Psychology of Entrepreneurship
Entrepreneurship is a venture where efforts and strategies are employed. The motivational driving forces are based upon the individual’s motive and expertise (Bull & Williard, 1993). Although scholars argue on the concrete definition of the phenomena, entrepreneurs intend to demonstrate to consider both internal and external factors to execute a business plan with the highest expectation of success. Internal and external controls are relevant to the locus of control theory that determines the success of entrepreneurs based on the theory of planned behavior. Thus, this paper intends to discuss the locus of control and its relation to the characterizations of entrepreneurs’ success.
Entrepreneurial Success
According to Bull and Willard (1993), the multidimensional conditions of motivation, expertise, expectation, and environment describe what makes up entrepreneurship. These conditions appear to be a prerequisite to the success of entrepreneurs. However, success is significantly associated with systematic planning (Alstete, 2008). The principle of entrepreneurial success is established in the strategies that connect the individual and the environment (Osborne, 1995). This general concept is relevant to the conditions that Bull and Willard (1993) identified, such as motivation and expertise are represented in the individual's traits, while expectations and environment are in line with the environmental aspect.
A more recent study argued that a tool to measure success is suggested and that the phenomenon must be measured using psychometric parameters (Staniewski & Awruk, 2019). The psychological considerations suggest the subjectivity of success because the motivation and expertise of entrepreneurs are based on personal and individual deliberations. Perhaps, success can be assessed by how motivated the entrepreneurs are without apparent monetary manifestation. For example, Montagno et al. (1985) examined entrepreneurs’ perceptions of success and financial institutions' success criteria of granting small businesses capital. This connotation signifies the subjectivity of success among entrepreneurs and can be a challenge of measuring. However, locus of control can be used to quantify success in an entrepreneurial venture.
Locus of Control
Scholars believed that individual characteristics play an essential role in the entrepreneurs' success (B Miner, 1997; Caliendo & Kritikos, 2008). These characteristics influence attitude and optimism in embarking on an endeavor in entrepreneurship. Thus, locus of control is a crucial variable for the justification of human behavior (Furnham, 1986). Scholars developed a scale to measure locus of control in various situations (Campis et al., 1986; Nowicki & Duke, 1974; Spector, 1988). Locus of control is triggered by internal and external elements that influence individual behavior and expectation. Behavior is affected by the concepts of control, which show in performance and self-efficacy (Ajzen, 2002).
Internal Locus of Control
The internal locus of control inclines to make people active participants relative to their environment and circumstances (Nykänen et al., 2019). They intend to demonstrate the belief that their behavior affects the circumstances around them. Higher motivation is shown by individuals with a high internal locus of control. Thus, this assumption signifies the importance of an internal locus of control in the success of entrepreneurs. Self-esteem is necessary for every venture, which fuels the entrepreneur's action to move and achieve goals. Therefore, an internal locus of control must be demonstrated by entrepreneurs to be successful in their entrepreneurial goals (Bernardus et al., 2020). The definition disputes on entrepreneurship give justification to the success measurement of entrepreneurs at an individual level. Perhaps even attempting to start a new venture and taking a risk are already an indication of success to the entrepreneurs.
External Locus of Control
Bull and Williard (1993) identified the last condition tied with the external locus of control where the environment plays a role in the success of the entrepreneurs. The external locus of control recognizes the different elements in the environment that entrepreneurs can recognize to strategize a plan. Biondo and MacDonald (1971) acknowledged that external locus of control influence attempts. This concept is relevant to entrepreneurial behavior, which relates the locus of control to planned behavior theory (Ajzen, 2002). The failed attempt can explain the missing steps and processes needed to be done in the subsequent attempts to succeed.
Conclusion
Entrepreneurial success is defined at an individual level and measuring it is subjective. The locus of control provides parameters to measure entrepreneurial success. Internal and external locus of control relates to the planned behavior theory to address the dynamic characteristics of business environments. Entrepreneurs' general characteristics are defined based on distinct personal understanding grounded on their locus of control.
References
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