Journal of Occupational and Organizational Psychology (1995), 68, 209-218 Printed in Great Britain 209

1995 The British Psychological Society

Achievement motivation and female

entrepreneurs

Janice Langan-Fox* and Susanna Roth

D^artment of Psychology, The University of Melbourne, Parkville, Victoria 3052, Australia

A typology of the female entrepreneur was developed on the basis of psychological char-
acteristics of 60 Australian founder businesswomen. Reviews of past research on the psy-
chological profiles of entrepreneurs have shown that studies of women entrepreneurs are
non-existent, and that most research has been conducted with men. In the present study,
a number of projective and self-report measures were used to assess multiple dimensions
of personality within the traditional theoretical framework of David McClelland. Other
variables influencing the motivations of entrepreneurs, for instance motives usually
attributed to managers, were explored and included self-attributed need for power and
influence, ability to influence/have power, resistance to subordination, internal locus of
control, job satisfaction, and achievement values. Analyses revealed three psycho-
logical types of female entrepreneurs: the need achiever entrepreneur, the pragmatic
entrepreneur and the managerial entrepreneur. The need achievers had high need
achievement scores, the managerial entrepreneurs had high self-attributed need for
power and influence scores, and the pragmatic entrepreneurs were moderate on both
motivations of achievement and power.

According to Ritchie, Eversley & Gibb (1982), the development of new enteqirises is the
cornerstone of economic growth. Despite public interest in entrepreneurial behaviour,
empirical research into the psychological attributes of individuals who found new enter-
prises has been sketchy, and little has involved women. Yet increasingly, entrepreneurship
has become a career option for women: there are 255 500 women in business in Australia,
or 31.5 per cent of the entire population of small business proprietors. Similar figures for
the United States have been cited by Bowen & Hisrich (1986).

Dominant personality characteristics of entrepreneurs

Extensive research over four decades into the characteristics of entrepreneurs (McClelland,
1961, 1965, 1987;:^) has established that the innate (early-learned) need for achieve-
ment is essential. Those high in "need achievement' are thought to have a general orienta-
tion towards certain types of goals, entrepreneurial activity being one of these goals
(McClelland, Koestner & Weinberger, 1989, p. 692). However, other variables commonly
found amongst managers are also thought to be important for successful proprietorship
(Brockhaus, 1982; Hisrich, 1990). In a number of studies, McClelland (1987^),

'Requests for reprints.

210 Janice Langan-Fox and Susanna Roth
McClelland & Boyatzis (1982) and McClelland & Burnham (1976) have argued that
entrepreneurs compared with, say, managers, require distinct motive dispositions and
that the hierarchical ordering of these motives should be differently prioritized in indi-
viduals belonging to these different groups. For instance, successful entrepreneurs should
be high in the need for achievement and low in the need for power, or the need to have
'impact, control, or influence over another person, group or the world at large' (Winter,
1973, p. 73), Conversely, successful managers should be higher in the need for power and
lower in the need for achievement.
Some other writers present a rather different picture, Furnham (1992) has advocated
that the 'influencing" attributes of entrepreneurs are paramount to the continued success
of the business. Timmons, Smollen & Dingee (1985) characterized the successful
entrepreneur as someone who can 'get things done through other people" (p, 115). Hisrich
(1990, p, 215) recently argued that as a venture enters a growth phase, there is an increas-
ing need for entrepreneurs to have 'managerial skills'. This suggests that entrepreneurs,
not just managers, should possess 'power motivated' characteristics (Winter, 1973) and
that McClelland & Burnham's (1976) argument, that need achievement is the dominant
motive disposition for entrepreneurs, may be in conflict with contemporary research.
Furthermore, the hierarchical ordering of typical managerial (influencing people) and
entrepreneurial behaviours (achievement motive) could vary in priority amongst
entrepreneurial types. Some ambiguity does seem to exist over the dispositions which pri-
marily motivate entrepreneurs, Further, because the bulk of past research has involved
males, Bowen & Hisrich (1986) state that 'no firm conclusions on the need achievement
of female entrepreneurs can be drawn' (p. 114).

Typologies of entrepreneurs

A number of researchers have constructed typologies of entrepreneurs (Gibb & Ritchie,

1982; O'Connor, 1983; Smith, 1967; Vesper, 1980) in order to group entrepreneurial
behaviours necessary for entrepreneurship. This information is helpful for educative
programmes and can facilitate research by reducing the enormous range of potential
variables to a manageable size, However, none of these typologies have come from a
psychological perspective. Three typologies have been published for female entrepreneurs
(Cromie & Hayes, 1988; Goffee & Scase, 1985; Hertz, 1986). These typologies were
formulated as conceptual frameworks, and were not tested statistically. The criteria
used to generate the four types in the Goffee & Scase (1985) typology were not psycho-
logical characteristics but rather the subjects' attachment to entrepreneurial and family
values, Cromie & Hayes" (1988) three-way classification and Hertz's (1986) classification,
of the female entrepreneur utilized some psychological measuresthese, however, were
incidental to the developed typology and were not the main generating forces behind
the types.
Thus, the aims of the study were both theoretical and empirical: {a) to investigate the
psychological attributes and motivations of founder women, including an exploration of
McClelland"s ideas regarding the relevance of particular achievement (entrepreneurial)
variables as well as power (managerial) variables; and {h) to establish and test the existence
of female entrepreneurial 'types' statistically. It was hypothesized that at least one of the
'types" would be dominant in both achievement and power motivations.
 Women and achiei^ement motivation 211

Method
Subjects
In 1991-1992, 60 escablished female founder businesswomen in the state of Victoria, Australia, participated
as unpaid volunteers, and were recruited from a number of sources: a national listing of businesswomen. The
Directory o/ff'omiW (1988); two business women's network groups; businesswomen known in the community.

Sample criteria
In order to obtain a true sample of 'entrepreneurs , subjects had to meet tbe following criteria for selection:
(i) a minimum of 50 per cent share of the business; (ii) founded the business by themselves or with a partner;
ot (iii) bought an already established business which they were operating. Subjects were not selected if they
had less than a 50 per cent share of the business, if they inherited the business from a spouse or other relative,
or if they took ownership as part of some form of property settlement. Business ptoprietors needed to have at
least a 50 per cent share of the business to be described as assuming the accompanying financial, psychic, and
social risks' (Hisrich, 1990, p. 209) which entrepreneurship entails.

Background of subjects
Altogether, 66.7 per cent of the sample owned 100 per cent of the business and 70 per cent set up the busi-
ness themselves; 86.7 per cent had employees, with 26,7 per cent having more than 10 employees; 68.3 per
cent earned more than $40 000 per annum from their business (above national average of $32 297; Australian
Bureau of Statistics, 1992^); 18.3 per cent owned more than one business and 68.3 per cent had been in busi-
ness more than five years. The sample's demographic details strongly resembled previous studies of
entrepreneurs (Cromie, 1987^; Hisrich & Brush, 1984; Humphreys* McClung, 1981; Ronstadt, 1984). Age
ranged from 26 to 55, with most in the age range 36 to 55; 61 per cent were married and 26 per cent were
divorced; 31 per cent had no children; 63 per cent had fathers in professional or managerial occupations and
56 per cent were raised 'in keeping with the Protestant faith'; 41 per cent were tertiary-educated to at least
degree level; 15 per cent were born overseas, with 32 per cent having fathers and 47 pet cent having
mothers, born overseas, Al! had been in business in excess of five years. The entrepreneurs worked in indus-
tries such as communications, the professions, management/consulting/recruitment, wholesale/retail trading,
hospitality/tourism, finance and manufectuting,

Measttres
Subjects completed (i) a survey questionnaire and (ii) an individual interview. Measures used to establish the
typology were well established psychological measures, with many previously used in studies of
entrepreneurs,

(i) Survey questionnaire

This consisted of requests for biographical information and measures that were to be used in the analytic tech-
niques. These were: (1) Achievement Motivation scale (Lynn, 1969), which measures achieving values. This
scale is referred to as 'san Achievement' as recently defined by McClelland et al. (1989). The term 'san'
achievement was constructed by McClelland in order to differentiate 'need' and 'san' achievement. 'San' refer-
ring to values which are thought to reflect relatively conscious mental representations, inferring some degree
of evaluation. Such values are appropriately measured using some form of self-report questionnaire. On the
other hand, 'need' and need achievement' refer to basically unconscious motive dispositions which more accu-
rately describe the energizing, driving and selecting function of motivation; (2) four subscales of Kahl's
(1965) achievement values questionnaire: (i) trust, (ii) primacy of the business, (iii) activism, (iv) indepen-
dence; (3) Rotter's (1966) Internal-External Locus of Control scale; (4) Hoppock's Job Satisfaction scale
(McNichols, Stahl & Manley (1978); and (5) four Bennett subscales from Bennetts (1988) Index of Personal
Reactions: (i) resistance to subordination, (ii) san Influence, (iii) san Power, (iv) ability to influence/have
power.
 212 Janice Langan-Fox and Susanna Roth
(ii) Individual interview
Besides questions about risk taking and business goals (not reported here), rhe Thematic Apperception Test
(TAT), one of the most widely used methods of psychological assessment (Groth-Marnat, 1990), was admin-
istered to the women to measure achievement motivation (McClelland, Atkinson, Clark & Lowell 1958)
Sentence cues were used which have been found to be similarly effective in eliciting need achievement' (Entin^
1973). Ftom a literature review, no appropriate business' sentence cues for women could be found and four
non-business cues were selected and presented in booklet form. Varying opinions exist as to the appropriate
number of cues to use to elicit implicit needs (Smith, 1992); four cues, however, have been found to be ade-
quate (McClelland, 1958; McClelland et al., 1958). Three of che cues were taken from Horner (1968)
Hoffman (1975) and Langan-Fox (1991). The fourth cue was taken from McClelland et al. (1958) The cues
were: (i) Caroline is looking into her microscope: (ii) a young woman is calking about something imj^ortant
with an older person; (iii) at the end of the school day, Barbara is going back to the school lab; (iv) a brother
and a sister are playingone is a little ahead of the other. Scoring reliability procedures described in
McClelland et al. (1958) were carried out. The inter-scorer reliability study involved using 30 case protocols
available from a previous study. Results were within those prescribed in the manual (McClelland et al., 1958)-
category agreement of 93 per cent and rho of .93.

Procedure
<i) Survey questionnaire. This was posted to the subjects prior to the interview.

<ii) Individual interview. Conducted at the entrepreneur s place of business during normal business hours. The
participant was requested prior to the interview to avoid interruptions. Procedures described here refer to the
TAT. Since the measure is more likely to be affected by the conditions of test administration, considerable care
was taken to ensure that testing conditions m the field setting were neutral and consistent across the differ-
ent conditions of administration (Atkinson, 1958; Veroff, Reuman & Feld, 1984). The following standard-
ization steps were taken: (i) subjects were asked to refrain from drinking alcohol prior to interview (ii) to
attain an acceptable method of'similar experiences' (Atkinson, 1958) the interview was conducted in the par-
ticipant s usual place of work, at their desk; (iii) tbe interview was begun with an informal chat which enabled
rhe participant to feel at ease with the investigator, as is required in the usual neutral' condition; (iv) identi-
cal instructions were given. Subjects were given their test booklets, which wete also stated verbally by the
investigator. During completion of the TAT exercise, the investigator sat quietly reading a magazine. Four
minutes were given to complete each story. Including other questions not reported in this paper, the at-work
interview took one and a half hours.

Results
To test the existence of the entrepreneurial types, hierarchical agglomeracive cluster anal-
ysis using SPSSx was petformed in order to group together people with similar psycho-
logical profiles. Need achievement (TAT), and variables stated in the survey questionnaire
were included in the analyses. Raw test scores were standardized to z scores (Norusis,
1988, p. 165). From the cluster analysis, the sample divided into three 'relatively homo-
^'eneous groups'. This was determined on the basis of the ratio of distances between each
step in the clustering process as displayed in the dendrogram, and on the basis of the the-
oretical interpretabilicy of the solution. The three-cluster solution corresponded to a
rescaled ratio distance of approximately 15. The two-cluster solution corresponded to a
rescaied ratio distance of 22. This was a considerable increase suggesting that the groups
being combined in che two-cluster solution were considerably dissimilar. Moving from a
four- to a three-cluster solution did not create a marked increase in the dissimilarity of the
groups combined and it seemed that the fourth cluster was of no value in terms of pro-
 Women and achievement motivation 213
viding greater interpretability of the solution. In other words, the Fourth cluster did not
appear to have any distinct characteristics and as such could not be described as a distinct
type. Therefore, on the grounds of parsimony and theoretical soundness (Everitt & Dunn,
1991), the three-cluster solution was preferred. To gain further evidence of the underly-
ing structure of the data and to test the robustness of the three-cluster solution.
Multidimensional Scaling (MDS) was performed. The 12 variables used in the cluster
analysis were scaled utilizing the ALSCAL procedure in SPSSx (Macintosh, Version 4).
The proximities command was used to standardize the variables in the proximity matrix
before MDS was conducted. To determine the number of dimensions which best repre-
sented the data, three approaches were adopted. The first approach was to plot Kruskal's
stress values against two, three, four and five dimensions. The plot indicated that the
'elbow' in the curve, i.e. the point at which an increase in the number of dimensions
yielded only a small improvement in goodness-of-fit, occurred at dimension three.
Although 'stress' continued to decrease as the number of dimensions increased, this
decrease in stress was not significant enough to warrant the increased complexity of a four-
or five-dimensional solution. The data suggested that a three-dimensional solution was an
adequate representation of the data as the improvement in goodness-of-fit began to taper
off at this dimension. The second approach to determining dimensionality was to use
Kruskal's (1964) 'rules of thumb' for interpreting the stress values obtained for each
dimension. These rules of thumb are now generally considered to be 'very conservative"
(Young & Hamer, 1987, p. 21). According to Kruskal's (1964) rules for interpretation,
the stress value obtained for a three-dimensional solution was, at the very least, 'moder-
ate', and certainly better than a two-dimensional solution. While increasing the number
of dimensions naturally decreased the 'badness of fit', moving from a three- to a four- or
five-dimensional solution did not lead to an extreme improvement (i.e. stress still did not
lie in Kruskal's excellent' range of less than .01). So the increased complexity of a four-
or five-dimensional solution did not appear to be warranted psychometrically. This pro-
vided further evidence for the conclusion that a three-dimensional solution was the most
parsimonious representation of results. Thirdly, as a final check on the adequacy of the
three-dimensional solution, a comparison was made between the obtained stress value and
Spence & Ogilvle's (1973) Monte Carlo studies of random data. Spence & Ogilvie (1973)
evaluated the stress in a number of dimensions of a large number of randomly generated
proximity matrices for sets of objects of different sizes. Using their tables of mean stress
values for random data, it was ascertained that the stress value obtained for a three-dimen-
sional solution scaled on 12 points has a mean stress value of .135. Spence & Ogilvie
(1973) advised that if the stress levels obtained fall below those presented for random
data, this provided evidence that the results obtained are not what would be expected by
chance. The stress level obtained was below what would be expected by chance. Hence, it
was concluded that the three-dimensional solution was a meaningful representation of the
data. A figure (Fig. 1), was constructed of the mean scores for the three clusters against
each of the variables used to generate the clusters. Figure 1 shows that cluster 3 is much
higher than the other 2 clusters on nAch (n Achievement).
It should be noted here that the usual statistical method of establishing significant dif-
ferences between groups on dependent variables (for example, analysis of variance), was
not an option in this case because the clusters were themselves by-products of the depen-
dent variables, having been used to generate the clusters in the first place. Hence, the only
214 Janice Langan-Fox and Susanna Roth

nAdi K ^ (Total) Thul ladrpcndcnct tnlenul LOC AUIII)< H n InflutBa

u n Acfa Primacy AetM-na Jab Siilisraciian IPR (Tolal) Power RCSMBDCC la uibcn]
PSYCHOLOGICAL MEASURES

Figure I. Cluster membership by psychological variables. , cluster 1: Managerial type; H, duster 2: Tbe
Pragmatists; A, Need cluster 3: Achievers.

Option available to describe the clusters was to examine the means and standard deviations
for each cluster on each of the psychological measures. Plots of the means allowed a visual
examination of the differences between the clusters. To allow comparison across the dif-
ferent variables / scores were computed. Table 1 gives the standardized (/ scores) means
and standard deviations for the three clusters on each of the variables used to generate the
clusters. Cluster 3 has a high nAch score and is consistent from theory (McClelland,
1987^).

Description of the psychological profiles

Figure 1 and Table 1 indicate that the psychological characteristics of each of the clusters
were as follows:

Cluster 1: Managerial entrepreneurs (N = 11). Cluster 1 has the lowest nAch score (raw
mean = 3.09), and the same mean score as Wainer & Rubin's (1969) low nAch
entrepreneurs (^3). Cases were very high on each of Bennett's (1988) four subscales: abil-
ity to influence/have power, san Power, san Infiuence, and resistance to subordination.
This group has the highest level of internal locus of control, san Achievement, job sat-
isfaction, and activism or planning for career and a low level of 'trust in humankind".
Dominant traits were those of managers, and the cluster was named the 'Managerial
entrepreneurs'.

Cluster 2: Pragmatist entrepreneurs (N = 34). Figure 1 and Table 1 illustrate that cluster 2
cases are "middling" on most psychological variables; they are neither very high nor very
low on the following variables: nAch [raw mean 5.25, similar to Wainer & Rubin's
 Women and achievement motivation 215
Table I. Standardized t scores means and standard deviations for each of the variables
used CO generate the three-duster solution

Clus 1 Clus 2 Clus 3

Variable M SD Ai SD M. SD

nAch 43.36 6.65 48.31 8.51 58.70 9.82

san Ach 54.79 6.91 51.63 7.99 42.79 12.52
Primary 47.81 7.11 50.43 11.47 50.64 8.44
Trust 47.25 10.5 49.08 10.04 54.1 8.85
Activism 58.31 6.3 50.95 6.71 41.74 12.55
Independence 55.29 5.01 47.82 12.02 51.06 5.31
Job satisfaction 53.73 7.53 51.38 10.14 44.14 9.29
Internal LOC 60.82 4.86 45.88 8.21 51.4 10.50
Ability 56.37 7.43 51.4 9.46 42.16 8.3
san Power 57.49 9.99 50.18 7.85 44.10 11.11
nlnfluence 57.92 5.25 51.38 8.69 41.07 9.19
rSubord 56.94 10.2 48.11 9.83 49.21 8.51
Kahl" 55.93 5.81 49.68 9.48 46.39 12.05
IPR' 59.99 8.13 50.43 8.32 41.70 7.64
* These are means for ihc total scores on Kahl's achievement orientation measure and Bennett's Index of Personal Reactions
(IPR). Because each of the subscales was clustered, these total scores were not entered into the clustering solution. The
results for the total scores are presented herefordescriptive purposes only.

(1969) moderate nAch entrepreneurs], san Achievement, trust, activism, job satisfaction,
ability to influence, san Power, and need for influence. Cluster 2 cases score the lowest on
internal locus of control, resistance to subordination, and independence from family. They
were not motivated by the intrinsic rewards entrepreneurship offers in the same way as
the other clusters. Scores derived from other measures taken from the subjects, but not
included in the cluster and MDS analysis, showed that this group of women seemed to be
motivated by family concernsopportunity to pass the business on to childrenand
expectations of earning more money in self-employment. They had practical, pragmatic
and economic reasons for entrepreneurship. This group also lacked some of the usual char-
acteristics of entrepreneurs such as high internal locus oi control and resistance to subor-
dination. Cluster 2 cases had a utilitarian approach to entrepreneurship and were referred
to as 'Pragmatist entrepreneurs'.

Cluster 3: Need Achiever entrepreneurs (N = 13). These cases represent the pure 'need for
achievement' type (McClelland, 1987^). Mean level of nAch is the same as in Walner &
Rubin (1969): 9.73. Cluster 3 is also the lowest of the three clusters on the following vari-
ables; job satisfaction, activism, san Achievement, ability to influence/have power, need
for influence, and san Power. Cluster 3 was titled 'Need Achiever entrepreneurs".

Discussion
The study set out to investigate the major psychological variables belonging to
entrepreneurs, to examine the importance of other variables commonly associated with
 216 Janice Langan-Fox and Susanna Roth
managers, and to test the existence of entrepreneurial 'types'. The need achievement type
constituted 25 per cent of the sample, the low nAch type (managerial type) constituted
18.3 per cent of the sample and the pragmatists constituted 56.6 per cent of the sample.
Hence, two of the types (81.7 per cent of the sample) had a moderate to high nAch. For
one-quarter, need achievement is a highly energizing force behind their enttepreneurship,
and for nearly two-thirds it is at least moderately important. McCIeiland's research on the
importance of nAch to enttepreneurship was given firm support in the present study: a
high nAch characterized one of the psychological types. While the sample as a whole dis-
played a high degree of job satisfaction, it is interesting to note also that the 'Need
Achievers' are the lowest in job satisfaction. By definition, high nAch individuals are con-
stantly 'competing with standards of excellence' and possibly can never be truly satisfied.
Studies have shown, for instance (Atkinson, 1958), that subjects high in nAch are
attracted to tasks of moderate difficulty; however, once these tasks are mastered they no
longer hold any incentive value. The possibility then of individuals high in need achieve-
ment having relatively low job satisfaction is always present. It is also interesting to note
that the 'Need Achievers' are the lowest on 'self-attributed' (san) achievement (Lynn,
1969). McClelland etal. (1989) have argued that there is no reason to expect that the two
types of measures as assessed by 'san" and 'need' achievement measure different aspects of
personality, and are therefore not correlated. In the present study, there was a negative cor-
relation between the TAT and Lynn's Achievement Motivation scale (r = - 07 b =
.274). ' '^
McClelland & Burnham (1976) described the profile of an entrepreneur as high in
iiAch and low in nPower, while good managers have high nPower and low nAch. While
the implicit need for power was not measured (through the TAT), it is not surprising that
one of the types of entrepreneurs manifests the psychological characteristics of managers
given the high degree of managerial activity involved in running a business. The man-
agerial entrepreneurs obtained the highest scores on the Bennett Index of Personal
Reactions which is a self-report measure of value of power and influence. As Cromie &
Johns (1983) concluded: 'The skills necessary to ensure the growth and development of
an enterprise may well be different from those required to conceive and launch a busi-
ness. . .the longer an entrepreneur remains in business the greater is the tendency for him
(her) to resemble an administrative entrepreneur' (p. 322).
The pragmatists displayed evidence of interdependence of motives. The characteristic
of the pragmatists is that they are not very high in nAch or in self-attributed value of
influence and power: they display moderate levels of both. Thus moderate levels of
these dispositions could, as the literature suggests, energize the individual to enter
entrepreneurship and equip him/her with the necessary organizational and managerial
abilities. The finding that a major proportion of the sample have a combination of
'common' managerial and entrepreneurial motivational dispositions is strong evidence to
suggest that McClelland & Burnham's (1976) theoretical distinction between the moti-
vations of managers and entrepreneurs may be oversimplified. In the absence of other
research, this interpretation may be peculiar to this particular sample or to females in gen-
eral. For instance, other studies have suggested that men and women differ on implicit
needs (Schroth 1985).
Further research needs to be conducted with different combinations of psychological
variables, in particular, longitudinal studies with both male and female entrepreneurs. In
 Women and achievement motivation 217
the interim, it would appear that there is wisdom in the advice of Gibb & Ritchie (1982),
that searching for unitaty characteristics of'the entrepreneur' only serves to blur the dis-
tinctiveness between different types.

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Received 15 December 1995; revised version received 3 November 1994