ENTREPRENEURIAL MOTIVATION

Razia Sultana Sumi

Associate Professor
• Motivation is the set of forces that causes people to
engage in one behavior rather than some alternative
behavior .
• The term, "Motivation" has come from the Latin word
‘movere’ the meaning of the same is “to move”. That
means to move from present situation to better
situation.
• Motivation is the willingness to do something, and is
conditioned by this action’s ability to satisfy some need
for the individual. The common man thinks that people
go for business to earn money, but it is not always true.
• Scott has defined motivation as "Motivation means a
process of stimulating people to action to accomplish
desired goals''
 The characteristics of motivation are as under :
(1) It has two parts
• (a) to motivate self
• (b) to motivate others.

(2) The concept of motivation is based on

assumption that a behavior of a person is goal
oriented and it is directed to complete the task.
(3) The behavior varies from man to man.
(4) It is an internal condition
(5) It is an inspiring process to do work.
(6) It is goal oriented process
 Motivation Theories
• McClelland’s Achievement Motivation Theory:
From the preliminary studies made by David
McClelland for the entrepreneurship
development it is noticed that for the growth of
entrepreneurship, achievement motivation is
very important factor which can be developed by
training and experience. He has also stated that
to get achievement some people have strong
drive while others have low drive. Those who
have strong drive are considered as high achiever.
 Dominant Motivator Characteristics of This Person
• Achievement Has a strong need to set and accomplish challenging
goals.
Takes calculated risks to accomplish their goals.
Likes to receive regular feedback on their progress and achievements.
Often likes to work alone.

• Affiliation Wants to belong to the group.

Wants to be liked, and will often go along with whatever the rest of the
group wants to do
Favors collaboration over competition.
Doesn't like high risk or uncertainty.

• Power Wants to control and influence others.

Likes to win arguments.
Enjoys competition and winning.
Enjoys status and recognition.
• David McClelland has introduced short form ‘n-
Ach’ that means need for achievement. He has
defined ‘n-Ach’ as “behavior towards completion
with a standard of excellence”
• There is a direct relationship between the high
need for achievement and the successful
administration with high standard of results
oriented skill. For successful administration or
successful entrepreneurship high need for
achievement ‘n-Ach’ is very important factor. This
factor (need for achievement) can be measured
and developed by suitable training.
• Achievement
• People motivated by achievement need challenging,
but not impossible, projects. They thrive on
overcoming difficult problems or situations, so make
sure you keep them engaged this way. People
motivated by achievement work very effectively
either alone or with other high achievers.
• When providing feedback, give achievers a fair and
balanced appraisal. They want to know what they're
doing right – and wrong – so that they can improve
• Affiliation
• People motivated by affiliation work best in a group environment, so
try to integrate them with a team (versus working alone) whenever
possible. They also don't like uncertainty and risk. Therefore, when
assigning projects or tasks, save the risky ones for other people.
• When providing feedback to these people, be personal. It's still
important to give balanced feedback, but if you start your appraisal
by emphasizing their good working relationship and your trust in
them, they'll likely be more open to what you say. Remember that
these people often don't want to stand out, so it might be best to
praise them in private rather than in front of others.
• Power
• Those with a high need for power work best when
they're in charge. Because they enjoy competition,
they do well with goal-oriented projects or tasks. They
may also be very effective in negotiations or in
situations in which another party must be convinced
of an idea or goal.
• When providing feedback, be direct with these team
members. And keep them motivated by helping them
further their career goals.
 CHARACTERISTICS OF THE PERSON WHO POSSESSES ACHIEVEMENT
MOTIVATION

1. High achievers search for areas of greater

personal responsibility and they readily accept it.
2. They take calculated risk.
3. They set challenging yet achievable goals.
4. They make detailed and comprehensive planning
to achieve the goals and get ready for the future.
5. They are ready to accept measurable feedback.
6. They reach for profitable industrial opportunities.
7. They show an attitude of sticking to the work
even in unfavorable conditions.
8. They tends to do something new.
9. They show certain inter personal competence.
10. High achievers have an attitude of bearing
uncertainties.
11. They are ready to migrate and start business
at any place.
12. They are adventurous.
 High achievers can be developed by providing proper
atmosphere. They are generally attracted by the
following proposals.
1. When personal responsibility be assigned for goal
achievement.
2. Total freedom be given to them to set their goals.
3. For the results of the efforts, proper and without any
prejudice, information feedback be provided to
them.
4. Work should be assigned to do in a moderate risk
conditions.
5. 5. Proper recognition and appropriate returns be
given according to the work done successfully
Entrepreneurial Motivation

Part-II

Razia Sultana Sumi

Associate Professor
 Schumpeter’s view on Entrepreneurship
Joseph Alois Schumpeter is regarded as one of the
greatest economists of the first half of the twentieth
century. The concepts of innovation and
entrepreneurship are probably Schumpeter’s most
distinctive contributions to economics. One of the most
common themes in Schumpeter’s writings was the role
of innovation (“new combinations”) and
entrepreneurship in economic growth.
He refers that entrepreneurs innovate the ideas & the
modes of translating those into reality. He perceives the
people who get pleasure in solving problems that others
cannot easily solve are with entrepreneurial trait.
 Entrepreneurs get ego satisfaction by innovating
normally the ways as under:
• Form new product/ service ideas,
• Develop new cost-effective method without losing
quality postulate
• Create new customers
• Find new source of inputs & skills needed for quality
to withstand competition
• Develop new organizational set-up-monopoly or
other type
• Train employees get pleasure in doing the process
with economy
• Creates markets area for such products/ services
Schumpeter’s innovation theory
Although since the late 1880s there have been
reports of the use of the term “innovation” to
mean something unusual, none of first precursors
of innovation have been as influential as the
Schumpeter. According to him, consumer
preferences are already given and do not undergo
spontaneously. It means that they cannot be
cause of the economic change. The concept
covers the following five cases:
 The concept covers the following five cases:
1. launch of a new product or a new species of
already known product;
2. application of new methods of production or sales
of a product (not yet proven in the industry);
3. opening of a new market (the market for which a
branch of the industry was not yet represented);
4. acquiring of new sources of supply of raw material
or semi-finished goods;
5. new industry structure such as the creation or
destruction of a monopoly position.
 Theory of Social Change: Everett E. Hagen
• According to Hagen, all human personalities in all human
societies are either authoritarian or innovational. All members
of traditional and/or peasant societies have authoritarian
characters, are caught in an unresolved oedipal conflict with
their authoritarian fathers, and are resistant to change. 
• Economic development is seen almost exclusively as a process
of technological change which is brought about the
technological creativity of individuals in the society. Hagen
postulates the sequence of changes separating the typical
authoritarian personality of a stable traditional society from
the emergence of creative entrepreneurial activity.
Everett Hagen’s view on the theory of Social change
Comparative study of Maslow, Hergberg and McGregor’ Motivation theories
Discussion on theories
• Maslow (1954) developed a new concept of motivation and
proposed a hierarchical order in the structure of human
needs.
• In the Maslowian paradigm five needs identified were:
Psychological, safety/security, social, self-esteem and self
actualization.
• This theory is based on assumption of internal-motivation--
the needs, wants and desires which exist within an individual
and influence the person by determining his thoughts, which
in turn lead to his/her behavior in a particular situation. For
example, a student who desires good grades in a course will
consider how he can fulfill the requirements for the grade.
• Herzberg (1959) sought a different answer to motivation and
propounded a bi-model theory of motivators and hygienes. The
motivators reflected the internal dynamics residing within the
individual and hygienes reflect the power of contextual factors like
money, work conditions, etc. which shape the motivation of the
individual.
• Herzberg's motivations described human beings relationship to what
he does, that is the content of the job. The hygienes on the other
hand reflect the situation in which he does the job, i.e. the context of
the job.
• If the hygiene factors, for example salary, working conditions, work
environment, safety and security are unsuitable (low level) at the
workplace, this can make individuals unhappy, dissatisfied with their
job. 
• Motivating factors, on the other hand, can increase job satisfaction,
and motivation is based on an individual's need for personal growth.
• Quite contrary to the assumption of Maslow and Herzberg,
McGregor (1967) worked entirely on different hypothesis and
sought an answer to motivation in the nature of man.
• Theory X and Y reflect McGregor's efforts in understanding
human motivation vis-a-vis the nature of the person. `Theory X'
and `Theory Y' are quite different, almost poles apart and have
different sets of assumptions. Theory X assumes the human being
as lazy, idle and indolent. Such a person is averse to any effort
and would like to avoid any kind of responsibility. They prefer
being directed and avoid being independent decision maker. They
only work under direct control and threat of punishment.
• The theory ‘Y’ is in contradiction with theory `X'. Theory `Y'
projects the human being as a creative, open-minded and
energetic person for whom the work is as pleasant and natural as
play. Responsibility is a welcome concept and such people seek
self-regulatory behavior.
 A proposed model of Entrepreneurial Motivation

• An implementation to outcome relationship describing various factors

the start up decision with issues of strategy formulation, implementation
and sustained entrepreneurial behavior.
• Perceptual interpretations made by the entrepreneur play a key role in
motivational process
• Strength of the relationship between the entrepreneur’s managerial
strategies and firm outcomes. The stronger the relationship is perceived
to be, the stronger will be the motivation to behave entrepreneurially
•Feedback on succeeding strategies, strategy implementation and
management of the firm. Entrepreneurs will be motivated to behave
entrepreneurially as long as they view that behavior being effective.
Firms performance may influence an entrepreneur but its only a part of
the picture.
Goal achievement and not performance: An entrepreneurial tendency can
be sustained as long there is a belief that there is no other viable option.
Thank you all