Entrepreneurial capability gaps and strategic institutional responses: Implications for business and governance strategy

Abstract

This study examines entrepreneurial capability gaps and institutional responses within the local business ecosystem of San Antonio, Nueva Ecija, the Philippines, with the objective of proposing a governance-oriented strategic framework for entrepreneurial capability development. Grounded in corporate strategy, institutional theory, and entrepreneurial capability perspectives (Kraus et al., 2018), the study employs a descriptive mixed-methods design integrating survey data and qualitative insights from local entrepreneurs and institutional stakeholders. Findings indicate that although entrepreneurial motivation remains strong, enterprise sustainability is constrained by capability gaps in financial literacy, leadership and strategic decision-making, digital entrepreneurship, and institutional connectivity. The study identifies universities and local government units (LGUs) as governance intermediaries that coordinate human capital development, digital capability enablement, and ecosystem-level support mechanisms. A central contribution of this research is the development of a conceptual framework that positions entrepreneurial capability development as a governance-embedded strategic process rather than an individual-level undertaking. By aligning contextual conditions, diagnosed capability gaps, and institutional strategic responses, the framework advances ecosystem-level strategic analysis and offers practical guidance for policymakers, higher education institutions, and development stakeholders seeking to strengthen micro, small, and medium enterprises (MSMEs) resilience and long-term local economic value creation.