6.8. Differences Between an Entrepreneur and a Manager - The Psychology of Entrepreneurship

The main differences between the entrepreneur and the manager according to their leading psychological qualities can be easily identified using the two-dimensional model of J.Ronen ⁴³ , an illustration of which is shown in Fig.4. The model presents a continuum of decision making under uncertainty. At its lowest point (extremum) is a worker whose tasks are characterized by minimal uncertainty. At the other end is an innovative entrepreneur. Along the continuum, the most changing characteristic is novelty seeking. Another axis is the purposefulness (purposefulness) of the entrepreneur. Entrepreneurs and inventories occupied very close positions in the diagram. Sometimes these figures are represented in one person, but more often the inventory shows creativity, perseverance and perseverance in solving some of its innovative problems, and the entrepreneur in promoting it, in the practical realization of the discovery; he founds the case and, thus, brings the idea to the end. All this requires special activity and purposefulness of behavior.

As can be seen from fig. 8, both entrepreneurs and managers are characterized by a high purposefulness of activity, a developed achievement motive.

Fig. 8. The two-dimensional model of entrepreneurship proposed by J. Ronen.

The differences between entrepreneurs and managers can be interpreted as follows: managers are more afraid of novelty, because their main goal is to preserve the organization, the team they manage, and the entrepreneurial activity that they undoubtedly manifest in many situations is aimed at campaign survival. The entrepreneur, on the contrary, is committed to change, development, risk. Over the life cycle, firms need both entrepreneurial activities.

The diagram becomes even closer to reality with the introduction by the author of such a parameter as risk taking (risk taking), which increases with an increase in the search for novelty and with an increase in purposefulness of activity.

The opinion that the entrepreneur is a kind of antithesis to the manager is consistent with the Ronen model, since the former works in an unstructured environment where rapid changes occur all the time. The second operates in an established management hierarchy, the laws of operation of which are comprehensively described in classical management.

According to literary data, the most striking differences in the psychological portraits of an entrepreneur and a manager concern leadership and the need for power. For example, H. Heckhausen ⁴⁴ believes that both managers and entrepreneurs show marked leadership qualities, but the manager is the leader of the hierarchy, and the entrepreneur is the leader of ideas.

According to D. McCleland ⁴⁵ , entrepreneurs who create firms rarely have leadership qualities, because they are dominated by the achievement motive, which is the “one man's game”, and it does not require the deep involvement of other people. Such an interpretation is consonant with the data of those authors who focus on the independence of the entrepreneur’s personality. For example, R. Hisrich identifies the desire for independence, freedom of action, creative work and creation of capital ⁴⁶ as the leading motives of the entrepreneur. As can be seen from the table. 8, the manager has a different motivation.

Table 8 .

Comparison of personal and behavioral qualities of traditional managers, entrepreneurs and intrapreneurs

From the point of view of innovation management, an entrepreneur is a transformative leader in contrast to a leader of regulatory or administrative management.

Clear boundaries between entrepreneurs and managers sometimes do not exist. These two figures can be represented in one person in a small business. In addition, there is an intermediate figure - intraprener or “internal entrepreneur” - possessing the same complex of qualities (see Table 3), as an entrepreneur.

Test questions:

1. What are the psychological prerequisites for the development of entrepreneurship?

2. What is the hypothesis Schmelders?

3. Give a description of the concept of "enterprise".

4. What techniques are used in your organization to reduce the distance between the employer and the employee? Give examples.

5. How do you understand paraenterprise?

6. What are the differences in psychological portraits of an entrepreneur and a manager?

7. To the typical portrait of which one is closer your portrait?