Are you born to be an entrepreneur?
Who can do this? Nature-Nurture discussions in psychology researchers found that entrepreneurs on average score different on variables as openness, autonomy, creativity, risk taking pro-activity, neuroticism. They found also some correlations with performance. Does it mean entrepreneurship talent is a natural gift? Or should one work for it and develop a talent.
This leads to the question as to whether entrepreneurship can actually be supported or learnt, or whether it is more a case of a talent that people do or do not possess. Jeffrey Timmons devoted considerable attention to that aspect in his work. In his view, it turns out that there is a great deal to learn about entrepreneurship. Take musicians as another example: it is only by working hard (playing for hours every day and sustaining that for many years) and gaining a wealth of professional knowledge (staying as long as possible at a college of music, taking master classes, coaching) that they manage to make a successful career for themselves in that field. Talent alone is not a sufficient condition for success, but a basic level is necessary.
The same applies to entrepreneurs. A basic degree of talent is necessary but not sufficient. Entrepreneurship is a profession in itself and innovative entrepreneurship based on new technology requires knowledge of the typical processes of innovative enterprise. That is why the 4S model is interesting because it includes the pattern maintenance function which includes the organizational culture and learning skills.
The question still remains whether entrepreneurship should be supported. There are, in fact, three viewpoints on this issue:
- Laissez-faire: no support is provided, as the market automatically selects the ‘fittest’. The provision of support can result in the survival of companies that basically do not match market requirements. ‘The invisible hand’ guides development.
- Planned economy: the government dictates which companies may be developed and which ones may not, according to collectively determined needs. The ‘one hand of government’ directs development.
- Network management: taking into account the shortcomings of a free market and a planned economy, frameworks are created that provide scope for enterprise. Entrepreneurs are supported where this is deemed effective and interaction between actors promotes a situation in which networks of entrepreneurs can be created. ‘Many visible hands’ coordinate development (Rip and Groen, 2001).
While the traditional market approach assumes that information regarding supply and demand is transparent, and also the ‘one hand’ perspective assumes that government has information enough to decide on the allocation of economic resources, the ‘many visible hands’ approach assumes that information is distributed asymmetrically and – on top of that – often is created in the process in an unforeseeable way. For this information problem alone, the ‘invisible hand’ and the ‘one hand’ are effective nor efficient for optimal economic development. Other factors are important.
© University of Groningen