Entrepreneurs in Illegal Business
Chapter 5: Entrepreneurial Structure and Culture
5. Entrepreneurial structure and culture Organisational design is important in entrepreneurship. For example, when a criminal entrepreneur needs venture capital, the venture capitalist provides monetary and non-monetary resources to turn the entrepreneur’s idea into a viable business. In order to maximize their returns from their investments, venture capitalists will pay considerable attention to the way the criminal enterprise is organised in terms of value configuration, organisational structure and organisational culture (Casson and Nisar, 2007). CHARACTERISTICS OF ORGANISED CRIME GROUPS The United Nations (2002) conducted a pilot survey of 40 selected organised criminal groups in 16 countries. The following characteristics of criminal organisations were identified: ● ● ● ● ● ● ● ● Structure. Rigid hierarchy was the most common structure, where there is a single boss and strong internal discipline. Size. The average size of the criminal organisations was 50–100 persons. Activities. Most of the criminal organisations had one primary activity, such as drug trafficking. Transborder operations. Most criminal organisations spread their activities across five or more countries. Identity. Half of the criminal organisations had members drawn from the same social background or ethnic background, while the other half had no such identity. Violence. Most criminal organisations saw the use of violence as essential to their activities. Corruption. Most criminal organisations considered the use of corruption to be essential to their primary activities. Political influence. Some criminal organisations had political influence at the local and regional level, while a few had influence at the national level in the country of intervention. 92 M1704 - GOTTSCHALK TEXT.indd 92...
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