Personality correlates of self-employed small business owners' success

Abstract

Drawing on prior occupational choice research on entrepreneurs and self-employed business owners, we examined personality predictors of their occupational business success and work satisfaction. PARTICIPANTS AND PROCEDURES: A sample of 147 small business owners completed a web-based assessment of 14 work-related personality traits--adaptability, autonomy, competitiveness, dependability, emotional resilience, goal-setting, optimism, persistence, risk tolerance, self-promotion, networking, and tolerance for financial insecurity, work-based locus of control, and work drive--and three self-reported indices of business success--revenue growth, profit growth, and income growth--as well as multiple facets of individual satisfaction. Criterion variables included composite business success and overall satisfaction. Ten traits correlated with business success. The top four personality predictors of success--goal-setting, social networking, emotional resilience, and work drive--together accounted for 16% of the variance. Similarly, 12 of 14 personality traits were positively related to overall satisfaction. The top three personality predictors of satisfaction--optimism, work-based locus of control, and work drive--accounted for 29% of the variability in satisfaction. An expectancy analysis revealed that the percent of participants who reported at least a 20% increase in sales and profits the preceding year was 26% versus 54% for individual scoring in the lower and upper third of a personality composite measure. Results carry implications for future research, and have direct, practical applications for prospective and current entrepreneurs and self-employed owners of small businesses.