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Gorgievski ea 2012 iwp entrepreneurs’ active personality traits and perceived success
Gorgievski ea 2012 iwp entrepreneurs’ active personality traits and perceived success
Gorgievski ea 2012 iwp entrepreneurs’ active personality traits and perceived success
Gorgievski ea 2012 iwp entrepreneurs’ active personality traits and perceived success
Gorgievski ea 2012 iwp entrepreneurs’ active personality traits and perceived success
Gorgievski ea 2012 iwp entrepreneurs’ active personality traits and perceived success
Gorgievski ea 2012 iwp entrepreneurs’ active personality traits and perceived success
Gorgievski ea 2012 iwp entrepreneurs’ active personality traits and perceived success
Gorgievski ea 2012 iwp entrepreneurs’ active personality traits and perceived success
Gorgievski ea 2012 iwp entrepreneurs’ active personality traits and perceived success
Gorgievski ea 2012 iwp entrepreneurs’ active personality traits and perceived success
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Gorgievski ea 2012 iwp entrepreneurs’ active personality traits and perceived success

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Following an active approach in personality and entrepreneurial success (Frese, 2009), the current study tests bi-directional relationships between personality traits proximal to entrepreneurial …

Following an active approach in personality and entrepreneurial success (Frese, 2009), the current study tests bi-directional relationships between personality traits proximal to entrepreneurial activities (self-efficacy, risk taking propensity, need for autonomy, tolerance for ambiguity, achievement orientation and creativity), subjective entrepreneurial success and the odds of starting a new establishment 3 years later.
Several meta-analyses have shown that personality traits relate to business success (Rauch & Frese, 2007; Zhao & Seibert, 2006). However, few longitudinal studies have been conducted on this topic. Most studies presume that the relationship leads from presumably stable personality characteristics to entrepreneurial performance. However, not all personality characteristics are unchangeable, some are malleable over time (Luthans & Yousseff, 2004), and there are good theoretical arguments to expect reversed relationships. For example, according to Bandura’s Social Learning Theory (Bandura, 1999), mastery experience leads to higher self-efficacy and increased self-esteem.
The current study is a three year follow-up study among 119 entrepreneurs in the hospitality industry (response rate Wave 1 = 23 %; Wave 2 = 43 %). Entrepreneurs filled in on-line questionnaires measuring the same variables at T1 and T2. Personality characteristics were measured with pre-existing, reliable, multi-item scales. Subjective entrepreneurial success was measured as satisfaction with the business (faces scale, Kunin, 1955) and 2 items asking entrepreneurs to rate how successful they were. Third criterion was having opened one or more new establishments at T2.
Results of multiple (logistic) regression analyses show that personality characteristics at T1 (tolerance for ambiguity and achievement orientation) predicted starting a new establishment at T2. None of the personality characteristics at T1 predicted subjective entrepreneurial success at T2. However, the extent to which entrepreneurs were satisfied with their business, and the extent to which they rated themselves as successful at T1 did predict higher achievement orientation and creativity at T2.
These findings challenge the currently dominant point of view that personality predicts entrepreneurial performance, and underscore the need for longitudinal research designs. As both a theoretical and practical implication the results show it is necessary to fit specific personality traits to specific performance criteria.

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  • 1. Marjan Gorgievski Erasmus University Rotterdam, Dept. of Psychology, The Netherlands Serge Rijsdijk Erasmus, Rotterdam School of Management, The Netherlands Andreas Rauch University of Exeter, Business School, United Kingdom Presented at the IWP conference, Sheffield, Jun 27- 28,2012 We like to thank Stephanie Wagener for her help during the first data collection.
  • 2.   The aim of current study was originally (2009) to investigate the personality -> performance link longitudinally. Many studies and reviews exist according to which personality traits would predict entrepreneurial success (Rauch & Frese, 2007; Zhao & Seibert, 2006; Collins, Hanges & Locke, 2004; Miner & Raju, 2004; Stewart & Roth, 2004, 2007; Zhao, Seibert & Lumpkin, 2010)  More specific traits, such as need for achievement, risk taking, innovativeness, need for autonomy, self-efficacy would be better predictors than broad traits such as the big 5, because of their closer proximity to the outcome variables.
  • 3.  However, theoretically it can also be hypothesized that performance predicts lower order personality, e.g.: ◦ According to the high performance cycle there is a feedback loop from high performance to self-efficacy through psychological and material rewards(Latham & Locke, 1990; 2004). ◦ According to social learning theory, the best way to develop self-efficacy is to allow people to experience success (Bandura, 1997). ◦ Positive organizational psychology: lower order personality constructs referred to as “psychological capital” are less stable than big 5 constructs and can increase or decrease as a consequence of gain versus loss spirals (Luthans & Youssef, 2004).
  • 4. Personality T1 - self-efficacy - Risk taking propensity - Need for autonomy - innovativeness - Tolerance for ambiguity Personality T1 - self-efficacy - Risk taking propensity - Need for autonomy - Innovativeness Subjective Business performance T1 - Satisfaction - rating Subjective Business performance T1 - Satisfaction - Rating - Subjective success scale
  • 5.       Three year follow up study among business owners in the hospitality Industry. T1, N = 278 (response rate 23%), T2, N = 128 (attrition = 54%). Age: 43.32 (sd = 9.06). Gender: 72,8 percent male, 27.2 percent female. Participants T2 were more satisfied with their businesses at T1 than respondents T1 who dropped out (M = 5.16, sd = .70 as compared to M= 4.77, sd = 1.01, T 269.25 df = 3.78, p < .001). No other differences. Wagener, S.L., Gorgievski, M.J. & Rijsdijk, S.A. (2010).
  • 6. Example Nr of items Alpha T1 Alpha T2 Achievement orientation I would describe myself as someone who aims to achieve good results. 5 .54 .70 Need for autonomy I prefer making decisions on my own 4 .68 .66 Innovativeness I am known for my innovative ideas. 4 .69 .64 Risk taking I rather chose for a promising, 5 risky plan than an average plan without any risk .82 .81 Self Efficacy I feel confident that I will be able to handle unexpected situations well 5 .78 .72 Tolerance for ambiguity When the future is not clear this is a challenge rather than a threat to me. 3 .68 - Scales adapted by Wagener, 2006
  • 7. reference Nr of items Alpha T1 Alpha T2 Satisfaction with business outcomes 5 point Kunin faces scale 1 - - Subjective success How successful would you rate yourself as entrepreneur? Wagener, 2006 2 .40 Started new business T2 In the past two years have you started a new business? (N=13, 10%) 1 - -
  • 8. reference Nr of items Alpha T1 Alpha T2 Satisfaction with business outcomes 5 point Kunin faces scale 1 - - Subjective success How successful would you rate yourself as entrepreneur? Wagener, 2006 2 .40 Started new business T2 In the past two years have you started a new business? (N=13, 10%) 1 - - Financial success T2 Dej, 2011 5 - .90 Growth T2 Dej, 2011 8 - .89 Societal success T2 Dej, 2011 7 - .79 Personal success T2 Dej, 2011 6 - .75
  • 9. T1 Self efficacy Risk taking 2 = 430.27, df = 356, p = .004, CFI = .95, TLI = .94, RMSEA = .03 Split halves, paths range from .45 (subjective success) to .84 (risk taking) T2 .72 .55 Self efficacy Risk taking Need for autonomy .54 Need for autonomy Achievement orientation .57 Achievement orientation Innovativeness Tolerance for ambiguity Satisfaction with business Subjective succes .75 innovativeness Satisfaction with business Subjective financial succes New business
  • 10.   Weaknesses are the reliance on subjective measures only, single item measures of business performance at T1 and low alpha reliabilities of the scales measuring personality. Strength of this study is its longitudinal design, SEM was used in order to correct for unreliability of the measures and to test all hypotheses in one integrated model, correcting for stability over time and interrelatedness of predictors and outcome variables at T1 and T2.
  • 11.   This study shows no support for the hypothesis that active personality traits predict subjective business success. Some support that personality predicts entrepreneurial types rather than business performance (Cf. T1 results, businessmen versus hosts, Wagener et al., 2010)  Subjective business performance T1 predicted innovativeness and achievement orientation three years later. This challenges the dominant point of view in entrepreneurship that personality predicts performance. It supports the view in positive organizational psychology that gain and loss spirals exists. Personality to performance relationships in cross sectional studies may be attenuated because of bi-directionality.

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