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Baum et al., (2007) affirms that the success of an entrepreneurial investment relies heavily on an optimistic environmental influence, such as a supportive environment and educational achievements. This may have a considerable impact in liaison with psychological characteristics and entrepreneurial point of reference. The study of entrepreneurship requires many explorations due to its multi-dimensional outlook. Earlier studies were characterized by disagreement and discrepancy comparative to suitable description of entrepreneurs with regard to personality in entrepreneurial studies. Okhomina (2012), points out that the use of personality traits approach to explain entrepreneurship in terms of entrepreneurial presentation and conduct that has faced a lot of criticism due to different findings from various studies. Some researchers finalized that personality features do not determine the success of an entrepreneur and it tends to ignore aggregation. This researchers dwelt upon population distribution, in which they are anticipated to vary from the connote society. The characteristic of their controversy is impulsive, hence endeavors to profile entrepreneurs exclusively along personality features that are entirely one-dimensional.
To respond to the above disagreement, Baum et al (2007), defined an entrepreneur as a person who initiates and manages a business with the aim of maximizing profits and business continuity. The primary character of an entrepreneur is innovativeness and entails planned management practices in his or her business, differentiating entrepreneurs from small business proprietors (Kumar, 2008). This perceived small business owners as people who aim at advancing their own personal goals. In sole proprietorship ventures, much of an individual’s time and resources are consumed to provide a source of income (Kumar, 2008). The business owner views his venture as an extension of his or her individuality, comprehensively bound with family needs and wishes.
The descriptive matter of entrepreneurship was additionally verified by differentiating entrepreneurship and entrepreneurial orientation. García et al ( 2007), defines entrepreneurial orientation as the method that explains the assumption of new investments, whereas entrepreneurship points to the nature of decisions made by the entrepreneur in tackling the venture assumption. García et al (2007), further assert that there are five scopes of the entrepreneurial orientation, which includes autonomy, innovativeness, risk taking, competitive aggressiveness and optimism. Autonomy is independence of an entrepreneur. Innovativeness is the aptitude to design a new thing, procedure among other things. Risk taking is bravery in investing in profitable ventures without considering the negative associates. Competitive aggressiveness refers to holding on and never quitting character of an entrepreneur. García et al (2007), affirm the significance of connection connecting personality and entrepreneurial orientation, this is because personality might influence the level of entrepreneurial orientation, which is a beneficial to an organization. Earlier research evaluated the need of achievement, tolerance for uncertainty, risk taking and locus control concerning entrepreneurial traits, and the results indicated strong positive correlation with the entrepreneurial success.
García et al (2007), assert that the desire to achieve the goal is a characteristic that has been practically allied to entrepreneurial action. The need to achieve refers to the propensity to select and stick with ventures that are having reasonable opportunities of success or optimum possibility of individual success approval, devoid of risk of failure (Okhomina, 2012). Different top-ranked personnel in businesses have the highest degree of the need for achievement, with marketing managers as the leading executives. Needs are not culturally determined; this statement is attributed to the fact that some cultures produce many entrepreneurs due to the socialization method that creates a desire to achieve. The trait of the need to achieve is closely related entrepreneurship with its foundation on upbringing and adult influence (Kumar, 2008). Fantasy evaluation proves to be the most effective method to assess motives that are essentially founded on unaware state. The desire to achieve is much higher in a company of pioneers as compared to other managers. Additionally, the need to achieve is linked to the company development. These apparently indicate that the need originates from the association of between personality and the founders and the extent of entrepreneurial orientation. Studies have affirmed that the need for achievement is highly demonstrated more by company founders than managers, and makes a significant contribution towards the realization of business growth. The findings infer that the degree of the need for achievement is derived from the relationship existing between the psychological traits of business founders and the degree of entrepreneurial orientation they have (Kumar, 2008).
Locus of control refers to a person’s discernment on the fundamental causes of incidents in his life. A precise definition is the individual beliefs that influence the decisions and internal efforts. Garcia et al (2007), argues that individuals with an internal locus deem themselves as able to manipulate happenings to their lives. However, people with an external locus of control perceive that events in their lives are attributed to luck, actions of powerful individuals and being at the right place at the right time. Studies reveal that people in possession of internal locus of control tend to have higher need of achievement than those with external locus of control (Kumar, 2008). A practical research by Kumar (2008) tackled the suggestion whether small firms’ innovativeness and non-innovativeness pose noteworthy variations. Fifty manufacturing companies from Texas area employing the cluster and correlation evaluations to analyze data were used in the above pragmatic study. It revealed an affirmative relationship that exists between the internal locus of control and innovation.
Tolerance for ambiguity is the inclination to recognize uncertain circumstances as pleasing (Okhomina, 2012). On the other hand, intolerance for ambiguity refers to the proclivity to recognize ambiguous situations as threat sources. Ambiguous circumstances involve provision of sophisticated, insufficient or indistinctly conflicting information to an individual. Low tolerant ambiguous people suffer from stress, and avoid ambiguous incentives and reacts impulsively (Baum et al, 2007). On the contrary, high tolerant ambiguous people recognize ambiguous situations as pleasing, testing and motivating. They do not deny or disfigure the sophistications of inappropriateness. In order to affirm the assertion, Okhomina (2012), conducted a study consisting of 100 adults and 200 California children of ages from nine to fourteen years old. The study assessed their perception towards ethnic injustices. It revealed that tolerance for ambiguity was a common trait, which was changeable related to primary social orientation. It is believed that entrepreneurial managers have higher degree of tolerance for ambiguity than conservative managers (Okhomina, 2012). This is attributed to less-structured confrontation, unsure promises faced by entrepreneurial managers. Supposedly, individuals with high tolerance for ambiguity are likely to gain from greater outcomes provided their planned aim to pursue development. This is evident from the fact that those entrepreneurs who resort to market shares in their own industries experience more undecided potential as compared to those who aim to increase profitability.
Baum et al (2007), perceive a risk taker as an individual who follows a venture, even when the chances of accomplishment are extremely low. It is apparent that most risk takers are successful as compared to those who fear risks. This was revealed by a linear discriminant evaluation study that involved five hundred key executives of firms. The connection between risk taking and entrepreneurial companies’ performances is wavy. Entrepreneurs employing modest risk taking outshine those who take high or low levels of risk. Risk taking has an affirmative influence on return on asset. Entrepreneurs differ from non-entrepreneurs in a way they perceive business opportunities. Moreover, entrepreneur tends to classify business opportunities as having few risks than non-entrepreneur. Entrepreneurs view circumstances more constructively than their counterpart non-entrepreneurs (Kumar, 2008). This implies that they are more confident than managers and do not integrate representativeness in their decision making process. Some of the conclusions that can be drawn from the scope of entrepreneurial orientation are that family business owners are more tolerant than their opposing non-business owners and the flexibility of an executive is linked position strategies (García et al., 2007).
Various studies have tabled a proposition that educational facilities play an imperative role in enhancing entrepreneurial success by offering sustenance of aptitudes including innovativeness and capability to obtain resources. The above capabilities are essential to the determining the success of an entrepreneurial business (Baum et al., 2007). This is evident in technological firms that stipulate a certain educational level as a requirement for employment. The evaluation on self-employment experience showed that education influences self-employment significantly and positively. There exists a direct relation between educational level and capability of providing services; hence, the higher the educational level, the higher the capability of service provision. Additionally, an entrepreneur is most likely to succeed, if he has education concerning the venture. Another factor that can determine the success of a venture is the degree of technical and business skills. They are vital in the starting and managing of a business (Kumar, 2008). Human capital must be incorporated with necessary business skills to have an impact on the performance. Presently, most entrepreneurs are educated with academic degrees that revealed a drift towards realization of education among entrepreneurs (Okhomina, 2012). The supportive environment is a critical factor in determining the success of a business. It plays a foremost role in the growth of entrepreneurship and its related activities.
In conclusion, it is evident that entrepreneurial studies have faced definitional disagreements. It was difficult to identify whether to include personal traits or individual capability influences entrepreneurial success. However, this was affirmed and the latter majorly dominates the definition of an entrepreneur as an individual who initiates and manages a business with the aim of maximizing profits. This resulted in the five scopes of entrepreneur, which include the need for achievement; internal locus of control; tolerance for ambiguity; risk taking propensity, and education. The need for achievement is a personal character associated with entrepreneurial actions. Internal locus of control is the management of individual’s perception concerning the underlying causes of events. Tolerance for ambiguity is the inclination to visualize ambiguous circumstances as desirable. Risk taking tendency or propensity is the ability to pursue a business opportunity even when the chances of success are limited. Education has been depicted as a current trend among entrepreneurs. It is embraced by many upcoming innovators. As evident in the paper, psychological traits have a strong influence in determining the success of entrepreneurial endeavors.