The “Side Hustle” May Have an Unexpected Benefit

In their paper, “Learning off the Job: Examining Part-time Entrepreneurs as Innovative Employees,” David R. Marshall (University of Dayton), Walter D. Davis, Clay Dibrell, and Anthony P. Ammeter (all of University of Mississippi) explain how engaging in part-time entrepreneurship—creating and managing side businesses while remaining employed for wages in existing organizations—uniquely positions individuals to exhibit innovative behavior in their primary employment positions.

To study this phenomenon, the researchers integrated the literatures on entrepreneurial learning, knowledge and learning transfer, and employee innovation. They hypothesized that part-time entrepreneurship provides an opportunity for individuals to acquire knowledge and skills conducive to enacting innovative behaviors as employees.

“Engaging in entrepreneurship requires the development of experience and knowledge necessary for the exploration and exploitation of opportunities,” the authors explain. “Therefore, learning to be more entrepreneurially minded may have important developmental benefits in terms of increasing innovative behavioral capabilities.”

The results, recently published in the Journal of Management,  showed that the extent to which an individual engages in part-time entrepreneurship is positively associated with his or her innovative behavior in employee roles. The results also showed the association between part-time entrepreneurship and innovative behavior in employees is more positive when the employee’s work-unit has a climate of innovation.

The researchers hypothesized that participating in entrepreneurial activities outside of the workplace uniquely positions employees to develop, refine, and transfer innovative capabilities from entrepreneurial to employee roles. They analyzed a sample of 1,221 employee responses across 137 organizational units at a large logistics and security company working in eight locations throughout the United States.  The results suggest employees who run side businesses exhibited greater innovative behaviors in their employee roles than those who do not.

Marshall cautions that the researchers are not interpreting their results to mean that part-time entrepreneurship is all around a great thing for organizations, just that it can positively affect one specific skill.

“We actually do not even know if it’s ‘good’ or ‘bad’ for employee job performance,” he explained. “We simply wanted to highlight that entrepreneurship is a unique learning context and that people doing entrepreneurship in their spare time can develop some valuable skills that could be transferred to their wage-employment work as well.”