The Mindset Of The Entrepreneur
If you have always wanted to be an entrepreneur, it is important to discover whether you have the mind-set of an entrepreneur as it will not only help you to evaluate your readiness, but it will also help you to identify if you have the personality, characteristics and skills to succeed, as a mind-set is believed to be the most important requirement for success in entrepreneurship. A mind-set is defined by Medical Dictionary as a “mental inclination”, “tendency” or “habit”. In other words, it is as a particular way a person thinks and forms opinion about things. So, when we refer to entrepreneurial mind-set, we are referring to the way entrepreneurs think.
Entrepreneurs are drawn towards entrepreneurial activities and outcomes. They seek opportunities for innovation and value creation. The Business Dictionary defines a start-up as “Early stage in the life cycle of an enterprise where the entrepreneur moves from the idea stage to securing financing, laying down the basis structure of the business, and initiating operations or trading”. The key words in the definition which are usually associated with starting a business that is of interest to us are “enterprise” and “entrepreneur”. Understanding these two terms will help to clarify how an entrepreneur thinks.
The term enterprise is usually defined as a business. However, the definition by Leicester University is relevant to our consideration here as enterprise is defined as “…a set of skills and attitudes that can enable a culture of innovation, creativity, risk taking, opportunism, etc. that underpins employability, enables entre- and intra- preneurship, and facilitates knowledge transfer”. This definition does not link enterprise to something static like an entity or organisation, but as a process resulting from an outcome of the word enterprising. According to this perspective, people who are enterprising have been known to have a set of skills, attributes and behaviours that enable them to successfully exploit ideas as shown below, as opposed to those who are not.
| Skills | Attributes |
| Intuitive decision making with limited information | Sense of belief in self |
| Coping with uncertainty and complexity | Strong sense of independence |
| Building know-how and trust in relationships | Goal/achievement orientated |
| Creative approach to problem-solving | Builds own know-how and trust in relationships |
| Negotiation capacity | Commitment to see things through |
| Selling/persuasive capacity | Sense of ownership over problems/actions |
These are skills many people do not naturally possess. However, the good news is that they can be cultivated through learning and are now taught in schools, colleges and universities
Motivation For Achievement
Abraham Harold Maslow, an American psychologist created a theory of motivation which has popularly come to be known as Maslow’s Hierarchy of Needs, consisting of five stages as shown below. He stated that one must satisfy the lower level basic needs before progressing on to meet the higher level needs of growth. Once these needs have been reasonably satisfied, one can aspire to to reach the highest level called self-actualization.
Source: Wikimedia Commons; Created by J. Finkelstein
As it can be seen form the diagram, one of the higher level needs is need for achievement. Many studies support achievement as the most important factor that motivates entrepreneurs. A research by Jari Huovinen and Matti Koiranen has shown that “A strong achievement motivation is probably the one characteristic most clearly describes the attitudes and the behaviour of an entrepreneur (e.g. Virtanen 1996). It may also be considered as a dimension closely related to other typical characteristics for an entrepreneur, such as willingness to take risks (e.g. Littunen 2000) and growth orientation (Kirschenhofer 2006; Virtanen 1996)”. According to an article by Dr James V Green, Director of Entrepreneurship Education, Maryland Technology Enterprise Institute, University of Maryland, the one trait that has been found that all successful entrepreneurs must have is “need for achievement”. This need for accomplishment is what motivates the entrepreneur to accept challenges and the responsibility for any outcome. It can be called “drive”, “hunger” or “self-motivation”.
Dr Green states that the need for achievement is so powerful that it is the driver of success in the following ways:
- It breaks down doors: Starting a business involves uncertainty as there are obstacles the start-up will face, which are difficult to predict. The investors need to be convinced that the founder and the team have the tenacity to continue with the vision and learn from all the challenges that they are facing.
- It fuels hard work: Starting a business is a daunting task and those who succeed are not just those with the most power or money. Success comes as a result of continuing and not willing to give up in the face of mounting obstacles.
- It demonstrates innovation: Investors do not not invest primarily in a big idea or strategy as much as in the character of the entrepreneur. An investor needs to know whether or not the founding team has the tenacity to stick to its vision through all the ups and downs, and if they will learn from them. Need for achievement can lead to innovation and new successful ideas. If entrepreneurs are too stubborn to give up, they will be forced to learn from their mistakes, adapt and advance in order to succeed.
- It harnesses natural abilities: Grit, tenacity and resilience are increasingly becoming part of talent management, and are often valued more than traditional predictors of success such as academic performance. Talent and intelligence alone are not enough as for achievement is needed to focus and develop talents.
Keys To Developing A High Need Of Achievement
Dr Green provides the following suggestion for developing a high need for achievement. He states that a high need for achievement makes for better entrepreneurs. “Naturally, if you have a greater motivation, a greater drive, and a greater level of commitment, you’re going to have higher involvement in your job and in your career. You’re going to have higher organizational commitment and commitment to colleagues, suppliers, partners, customers, and investors. Need for achievement is therefore an enabler of becoming a successful entrepreneur”.
Here are the five proven techniques suggested by Dr Green for developing a high need for achievement:
- Write and track your goals.
Self-monitoring is something to keep in mind as well. Do you have personal goals? Are they written? Are you tracking progress towards your goals?
I’m a believer in tracking what we care about, and measuring our progress towards our ambitions. Self-monitoring and milestone measuring are practices of individuals with a high need for achievement. - Reward yourself.
Self-reinforcement is important. Do you reward yourself for your achievement? Either with incremental rewards, or long-term rewards? - Be your own champion.
Are you self-motivated? Or do you need others to encourage you in order to feel motivated? - Cheer for yourself.
Do you need others to congratulate you? Or do you find satisfaction in your own success? Are you fulfilled without receiving the recognition of others? - See the success that you want to achieve.
Are you not only driven to success, but are you planning your own success? Do you mentally rehearse or forecast or think about future events? Do you anticipate obstacles? Do you develop alternative solutions?
References:
Huovinen, J. and Koiranen M. (2011). Achievement Motivation Among Habitual Entrepreneurs in Urban and Rural Areas, University of Jyväskylä, School of Business and Economics, Finland. LTA 3/11 • p. 316–325 http://lta.hse.fi/2011/3/lta_2011_03_a3.pdf
MaCMiLLan, i. a. (1986). To really learn about entrepreneurship, lets study habitual ent-repreneurs. Journal of Business Venturing1 (3), 241–243.
Dr James V. Green is the Director of Entrepreneurship Education, Maryland Technology Enterprise Institute, University of Maryland.