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Project Failures Arising from Corporate Entrepreneurship: Impact of Multiple Project Failures on Employees' Accumulated Emotions, Learning, and Motivation


  • Dean A. Shepherd,

  • J. Michael Haynie,

  • Holger Patzelt

Address correspondence to: Dean A. Shepherd, Kelley School of Business, Indiana University, 1309 East Tenth Street, Bloomington, Indiana 47405-1701. E-mail: Tel: 812-856-5220.


In this paper, we consider an organizational paradox inherent to corporate entrepreneurship; that is, the pursuit of entrepreneurial projects is necessary for organizational rejuvenation, renewal, and/or organic growth; however, the high failure rate of entrepreneurial projects likely has enduring implications for the project team members and, by extension, the organization. Drawing on the psychology and emotion literatures, we model the human capital costs of corporate entrepreneurship arising from the multiple failures of entrepreneurial projects. Specifically, we explore how and with what consequence negative emotions can accumulate across multiple failures; when this accumulation is most likely to occur; and what the nature of this accumulation is across organizational contexts, employee differences, and time. This theorizing complements extant scholarship focused on the financial benefits and costs of corporate entrepreneurship by investigating the negative impact of multiple project failures on employees.