Entrepreneurial Leadership

Entrepreneurial Leadership

Abstract

Entrepreneurship ventures are growing; each of these ventures is supporting the global economy in one way or another. The purpose of this paper is to analyze entrepreneurship leadership by describing the trait profile of an entrepreneurial leader, the development of leadership skills, and providing research on the issue of entrepreneurial leadership. Leaders in entrepreneurship are characterized by being supportive, team players, and always ready to share their success with others. They are creators and developers of ideas and strategies that make their ventures successful. Through their personality and behaviors, they create the necessary social interactions and networks that act as resources for their investments. Besides being goal-oriented and with a high urge for development, entrepreneurial leaders are also governed by ethics and values that dictate the way they conduct business. Development of leadership skills is also an essential aspect of entrepreneurial leadership through experiential learning to self-actualization and even going back to school to obtain leadership skills.

Approaching a Definition of Entrepreneurial Leadership

Entrepreneurship refers to the creation of and designing of new businesses as part of support to the economy. Entrepreneurship is aided by the capacity, ability, and willingness to organize and manage the business ventures while optimizing risks to make the business succeed. Leadership in entrepreneurship is an essential aspect of entrepreneurship as leaders in entrepreneurship are responsible for organizing and managing groups of people and ideas to develop a successful business venture. Entrepreneurship leadership, therefore, refers to organizing, mobilizing, and motivating a group of people towards the same objective and a common goal by optimizing risk, innovation, taking care of opportunities, and managing a dynamic environment.

For an individual to be an entrepreneurial leader, then there are certain character traits and personality that helps them achieve the goals in the entrepreneurship world. An entrepreneurial leader needs to have excellent communication skills, have to be visionary, supportive, innovative, and persevering. He or she also needs to be ready to learn new things, create an environment in an organization conducive for growth, be honest, and be prepared to share success. Personality and character traits are key driving factors towards the development of an active and influential entrepreneurial leader.

Not every leader is an entrepreneur, but an entrepreneur has to have some ability to influence others with or without authority over them. An entrepreneurial leader is a special kind of a leader that has to do whatever it takes under the face of uncertainty to make a business venture successful. When an entrepreneur starts a business, then he or she has to deal with the risk of failure while other leaders are appointed in already flourishing organizations. Entrepreneurial leaders have to balance between creating and innovating ideas responsible for taking the business to the next level while optimizing risks and creating an environment suitable for the required growth.

Literature Review (Methodology)

Previous research has been conducted on entrepreneurship, and entrepreneurial leadership, and the results of the most study came up with five common pillars for achievement in entrepreneurial leaders. According to Mushtaq Ahmad, “tolerance, motivation, risk-taking, control and drive for achievement are the pillars driving success in entrepreneurial leaders” (Ahmad, 2010). Leadership has been cited as the driver to entrepreneurial success. An entrepreneur who is also a leader is considered to ne more successful than others.

According to Claudia Felix, Sebastian Aparicio, and David Urbano, “participative and supportive leadership has been cited as one of the main reasons through which entrepreneurship leads to success” (Felix, Aparicio & Urbano, 2019). In the face of the turbulent, unstable, or competitive economic environment, entrepreneurial leadership influences success on entrepreneurship ventures. The type of leadership that an entrepreneurial leader employs in the organization determines how successful the enterprise will be. Some of the significant traits of an entrepreneurial leader include being supportive and the ability of the leader to share his or her success with other members of the organization. Therefore employing participative and supportive leadership influences growth to be experienced in the organization.

For a long time, research has been conducted differently between entrepreneurship and leadership. “Both aspects are considered as two different entities; however, recent studies have associated entrepreneurship and leadership together, and results show that entrepreneurial leadership improves organizational performance” (Harrison & Burnard, 2019). Entrepreneurial leadership has, therefore, gained more interest among scholars, and the aspect has, therefore, become an essential aspect of research among different individuals. Entrepreneurial leadership, therefore, continue to gain popularity as one of the factors that are influencing the success of various business ventures that, in turn, affects the economy.

The Trait Profile of an Entrepreneurial Leader

In entrepreneurial leadership, there is a specific trait profile that is associated with leaders. From values and ethics to character traits and personality traits, some characteristics are associated with successful entrepreneurial leaders. These traits include problem-solving skills where an entrepreneurial leader must be able to answer all of the issues arising in the business venture or organization. Problem-solving abilities include the leader being able to be innovative and creative in the face of difficulties to come up with the required solutions. He or she is also needed to be a team player such that is a solution requires the input of a team, then he or she should be able to organize them and come up with a solution.  Problem-solving skills also involve the entrepreneurial leader being resilient such that when the first ideas do not work, then he or she should be able to come up with a second and a third idea aimed to solve a problem.

Another trait associated with an entrepreneurial leader is self-efficacy, where the leader has tremendous belief in their ability to lead and their confidence gained from previous years of experience. Entrepreneurial leaders are characterized by being self-efficient in whatever they do; that is, they prove that they are efficient in the decisions they make that affect different ventures. Entrepreneurial leaders are also characterized by being patient and passionate about their investments. Whenever one idea fails to work, entrepreneurial leaders are patient enough to create another plan and wait to see if the concept actualizes.

Entrepreneurial leaders also are governed by the big five personality traits that include openness, consciousness, extraversion, agreeableness, and neuroticism. Openness trait involves people being imaginative and insightful such that an entrepreneurial leader has to be creative and insightful to always come up with new ideas and insights for the business venture. Consciousness includes individuals being organized, methodic, and thorough, and therefore they are reliable. Entrepreneurial leaders need to be reliable, and they need to be organized and comprehensive to manage the group of people they work with.

Most entrepreneurial leaders flourish if they are extroverts. They are known to derive their energy from interacting with others, and this is an aspect important for individuals in entrepreneurial ventures. Extraverts are known to be talkative, energetic, and assertive, and this tends to be an advantage for the leaders since, through their personality, they can network and engage others to make their ventures successful.

Another personality trait includes agreeableness, these individuals being friendly, co-operative, and compassionate. People that score high in agreeableness are kind, affectionate and sympathetic. Entrepreneurial leaders need to be helpful, co-operative, and compassionate to others for them to make the necessary networks and alliances to make their entrepreneurial ventures flourish. The other personality trait involves neuroticism, commonly referred to as emotional stability. A leader needs to be able to balance the positive and negative emotions. Leaders need not be moody or tense, they need not be over-excited over little things, and they should be able to withhold and deal with their emotions such that their work is not affected.

Besides the big five personality traits and other character traits common with entrepreneurial leaders, a proactive personality is also an essential personality among the leaders. “Proactive personality refers to having the ability and likelihood of taking personal initiatives and getting things done” (Brown, Steven; O’Donnell, Edward, 2011). Individuals with a proactive personality are goal-oriented, and they are known to be people who work towards a set objective that they have to achieve. This personality influences performance among the entrepreneurs since it helps them set goals and take personal initiatives towards achieving them without being pushed or waiting for others to do it.

Ethics and values of entrepreneurial leaders also play an essential role in shaping their trait’s profile. Most times, entrepreneurs are not considered to be guided by values and ethics due to their need to achieve their goals. Therefore, they are seen as people who would engage in unethical dealings for achievements and success. However, according to Gita Surie and Allan Ashley, “pragmatism in entrepreneurial leaders is related to innovation and accomplishment while disciplined attention to ethics gives the leader legitimacy required for value creation” (Surie, & Ashley, 2008). Ethics and values in entrepreneurship do not only focus on the moral person or the morel manager but also the ethical entrepreneur who combines his or her urge to succeed with values and ethics required in the business industry.

Ethical leaders in any field are viewed as models to be followed by other individuals in the same industry. “For leaders to be perceived as ethical, they have to be seen as legitimate, attractive and credible engaging in behavior that is normative and appropriate such as openness” (Kaptein, 2019). Entrepreneurial leaders are individuals who influence and motivate groups of people to work towards the same goal. Therefore for them to change ethics among others, then they have to be ethical themselves. They should be able to reinforce ethical communication with the followers, engage in ethical behavior, and fulfill the role of not just a moral person but also an honest manager. The fact that entrepreneurial leaders, among other leaders, are expected to behave normatively and appropriately leaves room for interpretation since what might be reasonable and appropriate for a specific individual might not be consistent for others. However, the is a set of actions that are universally considered such necessary in leadership such as honesty and integrity and guides the ethics of leaders.

Developing Entrepreneurial Leadership

Entrepreneurial leadership is an act just like any other that has to be developed through time by learning and exercising, following role models to become that perfect leader. Besides many things on entrepreneurial leadership that can be learned in the classroom, there is quite as much that is learned through practice. From experiential learning to obtaining leadership skills, acquiring human capital, social interaction and role-models, and self-actualization. Leadership has evolved from being just a set of traits and behaviors to being a social process that involves the whole community and not only the leader. Therefore in developing entrepreneurial leadership skills, then the leader needs to obtain the necessary social interactions as social capital.

An effective leader is considered to take account of the social relationships and social dimensions of individuals surrounding him or her. He or she has to take care of the emotional stability of his employees, such that people do not have to be dragged to work while they are not emotionally able to do so. Leadership development involves learning to interact socially with people around, taking into account not the human factor but also the social factors. “Leadership is built on the real world, and leaders have to recognize the reality of the real world and how each component in it affects the organization” (Leith, Mullan, & Harrison, 2012). Therefore, the effectiveness of a leader is built on how one can relate with the real world by recognizing and appreciating each component and how each affects the venture he or she runs. Resources helping an entrepreneurial leader develop his or her enterprise are gathered from the networks and interactions the leader develops through the course of the leadership process, and these networks help in improving the leadership abilities of the given individual.

Entrepreneurial leadership development also involves experiential learning that involves learning through experience. Entrepreneurial leaders can develop their skills through learning in the job that is doing what is required of them, making mistakes once in a while, developing ideas that do not work sometimes, and then learning from mistakes and failures, allowing them to do better next time. Experiential learning takes a cycle that involves the real experience that the leader has, observations and reflections, conceptualization, and experimentations. An entrepreneurial leader gets into the leadership position through the knowledge that he or she has on the venture. However, during the leadership process, the leader makes decisions and is supposed to take actions which may or may not work. The leader, therefore, makes observations and reflections while still on the job, and this works in developing his or her leadership skills.

Conceptualization of ideas and creations is also a part of experiential learning for the leaders where they develop ideas and conceptualize them to reality in the process of determining what is useful and beneficial to the business. Experimentation is also another process in experiential learning that involves trying for different things until the leader finds that which is most suitable for the business venture. There are so many ideas and suggestions that are available during the inception of a business idea, and a leader has to experiment, which among them works best for him or her — strategies to have to study, which among them is the most efficient for the business. Leadership does not mean that the leader knows everything or has a solution to every problem in the organization. The leaders learn in the job, learn to make better decisions, learn how to interact with different players for the good of the business.

Classroom learning is also another method for developing entrepreneurial leadership where leaders go back to school and undertake a leadership course to further their abilities in direction. Thousands of CEOs go back to schools to study more, and this is one of the measures os keeping them at per with all the educational requirements of being a leader. Attending leadership conferences and platforms also works in helping leaders develop their leadership skills. Mentorship and role models also develop leadership skills among different leaders. Observing and following mentors and role models who have made it in the entrepreneurship also develops individual leadership skills among entrepreneurial leaders.

Self-actualization is a concept defined as the realization and fulfillment of one’s talents and potentials. Self-actualization is considered as the first step towards being successful in leadership as this acts as the driver that pushes an individual towards reaching and achieving his or her potentials. Self-actualization in direction leads to a need for personal growth and development through one’s life. Therefore, a leader, through going back to school, getting mentorship from role models, and working hard every day, leads to the personal growth of individuals. Leaders need to have the urge to grow both personally and career-wise by doing things that develop their abilities as leaders and make them better managers for their ventures. According to Abraham Maslow (1962), self-actualization is the highest level in the hierarchy of needs meaning self-actualized individuals do whatever they are capable of doing. Entrepreneurial leaders are capable of leading organizations and ventures they are in charge of, and their need for personal growth and development develops their abilities in being better leaders.

Discussion/Summary

Entrepreneurial leadership is a new concept that is gaining momentum after a long period of studying entrepreneurship and leadership separately as independent concepts. Entrepreneurial leadership is a vital anchor to the economy all over the world as the different ventures started by entrepreneurs helps the economy of a nation grow. Entrepreneurship leadership has gained popularity in men as long as in females, gender is an issue in direction, but with time different people are accepting that women can be as good entrepreneurial leaders as men.

Entrepreneurial leaders have a set of traits and personality profile that makes specific individuals suitable as leaders. From being patient and honesty to supportive and risk-taking and seeking every chance of opportunities and capitalizing on them, these are some of the characteristics of entrepreneurial leaders. Entrepreneurial leaders are different from ordinary leaders since besides being risk-takers, they have to take a calculated risk to ensure that their ventures do not sink. Entrepreneurial leaders have to interact with others and build relationships and networks that help them obtain the necessary resources required for the organizations. Leaders have a particular personality profile that makes them suitable for the positions they are in, and they need to be co-operative, kind, and honest, have the emotional stability to balance between negative and positive emotions.

“Different people from women have created hundred entrepreneurial ventures to minorities and immigrants, and each of the ventures contributes to the global economy” (Kurtako, 2007). Without entrepreneurial ventures around the globe, there will be a deficit in the economy from the services provided by the small businesses created through entrepreneurship. Leaders in entrepreneurship are essential since they organize and motivate groups of people to identify a common goal and objective. Development of their leadership skills among the leaders is crucial in ensuring the growth of the leaders both in their context and career-wise.

Limitations and Future Research

In research on the topic of entrepreneurial leadership, there have been several challenges and constraints associated with finding the right resources to use regarding the subject. Most resources available are either for entrepreneurship or leadership separately. Funds that include both administration and entrepreneurship lack most of the information required to develop the profile of an entrepreneurial leader. Most of the resources available for entrepreneurial guidance included very complicated information that mostly did not make sense for the requirements of the study. The field of study as also limited, such that there were specific topics to be covered during the study. Since most of the resources contained general information, then it was difficult to narrow down to the required information.

For future research on entrepreneurial leadership, most scholars should start considering conducting more study in entrepreneurial leadership, including developing a profile of the existing entrepreneurial leaders. Defining the traits and personality of an entrepreneurial leader is essential in improving the visibility of any entrepreneurial leader. More research should also be conducted concerning the concept of entrepreneurship leadership since it is a concept that is not as normal as leadership. Individuals interested in the field of entrepreneurial leadership should understand what it entails besides the usual leadership in organizations.

Conclusion

Entrepreneurial leadership involves individual organizing and managing a group of people towards identifying a particular objective. Entrepreneurial leadership is coupled with both willingness and ability to manage and organize a group of people towards creating a successful venture. Various studies have been conducted on the topic; however, scholars are continuing to venture on the concept of entrepreneurial leadership, bringing together leaders and entrepreneurship concepts.  Leaders in the entrepreneurship field have particular character traits and personality profile that guides their behaviors and actions in the line of their work. From being problem solvers to being calculating risk-takers and being self-efficient, supportive, honest, and patient. Entrepreneurial leaders also need to be guided by ethics and values, just like any other leader. Besides their need to accomplish, this urge should not be allowed to cloud the ethical and pragmatic responsibility of leaders. The leaders also need to develop their leadership skills through obtaining leadership skills to promoting social and human capital and using role models and mentorship as methods of developing entrepreneurial leadership skills. Besides having certain limitations associated with this research, future research could still be conducted on the topic of entrepreneurial leadership.