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The Individual Entrepreneur Chapter Three(3) Chapter Three(3)

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1 The Individual Entrepreneur Chapter Three(3) Chapter Three(3)

2 Entrepreneurial Feelings: Locus of Control 1. Do you often feel ‘That’s just the way things are and there is nothing I can do about it’? 2. When things go right and are terrific for you, do you think ‘its mostly luck’? 3. Do you think you should go into business or do something with your time for pay because everything you read these days is urging you in that direction? 4. Do you know that if you decide to do something, you’ll do it and nothing can stop you? 5. Even though its scary to try something new, are you the kind who tries it? 6. Your friends, spouse and mother tell you that its foolish of you to want a career. Have you listened to them and stayed home all these years? 7. Do you think its important for everyone to like you? 8. When you do a good job, is your pleasure in a job well done satisfaction enough? 9. If you want something, do you ask for it rather than wait for someone to notice you and just give it to you? 10. Even though people tell you it cant be done, do you have to find out yourself?

3 Entrepreneurial Feelings: Locus of Control  Answering yes to questions 4,5,8,9, and 10 indicates that you possess the internal control aspect of being an entrepreneur.  Yes answers to questions 1,2,3,6, and 7 indicate that you are more geared toward external controls, which may stop you from being an entrepreneur.

4 Feelings about Independence and Need for Achievement  An entrepreneur is the type of person who needs to do things in his or her own way and has a difficult time working for someone else.  Yes answers to questions 1,4,5,8,9,and 10 indicate that you do not have a strong need for independence.  McClelland says an entrepreneur has (1) individual responsibility for solving problems, setting goals, and reaching these goals (2) moderate risk taking as a function of skill, not chance, and (3) knowledge of results of decision/task accomplishment.

5 Checklist for feelings about Independence 1) I hate to go shopping for clothes alone. 2) If my friends won’t go to a movie I want to see, I’ll go by myself. 3) I want to be financially independent. 4) I often need to ask other people’s opinions before I decide on important things. 5) I’d rather have other people decide where to go on a social evening out. 6) When I know I’m in charge, I don’t apologize; I just do what has to be done. 7) I’ll speak up for an unpopular cause if I believe in it. 8) I’m afraid to be different. 9) I want the approval of others. 10) I usually wait for people to call me to go places, rather than intrude on them.

6 Entrepreneurial Feelings: Risk Taking  Risk taking-whether financial, social or psychological-is part of the entrepreneurial process.  Yes answers to questions 2,5, and 9 means that you don’t have a strong willingness to take risks.  However, it has not yet been empirically established that a risk taking propensity is a distinguishing characteristic of entrepreneurs.

7 Checklist for Willingness to take Risk 1) Can you take risks with money, that is, invest, and not know the outcome? 2) Do you take an umbrella with you every time you travel? A hot water bottle? A thermometer? 3) If you’re frightened of something, will you try to conquer the fear? 4) Do you like trying new foods, new places, and totally new experiences? 5) Do you need to know the answer before you’ll ask the questions? 6) Have you taken a risk in the last six months? 7) Can you walk up to a total stranger and strike up a conversation? 8) Have you ever intentionally traveled an unfamiliar route? 9) Do you need to know that it’s been done already before you’re willing to try it? 10) Have you ever gone out on a blind date?

8 Entrepreneur Background and Characteristics: Childhood Family Environment  Family environment of the entrepreneur include birth order, parent’s occupations, and social status, and relationship with parents.  Study found that female entrepreneurs tend to be the firstborn.  Entrepreneurs tend to have self-employed or entrepreneurial fathers and/or mothers.  The independent nature and flexibility of self-employment exemplified by the father is ingrained at an early age.  Parents of entrepreneurs need to be supportive and encourage independence, achievement and responsibility.  Supportive relationship of the parents (particularly the father) appears to be most important for female entrepreneurs as they tend to be similar to their fathers in personality.

9 Entrepreneur Background and Characteristics: Education  A formal education is not necessary for starting a new business, but it provides a good background.  The ability to deal with people and communicate clearly in the written and spoken word is important.

10 Entrepreneur Background and Characteristics: Personal Values  Personal value scales for leadership, support, aggression, benevolence, conformity, creativity, veracity, and resource seeking are important for identifying entrepreneurs, but these also identify successful individuals.  Entrepreneur has a different set of attitudes about the nature of the management process and business in general.

11 Entrepreneur Background and Characteristics: Age  Entrepreneurial experience is one of the best predictors of success, especially when it is in the same field.  Most entrepreneurs initiate their entrepreneurial careers between the ages of 22 and 45.  There are milestone years every five years (25,30,35,40 and 45) when an individual is more inclined to start an entrepreneurial career.

12 Entrepreneur Background and Characteristics: Work History  Dissatisfaction with various aspect of one’s job-such as a lack of challenge or promotional opportunities, frustration and boredom inspires start of new business.  Experience in the following areas is very important: financing, product or service development, manufacturing, development of distribution channels, and preparation of a marketing plan.

13 Motivation  The reason cited most frequently for becoming an entrepreneur is independence-not wanting to work for anyone else.  The desire to be one’s own boss is what drives both male and female entrepreneurs around the world to accept all the social, psychological, and financial risks.  Money is the second reason for starting a new venture for men, whereas job satisfaction, achievement, opportunity, and money are the reasons in rank order for women.


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