The Entrepreneurial Mind

paulshawsmith scientific business strategy

The Entrepreneurial Mind How great entrepreneurs think different


Researching Entrepreneurs


Entrepreneurial personality?

David McClelland

Intelligence

Intelligence Personality

Intelligence Personality Needs

Intelligence Personality Needs Risk

??? ??? ??? ???


1984

“Who is an entrepreneur?”

Is the wrong question.

- Willaim Gartner

Who? Do?

Who? Do? Think?


Successful entrepreneurs thoughts?


What thoughts predict success?


1 Start up reasons


Why start a business?

1 Self-realization

2 Financial success

3 Roles

3 Innovation

4 Recognition

5 Unemployment

6 Independence


Reasons that lead to success?

Unemployment

Reasons

Financial

Reasons


Why?


2 Growth Motive


How many employees to do you expect to

employ in 5 years time?

0 or more

1 or more

2 or more

5 or more

10 or more

20 or more

50 or more

100 or more


What do you expect your annual sales

turnover to be in 5 years time?

Less than a R1 million

R1 million or more

R20 million or more

R50 million or more

R10 million or more

R20 million or more

R50 million or more

R100 million or more


Growth Commitment?

Source: Barringer et al. (2005)

54%

80%

FAST

GROWTH

SLOW

GROWTH

Avg. profit 12.4%

Source: Baum , Locke and Kirkpatrick (1998)

Avg. profit 5.5%

Written growth vision?

x



If your employees/sales doubled how would it

have a negative or positive impact on:

Your workload

Extend to which preferred tasks would dominate

Your employee well being

Ability to control operations

Independence from customers, suppliers, etc.

Ability to survive a crisis

Ability to keep up quality products and services

FOUNDER OF SONY



“We will create products that become

pervasive around the world… We will

be the first Japanese company to go

into the US market and distribute

directly.. Fifty years from now, our

brand will be as well know as any in

the world.”

HENRY FORD



“I will build a motor car for the great

multitude… It will be so low in price

that no man making a good salary

will be unable to own one. The horse

will have disappeared from our

highways, the automobile will be

taken for granted.”


3 Optimism


Optimism?


What are the odds of your business succeeding?

Source: Cooper et al. (1988)

0 1 2 3 4 5 6 7 8 9 10 No Chance

of Success

Certain Chance

of Success




0 1 2 3 4 5 6 7 8 9 10 No Chance

of Success

Certain Chance

of Success

81%




0 1 2 3 4 5 6 7 8 9 10 No Chance

of Success

Certain Chance

of Success

33%


=


Why?


4 Self Efficacy


Self-efficacy:

Belief in one own competence to

perform a specific task


How certain are you that you can:

Set and meet sales goals

Source: Chen, Greene & Crick (1998)

1 2 3 4 5

Completely unsure Completely sure



Expand your business


1 2 3 4 5




Create new products and services


1 2 3 4 5




Define organizational roles,

responsibilities and polices


1 2 3 4 5




Work under pressure and conflict


1 2 3 4 5




Develop financial systems and internal

controls


1 2 3 4 5



Is self-efficacy always good?


5 Passion?

Does passion lead to success?


I look forward to returning to work when I am away from my work


0 1 2 3 4 5 6 7 8 9 10 Very

False Very

True


I accomplish a lot because I love my job


0 1 2 3 4 5 6 7 8 9 10 Very

False

Very

True


Most of my life’s satisfaction is derived from my work


0 1 2 3 4 5 6 7 8 9 10 Very

False

Very

True


=


Why?


Working Alone

Restaurant

Cooking

Research recipes

Testing new dishes

Shopping


Managing Others

Working with others

Marketing and Selling

The Hiring Process

Dealing with customers

Managing Finances


Building a Great Team

Finding Opportunities

Marketing and Selling

Building Great Products

Acquiring Resources

Managing Finances

TASK SPECIFIC PASSION

6 Time Horizon

Good idea?

TIME AND SURVIVAL RATES


Source: Evans and Leighton (1989)

START UP EXP AND SURVIVAL


Source: Bruderl, Ziegler & Preisendorfer (1992)

Start up

Experience (3/20 failed)

No start up

Experience (6/20 failed)


Born 1930


1. His Dad was a stock broker


2. Chewing gum business (6-12 years)


3. Coke Business (6-12 years)


4. Peanuts and Popcorn job (6-12 years)


5. Invested in stocks (6-12 years)


5. Meet Sidney Weinberg (6-12 years)


6. Read Dad’s business books (13-15 yrs)


7. Read (6-12 yrs)


8. Worked at Buffet & Sons (11-14 yrs)


9. Newspaper delivery job (13-15 yrs)


10. Magazine business (11-14 yrs)


11. Sold second hand golf balls (13-15 yrs)


12. Calendar business (11-14 yrs)


13. Caddying job (11-14 yrs)


14. Set the millionaire goal (11-14 yrs)

I want to be a millionaire by the time I am 35

– Warren Buffett, 1941


15. Read stock pages daily (13-15 yrs)


16. Library visits (13-15 yrs)


17. Snow shoveling job (13-15 yrs)


18. Invested in a hardware store (15-17 yrs)


19. Horse race betting (15-17 yrs)


20. Tip sheet business (15-17 yrs)


21. Golf ball refurbish business (15-17 yrs)


22. Collectable stamp business (15-17 yrs)


23. Cornflakes and dog biscuits (15-17 yrs)


24. Car-buffing business (15-17 yrs)


25. Pinball business (15-17 yrs)


26. Farm investment (15-17 yrs)


27. Studied great business leaders

(15-17 yrs)


28. Studied at WBS (17-19 yrs)


29. Studied at UNL (19-20 yrs)


30. Masters at Columbia (20-21 yrs)


31. Taught by Graham (21-24)


32. Almost learnt textbooks by heart

(20-21 yrs)


33. Studied at NYIF (20-21 yrs)


34. Worked as a stock broker (21-24)


35. Taught a class on investing (21-24)


36. Invested in a gas station (21-24 yrs)


37. Worked for Graham (24-26)


Is it enough to just start business?


Marius

Pretorius


8 failures


D’oh!

8 failures

Expertise Development


Deliberate Practice: An activity that is designed

to improve a individuals performance level.


Are you taking time to reflect and learn?

The Entrepreneurial Mind


1 Financial Motive


2 Growth Motive

1 Financial Motive


3 Optimism 2 Growth

Motive 1 Financial

Motive


4 Self efficacy

3 Optimism 2 Growth

Motive 1 Financial

Motive


4 Self efficacy

5 Task Passion

3 Optimism 2 Growth

Motive 1 Financial

Motive


4 Self efficacy

5 Task Passion

6 Time Horizon

3 Optimism 2 Growth

Motive 1 Financial

Motive

The Entrepreneurial Mind

Business

Transcript of The Entrepreneurial Mind