Business As Hobby And Why Motivation Is An Important Factor For An Entrepreneur

Motivation can be compared to a force, an impulse, a tension. It allows the creation of a dynamic inherent to change. However, with important exceptions, motivation means very little without a suitable environment in which it can be generated. It is a type of response to this environment. A number of factors can be sources of motivation. In "Why Motivation Is An Important Factor For An Entrepreneur: Essay" analyzed some researches to find out the factors that motivates in creation of new venture. Some are as follows:

Internal (intrinsic) motivational factors

An intrinsic (internal) motivation is any motivation comes from within and provides a sense of satisfaction.

1. Belief in own ability
2. Educational background
3. Work experience
4. Creating innovation
5. Independent lifestyle
6. Risk taking propensity.

External (extrinsic) motivational factors

These are the external or environmental factors that drive an individual to become an entrepreneur. They include;

1. Promising demand toward products
2. Support by government
3. Labour and raw material
4. Encouragement from other business houses
5. Others.

Internal factors that motivate people towards entrepreneurship comes from within the entrepreneur and personal satisfaction is derived through self-initiated achievement. Risk taking propensity/craving/yearning to take risks regardless of outcome is the most important factors among internal motivation that every entrepreneurs should take for their startups and goal achievement.

Desire for independence

This is the desire of being your own boss and running your own business using your own ideas. This includes ambitions, goals, persistency and energy. Among the external factors government policies and support is crucial that drives an individual to become an entrepreneur. The government may reduce the rates of business permits, reduce the number of permits required to run a business or even reduces the amount of taxes. These policies encourage more individual to be entrepreneurs. The Government can also build business stalls, markets or offer loans to entrepreneurs. Availability of land, labor, capital, machinery and other materials required in establishing a business encourages entrepreneurship. The need or demand for a product in a market may encourage an individual to get into entrepreneurship so as to satisfy market gaps.

Personal Challenge

In the study of Palich (1995) a group of entrepreneurs and non-entrepreneur received unique cognitive test where they had to determine the risk factor of a business scenario. Surprisingly the entrepreneurs did not see themselves as a more risk taker. The difference is that entrepreneurs see opportunities more positive than non-entrepreneurs. McCelland (1961) uses the concept of need for achievement to explain why some people are more likely to engage in activities or tasks that required an high implication, high skills and efforts and high individual responsibilities for outcomes. People who have a greater need for achievement are more likely to start these types of activities. Based on research, Collins, Locke and Hange (2000) concluded that need for achievement is an effective tool to differentiate firm founders and the general. However they didn’t find it relevant to differentiate these firm founders and managers. Further they concluded that need for achievement can be effective to differentiate successful or unsuccessful groups of firm founders. Thus, need for achievement has an important role explaining entrepreneurial activities.

Locus of control

Another motivational trait pointed by Scott Shane and Edwin A. Locke is the locus of control: “people who have an external locus of control believe that the outcome of their action is out of their control whereas people with an internal locus of control believe their personal actions directly affect the outcome of an event”. And as for McCelland (1961) with his work on need for achievement, Rotter thought people with a great need for achievement will prefer situations where their own actions affect outcomes. So he argues people with an internal locus of control want a job where their actions have a direct impact on results and so, are more likely to seek after entrepreneurial roles.

Self-realization, self-satisfaction

Among the self-satisfaction act as motive force for an individual’s life, his/her ambitions rank first. It is hisher ambition that gives color and direction to his/her career. Self-Satisfaction of the individual puts his pressure on the need for achievement and this in turn, motivates him to play an active role to realize his ambitions. Naturally, self-satisfaction differ from individual to individual on the basis of personal tastes and temperaments, and family to family and nation to nation depending upon the circumstances in which they are placed and the priorities which they have set for themselves. Sometimes personal aspirations come in the way of family aspirations or national aspirations. But the ambitions or aspirations which are unfulfilled are passed on to the next generation who may chase the target with redoubled effort and vigor. So self-satisfaction which nourish the achievement motivation bring in economic growth a development.

Opportunities: effect on motivation and risk taking

Shane and Venkataraman (2000) define entrepreneurial opportunities as ‘‘situations in which new goods, services, raw materials, and organizing methods can be introduced and sold at greater than the cost of their production.’’ The entrepreneur choose to pursue opportunities with different economic value, so the authors of Entrepreneurial motivation concludes that opportunities themselves influence the entrepreneurial behaviour. The idea of how to exploit an opportunity, called a “vision” is the personal interpretation of it by the mind of the entrepreneur. Thus, the personal exploitation of his plan to fulfill his vision can influence all the entrepreneurial process which can affect his motivation.

Business as an occupation is not given much importance in any country. People prefer employment over business except in certain communities and business families. Very few enter into it purposefully with an interest towards it. The situation may now be changing. Increasing unemployment, more thrust on entrepreneurship by the Government, increased literacy rate, liberalization and globalization may have contributed as little to improvement of entrepreneurship in country. It can understand from the above that ambitions alone are not sufficient for entrepreneurship to emerge. They are to be transformed into reality and entrepreneurs have t work in order to materialize these ambitions. This requires a positive outlook, encouragement, and drive apart from capital and other infrastructural prerequisites. Factors like previous experience in the same line of activity, the availability of investible surplus, encouragement from family members and friends and others, getting hold of a new idea, product or marketing possibility, government help etc., are some of the factors that influence entrepreneurial decision. In such a background it was intended to examine whether the entrepreneurs under the study were interested in grooming their children as enterprises of tomorrow.