Home Motivation Entrepreneurial Motivating Factors: Internal and External Factors

Entrepreneurial Motivating Factors: Internal and External Factors


Entrepreneurial Motivating Factors: Internal and External Factors!

Let us address to the larger question what factors motivate entrepreneurs to start enterprises. Many researchers have tried to understand and answer this question by conducting research studies to identify the factors that motivate people to take all the risk and start a business enterprise (Kamraj and Muralidaran 2005, Manimala and Pearson 1998, Maslow 1954, Mitchell 2004, Saxena 2005, Khanka 2009).

While some researchers have classified the factors motivating entrepreneurs into ‘push’ (compulsion) and ‘pull’ (choice) factors, most of the researchers have classified all the factors motivating entrepreneurs into internal and external factors as follows:

Internal Factors:

These include the following factors:

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1. Desire to do something new.

2. Become independent.

3. Achieve what one wants to have in life.

4. Be recognized for one’s contribution.

5. One’s educational background.

6. One’s occupational background and experience in the relevant field.

External Factors:

These include:

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1. Government assistance and support.

2. Availability of labour and raw material.

3. Encouragement from big business houses.

4. Promising demand for the product.

One research study (Murthy et. al. 1986) reports that entrepreneurs are motivated to start business enterprises due to the following three types of factors:

1. Ambitious factors.

2. Compelling factors

3. Facilitating factors.

The present author also conducted a study on “Entrepreneurship Development in Assam” financially supported by the All India Council for Technical Education (AICTE), New Delhi. The study found the following motivational factors for the entrepreneurs. The study chose the 15 statements on motives on the basis of prior research on human motives.

It measured the keenness i.e., the degree of response of the entrepreneurs on each of the 15 statements using a Likert-type five-point scale as follows:

Degree of ResponseNumerical Value of the Degree
Not at all1
A Little Bit2
To Some Extent3
To a Large Extent4
To Full Extent5

The entrepreneurs’ responses to the 15 motivating factors are presented in the following Table 10.1:

Table 10.1: Motivating Factors for Entrepreneurial Plunge:

The StatementsMean Scores
ADVERTISEMENTS: 1.Money motive4.52
2.Independence/one’s own boss4.47
3.Provide greater comfort to family4.39
4.Do something new and path-breaking4.32
5.Reputation and recognition4.16
6.Preside over a big business4.05
7.Take family business to new heights3.93
8.Do business because it is one’s duty3.85
9.Express one’s creativity and ingenuity3.76
10.Make optimum utilization of one’s ability3.66
11.Temperament fit between self and business3.61
12.Contribute to the good of the society3.50
13.Desire to give financial security to one’s kins3.21
14.Flexibility of balancing work and family life3.07
15.Enjoyable work2.85

When we asked our respondent entrepreneurs to check the motivating factor(s) for their entrepreneurial plunge or initiation, each of them checked more than one factors, of course, some of them in the same and other in varying degrees. On an overage, out of 15 close-ended statements, a respondent checked 11 of them (see Table 10.2).

Table 10.2: Average Response to Statements on Entrepreneurial Motivation:

Type of ResponseAverage Number of the Statements Checked by the Respondents
No Response Some Response4 11

Noticing more than one motivating factor checked by the respondents is not unlikely. The reason being except in extreme cases of deprivation, human beings seek simultaneous satisfaction of different desires. This finding is enough evidence to believe that there is more than one motivating factor for an individual’s entrepreneurial plunge.

Rather than interpreting each of the 15 statements individually, for the convenience of analysis, we have grouped all these statements into six major factors as shown in Table 10.3:

Table 10.3: Factor-wise Classification of Entrepreneurial Motives:

Motivating FactorsMean Score
I. Self-Actualization
1. Money / Economic Motive4.52
4. Do something new and path-breaking4.32
9. Express one’s creativity and ingenuity3.76
10. Make optimum use of one’s ability3.66
II. Nature of Work Motive
12. Contribution to the good of society3.50
15. Enjoyable work2.85
III. Autonomy and Power Motive
2. Desire of Independence4.47
6. Preside over a big business4.05
11. Temperament fit between Self and business3.61
14. Flexibility of balancing work and family life3.07
IV. Status Motive
5. Reputation and Recognition4.15
7. Take family business to new heights3.93
V. Affiliation Motive
3. Provide greater comfort to family4.39
13. Desire to give financial security to one’s kins3.21
VI. Deontic Motive
8. Do business because it is one’s duty3.85


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