Hard work, drive and energy key to making it in business
So you want to be an entrepreneur? What does it take? Are you suited to entrepreneurial life? Have you got the required personality characteristics and what social factors influence whether or not you become an entrepreneur? While many studies have tried to answer these questions the results are mixed.
Just looking at some indigenous entrepreneurs we can see they are a motley crew. Entrepreneurs come in all shapes and sizes, from different social backgrounds and with different motivations, for example Michael Smurfit, Denis O'Brien, Chris Horn. It would appear there is no such thing as a typical entrepreneur. But studies have found entrepreneurs share a common type of personality (McClelland, Brockhaus, Morris, O'Connor and Rogers). Common characteristics include:
need for achievement, to prove oneself or seek personal accomplishment;
risk-taking propensity and ability to identify opportunities - entrepreneurs have the ability to recognise emerging patterns early;
strong need for independence and control;
internal locus of control - this refers to the belief that one is responsible for one's own fate, a key characteristic of successful entrepreneurs;
drive and energy;
tolerance of ambiguity and uncertainty.
These last traits are very important as the entrepreneur sets his/ her own agenda and works in a constantly changing environment, where the "buck" generally stops with them alone.
Entrepreneurs have also been found to be good at problem solving, setting and attaining self imposed goals. Learning from mistakes is also very important because the entrepreneur rarely has the luxury of a mentor from whom to learn. It is therefore necessary to identify your strengths and weaknesses before embarking on a business venture. To be successful, the entrepreneur will have to acquire resources he/she does not have.
What really sets successful entrepreneurs apart from others, however, is an ability to fill the resources gap, that is their ability to acquire resources in a practical, creative and cost-effective manner. Filling the resource gap requires highly developed networking and negotiating skills.
To complicate the matter the skills required to start a business are differ from those required to manage a growing enterprise. The entrepreneur will have to adapt continuously as the business grows. Initially financial, marketing, technical and administrative skills are all important but as the business develops the traditional management skills of planning, leading and organising become crucial.
Not all people who have entrepreneurial skills start businesses. The true entrepreneur is motivated to do so. Motivations vary and can start very early in life. Our social upbringing can strongly influence our entrepreneurial tendencies. An entrepreneurial parent often creates an environment where entrepreneurial development is encouraged. Many studies support this. Shapero and Sokal found that more than 50 per cent of company founders in the US had parents who were company owners, free professionals, independent artisans or farmers. A similar study in Ireland (O'Farrell 1986) found a high percentage of firm founders had fathers who were self-employed. Growing up in such an environment means self-employment is seen as a acceptable career option. In Ireland this tendency is seen in leading entrepreneurial families: the O'Reillys, Ryans and Smurfits.
The motivations for starting a business are manifold. Some become self-employed because they do not comfortably fit in with the restrictions of the modern organisation (Kets De Vries). They resent and are uncomfortable with the rules and regulations and prefer the freedom of working for themselves. Shapero found 65 per cent of entrepreneurs in his study had started a business for negative reasons, such as involuntary redundancy or job dissatisfaction. Another study found 60 per cent of entrepreneurs had decided to start a business long before they knew what type of business they wished to establish. Many entrepreneurs use the experiences they have gained in employment as a stimulus to "try it" themselves.
Because entrepreneurs need to gain experience in their chosen market, many work for a number of years in formal employment before starting a business venture. Hence the typical entrepreneur is 30 to 40 years old (Cooper) and until recently was predominantly male. But there is encouraging news for budding female entrepreneurs: women in the US are starting businesses at twice the rate of men and 50 per cent of all US businesses are expected to be owned by women by the end of this year. Hirsich and Brush find the female entrepreneur is typically first born, middle-class, starts her business venture in the services sector at the age of 35 having first obtained a degree and raised her children.
Being successful requires a mix of skills and resources, but above all it requires dedication, commitment, hard work, drive and energy. As such it is wise to start a business only when the timing is right, not just for the business opportunity but for you. Getting a business off the ground does not leave room for any distractions and requires strong family support. If you are determined to be an entrepreneur there will always be another opportunity.
Maura O'Connell is a lecturer in business studies in the Institute of Technology Blanchardstown
References: Brockhaus, R.H.(1980): Risk taking Propensity of Entrepreneurs' Academy of Management Journal, Vol. 23, No. 3, pp509-520; Cooper, A.C. (1973): Spin-offs and Technical Entrepreneurship: What do we know?, Research and development Management, Vol.3, No.2, pp.50-65; Hisrich and Brush, C.G. (1985) Women and Minority Entrepreneurs: A Comparative Analysis Frontiers of Entrepreneurial Research, J.A. Hornaday et al.(eds), Wellesley, MA: Babson College; Kets De Vries, M.F.R. (1977): The Entrepreneurial Personality: A Person at the Cross- roads, Journal of Management Studies, February, pp.35-57; McClelland, D.C.(1961): The Achieving Society, Princeton, NJ: Van Nostrad; Morris, J.L. and Faragher, K. (1974) Achievement, Drive and Creativity as Correlates of Success in Small Business, Australian Journal Of Psychology, Vol. 26, pp. 217-222; O'Connor, E.L. and Rogers, J.C. (1988) An Examination of the Attitudes of Clients and Students in the SBI case situation, SBIDA National Proceedings, San Francisco, pp.311-315; O'Kane, B. (1995): Starting a Business in Ireland, Oak Tree Press; O'Farrell, P (1986): Entrepreneurs and Industrial Change: The process of Change in Irish Manufacturing, Dublin: Irish Management Institute; Shapero, A. and Sokol, L. (1982): The Social Dimensions of Entrepreneurship, Encyclopaedia of Entrepreneurship, Kent, C.A. et al., (eds.), Englewood Cliffs, NJ: Prentice Hall.