Assessing and developing reliable entrepreneurial skills
University of St. Gallen (HSG), Swiss Research Institute of Small Business and Entrepreneurship
University of Fribourg (CH), Department of Education Science
Prof. Thierry Volery (University of St. Gallen)
Prof. emer. Fritz Oser (University of Fribourg)
Duration: 01.11.2012 - 31.10.2013
The present report discusses the first of a three-part research project devoted to the "failure of start-up companies". The research project seeks to gain a better understanding of the various ways of dealing with the psychological construct "sense of failure".
In the first part of this project, components of the "sense of failure" construct were gathered on the basis of 16 qualitative in-depth interviews (eight with failed entrepreneurs and either with successful ones), which were conducted, transcribed and analysed. The information gleaned from these interviews will be used to develop a measurement tool for quantitative surveys.
The research report concludes that both failed and successful entrepreneurs encountered numerous setbacks. Contributing factors for success included the stability or instability of order books, which affected the motivation to act or create a company. This resulted in an increase in calls for aid, aid strategies, forecasting of possible salvage heuristics, or generally the motivation to continue with the business. Another important factor was the fear of failure, which triggered more intense activity.
It is interesting to note that very often failure is not caused by a shortage of incoming orders, a lack of commitment or a flawed business plan but rather by a failure to consider possible delays in payment from customers. In this sense, the "sense of failure" is also associated with the knowledge of possible breakthroughs, which appear more frequently in successful business processes than in failed ones. With failed business processes, the entrepreneurs are either unaware of existing risks or failed to appreciate these risks to their fullest extent, realising how serious they were only after the fact.