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South African Journal of Higher Education

On-line version ISSN 1753-5913

S. Afr. J. High. Educ. vol.35 n.3 Stellenbosch Jul. 2021

http://dx.doi.org/10.20853/35-3-3676 

GENERAL ARTICLES

 

Entrepreneurial careers: Factors influencing entrepreneurial intentions using a sample of undergraduate exit students

 

 

M. NdovelaI; W. T. ChinyamurindiII

IDepartment of Management Sciences Durban University of Technology Durban, South Africa e-mail: mfundondovela.ndovela@gmail.com / https://orcid.org/0000-0002-8418-3558
IIBusiness Management University of Fort Hare East London, South Africa e-mail: wchinyamurindi@ufh.ac.za / http://orcid.org/0000-0002-4139-4224

 

 


ABSTRACT

Entrepreneurship is being encouraged as a possible career path especially within a context of high unemployment that mostly affects the youth. The study sought to empirically investigate the factors influencing entrepreneurial intentions using a sample of undergraduate exit students within a South African higher education (HE) context using a sample of final year students at a university campus in Durban. Researching the factors that influence entrepreneurial intentions can be a useful precursor to interventions that assist students. A sample of 320 respondents were surveyed from a Durban university campus. To determine relationships of the variables, correlation and regression tests were used. The results attest to the importance of the theory of planned behaviour in studies of this nature. Further, relationships existed between personality and participation in entrepreneurial education with entrepreneurial intentions. The study findings have implications for practitioners who may work in a space that encourages entrepreneurship development and education initiatives targeted at students in institutions of higher learning. The findings may serve as a catalyst for developing learning materials and creating opportunities that encourage entrepreneurship development and education.

Keywords: career, determinants, education, entrepreneurship, intention, personality


 

 

INTRODUCTION

Entrepreneurship is a maj or driver in the development and social stability of an economy piloted by risk-taking individuals driven by profit-making motives (Ngatse-Ipangui and Dassah 2019; Barringer and Ireland 2010; Gree and Thurnik 2003; Herrington, Kew, and Kew 2009). Due to the significance of entrepreneurship towards economic growth (Struwig, Kruger, and Nuwagaba 2019; Chinyamurindi 2016; Grigorea, Mainescu, and Tomaa 2014), calls exist for more empirical and practitioner efforts at understanding those factors that influence entrepreneurial intent (Barnir, Watson, and Hutchins 2011) and developing the next generation of entrepreneurs (Bushe 2019). Furthermore, the development of entrepreneurial skills emerge as one of the most important factors facilitating survival and continued innovativeness of entrepreneurs competing in an incessantly dynamic and technologically saturated environment (Cobbinah and Chinyamurindi 2018; Angriawan et al. 2012). Engelbrecht (2012) ranked the lack of innovativeness and entrepreneurial intent in South Africa as the fifth-lowest compared with other developing countries. This is a view also embraced by the Global Entrepreneurship Monitor Report of 2016/2017 showing South Africa to have low entrepreneurial activity (Global Entpreneurship Monitor 2017).

Entrepreneurship arises from naturally gifted individuals in possession of the relevant skills who by their creativity induce market equilibrium disturbance with the introduction of new business ventures (Boutillier, Uzunidis, and Laperche 2014). Moreover, despite the market equilibrium alterations induced by more products and services from such initiatives, unemployment has threatened several countries and thus impeding their economic growth (Global Entpreneurship Monitor 2017). Therefore, there is need to understand within an African context those factors that encourage individuals in becoming entrepreneurs, especially amongst those with the potential capacity to fulfil this role (Igbokwe-Ibeto, Agbodike, and Osakede 2018).

The rest of the article follows a structure. First, a review of the literature is presented including the hypotheses. The design of the study is then given attention. The article concludes with a discussion of the results in view of the presented literature. Implications for the practitioner and higher education (HE) context are finally presented.

 

LITERATURE REVIEW

Importance of entrepreneurship and entrepreneurship education

Education is argued to be a major catalyst in successful entrepreneurial venture startups (Mohamad et al. 2015). Focus has been directed on developing individuals with educational support as a precursor to encouraging entrepreneurial intent (Chinyamurindi 2016). This is deemed critical within the HE context believed to be tasked with responsibility to prepare graduates in dealing with the challenges of tomorrow (Chimucheka 2013). Chinyamurindi (2016) argues for a nuanced position in HE - one balanced between theoretical knowledge acquisition and the practical. Given the high unemployment situation in South Africa, such a balance is needed. Further, some form of skill acquisition and competence is noted as having ramifications in entrepreneurial activity and output (Rambe 2018). This places focus on understanding the determinants of entrepreneurship intention especially within HE that is in flux.

Entrepreneurship is believed to offer the potential to transform societies (Chinyamurindi 2016; Ngatse-Ipangui and Dassah 2019). Through entrepreneurship small businesses can emerge as catalysts for economic growth and job creation. The general consensus thus appears to be one that encourages not just the development of more small businesses but also entrepreneurs (Lowe 2012; Gupta, Guha, and Krishnaswami 2013; Igbokwe-Ibeto et al. 2018). This places impetus on studies of this nature as they enhance understanding into those determinants that encourage the development of the country's pool of entrepreneurs. The argument here could also be that entrepreneurship be seen as a possible career choice (Chinyamurindi 2016). This can happen through providing individuals with skills to recognise opportunities in their environment and creatively embark on risky entrepreneurial activities based on this (Eresia-Eke, Gwija, and Iwu 2014; Ngatse-Ipangui and Dassah 2019; Staff Writer 2013).

Entrepreneurial education is a process of learning that is continuous for survival, growth and profitability reasons (Chinyamurindi 2016). Through offerings that enhance knowledge around entrepreneurship, students can potentially be empowered not only in their search but also deliberate efforts to act on opportunities (Jones and English 2004; Igbokwe-Ibeto et al. 2018). Thus, through entrepreneurship education, even an established entrepreneur can engage in continuous self-improvement to remain relevant and unique in identifying potential profitable ventures. This supports the view that entrepreneurial intent can be transferred through a learning intervention (Dzisi and Odoom 2017).

Various platforms of learning exist for the entrepreneur such as educational institutions, peers and environmental factors (Igbokwe-Ibeto et al. 2018; Von Graevenitz et al. 2010). Chimucheka (2014) argues there is a gap between what is taught in the university setting and what happens in the real business world. This disparity can lead to misconceptions around the notion of entrepreneurship. A solution to this can be to make entrepreneurial education efforts in institutions of higher learning to be holistic and embracing of the practitioner space (Ndofirepi, Rambe, and Dzansi 2018). Exposing students to formal and informal HE educational opportunities can be key to encouraging entrepreneurial intention (Chinyamurindi 2016; Mohamad et al. 2015).

Entrepreneurial intentions

Intentions demarcate the ability to become an entrepreneur and further determine whether such notions will be embarked on successfully or otherwise (Mohamad et al. 2015). Thus, the lifetime of an entrepreneurial business, besides being affected by environmental factors, also lies in the strength of the entrepreneur's intentions (Kanonuhwa, Rungani, and Chimucheka 2018). Therefore, an individual with a high need for self-employment will most likely continue in business against environmental factors that may impede their intention.

Entrepreneurial intentions can be inter-woven as per the notions of the Entrepreneurial Event Model (EEM) and Theory of Planned Behaviour (TPB) (Douglas and Fitzsimmons 2013). The EEM asserts that perceptions of desirability, the propensity to act and the perception of feasibility are influenced by social norms, while attitude towards the act and perceived behavioural control are influenced by planned behaviour. It has been perceived that desirability and feasibility are key factors to entrepreneurship (Urban and Kujinga 2017), despite the notable relevance of entrepreneurship intention in encouraging the decision to become an entrepreneur (Achchuthan and Sivarajah 2013). Entrepreneurial intentions have a positive effect on students' entrepreneurial attitude, therefore posing a need for educators to reinforce this sentiment (Pulka, Rikwentishe, and Ibrahim 2014).

Others believe that entrepreneurial intentions to be influenced largely by the happenings in the macro-environment (Akmaliah, Pihie, and Bagheri 2013). The influence of such environmental factors can be an interacting effect with individual actions (Baron and Hmieleski 2012). Others (e.g., Koffi et al. 2015) place focus on the government's role in creating a context in which entrepreneurship thrives. In essence, though a plethora of factors exist to encourage entrepreneurship, the interacting and relatedness of these factors appears needs further research.

Subjective norms

Subjective norms are positioned significant measures of intentions (Kautonen, Van Gelderen, and Fink 2013; Kumar 2012). Peng, Genshu, and Hui (2012) state that subjective norms is influenced by perceived expectation levels from significant others, such as family, colleagues and role models. This view is supported by others internationally (e.g., Lestari and Susetyo 2014) and within the South African career research literature (e.g., Chinyamurindi 2016). Further, culture can also exist as a variable that influences subjective experiences and play a role in determining entrepreneurship intent (Linan and Chen 2009).

Perceived behavioural control

Mahmoud and Muharam (2014) highlight that behavioural control is one's ability to perceive, keep, recover, react and assess information. Behavioural actions are useful predictors of individual action review (Phuah et al. 2012). Prominent beliefs can consist of: a) behavioural beliefs which are expected to affect attitudes; b) normative beliefs that form the basic elements of subjective norms, and finally, c) control beliefs, which offer the root for perceptions of behaviour control Lapista et al. (2012). Alhaji (2015) concedes that through perceived behavioural control a decision can be made on whether or not to engage in an activity.

High risk-taking propensity

Risk-taking propensity is "the perceived probability of receiving reward linked with the success of situation that is necessary by the individual before an individual will be subjected to the consequences associated with failure, the alternative situation providing less reward as well as severe consequences than the proposed situation" (Hanan, King, and Mark 2011, 8). The ability to take risk can be the difference between entrepreneurs and non-entrepreneurs (Kautonen, Tornikoski, and Kibler 2009).

Renko, Kroeck, and Bullough (2012) state that usually entrepreneurs start their own businesses later in their lives, and many of these entrepreneurs have managerial experience because usually one would acquire the necessary skills and experience before pursuing a certain business venture; the necessary risk would have been established before the entrepreneur can take measures to start a business (Shane 2009, 141). Taking a risk goes hand in hand with the confidence of that particular individual, especially since graduates have less experience when it comes to managing a business even though they have studied for such. Therefore, those who exhibit higher levels of internal control will be more attracted to managerial positions. Finally, intense job dynamics and the experience in situations that have a lot in common with entrepreneurial situations can build confidence needed to believe that one will be able to start a new venture and succeed (Baron et al. 2012).

Personality traits

Students show different attitude towards entrepreneurship, also informed by their personality (Hasun and Makhbul 2010). These have been noted in the literature to range from an a) optimistic personality; b) a high risk-taking propensity; c) a proactive personality, and finally, d) a high risk-taking attitude (Du Toit and Muofhe 2011). Personality emerges as a major driver of performance outcomes (Ahmetoglu et al. 2014).

 

HYPOTHESES FORMULATION

The study sought to empirically investigate the factors influencing entrepreneurial intentions using a sample of undergraduate exit students at a campus in Durban. Graduates can possess the necessary academic qualification but without the right work skills, employment can be delayed. Entrepreneurship intentions need to be aligned with the right skills and the confidence to take a risk. Awang, Fitriati, and Suleiman (2012) allude that the contemporary business environment may be forcing institutions of higher learning to develop a different mindset that is positive towards entrepreneurial development. In light of this noted importance, a set of hypotheses have been formulated:

Hypothesis 1: Attitude towards entrepreneurship as a career option is positively related to entrepreneurial intentions.

Hypothesis 2: Subjective norm is positively related to entrepreneurial intentions.

Hypothesis 3: Perceived behavioral control is positively related to entrepreneurial intentions.

Hypothesis 4: Student participation in entrepreneurship education is positively related to entrepreneurial intentions.

Hypothesis 5: Students with a proactive personality are more likely to have a positive attitude towards entrepreneurship.

Hypothesis 6: Students with a high-risk taking propensity are more likely to have a positive attitude towards entrepreneurship.

Hypothesis 7: Students with a proactive personality play a role in entrepreneurship education.

Hypothesis 8: Students with a high-risk taking propensity are more likely to participate in entrepreneurship education.

Figure 1 is a pictorial representation of the model test in this study.

 

RESEARCH DESIGN AND METHODOLOGY

The study inclines towards a positivist research paradigm and using the quantitative approach. The study sought to investigate the factors influencing entrepreneurial intentions using a sample of undergraduate exit students. The aim here was for the generation of objective data while exploring the relationships between the variables. From this, 400 final year commerce students constituted the sample frame with 320 forming the study sample acquired through a convenience sampling strategy due to accessibility reasons. All the students were from a campus at a university in Durban.

For the descriptive data set results, frequencies are presented in respect to respondents' gender, entrepreneurship education, self-employment activities - that is if respondents were either planning to be self-employed in the near future or were already self-employed - and if the respondents came from a family with a self-employment history. Table 1 reports on the descriptive data of the respondents.

 

 

Measuring instrument

The questionnaire used for this research was developed from reliable and valid existing scales (e.g., Krueger et al. 2000; Francis et al. 2004). Reliability tests were conducted making use of the Cronbach Alpha Coefficient (CAC) tests. Santos (1999) argues that the higher the CAC, the more reliable the scale. The results of the CAC tests on the instrument and its scales are reported in Table 2. The table also details example items asked for each scale.

The results in Table 2, show all scales to have an acceptable reliability coefficient (Nunnally 1978). A pilot study was also conducted for this study. This allowed an opportunity not only for content and face validity. Ethical clearance was also obtained with the participating institution.

 

RESULTS

Data was analysed through the SPSS programme to generate both descriptive and inferential statistics. Correlation and regression tests were conducted. These tests receive attention next.

Correlation tests

Correlation tests are shown in Table 3.

At a 0.01 significance level, the results in Table 3 reveal some strong relationships. For instance: attitude towards entrepreneurship (0.632); perceived behavioural control (0.433) and subjective norms (0.343) all have a significant correlation with entrepreneurial intentions. The relationship between proactive personality and attitude towards entrepreneurship was also investigated using the Pearson product-moment coefficient. The results indicate a moderate to strong positive correlation between the two variables r = .476, n = 320, p <.001 with low proactive personality values being associated with high levels positive attitude towards entrepreneurship. Finally, at a 0.01 significance level, the results in Table 3 also reveal relationships between high risk-taking propensity and participation in entrepreneurship education (0.345) and proactive personality and participation in entrepreneurship education (0.267).

Regression tests

Table 4 presents the regression analysis in view of the dependent variable: entrepreneurial intentions (hypotheses 1 to 4).

The regression output in Table 4 generally supports hypotheses 1 to 4: attitude towards entrepreneurship (β=0.105); subjective norms (β=0.273); perceived behavioural control (β=0.376), and participation in entrepreneurship education (β=0.321). Hypothesis 1 can be accepted at a p<0.05 significance level and hypotheses 2, 3 and 4 should be accepted at a p<0.01 significance level. Table 5 presents the regression analysis in view of attitude towards entrepreneurship as a dependent variable (hypotheses 5 and 6).

Based on hypotheses 5 and 6, the regression results in Table 5 can be accepted at a significance level of p<0.01. In essence, students with a proactive personality (β=0.578) show a positive attitude towards entrepreneurship as a career option. This results in hypothesis 5 being accepted. Concerning hypothesis 6, there was no strong positive relationship between risk taking propensity (β=0.124). As a result, hypothesis 6 is rejected. Table 6 presents the regression analysis in view of participation in entrepreneurship education as a dependent variable (hypotheses 7 and 8).

Based on hypotheses 7 and 8, the regression results in Table 6 can be accepted at a significance level of p<0.05. In essence, students with a proactive personality (β=0.197) are more likely to participate in entrepreneurship education. This results in hypothesis 7 being accepted. Concerning hypothesis 8, there was grounds to accept that students with a high risk-taking propensity are more likely to participate in entrepreneurship education (β=0.201). As a result, hypothesis 8 is accepted. Between a proactive personality and a risk-taking propensity, a stronger link to entrepreneurship education was found with the latter.

 

DISCUSSION OF THE RESEARCH FINDINGS

The study sought to empirically investigate the determinants of entrepreneurial intent within a South African HE context using a sample of final year students as a university campus in Durban. The study's findings appear to heighten focus on the role that entrepreneurship plays in triggering self-employment (Barringer and Ireland 2010; Grigorea et al. 2014; Gries and Naudé 2011). That view leads one to an understanding that for entrepreneurship to be achieved, skills and entrepreneurship education would need to be acquired for such an activity to take place and prosper at the same time. This was emphasized in the study by showing relationships that exist between personality and participation in entrepreneurial education found to be related to entrepreneurial intention. This line of findings show support to previous studies (Eresia-Eke, Gwija, and Iwu 2014; Kaijage and Wheeler 2013).

Further, the study places focus on the role of subjective norms as explaining behaviours (Lestari and Susetyo 2014). Findings from the study support previous work where subjective norms have been measured against entrepreneurial intent (Kautonen et al. 2009; 2013). The findings also support the role of perceived behavioural control in predicting entrepreneurial intentions (Ajzen 2012; Anh and Mai 2013; Uygun and Kasimoglu 2013).

Risk-taking propensity refers to a trend to take risks whilst entrepreneurship has always been associated with risk-taking tendencies. Previous research findings also provide evidence that individuals with a greater risk acceptance had stronger levels of entrepreneurial intention (Zhao, Seibert, and Lumpkin 2010). It has been noted that high risk-taking propensity of students is likely to take part in entrepreneurial education (Hanan et al. 2011, 8; Shane 2009, 141). Findings have revealed that there is less intention to take risks in entrepreneurial education from students' point of view, hence this fact differs with the views of the authors highlighted above.

It was also stated that students with a proactive personality play a major role in entrepreneurial education. Personality traits can be associated with an individual's behaviour in terms of entrepreneurship, and factors on personality can easily determine if one has an ambition to be an entrepreneur (Vanevenhoven and Liguori 2013, 315). Personality has also been noted as an individual's willingness to perform duties and have the necessary desire to pursue business ventures; this norm further states that personalities are major drivers of performance outcomes (Ahmetoglu et al. 2014, 58).

As per the findings from this particular study, it was found that proactive personality has no correlation with entrepreneurial education, so the two variables do not complement each other. Therefore, the above findings are not in line with those of Cherkas et al. (2010) and Fairlie and Holleran (2011).

Theoretical implications

The results of this study could assist graduates in understanding the requirements for a successful entrepreneur and the traits one needs for entrepreneurial intentions to be satisfactory. It has been noted that South Africans largely depend on the government for job opportunities as well as the private sector which impedes entrepreneurial development and growth (Mvula and Tshikovhi 2014). However, evidence suggests that entrepreneurship, entrepreneurial education and entrepreneurial intentions are related. Subjective norms have been proven to be linked to low levels of entrepreneurship intentions; however, these two variables are related but do not entirely depend on each other.

Perceived behavioural control was initially regarded as a core function of entrepreneurial intentions. However, as per the findings of this study, that was found to be lacking evidence. Therefore, it can be noted that perceived behavioural control is a function of entrepreneurial intentions but is not the core function. Notably, one's behaviour will always be triggered by past experiences; therefore, lecturers need to dig deep and establish students' experiences or views on entrepreneurship and assist them. Creating an entrepreneurial intention will assist students in focusing on the future compared to the past. Personality traits were thus found to be associated with entrepreneurship since an individual with a proactive personality is more likely to be interested in entrepreneurship, provided that is their chosen career aspirations.

Practitioner implications

Attitude towards entrepreneurship was found to have a direct relationship with entrepreneurial intentions. This serves as a major factor in entrepreneurship as one would argue that for successful entrepreneurship, one requires the right mindset in pursuit of self-employment. Lowe (2012) concurs with the notion as stipulated that entrepreneurship should be nurtured from a young age. Bridging the gap on entrepreneurial intentions amongst students in tertiary education balances the economic needs by provisions of practical scenarios for practical business situations such as business planning delegation (Kuttim et al. 2014).

This notion takes us to a view that one's norms cannot predict interest or disinterest in entrepreneurial intentions just because of the way they do things. It was also highlighted that just because one has an entrepreneurial background from their upbringing does not mean, by default, they would make good entrepreneurs. Lecturers can learn that past experiences can be good or bad; therefore, one cannot predict the outcomes of whether one wishes to have a business or be self-employed. It is lecturers' duty to get in touch with the latest economic trends and advise students on where small businesses can be funded, including setting up workshops and inviting funders to come on site and share how one can start a business, should it happen that there is no capital (Owoseni 2014).

The findings revealed that with high perceived behavioural control values being associated with low levels of entrepreneurship intentions, although PBC is a function of entrepreneurial intentions, it is not a core function. Students can, in turn, benefit from this resource and formulate a strategic principle as to how they pursue business ventures. High risk-taking does not assist students in any way when it comes to gaining knowledge about entrepreneurship, which is also known as entrepreneurial education.

Personality traits were noted to play a role in entrepreneurship, and the findings confirmed that this norm is in line with Hasun and Makhbul's study (2010). One's personality can play a role in being involved in entrepreneurship; students who are keen to learn are always proactive and would participate more in entrepreneurship, and lecturers can capitalise on this by involving those students in entrepreneurial activities. The government is not playing an active role in grooming graduates to be part of entrepreneurial growth as it does not provide sufficient support for students to know how one can open a business in the first place. The government needs to step in and teach students how a business is actually opened, starting with acquiring a business certificate. The syllabus, even at secondary level, covers different kinds of business entities like the sole trader, partnerships and so on; however, at university, no one actually educates students to how to go about registering a business.

Limitations

The current study was conducted around the Faculty of Commerce at the Durban University of Technology. Hence the results generated in this study cannot be generalised to a wider population not involved in this study except for Commerce students. Future research can be conducted involving more tertiary institutions as this was only limited to one entity. Additionally, the study was conducted using the quantitative method where respondents were asked to tick applicable responses.

Recommendations for future research

Further research can be conducted in other tertiary institutions in addition to the Durban University of Technology for comparison with a broader scope. This study should be conducted on non-students and part-time students who also serve the corporate environment to establish if the same results will be achieved. Follow-up research can be conducted on entrepreneurial intentions and note if different respondents with experience will yield the same answers. Qualitative research will also serve as a convenient tool in future studies and on a broader scale than the current study. Another concern in this study was to try and establish if the factors named above were in line with entrepreneurial intentions and had something to contribute to the desired outcomes on students' entrepreneurial intentions. Major emphasis lacks in this regard and conducting research might spark debate in terms of the role played by the public sector in uplifting communities seeking to be in business. This study can also be conducted on normal citizens in business and explore the role played by tertiary education and mainly the government as statistics highlight that this is not effective, especially from the government.

 

CONCLUSION

Entrepreneurial intentions have been prioritised in this study as critical determinants towards the entrepreneurship journey. Critical towards all this is the role some form of entrepreneurial training and development plays in encouraging the formation of such intentions. Considering also aspects of subjective norms, personality and risk-taking propensity, a context can be encouraged in the development of future entrepreneurs especially within higher education.

 

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