FACTORS INFLUENCING INDIVIDUALS’
Date
2011-06-02
Authors
Nkambule, Nonhlanhla
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Abstract
The aim of this paper was to investigate factors that influence individuals’
propensity to start their own businesses. These factors were divisible into three
categories: non-psychological, psychological and environmental factors.
A survey was conducted on 36 existing entrepreneurs and potential
entrepreneurs on a purposive and convenience basis. The data gathered was
nominal and ordinal, the latter being rescaled into interval data using Stacey’s
(2005) Normal Distribution Fitting Algorithm. The results of the survey indicated
that in the South African context, entrepreneurs’ propensity to start businesses is
largely influenced by psychological factors, and that the strongest factors were
the desire to create wealth for themselves, their desire for independence, their
inclination to take risks and tackle challenges. A majority of the entrepreneurs
also agreed that education in entrepreneurship could increase the quality of
businesses that are started.
Although previously published literature on non-psychological factors such as
lack of business skills, low education levels, inefficiency of government
structures, social networks and exposure to family business suggest a negative
impact on entrepreneurial propensity, the results of this study indicate that South
African entrepreneurs disagree that these factors would have a negative
influence on their inclination to start a business.
The findings of this survey will benefit different stakeholders that have the
interest in engaging and in promoting entrepreneurship in South Africa. These
include business schools, government, financiers and potential and existing
entrepreneurs
Description
MBA - WBS
Keywords
Entrepreneurs, Entrepreneurship, Business, South Africa, Small businesses