Chapter 8: Personality - PDF

Summary

This document provides an overview of personality characteristics, focusing on how they influence entrepreneurial success. It explores the roles of traits like flexibility, passion, and vision in achieving entrepreneurial goals.

Full Transcript

## Chapter 8: Personality ### Unit 4: Self-awareness and reflection **Characteristics of personality** - Relatively stable and consistent - Influenced by genetic/environmental factors - Makes you behave the way you do - Personality decides your personal preferences **Discuss how personality con...

## Chapter 8: Personality ### Unit 4: Self-awareness and reflection **Characteristics of personality** - Relatively stable and consistent - Influenced by genetic/environmental factors - Makes you behave the way you do - Personality decides your personal preferences **Discuss how personality contributes to the success or challenges of entrepreneurial activities.** **Analyze how your personality influenced the outcomes of your entrepreneurial activities.** **What does it mean when we say that an entrepreneur should work on the business, not in it?** **Personality:** refers to individual differences in characteristic patterns of thinking, feeling and behaving. It is the combination of characteristics or qualities that form an individual's distinctive character. People have unique personalities that make them who they are. **A personality trait** is defined as something about a person that impacts how they tend to think, feel and behave on an ongoing basis. Personality traits are characteristic of enduring behavioral and emotional patterns, rather than isolated occurrences. Anyone can occasionally have a bad day, get irritated and make a snappy remark. When this happens in isolation, it doesn't reflect a personality trait. However, when someone's typical behavior is to snap at people rather than communicating politely, then "snappiness" is likely a personality trait that person has. These personality traits can enhance an entrepreneur's willingness to take initiative, tolerate risk, and deal with setbacks, enabling new ventures to continue to innovate, renew, and keep pushing forward, even after having achieved success. ### What characteristics do successful entrepreneurs share? An enterprising personality has distinctive characteristics separating the entrepreneur from others. Therefore, the level of impact of personality on entrepreneurship has increasingly been discussed over the last years. Entrepreneurs are the ones which have the ability to see the opportunities and seize them, take risks, create innovation and implement. The success of the person in entrepreneurship depends on many features such as capital, knowledge, and experience. **"Even if the chance of success depends on many different environmental and demographic factors, the real key determinant factors are the characteristics that the entrepreneur carries himself".** **Characteristics of entrepreneurs** can be listed as persons seeing change as an opportunity, being innovative, imaginative, creative, flexible, having the ability to endure ambiguity, being adaptable, reliable, able to take risks, persistent, responsible, and self-reliant. In addition, it is considered that these persons have the strength to endure the struggle of life, and have more motivation in achieving their objectives. Therefore, having a great concept is not enough. An entrepreneur must be able to develop and manage the enterprise that implements his or her idea. Being an entrepreneur requires special drive, perseverance, passion, and a spirit of adventure, in addition to managerial and technical ability. Entrepreneurs are the company, they tend to work longer hours, take fewer vacations, and cannot leave problems at the office at the end of the day. They also share other common characteristics as described in the next section. ### The Entrepreneurial Personality Studies of the entrepreneurial personality find that entrepreneurs share certain key traits. Most entrepreneurs are: - **Risk-takers:** They are prepared to take risk and see failure as possible positive experience to be learned from. They see initial failure is one of the best teachers. - **Flexibility and adaptability:** Entrepreneurs are able to change to suit different situations or circumstances. They are able to adapt to changes, explore the new possibility. Being able to adapt to changes and challenges is crucial for any business. In fact, most entrepreneurs will inform you that their idea or business plan is drastically different than when it began. An idea may be brilliant, but in reality it isn't effective. Entrepreneurs are flexible enough to make the adjustments to make that idea feasible. Furthermore, entrepreneurs are prepared and willing to modify their plan when new information arrives and when there are changes in circumstances. - **Passionate:** Entrepreneurs are not in it only for money. While there have been some icons who have made more cash than most of us we'll dream of, think Bill Gates or Steve Jobs, the reality is that most entrepreneurs work an insane amount of hours for little or nothing. Why would they put themselves through this? Because they are driven to either solve a problem or make it easier. Entrepreneurs reward themselves internally by realizing that they're on a mission for the greater good. No matter how bad it gets, it's their passion that motivates them between paydays and during all the times when everyone else tells them to quit. - **Visionary:** Their ability to spot trends and act on them, sets entrepreneurs apart from small-business owners and managers. Entrepreneurs see opportunity everywhere. They're innovators who are always on the lookout to either develop a new idea or improve an existing product or service. And, chances are that's the main reason why they became an entrepreneur in the first place. At some point in their lives they noticed something that could be better. But, instead of just saying that something could be better wasn't enough. They actually put a plan in motion. In other words, entrepreneurs have the ability to see the future before it happens. - **Resilient:** They have the ability to overcome high-impact entrepreneurial challenges and persist in the entrepreneurial process in the face of adverse situations and unexpected outcomes. As an entrepreneur, you're going to fail. That's just an unfortunate fact. Instead of giving up, an entrepreneur will learn from their failures. What went wrong? How can I learn from my mistakes? How can I succeed next time? These are the type of questions an entrepreneur will ask themselves. An entrepreneur doesn't stay down when times get rough. They're resilient and thrive off of the negativity. - **Self-confident, self-motivated, and determined:** They understand the challenges of starting and operating a business and are confident in their ability to solve problems. Any entrepreneur will tell that there are numerous problems to overcome. Whether it be not securing enough funding or facing the competition, it's not easy being an entrepreneur. Entrepreneurs don't think that their idea could be good. They know it's good. And, they're going to be motivated enough to illustrate to others that it's worth the time and money to go forward. While they also understand that they can't do everything on their own, they realize that they are the only ones to make their idea a reality. #### Strengths - In addition to the above, below are some common characteristics which help entrepreneurs to turn ideas into a real and profitable business: - **Creativity** - To compete with larger firms, entrepreneurs need to have creative product designs, bold marketing strategies, and innovative solutions to managerial problems. They can come with new ideas for new products or new ways for presenting existing products. - **Innovative** - They can translate an idea or invention into a good or service that creates value or for which customers will pay. - **Ambitious:** They are competitive and have a high need for achievement. - **Independent:** They are individualists and self-starters who prefer to lead rather than follow. - **Energetic:** Starting and operating a business takes long hours. Even so, some entrepreneurs start their companies while still employed full-time elsewhere. - **Committed:** Because they are so committed to their companies, entrepreneurs are willing to make personal sacrifices to achieve their goals. - **Leadership qualities & ability to build/work in a team (team dynamics)** - they have communication skills, the ability to motivate others and are good decision-makers. They make decisions deliberately and thoughtfully, consider and include all relevant factors. - **Initiative & good planner** - they can develop a good plan for achieving the business's objectives. - **Decisiveness/Result driven** - focused on achieving results and make sure products sold for profit. - **Emotional intelligence** - they can understand, use, and manage their own emotions in positive ways to relieve stress, communicate effectively, empathize with others, overcome challenges and defuse conflict. - **Tolerance of uncertainty and ambiguity** - They have the ability to operate effectively in an uncertain environment. - **Good at networking** - they listen to people's needs and concerns and find opportunities to help them. ### Possible Weaknesses - **Type A Personality Weaknesses** - Impatient - Inflexible - Intolerant - **Bad Time Management:** Different people are productive at different times of the day; sometimes entrepreneurs need to apply time management techniques. - **Being all over the place:** Can't Focus, lots of ideas, runs in circles. Having a lot of ideas is great! But don't try to implement them all at a time. It will most probably be a disaster. - **Hesitance to Delegation:** When they start a business, it is very common that they would be hesitant to delegate work to others. But unless entrepreneur want to be a one man orchestra he will have to get over it. - **Demanding Perfection from all:** Entrepreneurs are perfectionists. Most are never satisfied with their own work, as well as the work of others. They can cause delays and run up costs, in the business. Mostly it will cause friction and frustration in relationships with team members, partners, and customers. - **Not a team player:** Most entrepreneurs start their business because they perceive an unseen need in the market. Many times, they want to be in charge. Most often they just don't like working with others. - **Often emotional and temperamental:** Passion and sensitivity are key traits in every good entrepreneur. In some cases, these traits can seem to escalate to mood changes and emotional outbursts for no reason. #### Strengths and Weaknesses | Strengths | Weaknesses | |---|---| | - Gain Knowledge | - Undecided | | - Increasing Experience | - Expectation for results | | - Ambition to be the best | - Not find what I like| | - Networking | - Better competitors | ### Uncertainty, ambiguity, risk and failure **How do entrepreneurs deal with uncertainty ambiguity, and risk while planning a business?** Uncertainty forms a significant part of any business. Every business owner knows that without risk, there is no reward. Thus, the existence of uncertainty forms a core part of entrepreneurial activity. To be a top leader, entrepreneurs need to appreciate uncertainty and deal with it as it appears. **Ambiguity:** Where something is vague, unclear, open to more than one interpretation and possibly containing contradictions. This creates complexity and makes decision-making difficult. **Uncertainty** is a state of being unsure; where it is difficult to identify potential outcomes and likelihoods (probability). **Risk:** A possibility which has identifiable potential outcomes and likelihood (probability). **Risk means that the probabilities are known. Uncertainty means that the probabilities are unknown. On the basis of risk, you can decide whether or not to take a gamble. In the kingdom of uncertainty, though, it's much harder to make decisions. Entrepreneurship is associated with risk bearing, uncertainty, gains and losses. The entrepreneurs are more willing and better able to cope with risk and uncertainty.** **"Success is the ability to go from one failure to another with no loss of enthusiasm."** *Winston Churchill* **Failure:** Entrepreneurship is fundamentally linked to risk-taking. As an entrepreneur, you're going to fail. That's just an unfortunate fact. Entrepreneur has the uncanny ability to get up and dust themselves off. Entrepreneur knows that the big payoff will only come if they are able to cope with difficulties, challenges and the risk therein. Facing the fear of failure and turning that fear into something positive will build greater awareness and acceptance of risk. An entrepreneur should also know that great rewards are associated with a risk which cannot always be minimized. Finally, if good entrepreneurs fail, they learn from their failures and use them to drive them to success. Entrepreneurs see initial failure as one of the best teachers. **"Risk is measurable uncertainty"** **"Uncertainty is unmeasurable risk"** For an entrepreneur, every day there is something new, something changing, so a good entrepreneurial mind will adapt and shift. Being able to cope with uncertainty means being able to learn to adapt. They make decisions when the result of that decision is uncertain, when the information available is partial or ambiguous, or when there is a risk of unintended outcomes. Entrepreneurs live with risk and uncertainty. They don't have a choice. The future is up to them. They are responsible for their successes and failures, and success is never permanent. Therefore, entrepreneurs have to learn to handle the risk and uncertainty of having to be responsible for their company and employees. Standard approaches to decision making to begin with facts, and if none are available, to gather them diligently prior to making a decision. However, most real-life decisions are accompanied with uncertainty. For an entrepreneur, uncertainty is both about unknown variables/resources/inputs (i.e. capital, labor, land ...) and unknown outcomes. At times you have an idea of the variables that are involved but have uncertainty about the levels at which they will manifest themselves. At other times, they do not even have an idea of the variables that are involved. There are a number of challenges that the entrepreneur faces. First of all, to start a business, the entrepreneur has to line up land and other physical assets, labour, and capital. But closer examination tells you that getting land, other physical assets, and labour is possible only if you have adequate capital. So, the most critical challenge of business in its early stage is that of attracting capital. Uncertainty about the ability to attract capital can be the killer for many businesses at the inception stage. This is an example of a known (very well known!) variable with uncertain outcomes. Uncertainty creates unnumbered challenges for even the most skilled organizational actors, because an "unknowable" future prevents attempts to predict the consequences of their actions. Uncertainty cannot be ignored. It is the lifeblood of the entrepreneurial opportunities that are necessary for the revival of organizations and economies. Without human agency and action in the context of uncertainty, there are no mechanisms through which the entrepreneur-opportunity connection creates value. At this early stage, the business is more in your head than in tangible assets that others can see; in your mind, the business is a whole bunch of variables with unknown outcomes. To everyone else, even these variables are unknown. The only thing that others can see is your passion, perseverance, and positivity. That is why trust is also at a premium at this stage and why a strong people-orientation stands you in good stead. **The uncertainty is mitigated by creating a well-developed business plan in addition to the entrepreneur's characteristics: Flexibility and Adaptability, Resilient, Passion, Perseverance, Positivity, and People orientation.** Without taking a risk, you'll never know how great your company could be. While you shouldn't risk everything you've worked for, if you take a calculated risk, you could push your company toward even more success. Companies would never develop new methods or products if they didn't take risks. ### Establish an Action Plan **How to Write an Action Plan** **Objectives:** Define the objectives that implement your strategy **Planning:** Detailed planning and resource allocation **Tasks:** Break objective into high-level tasks **Team:** Assign responsibility over tasks **Schedule:** Establish deadlines and milestones **Execute:** Execute the plan and monitor KPI's Planning is always done for the future and the future is uncertain. An action plan is drawing the road map of, where your want to go, how you want to go, and why you want to go. With the help of an accurate and updated action plan; entrepreneurs could anticipate the possible changes in the future as it provides an overall outline and step-by-step of the various activities in the best possible way. In this way, the risk of future uncertainties can be minimized. However, an action plan will not reduce all uncertainty and risk and will not guarantee success or avoid future. **Build in Flexibility** **Flexibility = Success?** Research shows being flexible is a key factor to running a successful business. Uncertainty often requires that decisions be made with incomplete information. In these instances, we must acknowledge the unknowns, build flexibility into the plan and then monitor and adjust accordingly. It's much easier to alter the course of a sailboat when the wind changes direction if the captain has accounted for the need to tack. **Flexibility:** Successful entrepreneurs understand that the world and the environment in which they operate are constantly changing. While they must focus on the end game, they must adapt their strategies and offerings to meet changing market conditions. ### Key Vocabulary and Structures: - **Personality:** The combination of characteristics or qualities that form an individual's distinctive character. A personality trait is defined as something about a person that impacts how they tend to think, feel and behave on an ongoing basis. - **Ambiguity:** Where something is vague, unclear, open to more than one interpretation and possibly containing contradictions. This creates complexity and makes decision-making difficult. - **Uncertainty** is a state of being unsure; where it is difficult to identify potential outcomes and likelihoods (probability). - **Risk:** A possibility which has identifiable potential outcomes and likelihood (probability). - **Motivation:** Refers to the attitude that people have towards their goals. It is the reason for people's actions and willingness. Motivation is derived from the word motive which is defined as a need that requires satisfaction. These needs could be wants or desires that are acquired through influence of culture, society, lifestyle, etc. Motivation is the factors - reason- that influence the behavior of entrepreneurs towards achieving their goals. It results from a combination of factors that encourage entrepreneurs to work harder and more efficiently. - **Personal motivators:** also known as intrinsic or self-motivation can be defined as motivation arising from an individual's internal desires for the satisfaction and fulfillment of specific needs. Intrinsic motivation is the desire to do something even if there isn't an obvious reward. An example of intrinsic motivation is learning a new skill because you love the process of self-education and mastering something new. In contrary, Extrinsic motivation happens when you participate in an activity because of a reward or another form of compensation. An example of extrinsic motivation is learning a new skill because your company will pay you bonus in addition to your salary. - **Ambition:** is defined as, "a serious desire for some type of achievement or distinction, as power, honor, fame or wealth, and the willingness to strive for its attainment" Without a serious desire, what you may have ambition to accomplish is a pipe dream, because you lack the necessary drive to get there. - **Resilience:** the ability to overcome high-impact entrepreneurial challenges and persist in the entrepreneurial process in the face of adverse situations and unexpected outcomes. - **Team:** is a group of individuals working together to achieve their goal. - **Project:** Planned set of interrelated tasks to be executed over a fixed period and within certain cost and other limitations. - **Project team:** is a group of individuals who work together - usually belong to different groups, have different functions- and assigned to execute a set of interrelated tasks over a fixed period and within certain cost and other limitations to achieve a specific mission. - **Mentor:** A teacher in the role of mentor will act as an advisor, counsellor and guide to learners throughout their engagement in entrepreneurial activities. Learners should feel free to come to them with questions and problems and be supported to find answers and solutions.

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