VOLUME 8 NUMBER 6

1993

What Do Psychological Tests

Suggest about Entrepreneurs?
SallyP.Caird

The reasons for the importance of looking at the with business owner-management, and so on.
application of psychological tests to entrepreneurs The simplest and most easily operationalized
include the idea that there is a correlation definition of an entrepreneur is a business owner-
between economic growth and business manager. However, even this definition has
formations. This draws attention to the activities limitations because an entrepreneur is a special
of entrepreneurs and methods of identifying and category of business owner-manager, that is an
assessing these individuals. This article discusses innovative risk-taker. Although this is less easy to
the results of some psychological tests which operationalize, it is the definition maintained in
have been used with entrepreneurs. this article unless otherwise stated.
Interest in the application of psychological tests The main problems in the psychological testing
to entrepreneurs stems from interest in exploring of entrepreneurs relate to the varying definitions
the elusive nature of the entrepreneur. Tests may of the entrepreneur, the numerous characteristics
also help to assess participants on enterprise attributed to entrepreneurs and uncertainty about
training courses as well as help with the selection the significance of entrepreneurial characteristics.
of entrepreneurs for training, advice and financial These problems largely account for the main uses
support. of psychological tests with entrepreneurs which
Previous reviews of this area have focused are either to explore the nature of the
more on definitional issues than on psychological entrepreneur or to assess so-called significant
measurement (e.g.[l]). This is important because entrepreneurial characteristics.
there are problems in defining and identifying
These problems limit a review of the
entrepreneurs. The term "entrepreneur" usually
refers to innovative, risk-taking business owner- psychological tests employed with entrepreneurs
managers. However, some definitions may apply because the characteristics of entrepreneurial
not only to the occupation of business owner- samples are not always clear. However,
management but to the psychological psychological tests may be useful for identifying
characteristics associated with entrepreneurial entrepreneurial types, distinguishing more from
behaviour. The concept of entrepreneur could less enterprising individuals and establishing
therefore broadly apply to any individual in any psychological differences between
occupation of any status who shows entrepreneurial types with psychological test
entrepreneurial initiative. For example, there have results.
been studies of so-called social entrepreneurs
who set up enterprises in the voluntary sector EXPLORING THE NATURE OF
with aims to benefit society rather rather than ENTREPRENEURS
make profits[2].
The majority of tests used with entrepreneurs
Clearly, entrepreneurs are not a homogeneous could be described as personality tests rather than
population and there may be different types of tests of ability, attainment or aptitude.
entrepreneurs, distinguished by their growth
orientation, motivation, type of business,
involvement with new technology, association This article is partially based on research carried out at
the Durham University Business School which published
the author's previous work, A Review of Methods of
Journal of Managerial Psychology, Vol. 8 No. 6,1993, pp. 11-20
Measuring Enterprise Attributes in 1988. She is grateful
© MCB University Press, 0268-3946 to Mr C. Johnson for advice given at the time.

11
 JOURNAL OF
MANAGERIAL
PSYCHOLOGY

The main tests are described below (see Table Edwards Personal Preference Schedule
I). These tests include: (EPPS)
(1) the Thematic Apperception Test (TAT); The EPPS is an objective, reasonably reliable,
(2) Edwards' Personal Preference Schedule; personality test which requests the subject to rank
(3) Honey and Mumford Measure of Learning order the importance attributed to the fulfilment
Styles; of needs[6]. This instrument suggests that needs
(4) Jackson's Personality Inventory (JPI); and are ranked, not in the absolute Maslowian
hierarchical structure, but uniquely by
(5) Myers-Briggs Type Indicator (MBTI).
individuals, according to personal priorities. This
Two traditions of testing have influenced the implies that when the individual is forced to
development of tests. The impressionistic school choose between the fulfilment of various needs,
favours the use of projective measures, such as the need which has strongest motivating power
the Thematic Apperception Test (TAT) which will be chosen for fulfilment.
employs unstructured tasks and formats to This test found that entrepreneurs exhibited
measure motivation by requesting the subject to high needs for achievement, autonomy,
invent a story based on test pictures. The dominance and change with low needs for
influence of the psychometric tradition of testing deference, order, affiliation and abasement[7].
is more common and may be attributable to The need for autonomy was found to be the
reliability problems and the impracticality of strongest reason for starting a business[7, p. 6].
scoring procedures in projective testing. On the basis of Watkins' findings, subsequent
The psychometric approach favours the researchers have reduced the size of the EPPS to
employment of objective tests, which ask the include only the items representive of
respondent to rate predetermined scales of test entrepreneurial needs. For example, using the
items representing attitudes, preferences or scales of autonomy, achievement and dominance,
habitual responses. A variety of formats may be there were no significant differences found in the
used to collect responses. These range from less results of testing differences between black and
sensitive true/false or agree/disagree response white entrepreneurs[8].
formats to formats such as the Likert and multiple
choice which allow greater flexibility in the
Honey and Mumford Measure of Learning
reponse given (see Table I).
Styles
The Thematic Apperception Test (TAT) The Honey and Mumford measure of learning
styles is a general measure of individual learning
In McClelland's work, the TAT attempts to
dispositions[9]. This test identifies whether
measure needs for achievement, power and
individuals have a preference for learning through
affiliation by presenting pictures which suggest
reflection, theorizing, experimentation or
stories about problems to be solved with boss-
action[9]. The results of this measure show that
subordinate relationships, family and friendship,
the most successful growth oriented small
respectively[3]. This research found that the
entrepreneur has high needs for achievement, high business owner-managers have activist and
needs for power but low affiliation needs, that is pragmatic learning styles[10]. In other words, this
the need to relate to others and be approved by test shows that entrepreneurs prefer to learn
them[3]. Similar findings were reported in "The through action and experimentation rather than
Enterprising Man" when depth interviews and the through theory and reflection.
TAT supported the entrepreneur's high need for
achievement and autonomy[17]. Jackson's Personality Inventory (JPI)
Tests may reveal differences between different The well-validated JPI is an objective test which
types of entrepreneurs. When the TAT was used measures a number of different characteristics
with technological entrepreneurs, it was found which include innovation, conformity,
that they exhibited moderate rather than high organization, responsibility and risk taking ([11],
needs for achievement and power with low needs see Table I). In comparative studies between
for affiliation[5]. Further results revealed that entrepreneurs and managers, entrepreneurs scored
technical entrepreneurs were heavily orientated lower on measures of conformity and
towards independence and concerned with interpersonal effectiveness but higher on
meeting challenges more than financial measures of energy, risk-taking, autonomy,
rewards[5]. reaction to change and social adroitness[12].

12
 VOLUME 8 NUMBER 6
1993

User Name of test Characteristic Format

McClelland [4]; Thematic Apperception Need for achievement Open ended-projective
Collins et al. [17]; Test (TAT), McClelland Need for autonomy test with criteria-based
Dies, [37]; Roberts [17] Need for affiliation scoring and
[5] interpretation
Watkins [7]; Edwards Personal 15 Needs - Achievement, Forced multiple choice
Homaday and Aboud Preferences Schedule Deference, Order, with systematic rotation
[8]; Begley and (EPPS), Edwards [6] Exhibition, Autonomy, of items corresponding
Boyd [23] Affiliation, Introspection, to each need
Succorance, Dominance, Consistency check
Abasement, Nurturance,
Change, Endurance,
Heterosexuality and
Aggression
Maxon [15]; Myers-Briggs Type Examines styles of Structured with variation
Roberts [5]; Indicator, Myers and perception and judgement in Forced Choice
Hoy and Carland Briggs[13]. along four dimensions: Format, e.g. Multiple
[14] Introversion/Extroversion Choice plus Yes/No etc.
Intuition/Sensation
Thinking/Feeling
Judging/Perception
Thorpe and Dyson Learning Styles Active/Pragmatic, Forced choice, Agree or
[10] Questionnaire, Honey Reflective Theoretical Disagree
and Mumford [9] Learning Styles
Sexton and Bowman Jackson Personality Anxiety, Breadth of Forced choice, Agree or
[12]; Begley and Inventory, Jackson Interest Complexity, Disagree
Boyd 1[23] [11] Conformity, Energy Level,
Innovation, Interpersonal
Effect, Organization,
Responsibility, Risk-
taking, Self-esteem, Social
Adroitness, Social
Participation, Tolerence,
Value Orthodoxy,
Infrequency

TABLE I.
Exploring the Nature of Entrepreneurs
Myers-Briggs Type Indicator (MBTI) employees, comparisons are limited by the
possibility of migration in employment status and
Further insights into the nature of the
activities. However, studies which compared the
entrepreneur are offered by the MBTI which
attempts to identify the style in which individuals MBTI profile of managers and entrepreneurs
are disposed to operate. The test examines found that entrepreneurs are more intuitive,
preferred styles of perception and judgement thinking and perceptive than managers who are
along four dimensions: introversion-extroversion; more sensing, feeling and judging[14]. However,
intuition-sensation; thinking-feeling; judging- no significant differences were found on
perception[13]. The introversion-extroversion measures of introversion and extroversion[14].
dimension identifies whether you prefer to focus A comparison of entrepreneurs with
more on your inner world on your own or the intrapreneurs (enterprising employees) found that
outer world of people and objects. The intuition- entrepreneurs tend to be introverted, intuitive,
sensation dimension identifies whether you like thinking and judging types whereas intrapreneurs
to look for meanings, patterns and possibilities or tend to be extroverted, intuitive, thinking and
the realities and facts of a situation. The thinking- perceptive[5]. Comparisons between
feeling dimension measures whether you make technological entrepreneurs and scientists and
decisions based on objective analysis or your engineers found that technological entrepreneurs
feelings and sympathy for people. The judging- score more highly on measures of extroversion,
perception dimension identifies whether you intuition, and thinking and perception[5].
prefer to order and control life or flexibly respond The MBTI results support an entrepreneurial
to ever-changing opportunities. orientation towards thinking and intuition because
When this test is applied to managers, this describes entrepreneurs, technical
entrepreneurs and intrapreneurs or enterprising entrepreneurs and intrapreneurs. However,

13
 JOURNAL OF
MANAGERIAL
PSYCHOLOGY

intrapreneurs and technological entrepreneurs are there have been attempts to assess so-called
extroverted and perceptive, unlike entrepreneurs significant entrepreneurial characteristics. These
and managers who are introverted and judging. so-called significant entrepreneurial
Roberts' emphasis that perceptiveness describes characteristics include the high need for
the inventor might explain why intrapreneurs and achievement, internal locus of control, creative
technological entrepreneurs are more perceptive tendency and calculated risk taking.
than managers[5]. However, non-technical
entrepreneurs emerge more judging than
perceptive which is not easy to square with
Need for Achievement (NACH)
definitions of entrepreneurs as innovative McClelland claims that (NACH) is associated
business owner-managers. If perceptiveness is with entrepreneurship and economic growth and
indicative of inventiveness which is not therefore determines the individual's
descriptive of non-technical entrepreneurs who entrepreneurial potential[4]. Despite unproven
are innovative, then further work is needed to associations, McClelland's claims inspired the
distinguish concepts such as invention, development of more tests of this need for
innovation and entrepreneurship. achievment than other enterprise characteristics
(see Table II).
A high NACH is defined as the positive affect
ASSESSING SIGNIFICANT aroused in situations which involve competition
ENTREPRENEURIAL CHARACTERISTICS with a standard of excellence[4]. This is
associated with certain characteristics which
The application of psychological tests to explore
include self-awareness, planning ability,
the nature of entrepreneurs has shown that
initiative, problem solving, energy, innovation,
entrepreneurs have the following characteristics:
determination, motivation[4]skilled risk-taking,
a high need for achievement, autonomy, change,
responsibility, decision making[4], and superego
dominance, a low need for deference, abasement, strength[18].
affiliation and order, characteristics of risk taking,
energy and social adroitness; a preference for
learning through action and pragmatism; and a Internal Locus of Control
preference for intuition and thinking.
An individual with an internal locus of control
The administration of any psychological test takes responsibility for successes and failures,
will create a result and stamp its mould on the attributing outcomes to his or her own ability and
respondents. A research study of 300 effort, unlike an individual with an external locus
entrepreneurs is currently underway using a of control who relates outcomes to task ease or
selection of scales from the Minnesota difficulty, luck, fates, powerful others or being in
Multiphasic Personality Inventory (MMPI), the the right place at the right time. Measures of
Personal Profile System (PPI), the Fundamental internal locus of control describe the extent to
Interpersonal Relations Orientation Behaviour which individuals believe that reinforcements are
Scale (FIRO-B), the Herrmann Brain Dominance dependent on their own behaviour[19,20].
Inventory (HBDI) and the Rokeach Value This construct is strongly associated with
Survey[16]. Claiming that there are similarities entrepreneurial orientation[21]. Some studies
between entrepreneurs and sociopaths, the have found that it differentiates entrepreneurs
researchers plan to test the hypothesis that from managers[22]but others have not[23].
entrepreneurs are mildly sociopathic[16]. However, internal locus of control is also
Whether testing such a hypothesis is useful or associated with the following set of positive
not, this work demonstrates that any characteristics, many of which may be described
psychological test may be applied to as entrepreneurial: insight, initiative, tolerance,
entrepreneurs. However, the results of the dominance, achievement, well-being, assertion,
application of psychological tests are most useful independence, effectiveness, industriousness,
for understanding entrepreneurs when those sociability and intellectual efficiency[24].
results are correlated with entrepreneurial
behaviours and ventures. It is true that there have
been few attempts to establish these links, which Creative Tendency
is a criticism of the use of tests with The Kirton Adaption-Innovation Inventory (KAI)
entrepreneurs. However, despite the heterogeneity is one of the few tests of creativity used with
of entrepreneurial characteristics and the scarcity entrepreneurs. Although mainly applied to
of studies which associate the test results with managers in organizations[25], this test looks at
entrepreneurial behaviours and achievements, creative style rather than ability and suggests that

14
 VOLUME 8 NUMBER 6
1993

User Name of test Characteristic Format

Lynn [18] Lynn's Achievement Need for achievement Forced choice - with
Motivation yes/no response format
Questionnaire,
Lynn [18]
Smith [34] A Quick Measure of Need for achievement Forced choice and
Achievement Motivation, directive - with yes/no
Smith [34] response format
Mehrabian and Bank Measures of Achieving Need for achievement Likert scale
[31, 43]; Tendency, Mehrabian
Lachman [42] and Bank [31]
Joe [24]; Cromie and Internal Locus of Locus of control Forced choice and
Johns [22]; Cachon Control, Rotter [19] directive - with yes/no
and Cotton [21]; response format
Begley and Boyd [23]
Scanlan [44] Levenson's Measure of Locus of control Likert scale
Locus of Control,
Levenson [20]
Cachon and Cotton Kogan-Wallach-1964 Risk taking Open-ended and multiple
[21] Dilemma Instrument, choice
Kogan and Wallach [27]
Cross [26] Kirton Adaption- Creative style Likert-type format
Innovation Inventory,
Kirton [40]

TABLE II.
Assessing "Significant" Entrepreneurial Characteristics

creative style may be characterized by an to estimate the extent of risk that they are
adaptive or innovative mode of problem prepared to take in areas such as work, marriage,
solving[25]. The creative style of the adapter is to health, money, sport, education and so on.
improve within existing structures while the However, it may be inappropriate to measure
creative style of the innovator is to change the risks taken outside the business context because
structures themselves and take risks with one study of managers' risk-taking behaviours
uncertain outcomes[25]. This would suggest that showed that it was exceptional to find consistency
entrepreneurs should score high on innovative in risk-taking across different situations[28].
scales or those gaining high scores on innovative
scales would seek an entrepreneurial occupation. GENERAL PROBLEMS WITH TESTS
One study looked at the potential for using the AND TESTING
KAI to select potential entrepreneurs from a
sample of redundant managers, finding no The first assumption of testing is that
support for the hypothesis that innovative psychological characteristics may be measured
redundant managers seek the occupation of and that appropriate measurements may be found
entrepreneurship[26]. An explanation for this or developed. If this may be accepted then the
may be that innovators seek employment in next step is to develop, evaluate and employ
innovative companies[26]. Furthermore, a valid, reliable, sensitive and practical measures.
longitudinal study may produce different results The application of psychological tests to
as the KAI scores were correlated with preferred entrepreneurs begs many questions which are
strategies rather than actions of managers facing discussed below.
redundancy.
Are Tests Employed with Entrepreneurs
Risk-taking Validated?
The Kogan and Wallach measure of risk-taking A limited amount of validation work has been
behaviour has been used with entrepreneurs[27], carried out on tests which aim specifically to
and was found to correlate significantly with measure entrepreneurial characteristics (see Table
entrepreneurial orientation in student III). These tests tend not to be of the standardized,
samples[21]. This measure presents 11 areas of validated genre which are developed along the
uncertainty in which respondents are encouraged rigorous procedures for test development

15
 JOURNAL OF
MANAGERIAL
PSYCHOLOGY

User Name of test Characteristic Format

Boyatzis and Winter Testing the Specific attributes not Multiple choice
[30] Entrepreneurial You, identified
Boyatzis and Winter
[30]
Johnson and Caird General Enterprising Need for Achievement Forced choice,
[38] Tendency,Johnson and and Autonomy, Calculated Agree/disagree
Caird [38] risk taking, Creative
tendency and locus of
control
King [41] King's Achievement, Motivation, Multiple choice
Behavioural Checklist, Internal locus of control,
King [41] Risk taking propensity,
Problem-solving ability
and manipulative skills
Vicars et al. [45] General Entrepreneurial Specific attributes not Likert scale
Tendency, Vicars et al. identified
[45]
Freeley [36] Entrepreneurial Style Motivation, Problem Likert scale
Profile, Freeley [36] solving, Knowledge,
Persistence, Human
relations, Active
involvement, Variety,
Communications,
Responsibility,
Background Independence,
Risk taking

TABLE III.
General Measures

specified by the British Psychological • repeat results with repeated administrations on

Society[29]. Indeed, some of these tests are the same people and differentiate real personal
basically quizzes[30]. This suggests the change from test unreliability (reliability).
advisability of using these tests in a light-hearted
way rather than as an aid to making decisions Are the Assumptions about Human
about individual entrepreneurial potential or Nature and the Personality Valid or
suitability for business support or training. Testable?
When tests which are poorly validated are All psychological tests are based on some
administered, it becomes difficult to appraise theoretical understanding or assumptions about
results. If you cannot depend on the validity of a human nature which are frequently unproven. For
test then you cannot depend on the validity of example, the assumption underlying the Thematic
results, which could be a mere artefact of the test Apperception Test is that fantasy and overt
and have no reflection on reality. Extensive behaviour are directly related. The predictive
validation studies have been carried out on many validity of the instrument depends on the view
of the tests presented in Tables I and II. However, that fantasy (which is measured) represents
confirming that tests reliably measure what they behaviour or provides a preview of behaviour
claim to measure is a laborious, time-consuming (which is unmeasured). However, it is possible
proof. A valid test should: that fantasy does not reflect the personality of the
subject. Furthermore, fantasy may act as a
• look valid to the users (face validity); substitute for behaviour rather than an indicator
• discriminate between those tested with it of behaviour.
(discriminant validity); There is a tendency for tests to simplify the
measurement of the personality by using formats
• correlate with other psychological tests which
which may make artificial distinctions between
measure the same characteristics (concurrent
personality characteristics. Some psychological
validity);
tests are designed to assess, perhaps fallaciously,
• predict relevant behaviours (predictive personality characteristics as opposites. For
validity); example, Mehrabian's measure of achieving

16
 VOLUME 8 NUMBER 6
1993

tendency forces the respondent to choose between is known about psychological characteristics. For
the importance of fulfilling certain needs, thereby example, measures of single needs, such as the
implying some polarity between the need for need for achievement, are crude when one
achievement or affiliation; the need to achieve or considers the amount of work carried out on
to avoid failure; the need for challenge or for motivation theory and research[18,34]. The
superiority; the need for challenge or problem with measures of single needs is that
security[31]. Furthermore, the Kirton Adaption- even if the person receives a high score they may
Innovation Inventory (KAI) measures adaption, have needs that are more motivating than the
which is defined as the proclivity to do things need to achieve. For example, on Smith's scale a
better, and innovation, which is defined as the respondent may feel that it is more true than false
proclivity to do things differently, and polarizes "that the feeling of a job well done is a great
them on a continuum. In either case it may not be satisfaction" but may still have a stronger need
demonstrable that these are valid polarized for change or affiliation, and so on (see[34]).
dimensions. The complexity of personality characteristics are
rarely represented in tests. For example, the
Does the Test Measure What It Claims to complexity of risk-taking behaviour has not been
measured by psychological tests. Atkinson's
Measure? exploration of the relationship of motivation to risk-
The valid measurement of any characteristic taking reveals that risk-taking behaviour is a
fundamentally depends on the definition of the function of the strength of the motive to achieve or
concept. For example, with the need for avoid failure, the expectancy and probability of
success or failure, and the incentive value of
achievement, there is some confusion because success or the avoidance of failure[35].
this construct may be erroneously identified with
ordinary motivation to reach any goal and
assessed as such[32]. Originally the construct of Does the Format of the Test Allow for a
achievement motivation was coined to describe Valid Response which is Capable of
the striving to achieve specifically difficult and Discriminating among Subjects?
challenging goals to high personal standards of
The issue of test format is important for the
excellence[4]. Varying conceptions of this question of whether tests are sensitive to
construct have led to poor concurrent validity individual differences. Many of the tests
between the numerous measures of this employed with entrepreneurs favour a limited
construct[33]. response format, such as a forced choice
agree/disagree or true/false response
Does the Test Appear to Measure What It formatt[18,34].This format may produce reliable
Claims to Measure? results and offer a practical way to score
responses but may not be very sensitive or
It is important that tests appear to measure what discriminating.
they aim to measure, that is indicate face validity. Some balance is needed between reliability and
For example, Lynn's scale has been validated by sensitivity. However, some flexibility in response
showing that recognized high achievers score formats is important to prevent tests from
highly on it[18]. However, it appears to have face stamping a mould on the subjects. Tests of
validity given that it suggests that the high specific characteristics which use a limited-choice
achiever has a difficulty in relaxing on holiday, response format allow the subjects little
irritation with a lack of punctuality or efficiency, opportunity to offer a creative response which is
a dislike of waste, difficulty in forgetting about reflective of their individuality (see Tables I-III).
work, a preference for competent rather than The results of such tests may be superficial and
congenial partners and a propensity to strive to be may contribute little to understanding the
the best[18, p. 529]. These items seem intuitively entrepreneur's nature.
likely to reflect a high need for achievement, Forced-choice response formats may be less
thereby suggesting face validity. valid and sensitive than more open-ended
response formats; true/false, and agree/disagree
Do the Test Constructs Validly Reflect the formats being more limiting than the Likert scales
Complexity of the Psychological which encourage respondents to indicate the
extent of their agreement or disagreement with
Characteristic Being Measured? attitudinal test items along measures of intensity
Test development is limited by how little is or multiple choice formats which offer the
known about the nature of personality. However, respondent more flexibility in response (see
with some tests no attempt is made to reflect what Tables I-III).

17
 JOURNAL OF
MANAGERIAL
PSYCHOLOGY

From the vantage point of sensitive because responses may depend on respondents'
measurement the projective method employed confidence, self-awareness, honesty and
with the TAT has the advantage because it is open perception of the self-assessed test. Hence
ended. Respondents are required to create a story Freeley's claim that the rather transparent self-
in response to a set of pictures in their own style. assessment test "Entrepreneurial Style Profile"
There are scoring criteria to assess the responses. predicts the success of those who plan to start a
For example, measures of the need to achieve business, may depend on the self-awareness and
include whether the respondent defines a honesty of the respondents[36].
problem; express a desire to solve it; anticipates
difficulties; anticipates sources of help; and DISCUSSION
considers the consequences of success or failure.
The results of applying psychological tests shows
Unfortunately, the laborious nature of scoring
that entrepreneurs have the following
results reveals a practical disadvantage for an
characteristics: a high need for achievement,
otherwise sensitive measure. So although open-
autonomy, change, dominance; an internal locus
ended tests may be more sensitive they tend to be
of control; characteristics of risk taking, energy
less practical and reliable than more objective
and social adroitness; a preference for learning
tests.
through action and experimentation; and a
preference for intuition and thinking.
Are the Test Items Transparent in the The validity of these results depends on the
Implications and Indicative of Socially validity of the tests and many issues to do with
Desirable Responses? test validity have been discussed. The application
Test item transparency is an additional problem of well-validated tests to entrepreneurs may
present in many of the tests applied to enhance understanding, especially if the results
entrepreneurs. For example, Lynn's measure of were correlated with small-firm start-ups,
the need for achievement requests respondents to business type and growth, and financial success.
reply yes or no to the following question: "Have Surprisingly there are very few studies which
you always worked hard in order to be among the attempt to link the results of psychological tests
best in your own line?"[18, p. 529]. The subject with the activities of the entrepreneurs.
does not have to think too hard about what As well as the application of validated tests to
response they ought to give, irrespective of entrepreneurs, there have been attempts to
whether they choose to present that response. develop specific measures of entrepreneurial
On the other hand, test item transparency may characteristics (see Table III). The issue of
sometimes be so obscured that the test item fails whether a new test is needed is worth
(or appears to fail) to measure what it aims to considering. Few well-validated psychological
measure. For example, in "Testing The tests measure all the characteristics which have
Entrepreneurial You", it is not obvious that it is been highlighted as entrepreneurial. So specific
more entrepreneurial to daydream about being measures of entrepreneurial characteristics could
"detective who has solved a difficult case", than have greater power to discriminate within and
"a millionaire floating on a yacht"[30, p. 52]. But between entrepreneurs and other groups.
the test scoring procedure judges that it is more Unfortunately, such tests tend not to be rigorously
entrepreneurial to daydream about being a developed or well validated. This means that
detective rather than a millionaire. when these tests are employed there is a genuine
Sometimes the socially desirable response to dilemma over whether the test results reflect
test items is transparent which may undermine the genuine findings about the entrepreneur or the
value of test items. For example, one test item in quality of the test.
a measure of the need for achievement is "Do you Tests of specific entrepreneurial characteristics
like to get drunk?" and a negative response may be useful for testing out models or
indicates an entrepreneurial response[18]. hypotheses about the entrepreneur. However, in
Transparent items suggestive of social desirability order to achieve this aim, extensive test validation
limit the sensitivity and validity of a measure. studies are prerequisites for interpreting test
This is especially the case when tests are used in results. Without proper validation such tests are
threatening circumstances, such as recruitment useful only for casual purposes. Though a well-
when the results have far reaching implications. validated measure of entrepreneurial
Most general measures of entrepreneurial characteristics could offer a sensitive
characteristics (Table III) are transparent and discriminating measure which could be useful in
require respondents to assess themselves. the study of entrepreneurs, the labour cost of test
Objectivity cannot be claimed in the results validation is a disadvantage.

18
 VOLUME 8 NUMBER 6
1993

More effort should be made to correlate the Management Education and Training for the
results of psychological tests with entrepreneurial Development and Growth of Small Firms",
behaviours and activities. In addition, competence unpublished paper presented at the Eleventh
approaches offer the possibility of more holistic Small Firms Policy Research Conference,
assessments because they seek to identify the November 1988, pp. 17-19.
knowledge, skills and behaviours, as well as the 11. Jackson, D., Jackson Personality Inventory,
psychological characteristics, of groups such as Research Psychologists Press, New York, NY,
entrepreneurs. The use of psychological tests in 1976.
conjunction with other approaches to assessment
12. Sexton, D. and Bowman, N., "Validation of a
could be more enlightening than the development
Personality Index: Comparison of
of new psychological tests which aim specifically
Characteristics of Female Entrepreneurs
to measure entrepreneurial characteristics. This Managers, Entrepreneurial Students and
offers the possibility of exploring patterns in Business Students", Frontiers of
entrepreneurial competence and their behavioural Entrepreneurial Research, Babson Center for
correlates. Entrepreneurial Studies, Wellesley, MA,
□ 1986.
References 13. Myers, I. and Briggs, K., Myers-Briggs Type
1. Palmer, M., "The Application of Indicator, Consulting Psychologists' Press,
Psychological Testing to Entrepreneurial Palo Alto, CA, 1976.
Potential", California Management Review, 14. Hoy, F. and Carland, J., "Differentiating
Vol. 13 No. 3, Spring, 1971, pp. 32-8. between Entrepreneurs and Small Business
2. Young, D.R., If Not For Profit, For What? A Owners in New Enterprise Formation",
Behavioural Theory of the Non-Profit Sector Frontiers of Entrepreneurial Research,
Based on Entrepreneurship, Lexington, MA, Babson Center for Entrepreneurial Studies,
1983. Wellesley, MA, 1983.
3. McClelland, D.C., "Business Drive and 15. Maxon, J., "Creating New Ideas",
National Achievement", Harvard Business Management Decision, Vol. 26 No. 4, 1988,
Review, Vol. 40 No. 4, July/August 1962, pp. pp. 40-3.
99-112. 16. Winslow, E. and Solomon, G.,
4. McClelland, D.C., The Achieving Society, 2nd "Entrepreneurs Are More Than Non-
Conformists: They Are Mildly Sociopathic",
ed., Van Nostrand, Princeton, NJ, 1968.
The Journal of Creative Behaviour, Vol. 21
5. Roberts, E., "The Personality and No. 3,1987, pp. 149-61.
Motivations of Technological Entrepreneurs",
17. Collins, 0., Moore, D. and Unwalla, D., The
Journal of Engineering and Technology
Enterprising Man, University of Michigan,
Management, Vol. 6, 1989, pp. 5-23.
Ann, Arbor, Ml, 1964.
6. Edwards, A., Manual for the Edwards
18. Lynn, R., "An Achievement Motivation
Personal Preference Schedule, The
Questionnaire", British Journal of
Psychological Corporation, New York, NY,
Psychology, Vol. 60 No. 4, pp. 295-34.
1959.
19. Rotter, J.B., "Generalised Expectancies for
7. Watkins, D.S., "Entry into Independent
Internal Versus External Control of
Entrepreneurship-Toward a Model of the
Reinforcement", Psychological Monographs,
Business Initiation Process", paper 1966, pp. 1-27.
presented at Joint Seminar on
"Entrepreneurship and Institution Building", 20. Levenson, H., "Distinctions within the
Dansk Management Centre, Copenhagen, Concept of Internal-External Control: The
May 1976. Development of a New Scale", paper
presented at the Meeting of the American
8. Hornaday, J.A., and Aboud, J., Psychological Association, Honolulu, 1972.
"Characteristics of Successful
21. Cachon, J.C. and Cotton, G., "Assessing the
Entrepreneurs", Personnel Psychology, Vol.
Entrepreneurial Orientation of
23, 1970, pp. 47-54.
Undergraduate Business School Students,
9. Honey, P. and Mumford, A., The Manual of Following An Entrepreneurial Experience: A
Learning Styles, Peter Honey, Maidenhead, Model", Paper No. 58, School of Commerce
Berkshire, 1986. & Administration, Laurentian University,
10. Thorpe, R. and Dyson, J., "The Future of Sudbury, Ontario, 1987.

19
 JOURNAL OF
MANAGERIAL
PSYCHOLOGY

22. Cromie, S. and Johns, S., "Irish Social and Clinical Psychology, Vol. 12, 1973,
Entrepreneurs - Some Personal pp. 137-42.
Characteristics", Journal of Occupational 35. Atkinson, J., "Motivational Determinants of
Behaviour, Vol. 4, 1984, pp. 318-24. Risk Taking Behaviour", Psychological
23. Begley, T. and Boyd, D., "Psychological Review, Vol. 64 No. 6, 1957, pp. 359-72.
Characteristics Associated with Performance 36. Freeley, J., Entrepreneurial Style Profile,
In Entrepreneurial Firms and Smaller Long Island University, New York, NY, 1986.
Businesses", Journal of Business Venturing,
Vol. 2, 1987, pp. 79-93. 37. Dies, R., "Development of a Projective
Measure of Perceived Locus of Control",
24. Joe, V.C., "Review of the Internal-External Journal of Projective Techniques and
Control Construct as a Personality Variable", Personality Assessment, No. 32, 1968, pp.
Psychological Reports, No. 28,1971, pp. 619- 487-90.
40.
38. Johnson, C. and Caird, S., The Measure of
25. Kirton, M., "Adaptors and Innovators in
General Enterprising Tendency, Durham
Organizations", Human Relations, Vol. 33
University Business School, 1988.
No. 4, 1980.
39. Kahl, J., "Some Measures of Achievement
26. Cross, M., "Kirton Adaption-Innovation
Orientation", American Journal of Sociology,
Inventory: Selecting Potential Entrepreneurs
Vol.70, 1965, pp. 669-81.
from Redundant Managers", paper
presented to the British Psychological 40. Kirton, M., Kirton Adaption Innovation
Society's Occupational Psychology Inventory, Occupational Research Centre,
Conference, 6-8 January 1982. 1987.
27. Kogan, N. and Wallach, M., Risk-taking: A 41. King, A., "Self-Analysis and Assessment of
Study in Cognition and Personality, Holt, Entreprenurial Potential", Simulation and
Rinehart & Winston, New York, NY, 1964. Games, Vol. 16 No. 4, 1985, pp. 397-416.
28. MacCrimmon, K. and Wehrung, D., "A 42. Lachman, R., "Towards Measurement of
Portfolio of Risk Measures", Theory and Entrepreneurial Tendencies", Management
Decision, Vol. 19, 1985, pp. 1-29. International Review, Vol. 20 No. 2, 1980, pp.
29. Professional Affairs Board, "Technical 108-16.
Recommendations for Psychological Tests", 43. Mehrabian, A. and Bank, L., "A
Bulletin of the British Psychological Society, Questionnaire Measure of Individual
Vol.33, 1980, pp. 161-4. Differences in Achieving Tendency",
30. Boyatzis, R. and Winter, D., "Testing the Educational and Psychological
Entrepreneurial You", cited in Harris, M., Measurement, Vol. 38, 1978, pp. 475-80.
"The Entrepreneurs: Do You Have What It 44. Scanlan, T.J., "Self Employment as a Career
Takes", Money, March, 1978, pp. 26-7. Option: An Investigation of Entrepreneurs
31. Mehrabian, A. and Bank, L, A Manual for the from the Perspective of Hollands' Theory of
Mehrabian Measures of Achievement Career Development and Levenson's
Tendency, University of California, Los Measure of Locus of Control", PhD
Angeles, CA, 1975. dissertation, University of Illinois, 1979.
32. Erwee, R. and Pottas, C, "Locus of Control 45. Vicars, W., Jauch, L. and Wilson, H., "A Scale
and Achievement Motivation of Managers", to Measure General Entrepreneurial
Psychologia Africano, Vol. 21, 1982, pp. 79- Tendency", 40th Annual Conference Paper,
102. Academy of Management, Southern Illinois
33. Weinstein, M.S., "Achievement Motivation University, Detroit, MI1980.
and Risk Preference", Journal of Personality
and Social Psychology, Vol. 13, 1969, pp.
153-72. Sally P. Caird is a Research Fellow at the Centre
for Technology Strategy, the Open University,
34. Smith, J.M., "A Quick Measure of
Milton Keynes, UK.
Achievement Motivation", British Journal of

20