Who Is an Entrepreneur

Common/different aspects of the paper2 Conclusions6 References7 “Who is an entrepreneur? ” Introduction “Who is an entrepreneur? ” is a question that aroused many controversies and debates. Among many articles that talks about the entrepreneur and the process of entrepreneurship I will focus on three articles that tried to answer this question or demonstrated the uselessness of the question. Analyzing many different points of view will conduct to a better and deeper understanding of the phenomena.
Therefore, this is not an exact science, like for instance mathematics or physics. It leads us more to interpretation, which means that, there will always be a need of debate. Short Summary In the article “Differentiating Entrepreneurs from Small Business Owners: A Conceptualization”, Carland et al. tries to answer the question by focusing on the characteristics of an entrepreneur and they go further with comparing him to a small business owner. They settle a definition for each and then, they apply the main ideas to a larger scale and differentiate an entrepreneurial venture from a small business.
Gartner criticize their point of view in his article “Who is an entrepreneur? Is the wrong question” and considers that it is improper to define “the entrepreneur” because it would mean that an entrepreneur fits a certain type of person, which is not true since the views are not homogenous. That is why Gartner considers a more suitable approach for the concept, to analyze the entrepreneur’s behavior. In the article “Who is an entrepreneur? Is a question worth asking”, Carland et al. tries to respond to Gartner’s critique and in the end, he argues that indeed entrepreneurship is a complex and dynamic concept.

Common/different aspects of the paper In the article “Differentiating Entrepreneurs from Small Business Owners: A Conceptualization”, Carland et al. , in terms of entrepreneur and small business owner, focus on intentionality and characteristics. In their opinion, an entrepreneur’ purpose is profit and growth and he is characterized as an innovative person who will employ strategic management practices, while a small business owner’s purpose is furthering personal goals, and to whom the business is the primary source of income which will consume almost all of his time.
In terms of differentiating Entrepreneurial Ventures form Small Business Ventures, they focus on the same ideas applied to a bigger scale. However, this attempt to define the concepts, and especially their arguments were hardly criticized by Gartner in his article “Who Is an Entrepreneur? Is the Wrong Question”. He brings into discussion the situation when “an individual personal goal is to establish a business for profit and growth”. He considers that Carland et al. are rung, first by focusing on intentionality, instead of creation, and second by focusing on the person instead of the act of entrepreneurship.
He argues that, by referring only to intentionality rather than to concrete things like articulated strategies or observed behaviors, they increased even more the ambiguity. In my opinion, Carland et al. ’s attempt to define a small business owner as an individual whose main characteristic is achieving its personal goals is a vague statement. To be more specific, I will take as an example a farmer, who lives in the country, has no job, owns 10 hectares of vineyards, and decides to start a business in wine industry. For him, this will be the primary source of income.
To help me set his goals, I will analyze Maslow pyramid. According to Abraham Maslow we will start from the base. Our farmer’s first goal will be to sell as much wine as to be able to sustain his physiological needs, like buying food, water and so one. After satisfying his basic needs, he will want to assure the need of safety and therefore, he will need to earn more money. So how can he do that? Growing his business and raising his earnings. This means that his goal will change into growth and profit while his business remains his principal source of income. And so one, we can continue to higher stages in the pyramid.
Therefore, I consider that, the desire of achieving its personal goals cannot be a specific characteristic for a small business owner. I also believe that the two terms, “entrepreneur” and “small business owner”, are so close related that the transition between them can be made very easy and therefore I again disagree with Carland et al. because of their attempt to totally separate the concepts. For instance, if we take the farmer, on the the first stage of Maslow pyramid, according to Carland et al. , he fits the description of a small business owner, by having his business as his primary source of income and furthering his personal goals.
But, what if we add that he discovers a secret recipe of wine, a new type of product, and he is able to put it into practice? This last feature belongs to an entrepreneur; therefore, the farmer will have both characteristics from a small business owner and an entrepreneur. So is he really a small business owner or he had become an entrepreneur? Gartner tries to show what differentiates an entrepreneur from non-entrepreneurs and it demonstrates that behavioral approaches are the ones we should concentrate on, for analyzing future researches in entrepreneurship, than trait approaches.
He also recognizes that trait approaches and behavioral trait approaches are two related concepts that cannot be treated separately. Gartner explains that if we talk about behavioral and trait approaches, we analyze the entrepreneur’s characteristics through its activities undertaken to create an organization. For instance, Arthur Cole tries to take a behavioral viewpoint of an entrepreneur and then analyses his traits and specific characteristics (judgment, perseverance, knowledge of the world and business).
Jenks and Kilby disagree with studying the personality of an entrepreneur and they encourage researchers to study the behaviors and activities of an entrepreneur. However here, I consider that we can analyze equally, both the traits and the behavioral of an individual, because are strongly connected, and can be related in both ways, but the focus should be on the behavior. First, the behavior of an individual can be determined by its characteristics, as if for instance a person who most often takes hasty decisions he could be an impulsive person.
And second, if we analyze an individual characteristics, we can suppose that he will behave in a certain way, like if he is very confident in its believes he could assume more risks than a person who does not trust its own ideas. Still we have to analyze each person as a simple, because everyone is unique and behaves in its own way. Gartner uses researches that focuses on the person of the entrepreneur, and tries to settle an entrepreneur’s qualities (traits), like: need for achievement, locus of control, risk taking, values, age, and others.
Then he explains that these are worthless to differentiate entrepreneurs from others, because in the trait approach, an entrepreneur is considered a particular personality type with certain characteristics, but if we look at the studies, we can see that few entrepreneurs employ the same definition, so the views are not homogenous. In the article “Who is an entrepreneur? Is a question worth asking”, after analyzing a compilation of Gartner’s studies of entrepreneurship, Carl et al. demonstrated the fruitlessness of his trait research.
They considered that he used inconsistent definitions, samples that are not homogeneous or comparable and most important, he created an inconsistent entrepreneurial profile, which is often not significantly different from the rest of the population. Van de Ven finds it also important to analyze the traits and characteristics of a leader. However, Carland et al. considered that there are not so many classification schemes involving complex human behavior and that is one reason why they have excluded it.
According to Gartner, we cannot talk anymore about “entrepreneurs” in general without referring to characteristics of the sample. In their continuous attempt to separate the term of “entrepreneur” from “small business owner” Carland et al. uses also psychology literature and considers that one’s personality is defined by all aspects of life and is largely set during the formative years. However, Gartner still believes that it is impossible to settle certain traits for an entrepreneur because everyone is different from other.
Gartner also disagrees with the last part of Carland et al. entrepreneurial definition, which ties the state of being an entrepreneur to innovative behavior, and he brings up the problem of identifying if only the first firms in each industry are the innovative ones and all other subsequent would be small business owners. I consider that an entrepreneur is an innovative person, so in this respect I disagree with Gartner’s opinion. In addition, this does not mean that only the first company in each industry is innovative, like Gartner believes.
Even if two firms are competing on the same industry, the second firm appeared on the market, could have products with the same utility and some similar characteristics, but the product can also contain an extra new, special, different, and innovative characteristic. Like for instance when it appeared the beer with lemon, I consider that is was a result of innovative thinking, because although it has the main utility of a bear, to quench the thirst, and has similar characteristics, it can also be seen as a new and different product.
In this respect, Bhide, in his article “The questions every entrepreneur must answer”, considers that in the same industry, the option that suits for one entrepreneurial venture can be completely inappropriate for another. In addition, he gives as an example companies like Microsoft, Lotus, WordPerfect, and Intuit, which are competing in the same industry but had a very different evolution. In his research “What is entrepreneurship? , Davidsson analyzes entrepreneurship through competitive behaviors. He agrees with Gartner. He does not consider innovation as an example of entrepreneurship. On the one side, he manages to avoid more the risk of ambiguity by restricting the entrepreneurship concept to a market context which gives a more precise characterization to the process and on the other its permissive because it has no restriction to innovation, organizational context, risk taking and others.
He sees entrepreneurship on a small level, which has important effects on a bigger scale, because it influences the whole market. In addition, it is brought into discussion the problem of differentiating a product from its similar product that constitutes innovation. Moreover, but not lastly we confront with the dilemma if new methods of manufacturing, marketing, distributing the product could be also considered as innovation and here, Gartner brings into discussion, the debate on which are the truly innovative methods.
In the end, Gartner tries to change a long held viewpoint of entrepreneurial process by identifying it as the creation of new organizations. After that, he debates if the entrepreneurship ends once the organization creation is over. In his opinion the entrepreneurship ends once with the creation stage of the organization. In these respect, Greiner (1972) and Steinmetz (1969) considers that any organization can survive on past its creation stage to all the possible stages like growth, maturity, and decline.
Therefore, if we look at the process itself and analyze each stage, when the individual creates an organization he takes different roles like innovator, manager, small business owner and many others and each is characterized by specific behaviors. But the order of these stages aren’t always the same. I consider that when the creation of the organization is on its end stage, we cannot say that entrepreneurial process it’s necessarily over. In certain situations, some firms extend their business by discovering a new revolutionary product.
To be more specific, if we take in consideration a company which produces milk, and it discovers a new product that haven’t existed before, let’s suppose it’s butter, than the company will have to develop only some extra operations to make the revolutionary product. Therefore, the milk company will support a creation of a new sub organization in this section (technology, marketing, sales, management, and so one). Moreover, here come into discussion the habitual entrepreneurs, who, after creating a business, they are still identifying new business opportunities and put it into practice when they are able to do that.
An interesting polemics, we can find on the article of Ucbasaran et al. , “Does entrepreneurial experience influence opportunity identification? ”. After using data and research methodology among individuals engaged in entrepreneurial acts, they conclude that, on the one side, there are some differences between inexperienced novice entrepreneurs and experienced habitual entrepreneurs, but on the other, they also have some similarities in their behavior.
Both habitual and novice entrepreneurs are in continuous searching for knowledge and development. One difference between these two categories is that with their experience, habitual entrepreneurs, identify more business opportunities, and one explanation could be that they use different sources of information like financiers, employees, and consultants. In addition, their attitude to business opportunity identification is different. They consider that one opportunity often leads to another but it can also emerge in connection with some problems.
Experienced entrepreneurs are also convinced that it is crucial to obtain the necessary resources and capital to implement a good idea, and they underline the importance of spontaneity and alertness. In addition, experienced entrepreneurs often identify business opportunities with higher level of innovativeness. One explication could be their ability of choosing the best person for the right activity, based on their experience, which gives them more time to develop more business opportunities. Wright et al. brings into discussion the risk of habitual entrepreneurs to repeat same ideas but in different or changed environments.
I believe that habitual entrepreneurs indeed find more easily business opportunities because of their experience in the changing of the market needs, and most important customer’s needs. They have a better understanding of the market mechanism and how vital is the spontaneity. They also understand better the consequences of doing or not doing something. However, entrepreneurship cannot be treated as an independently concept so therefore it can be related to areas like for instance mathematics, statistics, economics and many others.
We find an attempt to prove the importance of having a complex model, in Bygrave and Hofer’s research, “Theorizing about Entrepreneurship”, where they try to highlight that entrepreneurship is a dynamic concept, which can’t be analyzed very good, using simples models like regression. They consider that we need a model with much more variables, such as: discontinuities in entrepreneurial process, changes of state (changes of phase in organization, including start-ups), sensitivity to initial conditions and multiplicity to anterior variables.
In my opinion, using mathematics or some other exact sciences offers us a less subjective approach but if the model is not complex enough, we can also miss some details that could lead us to a rung conclusion or interpretation. Conclusions After analyzing opinions from several authors of articles, who tried to understand the concept of entrepreneurship and “Who is an entrepreneur? ”, we can conclude that there are many points of view in this respect and that’s why we cannot reach to a general valid and accepted definition of the concepts.
Some tried to establish the differences between entrepreneurs and non-entrepreneurs, others tried to differentiate even the entrepreneurs between them, focusing on experience, and some tried to measure the concept through statistics, all having the same aim, to understand deeper the concept. However, there will always be the need of debate because the concept itself is a subjective one. So it remains to our discretion what opinion do we agree with, or we may very well create our own concept of an entrepreneur and entrepreneurship.
In my opinion, a better understanding of the entrepreneur concept, needs a more suitable question, than “Who is an entrepreneur? ”, like “What does an entrepreneur do? ”. I believe that if we are able to establish his behavior, this will lead us to its characteristics, on the one side, and on the other, it could also give us a vision of his potential future behavior. After analyzing all points of view, I finally created my own concept of an entrepreneur.
Therefore, first I believe that an entrepreneur should be able to create an organization, based on an original innovative idea, and sustain it. Second, he is concentrated on anticipating the need of the person on long term and finds the most efficient way of satisfying it. Third, he takes huge risks in order to fulfill its goal and he is able to adapt easy to changes. Moreover, most of all he identifies itself with the organization. Therefore, on an entrepreneur all these characteristics and behaviors complement each other.
References Bhide, A. 1996) The question every entrepreneur must answer, Harvard Business Review, 74(6), 120-130 Bygrave, W. D. & Hofer, C. W. (1991), Theorizing about entrepreneurship, Entrepreneurship Theory an Practice, 16(2), pp. 13-39 Carland, J. W. , Hoy, F. , Boulton, W. R. , & Carland, J. A. (1984). Differentiating entrepreneurs from small business owners: A conceptualization.
Academy of Management Review, 9(2), 354-359 Carland, J. W. , Hoy, F. , & Carland, J. A. C. (1988): _’Who is an Entrepreneur? _Is a question worth asking’, American Journal of Small Business, 12(4): p. 3-39. Davidsson, P. (2004) What is entrepreneurship? Chapter in Researching entrepreneurship. Boston, Massachusetts: Springer. Gartner, W. (1989)