business Innovation management

1. The
Entrepreneurial
Motivation
Mohd Nazri
Zakaria Ph.D

2. Lecture Outline
� What is entrepreneurial motivation?
� Sources of motivation
� Models of entrepreneurial motivation
� Triggers and barriers to entrepreneurial
motivation
� Ways to enhance entrepreneurial motivation
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3. What is EM?
�Entrepreneurial motivation refers to the
way in which urges, drives, desires,
striving, aspirations or needs direct,
control or explain the entrepreneurial
behavior of human beings.
�Michael Julius defines motivation as
“the act of stimulating someone or
oneself to get a desired course of
action.”
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4. Socio-psychological antecedents of entrepreneurial
behavior
� Self concept – ‘I see myself as an entrepreneurial
person’
� Belief system – Entrepreneurship is a ‘good thing’
� Perceived societal norms – People within my
environment (family, friends, peers) approve of
entrepreneurial behavior.
� Perceived instrumentality – Displaying entrepreneurial
behavior will help me to achieve my life’s purpose (or
maximize my utility)
� Self efficacy – I believe that I can display the behaviors
and attitudes required to succeed as an entrepreneur
� Intrinsic motivation – Interest and enjoyment (pull)
and/or need (push)
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5. Elements of EM
■ Motive
■ Behavior
■ Goal
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Motiv
e
Beha
vior
Goal

6. Link Between M-B-G
� Motives:
� People differ not only in their ability to do but
also in their will to do, or motivation.
� The motivation of people depends on the
strength of their motives. Motives are needs,
wants, drives, or impulses within the individual.
� Motives are directed towards goals, which may
be conscious or sub-conscious.
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7. Cont
� Behaviour
� is 'need' based and goal oriented. The basic unit
of behavior is an activity or a series of activities.
As human beings we are always doing
something: walking, talking, eating, sleeping,
working and the like.
� Why do people engage in one activity and not
another? How can we understand, predict, and
even control what activity or activities a person
may engage in at a given moment?
� To predict behavior one must know which
motives or needs of people evoke a certain
action at a particular time
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8. Cont……
� Goals:
� Goals are outside an individual; they are
sometimes referred to as “hoped for” towards
which motives are directed. These goals are also
called incentives, which may be tangible
rewards, such as increased pay or intangible
rewards, such as praise or power.
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9. Relationship between Motive,
Behavior & Goal
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Intention
(Motive)
Effort
Barriers
(External)
Barriers
(Internal)
Help
(Assistance)
Expectation
(+ve/-ve)
Goal
Feelings
(+ve/-ve)
Activity

10. Sources of Entrepreneurial Motivation
■ Internal/Intrinsic
� Personal goals
� Need for achievement
� Ambition
■ External/Extrinsic
� Compulsion-forced to do something
� Support
� Successful entrepreneurs
� Access to capital
� Status
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11. Models of EM
� Needs-based entrepreneurial motivation
� A general model of entrepreneurial motivation
� Entrepreneurial intentions model
� Enterprise formation model
� Model of entrepreneurial motivation and the
entrepreneurial process
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David McClelland,
Psychologist
(1917-98)
Needs-based
Entrepreneurial
Motivation

13. David McClelland's Needs-Based
Motivational Model
� Need for achievement (n-ach)
� attainment of realistic but challenging goals, and
advancement in the job. Feedback as to achievement
and progress, and a sense of accomplishment.
� Need for authority and power (n-
pow)
� influential, effective and to make an impact ,personal
status and prestige.
� Need for affiliation (n-aff)
� friendly relationships and interaction with other
people
� Need for security/safety (n-sec)
� Comfortable with secure employment and
unwillingness to take higher risk
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14. Behavior of Achievement-
Motivated People
�Achievement is more important than material or
financial reward.
�Achieving the aim or task gives greater personal
satisfaction than receiving praise or recognition
�Financial reward is regarded as a measurement of
success, not an end in itself.
�Security is not prime motivator, nor is status.
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15. Behavior of Achievement-Motivated People
�Feedback is essential, because it enables
measurement of success, not for reasons of
praise or recognition.
�Achievement-motivated people constantly
seek improvements and ways of doing things
better.
�Achievement-motivated people will
logically favor jobs and responsibilities that
naturally satisfy their needs, i.e. offer flexibility
and opportunity to set and achieve goals, e.g.,
sales and business management, and
entrepreneurial roles.
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16. Behavior of Achievement-Motivated People
� Capacity to set high personal but
obtainable goals
� Concern for personal
achievement rather than the
rewards of success
� The desire for job-relevant
feedback (How well am I doing?)
rather than for attitudinal
feedback (How well do you like
me?)
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17. APT 2013
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A Model of Entrepreneurial Motivation
Expectation/
Outcome
Comparison
Decision
to behave
Entrepreneuriall
y
Implementation/
Outcome
Perception
Entrepreneurial
Strategy
Intrinsic/Extrinsi
c
Rewards
Firm
Outcomes
Entrepreneurial
Management
BE IDEA
PC PE PG
PC = Personal Characteristics
PE = Personal Environment
PG = Personal Goals
BE = Business Environment
Source: Naffziger, Hornsby and Kuratko, (1994)
Internal
Internal/External

18. Entrepreneurial Intentions Model
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Perceived net
desirability of
self-employment
(NDSE)
Tolerance for
risk (TR)
Perceived
feasibility (self-
efficacy) of self-
employment (SE)
Self-employment
intentions
Source: Gerry Segal, Dan Borgia & Jerry Schoenfeld (2005)

19. Factors Critical to Start-Up & Reasons
for Not Starting-Up
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Source: Martyn Roberton et.al. (2003)

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A Model of Enterprise Formation
Source: Vollery, Mazzarol, Doss & Thein, 1997

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Triggers to start up
• Invest (need a job; way to personal savings, super,
redundancy; earn a better salary)
• Creativity (take advantage of own talents; have an
interesting job; create something new; realise a
dream)
• Autonomy (work own hours, own location; be
one’s own boss)
• Status (follow example of a person I admire;
increase status/prestige; maintain family tradition)
• Market Opportunity (saw one)
• Money (make more, keep more RM)

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Barriers to start up
• Lack of resources - lack of marketing skills,
lack of management/financial expertise, lack
of information, difficulty in obtaining finance
• Compliance costs - high taxes and fees,
compliance with government regulation,
problems finding suitable labour
• Hard reality - assessment that risks are
greater than expected, uncertainty and fear
of failure

24. Entrepreneurial Motivation & Entrepreneurship Process
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Source: Shane, et.al. (2003)

25. Entrepreneurial Behavior & Favorable Business Outcome
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Pull Factors
■ Religious Values
– A lot of bounties in business
– Follow the teachings of the
religion
– Duty to lead a prosperous life
■ Psychological
– Doesn’t like to be controlled
– Want freedom

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Pull Factors
■ Riches and Power
– Rich and famous
– Sophisticated life-style
■ Service to the Society
– Corporate social responsibility
– Philanthropic activities
■ Entrepreneurial Culture
– Entrepreneurial mindset
– Business succession

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Push Factors
■ Frustration
– Limited job mobility
– VSS and “retrenchment”
– Dissatisfaction
■ Necessity
– No jobs
– Need to support family
– Lack educational qualifications

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30. Barriers to Entrepreneurship
� “Too much to lose”
� Terlalu memikirkan apa yang akan berlaku
kepada diri & keluarga sekiranya gagal
� Sikap takut kepada kegagalan yang tinggi
� Sangsi dengan keupayaan diri sendiri
� Terlalu mementingkan faktor jaminan
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31. Barriers to
Entrepreneurship
� “Personal inadequacy”
� Saya terlalu tua atau terlalu muda atau
kurang pengalaman
� Terlalu membesarkan kekurangan dan
kelemahan diri sendiri.
� Menanggapi bahawa kegagalan
perniagaan membawa kesan yang terlalu
besar
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32. Sukri Ibrahim
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� Sykt D Strike Solution Sdn
Bhd
� Perniagaan
pemasangan karpet
sejak 2010
� Ijazah Sarjana Muda Tek.
Maklumat UKM
� Agensi Supervisor di CIMB
Wealth Advisor
� Perunding Motivasi

33. Lee Thiam Wah
� Pemilik 99 Speedmart
� Lumpuh sebab polio
sejak bayi
� Mula perniagaan usia
23 thn
� Sekarang miliki 200
cawangan
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34. Barriers to Entrepreneurship
� “Fear of Competition”
� Bagaimana saya boleh bersaing dengan mereka
yang telah lama berniaga
� Takut kepada bayang-bayang pesaing dan dihantui
perasaan bahawa produk atau perkhidmatan yang
ditawarkan lebih “inferior” dari pesaing
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35. Barriers to Entrepreneurship
� “Lack of Capital”
� Terlalu membesarkan kekurangan modal untuk
memulakan perniagaan
� Tidak ada modal, tak boleh berniaga
� Membesarkan kepayahan untuk mendapatkan
pembiayaan
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36. Barriers to Entrepreneurship
� “Lack of Opportunity”
� Terlalu membesarkan masalah mendapatkan
peluang
� Peluang perlu dicari
� Masalah kepada orang lain mungkin peluang
kepada kita
� Guna “lubang” untuk cari lubang (peluang)
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37. Factors in Entrepreneurial Success
� Achievement Oriented
Personality
� Entrepreneurial Attitudes
� Belief in Self and Ability
� Social Context
� Precipitation Event
� Intention to Start a Venture
� Opportunity Recognition
� Controlling Resources
� Timing
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40. Conclusion
Entrepreneurship motivation refers to powerful
factor that urge someone to behave like
entrepreneur. It related with three interrelated
things – goal, motive and behaviour. Study of
entrepreneurship motivation helps someone to
emulate successful entrepreneurs because ones
know what drive them to be successful person.
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