Chapter 4: Entrepreneurial Personality *Drive

1. Know the different characteristics of a good  Success in entrepreneurship becomes possible

entrepreneur.
2. Know what motivates people to become
entrepreneur.
Operating a business enterprise is a very
challenging occupation. The rate of failure among
those to make attempts is high. Only few become
successful and the levels of their success differ.
when entrepreneurs is self-motivated enough
to pursue his chosen course without relenting
even in the face of adversity.
 An entrepreneur must try multiple times to
succeed.
 The tension that occurs when a need is not
met.
*Thinking Ability

Two complementary factors that determine
success or failure in an entrepreneurship:
1. Environmental factors
2. Personality of the entrepreneur
THE ENVIRONMENT AS A FACTOR
 The entrepreneur’s job involves solving
problems and making\g decisions.
 When he finds the correct solution to
problems that confronts him and then makes
decisions that are implemented, he comes
closer to realizing his goals.

Entrepreneurship will survive and grow only * Human Relations Ability

in economic environments of free enterprise. Full  There are three types of persons that will
blooming entrepreneurships cannot be expected to determine the survival and growth of business
flourish in economies that are not fully supportive of firms:
free enterprise. 1. The customer
Classification of economic environments: 2. The employee
3. The third party with interest to the firm.
1. Fully supportive of entrepreneurship  Customer
2. Moderately supportive of entrepreneurship  Makes decisions whether to
3. Not supportive of entrepreneurship patronize the firm or not.
Economies that fully support entrepreneurship makes  His decisions, however will
it easy for entrepreneurs to succeed. depend on what he thinks of
the firm.
THE ENTREPRENEUR’S PERSONALITY  Perception on customer
Every person has a personality that is unique relation will definitely be a
and different from others. factor.
 Employee
Personality  Can be productive and loyal
to the firm.
 Refers to the pattern of characteristics that
 He can help avoid production
distinguishes one person from another.
delays and shortages,
 It includes the person’s traits, values, motives,
wasteful consumption of
generic blueprints, attitudes, and emotional
resources, dissatisfied
reactivity, self-image, intelligence and visible
customers, and the like
behavior patterns.
 He can be an asset depending
CHARACTERISTICS OF ENTREPRENEURS* on what his superiors do to
him.
1. Drive;
 Third party with interest to the
2. Thinking ability;
firm.
3. Human relations ability;
 They can help the business
4. Ability to communicate;
depending on how the
5. Technical knowledge;
business relates to them
6. Reasonable risk taker;
 Agencies
7. Self-confident;
 LGU
8. Goal setter;
 Public
9. Accountable;
 Other Stake holders
10. Innovative.
 All the interest cited above can be useful
partners of the firms, but this will depend to a

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 large extent on the ability of the entrepreneur
to relate with them.
*Ability to communicate
 Communication skill is very important
characteristics an entrepreneur must have if
success is expected.
 The ability to understand and be understand
makes it easier for the entrepreneurs to
transact business with customers, bankers,
government and the likes.
*Technical Knowledge
 Operating an entrepreneurship requires the
performance of the major and minor tasks.
 The entrepreneurs must be at least be familiar
with and possess some technical knowledge
about how the various tasks are performed.
 It will be easier for him to devise a strategy on
how he will manage his firm to effectively
compete with others.
*Reasonable Risk-taker
 When a person starts a new venture, he has
already begun to assume the risk of business
failure.
 Entrepreneurs, however, normally do not
assume unreasonable risk.
 Entrepreneurs are expected to be reasonable
risk-takers, not conservative but also not
gamblers.
 They assume risk but only after they are
convinced that they have the skills and
resources to overcome the difficulties inherent
in a new venture.
*Self-confident
 A person cannot achieve much unless he has
sufficient confidence in himself.
 In any undertaking, including
entrepreneurship, a person’s belief in his
ability leads him to actual performance and
eventual success.
 When a person has self-confidence, he does
his job without inhibitions.
*Goal Setter
 Goals are very useful motivational tools,
especially those related to accomplishing the
objectives of entrepreneurs.
 Functions of Goal
o It directs one’ attention to specific
target
o It encourage one to exert effort
towards achieving something specific.
o In encourage persistence
o It fosters the creation of strategies and
actions plans.
 It is easy to understand that persons who are
goal setters would make entrepreneurs of high
success potentials.
*Accountable
 The success of an enterprise will depend much
on the willingness of subordinates to comply
with the wishes of the entrepreneurs.
 Compliance can be expected if the
entrepreneur is accountable enough to take
responsibility for what happens to the firm.
*Innovative
 A free enterprises economy like ours allows
business enterprises to flourish. This will
depend, however, on how well the public is
convinced to patronize them.
 Buyers will have to be persuaded to buy from
the entrepreneur’s firm rather than from the
competitors. The innovative entrepreneur,
however will be able to handle this problems
o Innovation may be the only way the
entrepreneur can achieve the
following:
1. Penetrate the market
2. Improve employee turnover
3. Reduce manufacturing cost
4. Improve collection rate
What Motives People to Become Entrepreneurs
4 MOTIVATION to be an Entrepreneur:
1. Desire to be one’s own boss;
2. Desire for financial rewards;
3. Desire to create one’s own job security;
4. Desire to improve one’s quality of life.
**Desire to Be One’s Own Boss
 There are times when an employee sees some
opportunities for his employers business.
 When he recommends action to be undertaken
and is ignored, the employee may just proceed
to take the opportunity and organize his own
business.
** Desire for financial rewards
 Some people, do not get satisfaction from
fixed monthly income which often, is
inadequate.
 Some think that they deserve to be properly
rewarded for their skills. The means open to
them is entrepreneurship.
** Desire to create one’s own job security
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  Some people feel their jobs are not secure. For the firm to get along in the first three stages, the
They think they could be fired for a variety of entrepreneur skill is required. The last two stages
reasons like downsizing, management errors requires the skills of the manager. (See Table 2)
 Person who cannot bear to worry about job
Entrepreneurs Tasks vs. Managers Tasks
security may just decide to become
entrepreneurs
** Desire to improve one’s quality of life. Enterpris Entrepreneur Managers
Activity involvement involvement
e Stage
 To some people engagement in
entrepreneurship provides them with some
control over their work schedules. Feasibility of idea, Full None
 An entrepreneur can choose a type of Prestart- Product or service,
business that will be compatible with the up Among others, is
quality of life he desires. scrutinized
 Specifically, the business locations and the Business is formed, Full none
type of products sold can be chosen to jibe necessary capital is
generated, facilities
with the personal and family needs of the
and equipment are
entrepreneurs. Start-up
purchased,
The Entrepreneur and the Manager Distinguished prototype of
product are built,
The term “entrepreneur” and “manager” are market is tested
sometimes used interchangeably. Although both jobs With limited full none
are useful to the economy, each performs distinct Early resources, selling is
functions. growth undertaken in
limited markets
Table 1: Activity Emphasis of New Ventures Structured Declining Partial
ENTERPRISE FACTORS EMPHASIS management, long
Late
STAGE term financing, and
growth
facilities planning
Business idea Full
I. Prestart-up are established
Human resources None
Stage With bigger none full
capital None
resources, recurring
Business idea None
II. Start-up Stable sales and profits,
Human resources Limited
Stage enterprise selling is
capital Limited undertaken in
III.Early Business idea None bigger markets
Growth Human resources Escalating
Stage capital Escalating
IV. Later Business idea None A major distinction between the entrepreneur and
Growth Human resources Full manager is about orientation.
Stage capital Full
Business idea None The Entrepreneur (Also alternatively called
V. Stable Promoter) feels confident of his ability to seize’ a
Human resources Full
Enterprise business opportunity regardless of the resources under
capital full
his current control.
The Manager (Also alternatively called Trustee)
emphasize the efficient utilization of resources.