literature as a key prerequisite tobusiness success and entrepreneurial activity. This paper provides the reader with a newperspective on aspects that involves Indigenous networking. The existence andrelationship between social and human capital combined with the historical legacy of the
impact of colonisation influences the capabilities and networking environment of the
Indigenous entrepreneur. The study of Indigenous entrepreneurship is more than aresearch area based in Management studies; it is a diverse research area requiring theunderstanding of several literature bases.
This paper illustrates Indigenous Australian entrepreneurs experience reduced social
capital that results in active social networking in the settler society culture (or dominantsociety) as a necessity in their basic business functions. The role of the family was
negligible to negative, they were dependent on racial acceptance and social inclusion (afragile sociological relationship), and they experienced little diversity in their networking
while their business relationships were often that of dependence, with a distinct
separation between social and business networking interactions. Education attributes
became important in order to access the settler society’s social capital resources.
Māori displayed a solid cultural and social capital base. Networks were culturally
accepted, the family role was supportive, and a dynamic networking interaction ensued
with strong economic motivators. Networking was diverse and well-maintained,
entrepreneurs taking an avid interest in their networking relationships which areculturally supported. In general, networking relationships were highly integrated between
both their social and business spheres. In Māori the attributes of formal education wasless important in comparison to the Australian, with it being least important in thestrongest cultural and social capital base of the Māori. Yet the high levels of formal
education for the Indigenous Australians (a group that statistically experiences very low
educational achievement in both K-12, trade and tertiary), indicating that their humancapital and corresponding social capital required formal education to supplement the lackof pre-existing human and social capital levels that the other group enjoyed. Based on
supplementary questioning it would appear that education was not for any formal

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New Zealand Journal of Employment Relations, 35(1):65-88
business content, rather it provides many attributes, the most important appearing to be
the skill in dealing with people especially the ‘settler society’.
The practical implication of this research is an increased understanding of the businessenvironment for policy makers, for Non-Government Organisations (NGOs), businesssupport organisations and the Indigenous entrepreneurs themselves. In Australiaorganisations such as Indigenous Business Australia, the premier ‘business’ funding
body, can now begin to understand sectors of their lending portfolio that will enable them
to work with educators to ensure the development of social capital and understand thedependency in Australian business circles on the dominant society and the corresponding
impact of racial attitudes. If we can understand how business relationships are stimulated
or reduced by the presence of varying levels of social capital, then we can and will assist
the Indigenous entrepreneurs in their business planning and economic development.
Research on the Indigenous cultures of Australia and Aotearoa within such a short paper
involves generalisations and limitations. Perhaps the key finding of this paper is that
Australian Indigenous entrepreneurs are embedded in a minority culture which must
interact simultaneously within the dominant settler society culture if they are to survive inbusiness. The level of this interaction, and the power imbalance within entrepreneurial
networking that correlates to the entrepreneur’s level of social capital demands further
detailed study. This opposes Onyx et al’s finding that social capital is “remarkably stable
across communities and groups” (2009: 168). This, together with the marked differencein education attainment in the Australian group highlights that compared to Aotearoa,
indicates the need for a different interpretation of literature across disciplines, tounderstand a complex issue – the relationship between human and social capital in a postmodern, allegedly post-colonial world. The casual paths to the development of social
capital in the Indigenous situation are dependent on historical factors; the impact ofcolonisation, removal, limited to no intergenerational business expertise, discrimination,
limited financial reserves that result in a casual path in Australia that is dependent on
non-indigenous mentors, financiers and business partners and so on. The significant
findings by Onyx et al, (2009) indicating social agency and trust as the most importantcasual factors are the same as those by Bourdieu (1986), for it would appear the trust,common values, norms and social resources within the social structure of ‘settler society’form the Indigenous Australian entrepreneurs business social capital structure. This
includes both ‘material’ and ‘relational’ functions within a varying trust-intensive
relationship as supported by Antoci et al, (2009).
The Australian Aboriginal business sphere within the dominant society will influence
their economic position and actions (Antoci et al, 2009), the direct casual path as definedby Onyx et al (2009). In effect, this is the “… social environment rich of participation
opportunities which allow people to meet frequently, creates a fertile ground for
nurturing trust and shared values” (Antoci et al, 2009: 4). Yet the Māori social
interactions are so different as the Māori trust and shared values comes not only
externally from settler society it also comes from within their own Indigenous and family
networks indicating as Onyx et al (2009) would write as their (Māori) social capital isstable, within their own cultural and economic spheres even though they endure colonial

79New Zealand Journal of Employment Relations, 35(1):65-88
practices. It is the social interaction of the non-indigenous business community inAustralia that creates a vehicle in the diffusion of information and trust that impacts on
the Aboriginal entrepreneurs economic activity, creating social well-being (Smith,
1763/1978). Further analytical and quantitative research needs to be undertaken to more
fully test and confirm these ideas; however, this paper provides a foundation from which
academic debate can proceed to understand the relationship between human and social
capital and its impact on Indigenous entrepreneurs.

Notes
i

The policy of ‘Exclusion on Demand’ was not removed from the New South Wales Teacher’s
Handbook until 1972. Equitable education was denied to Indigenous Australians throughout New
South Wales for 70 years. Other states implemented similar frameworks that excluded Indigenous
Australians based on the pretext of racial inferiority. (Connell, Campbell, Vickers, Welch, Foley & Bagnell, 2007).

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Chronicle October, 2009 - January, 2010
October 2009
The upcoming November election provided a platform for political parties to trumpet
their employment policies. The Press reported an announcement by Minister ofLabour Trevor Mallard that the Government planned to introduce requirements forbusinesses to give staff minimum notice periods and payouts if they propose to lay off
workers. Mr Mallard said that options for a statutory minimum for compensation andnotice would go out for public consultation in early 2009. This announcement cameamongst predictions of a sharp rise in unemployment due to the world financial crisis.
The NZ Herald reported on the National Party’s proposal to introduce a 90-day trial
period for new employees in firms that employed fewer than 20 people. The National
Party’s Employment Relations Spokesperson Kate Wilkinson claimed that New
Zealand was the only country in the OECD (apart from Finland) that did not have atrial period for new staff. She said that a trial period would give smaller employers
confidence to take on new employees with the knowledge that if they didn’t work out,
they could be dismissed. The article went on to note that the proposal would affectmost of the country's companies as 350,000 (96.8 per cent of all firms) employed 19
or fewer full-time staff. Wilkinson also suggested that Small Medium Enterprises(SME) lacked the human resource capacity to make good employment decisions andthat the policy would give them the confidence to take on people. She concluded thatthe policy included enough safety mechanisms to protect people from being exploitedby bad employers.
In a response to this announcement, Minister of Labour Trevor Mallard called on the
National Party to clarify its position on whether new teachers would face 90-day trial
periods or not after conflicting comments from two spokespersons. The National
Party’s Education Spokesperson Anne Tolley had previously said that teachers would
not be included in the policy but subsequently, at a Council of Trade Unions election
forum, Employment Relations Spokesperson Kate Wilkinson said that teachers would
be included.
The celebration of Labour Day was foreshadowed by a Dominion Post article which
said that more New Zealander’s than ever were working in excess of 50 hour’ a week.
This level was exceeded only by South Korea in the developed world. Reasons given
for working longer included changing economic conditions meant that households
could not survive on one income. Business NZ’s chief Executive Phil O'Reilly said
that workers could not continue “slogging away day after day” but until they started
thinking smarter and productivity increased, the 40-hour week would be a dream for
many. Council of Trade Unions’ President Helen Kelly cited research that stipulated
that those working in excess of 50 hours fell into two categories. The first group of
workers worked long hours to make ends meet, and the second group of workers
earned a good wage but were part of a work culture that caused them to work longhours.

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The Press reported that junior doctors had finally ratified their collective employment
agreement which featured an 8.68% pay rise. This brought to an end a protracted
dispute that had lasted for 15 months and led to doctors to take strike action in May
and June 2008 (see May and July Chronicles).
The Dominion Post reported in early October that Wellington bus drivers were again
threatening strike action. After another round of negotiations, a new offer was madeby the employers which included a cash payment of $300 plus a new pay offer of a
7.5% rise, and this new offer was accepted by the drivers. The Taranaki Daily News
reported that workers at Fitzroy Engineering in New Plymouth threatened to strike if
their pay negotiations did not reach a satisfactory outcome. However, they accepted a
6.5% pay increase over 12 months, which constituted a significant cut on their initial
demand of up to 15 per cent.
Fast-food giant McDonald’s featured prominently in the media during October. The
Timaru Herald reported that union employees at all five McDonald’s outlets at
Auckland Airport took industrial action in an attempt to gain pay equity with theirunion colleagues at KFC, Starbucks and Pizza Hut. The Secretary of the Unite union
Matt McCarten claimed that members who went on strike and protested at the airport
were harassed by security staff and police, and the union's organiser was threatenedwith a trespass notice. The Waikato Times suggested that McDonald’s employees in
Hamilton had asked their customers not to eat at McDonald’s at all. The workers
wanted McDonald’s to lift its minimum pay rate from $12 per hour to at least $12.80
per hour with allowances to pay for length of service. A McDonald’s spokesperson
was quoted as saying that the company supported the right to strike but there weremany ways workers could earn more money and the company preferred to give pay
increases on performance rather than service.
McDonald’s featured again in a Press article with a report that the Kaiapoi outlet wasgoing to appeal an Employment Relations Authority decision that awarded $15,000 toa teenage worker (see September Chronicle). The Authority ruling found that theemployee had been constructively dismissed after joining a union. The same franchisereceived further publicity in the Press when the union representing another employee
claimed that the employee was forced to finish her shift despite her foot being runover in the restaurant car park. A Unite union organiser Joe Davis said the 17-year-old
girl was working on the drive-through when her foot was run over as she delivered
food to a parked car. She suffered a swollen foot but her manager told her she still
had half an hour until her shift finished and made her carry on.
A Dominion Post article claimed that high staff turnover at the Accident
Compensation Corporation was attributed to a “bullying culture” and a massive
workload. This was despite a Department of Labour investigation in 2004 into
complaints of overwork, stress and bullying. Figures showed that since May 2007,
630 staff had resigned (out of 2600) and that since 2003, 56 personal grievance cases
had been taken by staff members. The turnover rate of around 25% per annum did notcompare favourably with comparable government agencies such as Housing New
Zealand and Auckland District Health Board who had around 15% staff turnover. In
the article, a former employee was quoted as saying that there was definitely a“bullying culture” and the management approach was “dictatorial”.

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According to the Dominion Post, the Supreme Court had agreed that it would hear thecase of unlawful discrimination of a senior Air New Zealand pilot who was
automatically demoted when he turned 60. The pilot went from being a Boeing 747
captain and flight instructor to the lower rank of first officer when he turned 60 in
September 2004. The appeal would be against a Court of Appeal decision that age
discrimination was not the reason the man lost rank and was moved to a lower-paying
job (see July Chronicle). The appeal was seen as having the potential to clarify theway discrimination issues are defined and decided.
The NZ Herald reported that an Auckland school teacher, who took a case to the
Employment Relations Authority claiming he was repeatedly bullied by other staff,
was so difficult to work with that his dismissal was entirely justified. The teacher
claimed that his workload was intolerable and maintained that he was bullied by otherstaff. It was also asserted that his dismissal was in retaliation for having complained
to the Ministry of Education about college management. The Authority found that theteacher’s workload was not “out of sync” with other teachers and that he was given
adequate support which included an extra day off a month. It was also found that hewas not bullied by his colleagues, but rather that they acted in an “entirely
predictable” way in frustration at the way he behaved towards them. The Authority
added that the teacher appeared to have little insight into the effects of his behaviouron those with whom he interrelated with.
The NZ Herald featured an article detailing the impact of casualisation on sectors of
the workforce and gave the example of a Middlemore Hospital kitchenhand employedby Spotless Services. The employee worked on average 20 to 30 hours a week forfour years but was still a casual worker. The worker said that although she wasworking 40 hours at the moment, it was ‘off and on’ and that she needed secure work
to support herself, her sick husband and four children. The article went on to say that
despite nine years of Labour-led governments, her experience was commonplace. The
Service and Food Workers Union suggested that the trend toward using casual
workers had become a serious problem. In response, the Minister of Labour Trevor
Mallard had drafted legislation which would give Labour Department inspectors thepower to determine whether ‘casual’ employees were, in fact, really permanent
employees (see June Chronicle). The bill would also provide a code of employment
practice for casual workers, and would require that unionised workers in labour hirecompanies to be paid at least as well as unionised workers employed directly by an
employer that hires the labour hire company.

November, 2009
The Herald on Sunday reported that small and medium business owners welcomed
the news that the 90-day probation period policy was likely to be implemented by the
newly elected National government (see September Chronicle). Employment
Relations Spokesperson Kate Wilkinson indicated that the new government had not
set a time for implementing the policy but an indication would be given once
parliamentary roles had been announced.

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Both the NZ Herald and the Waikato Times reported that The Dairy Workers’ Union
had given Fonterra notice of a strike planned to begin on 17 November 2008. The
union was seeking an 8% increase but the employer had offered 5% plus a 2.5% lumpsum payment. The National Secretary of the New Zealand Dairy Workers’ Union
James Ritchie said the collective bargaining agreement, which covered about 4,500
people, was historically the most serious negotiating situation the union had with
Fonterra. It was later reported in the Waikato Times that the parties had reached asettlement after two days of negotiations. The agreement still required ratification by
the members before the strike notice would be withdrawn. Fonterra claimed that theoffer was a fair and appropriate agreement that would give security for both sides in
the current turbulent economic and financial climate.
An ongoing dispute at Ports of Auckland flared up again with the NZ Herald reportingthat the Ports of Auckland Company had received notice only an hour before its
annual Christmas party of a one-day strike by members of the Maritime Union. The
union withdrew the notice after a technical error, but Branch President Denis Carlisle
said another strike notice would be issued. Predictably, the reaction from Ports of
Auckland management was that the strike notice was “disappointing, unnecessary andprovocative” in difficult economic times. The Maritime Union claimed that it was thecompany that was being provocative by making it increasingly difficult for the union
to hold meetings for its members.
There was further unrest at McDonald’s with a report that unionised workers wereplanning to burn an effigy of Ronald McDonald at a meeting in Auckland (seeOctober Chroncile). Unite union members were taking part in a meeting to mark both
Guy Fawkes day and to emphasise anger over work and pay conditions. Unite’s
National Director Mike Treen was quoted as saying that “...young, angry workers are
telling the world’s biggest fast food company that we’re not lovin’ low pay and unfair
rostering...” According to Mr Treen, low pay and irregular work hours were among
the main concerns but McDonald’s Communications Manager Kate Porter claimed
that McDonald’s had already agreed to the demands for secure work hours and thatthe planned strikes were an attempt at “news grabbing”.
The Waikato Times reported that Hamilton bus services were disrupted by a 24-hour
drivers strike after a breakdown in pay talks between bus company Go Bus anddrivers who were members of the Northern Distribution Workers Union (seeSeptember Chronicle). Drivers indicated to Go Bus that they would not accept cash
fares but, in turn, Go Bus responded that this refusal was not acceptable and that it
would lock out the union drivers. However, within a week the drivers ended the fiveday strike and accepted a 5.6% pay increase. Union Secretary Karl Andersen said thebus drivers had to settle for an offer of $14.27 per hour but would have preferred$15.50 an hour.
The ongoing case of the leading medical specialist wrongly dismissed after trying toe-mail photographs of his genitals to a female friend remained in the news with
Dominion Post recorded his successful appeal in his battle for a costs award in the
Court of Appeal. The Court determined that he could remit his appeal for costs backto the Employment Court, after a previous judgment that awarded no costs. The
doctor was dismissed after pictures of his penis were found on his work computer. He
was reinstated to his $200,000 position by the Employment Court in November 2005

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after a ruling that he had been unjustifiably dismissed. Subsequently, the doctor
claimed more than $195,000 in costs which was rejected by the Employment Court.
The Court of Appeal concluded that the judge failed to deal separately with the issuesof remedies and costs.
In a sign of the times, the Dominion Post suggested that corporate chiefs andbusinesses were hiring bodyguards and extra security to protect themselves fromdisgruntled employees who had lost their jobs. The article claimed that the fallout
from the financial crisis had made several chief executives hire round-the-clock
protection as sacked or redundant workers threatened both them and their families. In
one case, a bodyguard maintained protection of a chief executive for several weeks,
while another monitored the movement of a former employee.
Although there was an economic downturn it was highlighted in media reports that a
number of initiatives were being used to prevent staff layoffs. Helene Higbee, directorof a specialist remuneration consultancy, informed that while most of her clients werelooking at making staff redundant, some were doing their best to retain and redeploy
people. These actions included redeployment of staff into other areas, a freeze on
hiring new staff, not replacing staff as they leave as companies try to do more withless. Budget reviews also looked at ways to trim spending such as calling travel halts.
However, the reality for unions was that redundancies were increasing at a great rate.
The President of the National Distribution Union claimed that the union had been“right up to our necks” in redundancies.

December, 2009
There was extensive coverage in the mainstream media regarding the introduction of
the 90-day probation period amendment to the Employment Relations Act. The
Dominion Post informed in early December that the National-led Government looked
set to introduce a 90-day probation period for new employees into Parliament underurgency. The introduction of the Bill was predicted to run into “stiff opposition” andwas seen as a test of the relationship between the National Party and the Maori Party.
There was no select committee hearing required because the changes were signalledin the election campaign and the Bill introduced in 2006 by Wayne Mapp went before
a select committee. This lack of “public debate” drew criticism from the union
movement who called it an attack on worker’s rights. Former MP Laila Harre claimed
that this was “the first step to wind back workers’ rights and protections”. She further
criticised the push to pass the bill before Christmas as “ideological” and that it was“unashamedly backing bad bosses against vulnerable workers”.
Later in the month, the Dominion Post and the Press published articles suggesting that
the Government could extend legislation which would allow the 90-day probation
period to cover all employers. The explanatory notes to the Bill stated that“[c]onsideration could be given to evaluating the outcomes of this legislative changewith a view to extending it to cover all employers in future." Minister of Labour Kate
Wilkinson was quoted as saying that the Government was open to such an extension.
There were further media reports on the operation of the Employment Relations
Authority when an article appeared in the NZ Herald which criticised the operation of93

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the Authority. The article cited the Parentline / Maxine Hodgson case (see September
Chronicle) and added that reform of the Authority was high on the government’s
agenda. The article suggested that the Minister of Labour Kate Wilkinson wasplanning to make the Authority keep records of its proceedings, allow the crossexamination of witnesses and make it act more “judicially'”. One senior employment
law practitioner commented that legal costs had crept up and that taking a case to the
Authority could be more expensive than taking a similar case to the Employment
Court. The Head of the Authority James Wilson said that the increased costs werepartly due to a 2004 amendment to the Employment Relations Act allowing dismissalon the grounds of what “a fair and reasonable employer would have done in all thecircumstances”. According to Mr Wilson, hearings that lasted more than a day had
increased 50% since the law change. Unions and employers generally felt that thesystem was working well but just needed “tweaking” with Tony Wilton, of theEngineering, Printing and Manufacturing Union (EPMU), claiming that compulsory
mediation and the use of the Authority had made resolving employment disputes
much less costly.
A further NZ Herald article on the Auckland waterfront dispute which began in late2006 after the collective agreement expired claimed that it was “lumbering intoanother year” (see October Chronicle). An Employment Relations Authority
investigation into claims breaches of good faith by both parties had been adjourned
until 2009. The article stated that that the port company appeared “unenthusiastic”
about the Maritime Union’s latest proposal and that prospects of a settlement looked
shaky.
The Nelson Mail highlighted that an Auckland bar manager was awarded nearly$36,000 in compensation and lost wages. The woman was demoted from her job as abar manager one week after she informed her employer that she was pregnant. She
was then dismissed a month later after she was accused of lying about her work hours.
A high profile television personality Craig Busch, also known the “Lion Man”, lost
his claim for temporary reinstatement at the Zion Wildlife Park in Whangarei,
according to the NZ Herald and the Dominion Post. The articles reported that Mr
Busch had been dismissed for alleged serious misconduct, including allegations ofmajor breaches of safety protocols, inappropriate behaviour in the workplace,
performance issues, failing to keep proper training records and causing loss ofrevenue through cancelling tours. What made the case more sensational was that hehad been dismissed by his mother and that some of his fellow staff members had
threatened to resign if he was reinstated.
The Unite union received further media coverage after accusing research company
Digipoll of victimising union members at its Hamilton call centre. The Waikato Times
reported that the union has instructed its lawyers to file a claim in the Employment
Relations Authority citing bullying, intimidation and workplace segregation. The
union attacked Digipoll owner Dr Gabriel Dekel, calling him “psychopathically antiunion”. The article featured Dr Dekel’s response where he denied that he was antiunion, but he also argued that his line of work was not suited to unionism, with clientdemand erratic and with many of his workers “otherwise unemployable”. Dr Dekel
said the union did not acknowledge “the uniqueness” of his operations and, if forced,
he would outsource all his jobs to call centres overseas.

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In yet another case of workplace bullying, the NZ Herald recorded the unsuccessful
claim of an employee dismissed for bullying a fellow worker. The man claimed that
he was dismissed because his employer wanted to avoid the cost of making him
redundant. The Employment Relations Authority found that his employer Auckland
firm Buckley Systems (BSL) was justified in sacking the man because of his abusive
and aggressive behaviour towards his fellow worker. The behaviour included pouring
yellow or brown coloured primer paint on the man’s overalls to make it appear he hadsoiled himself, making loud and sudden noises to cause fright and filling his gloves
and facemask with tuna, as well as smearing it on some of his equipment. The
harassment escalated to physical assault and the employee eventually resigned. An
exit interview revealed the extent of the victimisation. The company investigated andthe perpetrator was dismissed for serious misconduct. The Authority concluded that“an employer acting in a fair and reasonable manner” would have dismissed the man.
A Dominion Post article published an analysis of the Employment Relations
Authority and its decisions which had been conducted by the Employers andManufacturers Association (EMA). The analysis of awards over the past five years
showed that complainants in Wellington were consistently awarded the highest
compensation for the hurt and humiliation involved in unjustified dismissals. The
Wellington payouts averaged $8,536 in 2007 while Christchurch averaged $6,630 and
Auckland $5,526. The analysis identified Wellington member Denis Asher, as making
the highest average awards of all the 17 members in 2004, 2005 and 2006, although
he was eclipsed in 2007 by Maria Urlich of Auckland. Auckland lawyer Eska
Hartdegen was quoted as saying that the variations showed that authority members
were “a law unto themselves”. The EMA had said in previous annual surveys thatcompensation claims were “a gravy train still picking up speed”, with the number of
personal grievance claims taken to the authority rising from 340 in 2004 to 436 in2005 and 515 in 2006. However, the latest analysis showed that the number of claims
had dropped to 416 in 2007.

January, 2010
There was a dearth of reporting on employment relations in January 2010. Apart fromthe focus on further changes to employment relations legislation, most reporting
concerned disputes before the Employment Relations Act.
Reform of employment relations legislation remained on the agenda. A NZ Herald
article suggested that the Government needed to go further in overhauling the
Employment Relations Act if New Zealand was to survive the recession. Once again,
there were claims that restrictive employment law was one of the major hurdles forsmall to medium enterprises (SMEs). A survey conducted by a coaching company,
the Results Group, claimed that 94% of all the businesses surveyed stated that
“unworkable employment law” was the primary issue they faced. The announcementof an employment summit by Prime Minister John Key was seen by the Minister ofLabour Kate Wilkinson as a forum which could “offer a good opportunity forbusinesses and unions to raise their primary concerns and promote any initiatives,
particularly with respect to productivity and employment opportunities”.

95New Zealand Journal of Employment Relations, 35(1):89-97
The NZ Herald suggested that the primary school teachers’ union, the NZ Educational
Institute, was taking its “first shot” at the recently passed 90-day employment trial
period. The union wanted to omit the trial period provisions from the kindergarten
teachers' collective agreement with the Ministry of Education. The union sought anagreement from the Ministry of Education and various kindergarten associations thata 90-day trial period was “neither necessary nor desirable”. The National Secretary of
the NZEI Paul Goulter stated that the Ministry of Education needed “to realise that
law change did not just deprive workers of personal grievance rights, but had asignificant effect on the labour market”.
In yet another employment issue involving McDonald’s (see November Chronicle),
the Sunday Star Times reported that a disagreement over payment of $10 worth of
McDonald’s burgers had escalated into a year-long employment dispute costing
thousands of dollars. Daniel Gledhill, an employee at McDonald’s branch in Mana
(Porirua), won his case for unjustifiable dismissal before the Employment Relations
Authority. However, the Authority told both parties that they should have been able
to settle the dispute themselves. Gledhill, who had worked at the McDonald’s branch
for three years and had a clean work record, was dismissed in October 2007 for giving
away $10 worth of fast food to friends. He took a personal grievance, claiming that hefelt pressured to give the food away, but intended to settle the bill after his shift
finished. However, he only paid the staff discount rate of $4 and accepted that heshould have paid the full amount. Gledhill was not awarded any remedies as his
actions had contributed to the employment dispute. It was found that the McDonald’s
branch did not conduct a reasonable inquiry into the incident and did not have hearevidence before dismissing Mr Gledhill.
Both the NZ Herald and the Waikato Times reported on the case of a breakfast radio
announcer from Tokoroa who claimed unjustifiable dismissal after a public “bust-up”
with his manager. The employee was unsuccessful in his claim for reinstatement andcompensation. The man was dismissed after he loudly challenged the mayor of
Tokoroa at a public meeting while dressed in clothing that identified his employer.
The man’s manager said she was embarrassed by his actions as local people
recognised him and associated him with working at the radio station. The
Employment Relations Authority found that the man’s conduct outside of working
hours did impact on his employment and his behaviour was “manifestly injurious to
the interests of the employer” and could bring his employer into disrepute.
The Dominion Post reported that the Defence Force was ordered to pay $100,000 to adoctor who was dismissed after raising concerns about her ability to treat patients in anaval decompression chamber. The treatment of the doctor was labelled as “callous,
hasty and rash” by the Employment Relations Authority. The Doctor had met with
her then manager to express concerns about her own work in the hyperbaric unit,
stating that she believed it was not safe for her to continue working as she was notadequately trained nor qualified. Hours later she was dismissed on the grounds thather duties could be altered only by mutual agreement. Additionally, it was claimed
that the doctor was not an employee because she worked under an independent
contractor agreement. However, the Authority ruled that, although the doctor worked
under an independent agreement, the nature of the employment meant that an
employment relationship existed. The Defence Force was ordered to pay her $81,072

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New Zealand Journal of Employment Relations, 35(1):89-97
in lost wages, plus a further $20,000 compensation for “emotional trauma anddistress”.
Another employment dispute involving a high profile personality reached the media.
Real-estate agent and former television star Michael Boulgaris was ordered by the
Employment Relations Authority to pay back $163,635 in unearned commission. An
Authority ruling determined that Mr Boulgaris, who had a major role in the ‘Location,
Location, Location’ TV series, had to pay back the money to Wensley Developments
Ltd who had employed him as a salesman in Queenstown. The dispute focussed on a$535,000 commission paid in advance. Mr Boulgaris had only earned $339,990 when
he resigned. Boulgaris claimed that he did not owe on the pre-paid commission as his
employer had misrepresented what he would earn. The Authority found no merit in
his argument.

Erling Rasmussen & Colin Ross
Auckland University of Technology

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