oa Business Management Review - Evolution of entrepreneurial motivation: the transition from economic necessity to entrepreneurship

Volume 7, Issue 2
  • ISSN : 0856-2253



Most of the small business operators in Tanzania. as well as other developing countries started business as a result of economic necessity. It therefore becomes of interest to know the extent to which they are entrepreneurial in the sense of wanting to develop substantial enterprises and whether this behaviour changes over time. This study sought to explain the process through which this evolution occurs. Five cases of Tanzanian owner-managers who reported to have started business activity due to economic necessity were analysed. using the grounded theory approach. the constant comparative method and a replication strategy. The results suggest that the owner-manager who starts a business because of economic necessity is uncommitted to both the business and the entrepreneurial career. He is merely hanging on an activity. For this reason. his/her future orientation is qUite passive and therefore growth motivation is non-existent or extremely low. In the occasions where he/she evolves into a serious entrepreneur desiring and pro~ctively seeking substantial growth. he/she must go through a number of sequential stages. He/she must first stabilise his personal life. acquire commitment to the business. stabilise the business and acquire commitment to the career. A number offactors influence the direction and pace of this evolution. A favourable external environment. resources that are useful only in the context of the firm and interest in the activity Enterprise development initiatives in developing countries should also aim at enhancing growth motivation and in particular the process of evolution from economic necessity to entrepreneurship. This can help minimise defoult rates when lending to micro and small enterprise operators. This knowledge can also be used for sensitising ownermanagers in the process through which they are evolving and thereby accelerating it.

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