Following an active approach in personality and entrepreneurial success (Frese, 2009), the current study tests bi-directional relationships between personality traits proximal to entrepreneurial activities (self-efficacy, risk taking propensity, need for autonomy, tolerance for ambiguity, achievement orientation and creativity), subjective entrepreneurial success and the odds of starting a new establishment 3 years later. Several meta-analyses have shown that personality traits relate to business success (Rauch & Frese, 2007; Zhao & Seibert, 2006). However, few longitudinal studies have been conducted on this topic. Most studies presume that the relationship leads from presumably stable personality characteristics to entrepreneurial performance. However, not all personality characteristics are unchangeable, some are malleable over time (Luthans & Yousseff, 2004), and there are good theoretical arguments to expect reversed relationships. For example, according to Bandura’s Social Learning Theory (Bandura, 1999), mastery experience leads to higher self-efficacy and increased self-esteem. The current study is a three year follow-up study among 119 entrepreneurs in the hospitality industry (response rate Wave 1 = 23 %; Wave 2 = 43 %). Entrepreneurs filled in on-line questionnaires measuring the same variables at T1 and T2. Personality characteristics were measured with pre-existing, reliable, multi-item scales. Subjective entrepreneurial success was measured as satisfaction with the business (faces scale, Kunin, 1955) and 2 items asking entrepreneurs to rate how successful they were. Third criterion was having opened one or more new establishments at T2. Results of multiple (logistic) regression analyses show that personality characteristics at T1 (tolerance for ambiguity and achievement orientation) predicted starting a new establishment at T2. None of the personality characteristics at T1 predicted subjective entrepreneurial success at T2. However, the extent to which entrepreneurs were satisfied with their business, and the extent to which they rated themselves as successful at T1 did predict higher achievement orientation and creativity at T2. These findings challenge the currently dominant point of view that personality predicts entrepreneurial performance, and underscore the need for longitudinal research designs. As both a theoretical and practical implication the results show it is necessary to fit specific personality traits to specific performance criteria.

1. Marjan Gorgievski
Erasmus University Rotterdam, Dept. of Psychology, The Netherlands
Serge Rijsdijk
Erasmus, Rotterdam School of Management, The Netherlands
Andreas Rauch
University of Exeter, Business School, United Kingdom
Presented at the IWP conference, Sheffield, Jun 27- 28,2012
We like to thank Stephanie Wagener for her help during the first data collection.

2. 

The aim of current study was originally (2009) to
investigate the personality -> performance link
longitudinally.
Many studies and reviews exist according to which
personality traits would predict entrepreneurial
success (Rauch & Frese, 2007; Zhao & Seibert, 2006; Collins,
Hanges & Locke, 2004; Miner & Raju, 2004; Stewart & Roth,
2004, 2007; Zhao, Seibert & Lumpkin, 2010)

More specific traits, such as need for achievement,
risk taking, innovativeness, need for autonomy,
self-efficacy would be better predictors than broad
traits such as the big 5, because of their closer
proximity to the outcome variables.

3. 
However, theoretically it can also be
hypothesized that performance predicts lower
order personality, e.g.:
◦ According to the high performance cycle there is a
feedback loop from high performance to self-efficacy
through psychological and material rewards(Latham &
Locke, 1990; 2004).
◦ According to social learning theory, the best way to
develop self-efficacy is to allow people to experience
success (Bandura, 1997).
◦ Positive organizational psychology: lower order
personality constructs referred to as “psychological
capital” are less stable than big 5 constructs and can
increase or decrease as a consequence of gain versus
loss spirals (Luthans & Youssef, 2004).

4. Personality T1
- self-efficacy
- Risk taking propensity
- Need for autonomy
- innovativeness
- Tolerance for ambiguity
Personality T1
- self-efficacy
- Risk taking propensity
- Need for autonomy
- Innovativeness
Subjective Business
performance T1
- Satisfaction
- rating
Subjective Business
performance T1
- Satisfaction
- Rating
- Subjective success scale

5. 





Three year follow up study among business owners in
the hospitality Industry.
T1, N = 278 (response rate 23%), T2, N = 128
(attrition = 54%).
Age: 43.32 (sd = 9.06).
Gender: 72,8 percent male, 27.2 percent female.
Participants T2 were more satisfied with their
businesses at T1 than respondents T1 who dropped
out (M = 5.16, sd = .70 as compared to M= 4.77, sd
= 1.01, T 269.25 df = 3.78, p < .001). No other
differences.
Wagener, S.L., Gorgievski, M.J. & Rijsdijk, S.A. (2010).

6. Example
Nr of
items
Alpha T1 Alpha T2
Achievement
orientation
I would describe myself as
someone who aims to achieve
good results.
5
.54
.70
Need for
autonomy
I prefer making decisions on
my own
4
.68
.66
Innovativeness
I am known for my innovative
ideas.
4
.69
.64
Risk taking
I rather chose for a promising, 5
risky plan than an average plan
without any risk
.82
.81
Self Efficacy
I feel confident that I will be
able to handle unexpected
situations well
5
.78
.72
Tolerance for
ambiguity
When the future is not clear
this is a challenge rather than
a threat to me.
3
.68
-
Scales adapted by Wagener, 2006

7. reference
Nr of items
Alpha T1
Alpha T2
Satisfaction
with business
outcomes
5 point Kunin faces scale
1
-
-
Subjective
success
How successful would you
rate yourself as
entrepreneur? Wagener,
2006
2
.40
Started new
business T2
In the past two years have
you started a new
business? (N=13, 10%)
1
-
-

8. reference
Nr of items
Alpha T1
Alpha T2
Satisfaction
with business
outcomes
5 point Kunin faces scale
1
-
-
Subjective
success
How successful would you
rate yourself as
entrepreneur? Wagener,
2006
2
.40
Started new
business T2
In the past two years have
you started a new
business? (N=13, 10%)
1
-
-
Financial
success T2
Dej, 2011
5
-
.90
Growth T2
Dej, 2011
8
-
.89
Societal
success T2
Dej, 2011
7
-
.79
Personal
success T2
Dej, 2011
6
-
.75

9. T1
Self efficacy
Risk taking
2 = 430.27, df
= 356,
p = .004,
CFI = .95,
TLI = .94,
RMSEA = .03
Split halves,
paths range
from .45
(subjective
success) to .84
(risk taking)
T2
.72
.55
Self efficacy
Risk taking
Need for
autonomy
.54
Need for
autonomy
Achievement
orientation
.57
Achievement
orientation
Innovativeness
Tolerance for
ambiguity
Satisfaction with
business
Subjective succes
.75
innovativeness
Satisfaction with
business
Subjective
financial succes
New business

10. 

Weaknesses are the reliance on subjective
measures only, single item measures of business
performance at T1 and low alpha reliabilities of
the scales measuring personality.
Strength of this study is its longitudinal design,
SEM was used in order to correct for unreliability
of the measures and to test all hypotheses in one
integrated model, correcting for stability over
time and interrelatedness of predictors and
outcome variables at T1 and T2.

11. 

This study shows no support for the hypothesis that active
personality traits predict subjective business success.
Some support that personality predicts
entrepreneurial types rather than business
performance (Cf. T1 results, businessmen versus hosts,
Wagener et al., 2010)

Subjective business performance T1 predicted
innovativeness and achievement orientation three years
later. This challenges the dominant point of view in
entrepreneurship that personality predicts performance. It
supports the view in positive organizational psychology
that gain and loss spirals exists. Personality to
performance relationships in cross sectional studies may
be attenuated because of bi-directionality.