MG305 Lecture March 10, 2010

Understanding the Entrepreneurial Perspective in

individuals

09
5, 20
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M G3

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The Entrepreneurial Perspective

How do we get information on entrepreneurs?

Use the information for what?
Usefulness of information!!!
Now?

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Sources of research on entrepreneurs
1. Technical and professional journals that
encompass in-depth research on current business
concepts.

These are well designed and structured. Examples

include the—Journal of Business Venturing,
Journal of Small Business Management and
Entrepreneurship, etc.

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2. Textbooks on entrepreneurship —These are
books that typically discusses the operation of
small firms/nonprofit organizations.
Examples : New venture Creation, Effective Small
Business Management, and Entrepreneurial
Strategy, etc.

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3. Books about entrepreneurship — These books
are written from the practitioners’ perspective--
‘how to’ guides.

A variety deal with the problems facing the

individual who commences a business, and others
deal with a particular aspect of the subject.
Examples — In the Owner’s Chair, The Business
Planning Guide, etc.

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4. Biographies or autobiographies — of
entrepreneurs, such as “Business at the speed of
Thought”.

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5.Compendiums about entrepreneurs — These are
pieces that associate with different picked
individuals, submit statistical information and/or
overviews of perceived general trends.

In other words these are collection of facts,

drawings and photographs on a particular subject,
especially in a book.

Examples include The Entrepreneurs and the

Enterprising Americans.

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6. News and periodicals — These news periodicals
present stories on entrepreneurs on a timely basis.
Examples: Business Week, Forbes, and The Wall
Street Journal, etc..

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7. Venture periodicals —An increasing
growing number of new magazines are
involved particularly with new business
ventures.
Examples: Entrepreneur and Inc, etc.

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8. Newsletters — There are a number of
newsletters devoted exclusively to
entrepreneurship. The “Liaison” is an
example

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9. Proceedings of conferences — These are
publications relating to annual or periodic
conferences that deal in part with
entrepreneurship. Examples include
Proceedings of the Academy of
Management and Frontiers in
Entrepreneurship Research.

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10. Government Publications — The United
States government publishes a wealth of
information on small business operations.
In case of Fiji —the Fiji Bureau of Statistics

Examples: pamphlets from the Small

Business Administration or the Fiji Bureau
of Statistics, etc.
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Additional Sources of information about
entrepreneurial characteristics

1. By direct observation of practising

entrepreneurs, it can provide insights into
their traits and characteristics, and provide a
profile. Some common methods include
interviews, surveys and case studies.

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2. The final source on entrepreneurial
information is speeches and presentations
by practicing entrepreneurs.

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Characteristics of entrepreneurs
1. Commitment, determination, and
perseverance —more than any other
factor, total dedication to success---as an
entrepreneur can overcome obstacles and
setbacks. It can also compensate for
personal shortcomings.

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2. Drive to achieve — Entrepreneurs are
self-starters who appear to others to be
internally driven by a strong desire to
compete, to excel against self-imposed
standards, and to pursue and attain
challenging goals.

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3. Opportunity orientation — one clear
pattern among successful growth-minded
entrepreneurs is their focus on opportunity
rather than on resources, structure, or
strategy. Their goal orientation helps them
with measures of how they are performing.

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4. Initiative and responsibility —
entrepreneurs are willing to put themselves
in situations where they are personally
responsible for the success or failure of the
operations.

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5. Persistent problem solving —
Entrepreneurs are not intimated by difficult
situations. Simple problems bore them,
unsolvable ones do not warrant their time.

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6. Seeking feedback — Effective
entrepreneurs are often described as quick
learners.
Entrepreneurs actively seek feedback. This
strong desire might improve their
performance.

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7. Internal locus of control — Successful
entrepreneurs believe in themselves.
They believe that their accomplishments and
setbacks are within their own control and
influence and that they can affect the
outcome of their actions.

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8. Tolerance for ambiguity — Successful
entrepreneurs flourish on the fluidity and
exhilaration of such an ambiguous
existence.

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9. Calculated risk taking — Successful
entrepreneurs are not gamblers. When they
decide to participate in venture, they do so
in a very calculated and careful manner.

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10.Integrity and reliability — Integrity and
reliability build and sustain trust and
confidence.
Since word of mouth is a valuable tool, a
successful small-business owner must be
respected in the community (c.f. Fiji &
Taiwan, Fiji & Japan, etc)

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11. Tolerance for failure — Entrepreneurs
use failure as a learning experience. The
most effective entrepreneurs are realistic
enough to expect such difficulties.

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12. High energy level — Many
entrepreneurs fine tune their energy levels
by carefully monitoring what they eat and
drink, establishing exercise routines, and
knowing when to get away for relaxation.

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13. Creativity and innovativeness — An
expanding school of thought believes that
creativity can be learned

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14. Vision — Not all entrepreneurs have
predetermined vision for their firm.
In many cases, this vision develops over
time as the individual begins to realize what
the firm is and what it can become.

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15. Self-confidence and optimism —
Although entrepreneurs often face major
obstacles, their belief in their ability seldom
waivers.

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16. Independence — The desire for
independence is a driving force behind
contemporary entrepreneurs.

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17. Team building — The desire for
independence and autonomy does not
preclude the entrepreneur’s desire to build a
strong entrepreneurial team.
Most successful entrepreneurs have highly
qualified, well-motivated teams that help
handle the growth and development of the
venture.

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There is a ‘dark side’ of entrepreneurship.
What is meant by this statement?

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The dark side of entrepreneurship is
detrimental source that exists within the
energetic drive of a thriving entrepreneur.
There are three major traits that are affiliated
with the dark side of small businesses:
[A] Risk
[B] Stress
[C] Entrepreneurial ego.
Potential entrepreneurs need to be cognizant
that the dark side of entrepreneurship prevails.
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The Dark Side of Entrepreneurship
A. The Entrepreneurs Confrontation with
Risk

1. Financial risk — In many ventures the

individual puts an enormous part of their
savings or other resources at stake.

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The Dark Side of Entrepreneurship [c’d]

2. Career risk — A question frequently by

‘would be entrepreneurs’ is whether they
will be able to find a job or go back to their
jobs if their venture should fail.

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The Dark Side of Entrepreneurship [c’d]

3. Family and social risk — Entrepreneurs

expose their families to the risk of an
incomplete family experience and the
possibility of permanent emotional scars.

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The Dark Side of Entrepreneurship [c’d]

4. Psychic risk — The greatest risk may be to the

well-being of the entrepreneur.

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B. Stress and the Entrepreneur
1. What is entrepreneurial stress?
2. Sources of stress
a. Loneliness--Entrepreneurs are isolated
from persons in whom they can confide.
They tend not to participate in social
activities unless there is some business
benefit.

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b. Immersion in the business — Most
entrepreneurs are married to their
“business”. They have long work hours,
leaving them with little or no room for civic
recreation

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c. People problems — Most entrepreneurs
experience frustration, disappointment, and
aggravation in their experience with people.

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d. Need to achieve--Achievement brings
satisfaction.
However, many entrepreneurs are never
satisfied with their work no matter how well
it was done.

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Dealing with Stress
a. Networking --One way to relieve the
loneliness of running a business is to share
experiences by networking with other
business owners

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3. Dealing with Stress [c’d]

b. Getting away from it all--The best

antidote could be a well-planned vacation.

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3. Dealing with Stress [c’d]

c. Communicating with subordinates--

Entrepreneurs are in close contact with
subordinates and can readily assess the
concerns of their staff.

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3. Dealing with Stress [c’d]

d. Finding satisfaction outside--

Entrepreneurs need to get away from the
business occasionally and become more
passionate about life itself; they need to gain
some new perspectives.

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3. Dealing with Stress [c’d]

e. Delegating — Entrepreneurs find

delegation difficult because they think they
have to be at the business all of the time and
be involved in all aspects of their operation.

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Next (dark side cont’d)
C. The Entrepreneurial Ego
[ego: 1. Your sense of your own value and 2 (psychology) the part of the mind
that is responsible for your sense of who you are (= your identity) [Oxford
Dictionary]

1. Why the need for control--The

entrepreneurs are driven by a strong
desire to control both their venture and
their destiny
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2. Sense of distrust--Because entrepreneurs
are continually scanning the environment, it
could cause them to lose sight of reality,
distort reasoning and logic, and take
destructive action.

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3. Overriding desire for success--This can
be dangerous because there exists the
chance that the individual will become
important than the venture itself

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4. Unrealistic optimism--When external
optimism is taken to its extreme, it could
lead to a fantasy approach to the business.

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Entrepreneurial Motivation—what is it?

This refers to the willingness of an

entrepreneur to sustain his/her
entrepreneurial behaviour.

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