The Entrepreneurial Mindset
Some argue that entrepreneurship cannot be taught. Sure you can learn accounting, finance and marketing, you can even learn opportunity spotting and business planning (modeling). However, those who insist that entrepreneurship cannot be taught would argue that the mechanics of business is not entrepreneurship. It is not the thing that enables and motivates a person to identify, evaluate, and execute a business opportunity. It is not what sets entrepreneurs apart from ordinary people with ordinary lives.
What is it that sets entrepreneurs apart? Their mindset!
So, what is an entrepreneurial mindset?
To answer that we need to back up just a little and start with the question of what is entrepreneurship.
Entrepreneurship has increasingly been defined by three activities that are unique to entrepreneurship: (1) opportunity identification, (2) opportunity evaluation, and (3) opportunity execution.
This definition takes entrepreneurship from a knowledge or skill base to a process. It moved the “things” that define an entrepreneur from a static, stimulus response set of traits and behaviors to a dynamic, interactive mindset.
Mindset is an established set of attitudes held by someone that influence or predispose them to interact (perceive and behave, act and react) with the world in a certain and consistent way. It is synonymous with an intention or inclination, a frame of mind, an approach or an outlook. Although there are many ways to describe mindset, research has demonstrated that the concept of “attitude” from the psychological literature provides the most useful model for mindset, particularly with regard to entrepreneurs.
The concept of “Attitude” in the scientific literature is defined as a consistent predisposition to respond (perceive and behave, act and react) in a generally favorable or unfavorable ways to things in the environment. Attitudes are dynamic concepts that changing over time and are acquired through experience. In the field of entrepreneurship the best embodiment of this framework is the Entrepreneurial Attitude Orientation (EAO) developed by Dr. Peter B. Robinson in 1987. It is the most widely used and cited attitude measure in the field.
The EAO consists of a group of four related attitude scales that represent ways we interact with the business world. Together they constitute a measure of the entrepreneurial mindset. It should be noted that the EAO does not measure one’s attitude toward entrepreneurship. Rather it measures four business based attitude that are highly related to entrepreneurship. These four scales are:
- Achievement in business, referring to concrete results associated with the start-up and growth of a business venture.
- Innovation in business, relating to perceiving and acting upon business activities in new and unique ways.
- Perceived Personal Control of business outcomes, concerning the individuals perception of control and influence over his or her business.
- Self-Esteem in business, pertaining to the self-confidence and perceived competency of an individual in conjunction with his or her business affairs.
The questionnaires you will take in the next section will measure your entrepreneurial mindset and compare your level with those of practicing entrepreneurs. It will provide and indication of where you currently are. But remember, “mindset” is a dynamic concept that will change. More importantly, you can do things that will change your entrepreneurial mindset. You can become more entrepreneurial.