Monday, December 25, 2006

Management Lite & Ezy 20 – The Dark Side of Entrepreneurship

You have heard of the success story of Bill Gates, Sir Richard Branson, Steve Jobs and Google's co-founders. You admire them. You want to be an entrepreneur, too.

Remember Milton Friedman’s words? There is no such thing as a free lunch. Entrepreneurs pay a high price for their ventures. Here we will examine the dark side of entrepreneurship.

Risk

They are a numbers of risks entrepreneurs must confront, such as:

  • Financial risk - not all ventures are successful
  • Career risk – loss of employment security
  • Family and social risk – competing commitments of work and family
  • Psychic risk – psychological impact of failure on the well-being of entrepreneurs

Stress

When entrepreneurs’ work demands and expectations exceed their ability to perform as venture initiators, they are likely to experience stress. Stress can also result from a basic personality known as “type A” behavior. People with “type A” personality exhibit following characteristics:

  • Chronic and severe sense of time urgency.
  • Constant involvement in multiple projects subject to deadlines.
  • Neglect of all aspects of life except work.
  • A tendency to take on excessive responsibility, combined with the feeling that “only I am capable of taking care of this matter.”
  • Explosiveness of speech and a tendency to speak faster than most people.

Ego

Entrepreneurs may have inflated ego. Here are four characteristics that may hold destructive implications:

  • Overbearing need for control
  • Sense of distrust
  • Overriding desire for success
  • Unrealistic optimism

For those who are ambitious to become entrepreneurs, make sure you don’t become the Darth Vader of entrepreneur world.

Reference: Kuratko & Hodgetts, Entrepreneurship – Theory, Process, Practice, 7th edition

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