Definition of Entrepreneurial Motivation

Introduction

It is understood from the previous chapter that entrepreneurship development is due to the entrepreneurial role played by the entrepreneurs and. the Government. The role of entrepreneurs is a continuous phenomena. In the dynamic society, the entrepreneurs foresee the future and smell the undesirable consequences well in advance. Predicting the future with all accuracy is the first step for a successful entrepreneur. Entrepreneurs identify the business opportunities. Motivation ‘is the propelling force for an entrepreneur to predict the future and identify innovative and hitherto unknown business opportunities,. The exhaustion of the existing limited resources motivate entrepreneurs to find alternative resources which are found available and unused so far. The scarcity of manual labour compels the entrepreneurs to introduce computers and rabots.

The growing consumers awareness enable and motivate entre­ preneurs to identify their expectations and assess the amount of consumers demand well in advance.and sometimes even before identifying the location of the industry. The new economic policy of the Government motivates entrepreneurs to seek trade and business relations at the global level and motivate them as how best to manufacture quality goods so as to compete in the global market. Similarly, the transfer’ of and import of new technology motivate entrepreneurs as how best to adapt the latest technology that must suit to their respective countries.

Entrepreneurial Motivation

Enrepreneurial behaviour is the result of entrepreneurial motivation Motivation refers to the inner urge that ignites and sustain behaviour to satisfy need.Motivation has been derived from the word motive which implies the inner state of mind that activates provokes and direcs our behaviour towards the goal.

Theories of Motivation

Need is the starting point of motivation. A satisfied need does not motivate an individual. It is only the unsatisfied need which creates tension and stimulates drives within the individuals for the satisfaction of the need and reduction of tension.

Several studies have been undertaken to identify the factors that motivate people to start their own enterprises. P.N Sharma has identified nine motivating factors which are as under:

Educational background.

Occupational experience.

Desire to do work independently.

Desire to branch out to manufacturing.

Family background.

Assistance from government.

Assistance from financial institutions.

Availability of technology/ raw material.

Otherfactors demand of the particular product, utilisation of excess money earned from contractual estate business, started, manufacturing to facilitate trading/ distribution business since the product was in short supply, unstable policy of the foreign government for non residents and no chance for further promotion.

The above nine factors were grouped into two major categories-internal and external. First five motivating factors were termed as internal and the last four factors as external. The internal motivating factors like education, occupational experience, family background, the desire to do something independently together make the personality of the entrepreneur. These factors generate an inclinationn to adopt entrepreneurial activity. The presence of internal factor is a necessary condition for the entrepreneurial activity to takeplace. But entrepreneurial ideas cannot fructify or take real shape without a proper or conducive environment which provide support in terms of financial assistance, technology and raw material and infrastructural facilities. These facilities from external motivating factors and serve as a spark in igniting the entrepreneurial idea. These factors give a boost to the entrepreneurial activities.

It is clear from the above that majority of the new entrepreneurs were tempted to enter industry because of three main factors viz.

They had strong desire to do something independent in life.

They were having technical knowledge or manufacturing experience

Availability of governmental and non-governmental assistance.

Motivation and Environment

Motivation of entrepreneurs depends upon the environment with which the entrepreneurs live in the society. The entrepreneurial environment could be classified into two viz.

External environment and

Internal Environment

External Environment

The external environment includes:

the entrepreneurial role played by the Government trade regulations.

industrial policy and the import and export restrictions living standard of the people.

level of education and standard of education occupation of the people and their strong faith in religion.

Besides, the infrastructural facilities available in the country, political stability, availability of capital and technical know-how are some important factors come under the external environment. Some of the above said factors can be controlled. Again there are some uncontrollable elements viz., the existing availability of resources, geographical location of the country and the prevailing weather conditions.

Entrepreneurs are motivated by the speed with which these knowledge based innovators join together and invent new things. For instance, the invention of computer was not due to the innovative efforts of one or two scientists. It required the innovating efforts of scientists who aimed for different products, and the convergence of not less than 5 kinds of knowledge viz.

a scientific invention.

the audian tube mathematical discovery the binary theorem a new logic.

design concept of punch card and the concept of programme and feed back.

Without the ‘application of these knowledges, no computer could have been found out.

Technical entrepreneurs have motivation to combine the different branches of knowledge and thereby try to manufacture­ new products. It is also the duty of these entrepreneurs to identify the gap and inform the scientists to invent something new so as to fill the gap. Thus, motivation enable entrepreneurs to combine the scattered knowledge into a meaningful combination and thereby see’ how best to convert these knowledge based information into a commercial product.

Production Opportunity

Identification of business and production opportunity becomes the prime motive of entrepreneurs to set up a new line of business enterprises. Production opportunities cold be identified through the introduction of:

New technology.

Change of consumers tastes and fashions and

Change of the income level of consumers.

Opportunities could be identified through the application of the laboratory research findings. Industrially advanced.countries rely upon the R & D departments and apply their research findings in the manufacturing process and thereby introduce new products in the market.

Production opportunities could also be identified when we adapt of new technology. There are many alternatives for the production of a particular product. It is the entrepreneurs’ duty to fwd out the best alternatives and manufacture goods at the earliest so as to enable them to meet out the unexploited market.

Entrepreneurs in Japan are pioneers in finding out the new production opportunities. Early identification motivates entrepreneurs to manufacture and distribute in the market and thereby earn huge profits and that too in the short run and before the competitors enter.

Japansee adopt, adapt and adept the technology which they import abroad and make use of it in such a way that there is ample scope for alternative uses.

Production opportunities could also ‘be identified through the invention of new sources of raw materials or the application of existing materials for alternative uses.

New production opportunities motivate entrepreneurs to combine new factors of production and thereby explore the possibility of setting up of a new industrial unit.

Investment Opportunities

Like production opportunity, entrepreneurs are motivated by the investment opportunities. There are ample scope for young businessmen to mobilise capital from the capital market and financial institutions. Financial institutions are ready to provide any amount of financial assistance for viable projects and innovative projects. Far reaching changes are taken place in the stock exchange dealings. The stock exchange reforms create a congenial atmosphere for the enterprising entrepreneurs to raise adequate capital through thee public issues.

The commercial bank now-a-days offer not only financial assistance to young entrepreneurs but also render training and help young entrepreneurs to mobilise factors of production. All these conducive atmospheres motivate young entrepreneurs to set up their own industrial units especially the SSI units.

Entrepreneurial Development Programmes

There is a need to reformulate the existing entrepreneurial development programmes that suit to the entrepreneurs of different groups. Entrepreneurs need training at regular intervals so that they could clarify their doubts which many come at every subsequent stages of manufacturing process. Training enable and motivate entrepreneurs to find alternative course, of action to be taken in the event of dearth of funds, poor quality and labour deficiencies.

The objectives of training programmes must be clear and unambiguous. While selecting entrepreneurs for training, chance must be given to a group of entrepreneurs whose status, family and social background are uniform.

Only the enthused and self-motivated entrepreneurs shall be given chance for undergoing training. The entrepreneurial development programmes become failure due to the wrong choice of selection of entrepreneurs.

The entrepreneurial development programmes must be such that there must be scope for follow up activities. In other words, the entrepreneurial development and training institutions must give refresher courses and give an opportunity to update the knowledge of entrepreneurs.

Risk Management

Entrepreneurial motivation is also due to entrepreneur’s mental ability to bear the risks and his capacity to calculate the risks. Successful entrepreneurs are ready to bear ‘calculated’ risks only. In these days risks are being shared. For instance the raising of capital through equity issue enable entrepreneurs to shift their risks towards the investors. Risks are also shared through collaborative and joint venture agreements.

Entrepreneurs in these days would like to diversify their business mainly with the intention of overcoming the losses. Thus, the opportunity for the avoidance of risks motivates entrepreneurs to take up new business ventures.

Cultural Development

The prevalence of rigid cultural norms and mores act as an impedement for entrepreneurs to introduce innovative businesses. This problem is found more in less developed countries. On the other hand in the industrially advanced countries, the. Existing culture is such that allows people to develop and start any new business. Though the cultural rigidity is an obstacle, entrepreneurs can be motivated to develop new business through cultural liberalization.

Aggrandise Profit

In a true sense, the entrepreneurs are motivated by profit. The expected profit of any new business ventures is always high. Since there is little competition at the initial stage of business entrepreneurs are motivated to introduce new business and earn the maximum profit until other competitors enter into their lines of businesses. Entrepreneurs in Japan follow this practice. Though they import technology, they adapt and manufacture new lines of goods and earn high rate of profit. As soon as they face competition, they give away their existing business and try to establish a new one.

Thus, entrepreneurs are motivated to introduce new business mainly due to the chance for earning a high rate of profit.

Economic Environment

The changing economic environment acts as a motivating factor for entrepreneurs to think of new business developments. The policy of liberalisation enable Government to invite NRI investors and allow them to establish infrastructure supporting industries like generation of power, communication equipments etc., The free exports and imports motivate entrepreneurs to find a new for their goods at the international market.

The development of private large scale industry would pave way for ancillarisation and there is a vast scope for the growth of SSI units. The globalisation of the business sector enables entrepreneurs to mobilise the latest talents and thereby develop new business.

Internal Environment

Apart from the above said external environmental factors, the entrepreneurs’ motivation also depends upon the internal environment viz., the family background of the entrepreneurs that is weather they hail from the agricultural family or business family, the professional and academic achievements of the entrepreneurs, the level of education, training acquired, their previous experiences and their mental behaviours. Besides, the personality development, leadership qualities and ability to achieve character of the entrepreneurs also act as congeneial climate for entrepreneurs to enter into new business ventures.

Though there are many environmental factors, all entrepreneurs are not motivated by all the factors or a group of similar factors. No research study has so far been found and undertaken to prove the fact that what environmental factors that exactly motivate entrepreneurs and in what proportion. Again there is no adequate literature found available as when the motivation works in the mind of entrepreneurs. However, one would say that behind every successful entrepreneur there is atleast one motivational factor that strongly influences him to become a successful entrepreneur.

The entrepreneurs must have some inborn skills which inturn motivate entrepreneurs to establish new business.

Thus, motivation is like a foundation with which the entrepreneurs build new business, and it is the intensity of motivation that determines the height of success of new business ventures. Let us see the various factors that motivate entrepreneurs to play their role and thereby see how far motivation helps to build entrepreneurship development.

Mc Celland has identified the following motivational factors that influence entrepreneurs to become successful in their business ventures:

Demonstration effect.

Business background

Technical knowledge

Stable market

Skilled labour

Self determination

Ancillarisation

Risk bearing capacity and

Success stories.

Demonstration

Demonstration of successful business enterprises motivate entrepreneurs to enter into similar lines of businesses. In under ­developed countries demonstration is normally being done by the Government. In India, the Government at present invite foreign investors who would like to invest their capital and new technology and develop new business enterprises. This in turn encourages and motivates the emerging entrepreneurs to set up similar lines of business. For instance, the aquaculture business was not very populate in the last decade. Now this business is getting popular and entrepreneurs of different types come forward to establish this business in and around the coastal areas. It is all due to the demonstration effect. Thus, the establishment of one successful business venture attracts and motivates entrepreneurs to develop and run similar I business. Entrepreneurs also learn the demonstration effects through the foreign entrepreneurs.

Business Background

Entrepreneurs who hail from business families are able to establish new business more easily than those who hail from agricultural families. Though, it is true,’ the research findings revealed different findings. Entrepreneurs who hailed from the agricultural families are found more successful in their business ventures than those who hailed from business families.

Lack of employment opportunities is the main factor which motivates these entrepreneurs to enter into business ventures. However entrepreneurs with business background are able to Identify business diversions and able to enter into profitable business ventures since they have managerial and organising capacity.

Nowadays, entrepreneurs start multi-lines of business so that they could be able to avoid losses. ie., the profit of one business line could be used to compensate the loss of another business and hence the chance for incurring heavy losses is found little.

Technical Knowledge

People with technical knowledge are more interested in entering into new business ventures than people with less technical knowledge. With the help of technical knowledge, the entrepreneurs are motivated to set tip their own business or industrial units and they themselves engage in the day to day operations. They have no fear in attending the repair and maintenance works and also able: to direct subordinates and delegate their works easily. Thus, possessing the technical knowledge is the prime moti-vating factor for entrepreneurs to come out with a successful business ven-ture. In these days we found that ITI students with the MBA degree would like to establish their own industrial units rather searching jobs elsewhere.

Similarly, many. engineers who served in big industrial establish-ments have come out from the existing job and try to set up their own in-dustrial units. Thus, holding technical knowledge and experience is one of the motivating factors for entrepreneurs to enter into the business world.

Stable Market

Stable market is one of the prerequisites for a growing economy. Stable market ensures long term planning. Stable market motivates entrepreneurs to manufacture goods on a large scale with the intention of capturing market. It attracts entrepreneurs to devote their time and energy towards ‘Research and Development’. Unless the market is stable, the entrepreneurs cannot manufacture new products and plan to spend huge amount of money for research and advertisement. Entrepreneurs expect stable market not only at the national level but also at the international level. Stable market motivates entrepreneurs abroad to invest then- money and technical know-how in other countries which inturn gives room for global market and as a result the consumers all over the world are able to enjoy the benefits at a time.

Skilled Labour

Entrepreneurs however they are trained and experienced cannot become successful in their business ventures, unless they rely upon the skilled labour force. Specialisation becomes the order of the day. Consultancy services are rapidly growing. The availability of skilled labour force in the local places motivate entrepreneurs to make use of their services at relatively cheaper prices. The success of any entrepreneurs depends upon the skilled personnel who are employed in his business ventures. Entrepreneurs seek their help and guidance and thus, the decision taken by them is always right and it gives scope for the development of “group entrepreneurs”.

Self Determination

Entrepreneurs are motivated by means of their ‘will power’ and ‘self determination’. They fix the target for themselves and try to attain the target. They have power to resist and overcome all the obstacles and external or internal forces. They have strong determination in bringing out their business ventures successfully. They have no second thought soon after entering into a new line of business. Self determination depends upon the behaviour of the entrepreneurs. This self determination motivates the power of achievement of entrepreneurs.

Ancillarisation

Establishment of big business ventures is always unthinkable. Big business houses need huge amount of capital and labour force. Besides, entrepreneurs have to observe cumbersome formalities.

Small scale industrial units are mostly established in and around the existing large scale industries. The successful running of SSI depends upon the extent with which the large scale industrial units shall come forward to seek the help of SSI in manufacturing spare parts and ancillary products. As a result the large scale industrial units can concentrate on their main products.

The entrepreneurs of SSI are thus motivated to set up their industrial establishments when there is a scope for ancillarisation. Entrepreneurs ensure stable market for their products. They can be able to identify the expectations of the large scale industrialists and determine the quality too. As a result, entrepreneurs could concentrate more on production and quality.

Besides, they are assured of stable and predetermined income. Ancillarisation gives much benefit to large scale industrial units since they need not concentrate on trivial matters.

Risk Bearing Capacity Risk Bearing Capacity

The risk bearing capacity motivates entrepreneurs to establish businesses of different sizes. ‘Risk’ and ‘Profit’ are closely associated with each other. Higher the scope for profit higher would be the risk that an entrepreneur should bear and vice versa. It is because of the risk bearing capacity, entrepreneurs are found little in under-developed countries.

In these countries; people hesitate to bear the risks. They seek employment opportunities instead of setting up of business units. Age is another factor that determines the risk bearing capacity o( entrepreneurs. Entrepreneurs in their 30s could come forward to bear heavy risks when compared with the entrepreneurs who are in the age group’ of 40s or 50s.

Thus, risk bearing capacity is one of the motivational factors that determines entrepreneurs whether to enter into new line of business or other similar lines of businesses.

Success Stories

Publication of success stories motivate enthused” and young entrepreneurs to set up their own business ventures. Success stories reveal and highlight the circumstances under which successful entrepreneurs started their business ventures. It also highlights the precautions to be taken and the practical difficulties involves in the proposed businesses. The success stories of manufactures like NIRMA and Dhabur Hair Oil Company motivate many entrepreneurs to enter into the manufacturing of detergents and hair oil. The success stories enable entrepreneurs to step into the shoes of the successful businessmen and develop similar business. Success stories of entrepreneurs must be published and screened through T.V. very often and in different and in different languages so that there is a chance for new entrants to venture into new business with all vigour.

Summary

Thus, the entrepreneurship development is mainly due to the entrepreneurial motivation. Motivation of entrepreneurs is influenced by the external as well as internal environmental factors. Though there is no research study which reveal the extent with which the entrepreneurs are motivated by these two environments it is found that the entrepreneurial motivation is due to the influence of both the external and internal environmental factors. The psychological behaviours of the entrepreneurs are also equal playing its role while motivating the entrepreneurs.

The main requisites for promoting entrepreneurship are motivation. It can be made by duly understanding the internal environment and external environment. Entrepreneurs can be made through motivational process by explaining the need for inculcating basic qualities of entrepreneurs and to read and understand the success stories of entrepreneurs.

Thus, motivation is the propelling force behind every entrepreneur to

introduce new products,

develop new business establishments,

introduce new form of business organisation,

make use of alternative sources of raw materials and

see how best to fulfil the expectations of the consumers and the society.