Interpretation:
What Traits and Characteristics Make a Successful Entrepreneur

Numerous studies have been made of small business managers over the years. Many look at traits and characteristics that appear common to most people who start their own businesses. Other studies focus on characteristics that seem to appear frequently in successful owner-managers.

First, consider those characteristics that seem to distinguish the person who opens a business from the person who works for someone else. These studies investigated successful and unsuccessful owners, some of whom went bankrupt several times. Some were successful only after the second or third try. The characteristics they share might almost be said to predispose a person into trying to start a business. Of course, not all of these characteristics appear in every small business owner-manager, but the following seem to be most predominate.

People who start their own business may be members of different political parties, feel differently about religion, economics and other issues. They are like everyone else. The difference is they usually feel and express themselves more strongly. This is consistent. If you are going to risk your money and time in your own business you must have a strong feeling that you will be successful.

These strong feelings may also cause problems. If you want to start your own business you probably have mixed feelings about authority. You know the manager must have authority to get things done, but you're not comfortable working under someone. This may also have been your attitude in a scholastic, family or other authority structure.

If you want to open your own business you are likely to have a strong "Need for Achievement". This "Need for Achievement" is a psychologist's term for motivation and is usually measured by tests. It can be an important factor in success. The person who wouldn't think of starting a business, might call you a plunger, a gambler, a high risk taker. Yet you probably don't feel that about yourself.

Studies have shown that very often the small business owner doesn't differ from anyone else in risk avoidance or aversion when measured on tests. At first thought this seems unreasonable since logic tells us that it is risky to open your own business. A management expert once explained this apparent contradiction very simply. "When a person starts and manages his own business he doesn't see risks; he sees only factors that he can control to his advantage." If you possess these traits to some degree or other it doesn't mean you will be successful, only that you will very likely start your own business. Some of these characteristics in excess may actually hamper you if you are not careful.

The characteristics that appear most frequently among "successful" small business managers include drive, thinking ability, competence in human relations, communications skills and technical knowledge.

Drive, as defined in the study, is composed of responsibility, vigor, initiative, persistence and health.

Thinking ability consists of original, creative, critical, and analytical thinking.

Competency in human relations means emotional stability, sociability, good personal relations, consideration, cheerfulness, cooperation. and tactfulness.

Communications skills include verbal comprehension, and oral and written communications.

Technical knowledge is the manager's comprehension of the physical process of producing goods or services, and the ability to use the information purposefully.

Motivation or drive has long been considered as having an important effect on performance. Psychologists now claim you can increase the motivation and the personal capacities that will improve your effectiveness and increase your chances for success. Much of the development of such achievement motivation depends on setting the right kind of goals for yourself.