Entrepreneurial Competencies and Traits

Entrepreneurial Competencies and Traits

DOI: 10.4018/978-1-5225-8473-5.ch005

Abstract

Entrepreneurial competency is the most influential contributing factor for rapid economic progression within many developed economies. This chapter focuses on several selected entrepreneurial competencies and traits by investigating their influence on the performance and the sustainability of micro-enterprises owned and managed by low-income households. The key competencies and traits were selected after combing through a number of relevant theories and empirical studies that determined the effects of these traits and competencies on the performance and the sustainability of micro-enterprises.
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Entrepreneurial Competencies

Several studies have highlighted both the progress and the positive impact of entrepreneurship among rapidly emerging economies, such as that in Malaysia. In the attempt of retaining the continuity of all positivity, it is pertinent for the Malaysian government to comprehend and to identify the factors that can enhance the performance of entrepreneurs towards sustenance in the present market.

Nevertheless, some gaps have been identified, particularly within the context of low-income micro-entrepreneurs in Malaysia. Wahid, Aziz, and Halim (2017) asserted that the Malaysian micro-enterprises seem to face inadequate human competency that must be addressed in order to survive and to compete in the fierce market. In order to succeed in business, entrepreneurs must acquire certain competencies that can aid them to become financially solvent (performance), as well as to attain sustenance in their entrepreneurial activities. According to Al-Mamun, Nawi, and Zainol (2016) one of the many key drivers of micro-enterprise performance is an entrepreneurial competency. Over the last century, entrepreneurial competency emerged as a crucial contributing factor for rapid economic progression within many developed economies. Studies also have proven that the correlation between individual characteristics and managerial competencies can lead to organizational success and sustainability (Gray, 2002; Jokinen, 2005). Entrepreneurial competencies further ascertain growth and survival of small- to medium-sized enterprises (Tehseen, Sajila, Ramayah, and Gadar, 2015). In particular, these small and micro businesses can only accomplish enhanced performance and continuity when their owner-managers and employees acquire knowledge, skills and entrepreneurial traits at a level of competence as required to effectively performing business activities (Nabiswa and Mukwa, 2017). Within the context of Malaysia, entrepreneurial competencies have been reckoned as strong determinants to a successful business, especially among small and medium enterprises (SMEs) (Ahmad, Ramayah, Wilson, and Kummerow, 2010) apart from exerting positive and significant effects on the performance of micro-enterprises (Al-Mamun, Nawi, and Zainol, 2016).

Entrepreneurial competencies can be defined as the characteristics that encompass personality traits, skills and knowledge, which can enhance business performances (Man, Lau, and Chan, 2002). Some studies have depicted that entrepreneurial competencies refer to a specific set of competencies that is relevant to the activities of successful entrepreneurships (Mitchelmore and Rowley, 2010). Studies have also suggested entrepreneurial competencies as skills and knowledge that can influence the abilities of entrepreneurs to perform exceptionally in their business activities (Bridge, Neill, and Martin, 2009). Furthermore, researches regarding entrepreneurial competencies have mainly focused on three aspects, namely, 1) antecedents (education, background, family, and traits), 2) processes (opportunities, organizing, and commitments), and lastly, 3) outcomes (performance, competitive advantage). Furthermore, Man, Lau and Chan (2002). identified opportunity recognition competency, organizational competency, strategic competency, relationship competency, commitment competency and conceptual competency as essential key entrepreneurial competencies, all of which are briefly discussed in the following.

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