Female Entrepreneurship In Comparison with Male Entrepreneurship - Coursework Example

Female entrepreneurship in comparison with male entrepreneurship I. Introduction: In both developing and developed countries, women are being unableto prosper in their professional career thereby forcing to set up their own business entity, mainly in service and retail sectors as they are facing various barriers in respect of gender, in their way, like male dominance in various sectors, less compensation scale, injustice and inequality, which have disturbed them to move ahead in their lives. Normally women were stalled in low-productivity jobs, which relate to the wage gap between male and female where women were compensated less for similar work (Mirchandani, 1999). Even in Turkey, being a developing country, women were found designated with junior positions in private companies. It a psychologically belief that their efforts are considered to be untrained and unskilled in comparison to their counterparts. Various researches on entrepreneurship relate to male distinctiveness and focused mainly onto male-dominant area. Few studies considered the female individuality of entrepreneurship with their related actions. Women always had to put some extra effort in order to succeed in putting up a business and then maintaining it in a male dominated working environment. Therefore, women had to gain extra assets through other connections and networking. Mainly women who belong to subordinate classes need major support from their families and friends and the tie ups they make in between through negotiations, in order to set up and maintain a business. Whereas, women from high class families or from middle class families, could independently initiate their business through contacts with their colleagues or with the members of the chamber and association. Moreover, there can be a personal ambition or drive to set up a business of its own or else some other external reasons like the fight to survive, where women believe on their social contacts and networks and utilize it completely to shape up their business entity. II. Female entrepreneurship in comparison with male entrepreneurship: Various studies have reflected that female and male entrepreneurs vary in respect of: their production outcomes; the motivations they get to start up a business; the effort they put up for the progress of their business entity; the extent of their business start-ups; the sort of business they want to start; the performance potential they expect to have for their set up; their preference for any project risk; the technique they apply to identify various business opportunities; the assurance they have in their efforts for start-up; and the consequences that they need to face (Brush, 1992; Carter et al., 1997; Srinivasan, et al., 1993; Boden, 2000; Office of Advocacy, 2006; Robb and Wolken 2002 ). II. 1. Performance of firms Studies have highlighted that the presentation of new projects led by females lag behind to that led by males. For ventures led by females, factors like sales growth, employment growth, compensation and venture endurance are all considered to be low. (Boden, 2000; Office of Advocacy, 2006; Robb and Wolken 2002; Srinivasan, et al., 1993). The firms owned by women have inferior sales margin and hence could occupy lesser people in their business than that of men-owned enterprises (Fischer et al., 1993). For example, in 2002 the firms owned by females generated about 87585 dollar sales and had employed about 7.79 people in comparison to 12.04 employees and 1862159 dollar sales for those led by men (Office of Advocacy, 2006). Women-owned firms also gained less income than that by men. They generate an average of only 78% of the profit in a similar business led by men. (Robb and Wolken, 2002). Furthermore, 46% of freelanced women earn less than 15000 dollar in 1998, whereas only 21% of freelanced men earned this amount. On the contrary, 16% of freelanced men earned higher than 95,000 dollar, in comparison to 4% of women (Office of Advocacy, 2001). New projects led by women have little chance to survive eventually than the new ventures initiated by men. The survival rate of men-employed firms was about 8.6 % higher than that to same new businesses led by women. (Boden, 2000; Srinivasan et al, 1993). II. 2. Motivations worked behind the business starting There are various reasons for someone to start up a business and the motivation for that varies in respect to gender. Firstly, in this respect, women are expected more than men that to initiate a business is for to achieve a balance between work and family. (Brush et al., 2006). This is because, as also reflected by varied surveys that women has revealed the need for suppleness and work-family stability. (Boden, 1999; Carter et al., 2003). Paternity plays a key role in their wish to become employed by her own. (Birley 1989). Researches highlight that several women crave to be self-employed so as to build up a more flexible timesheet where they can balance demands from both work and family. (Boden 1996; Georgellis and Wall, 2004; Lombard 2001). They also prefer to be self-employed as that provide them the time to commit for their home and childcare (Boden 1996; Connelly 1992). Actually, Boden (1996) have used information from the Existing Population Survey to reflect a noteworthy constructive association for women to opt for self-employment or motherhood. Secondly, men start businesses to make money or to own a company unlikely than women. For example, DeMartino and Barbato (2003) establish that businessmen prefer careers that will bring money while businesswomen favor careers that will allow work-home balance. Women also consider nonfinancial scope of services than men usually do (Jurik, 1998). Like men, women also initiate a business for personal interests, for fulfillment of ones’ desire and also for job satisfaction (Georgellis and Wall, 2004; Jurik 1998). They want to do it so that they can even face challenges successfully and can gain more self determination.. Thirdly, women also desire for recognition and therefore want to be self employed. II. 3. Effort put in the creation of new business Many researches have reflected that on average business women work lesser hours than business men. Especially, it is seen that women have devoted lesser time than men to set up their businesses. Also in comparison to men, women who are self employed do not commit their full time for work. (OECD, 1998). Business men are more likely to work for longer hours as their intention to set up a business is to make money. Therefore they face less competition in the market as women get busy in household work, child care, old parents care. Otherwise within this time frame women could sketch the whole business format thereby reducing their effort to be at par with their competitors. II. 4. Size of Venture Various studies on surviving businesses has focused that the firms owned by women are smaller in size to that of men. Moreover, while starting up, women have very less amount of employees and capital to support wholly. Women often start up businesses at a smaller scale because they lack access to business opportunities at a large scale, essential financial resources and different factors and discipline required for a business set up. (Brush, 1992; Carter et al., 1997) II. 5. Type of Business Started Female and male entrepreneurs do not initiate similar type of businesses. Businesses led by women are probably found in private services and in retail sector and are rarely found in the manufacturing sector and high technology driven industries. (Brush et al., 2006). Moreover, women-led businesses are not very growth oriented and have less opportunity and is more tilted towards wage substitution Several researchers argued that gender differentiation in businesses are the outcome of structural barriers and socialization. Women are found to work in some specific industries where they are socially accepted and recognized and also it happens that they face various problems in other sectors where they are not given the due recognition. (Mirchandani, 1999). This also helped the women entrepreneurs to set up a similar company independently in which they have worked previously as they can utilize their prior experiences into it to set it up in a proper manner. Additionally, without an appropriate educational background, adequate skills and knowledge, a business entity cannot be set up at all. This is the case where most businesses are technology oriented. Therefore women lack to set up such business entities which require rich (Brush et al., 2006) technical skills. Moreover, some business start ups does not need to face any hassles as they face less entry barriers. Women are likely to initiate such businesses as they require less capital for this than to initiate other type of businesses. II. 6. Expectations relating to the Venture Performance Female entrepreneurs expect less out of their business compared to male entrepreneurs. Firstly, they anticipate for lower profits thereby employing lesser people than that of male entrepreneurs as they are less aggravated to earn money and more excited to accomplish other goals, basically where they need to concentrate in their domestic sector. (Brush, 1992). Secondly, male entrepreneurs are highly confident in their industrial skills than women entrepreneurs. Such vary in confidence level lead the male entrepreneurs to expect much greater profit out of their business. (Robb and Wolken 2002) Thirdly, female entrepreneurs initiate businesses that have less growth opportunity and income prospective than men entrepreneurs. Hence, female entrepreneurs expect less out of their businesses, in practical sense, compared to male entrepreneurs. Fourthly, female entrepreneurs restrict themselves to a limit while expanding their businesses so that their domestic lives do not get affected much, as they need to commit their time in their personal lives together in their professional lives. Fifthly, women entrepreneurs initiate smaller scale firms which require less capital than men entrepreneurs and therefore their initial hope for profit is much less compared to men. (Boden, 2000; Robb and Wolken 2002) II. 7. Preferences of Risks Studies on psychology and sociology highlighted that women are more reluctant than men related to business risks. Mainly, women do not have much interest on financial risk unlike men. Actually, one study reflected that psychologically female entrepreneurs scored very less in risk propensity compared to men. Hence, male entrepreneurs take up business opportunities that are more risk driven than pursued by women entrepreneurs. (Brush, 1992). II. 8. Identification of opportunities Women entrepreneurs look out for new business prospects separately than men because of certain reasons. Some are like: Firstly, social networks provide a lot of information on newer opportunities. Women could pursue various social networks and contacts, hence, they get more information about new opportunities. For example, female entrepreneurs identify many opportunities just by conversing with various investors and bankers as they have more contacts with bankers and investors. Secondly, on an average, male and female entrepreneurs view and solve their respective problems in a different way. For example, female entrepreneurs gain their experiences through conversation and sittings with their social contacts, friends and business partners whereas male entrepreneurs learn and move every bit through facing lot of set backs and hassles by themselves. (Brush, 1992) II. 9. Self-confidence in organizing behavior Generally, women show less efficiency in businesses which are mainly male oriented. They pursue less knowledge and experience in the field compared to men. Traditionally, it has been thought in a way that businesses can be done only by men as a result of which women are regarded to have low confidence level in their business abilities compared to their male counter parts. Hence, they usually take a back foot in taking up the key tasks related to new ventures, such as gathering working capital and then attracting the customers. (Carter et al., 1997) II. 10. Problems faced at the beginning Various researchers suggested that because of many social norms like women need to carry majority of the household burden have led female entrepreneurs to face a lot of start-up problems with greater magnitude than men. For example, society does not admit seriously that women can also be capable to setting up a business of their own, as a result of which it becomes difficult for them to gain the support from their family, friends, social contacts, near and dear ones. Moreover, the comparative scarcity of role models had been a grater problem for women entrepreneurs to get enough mentorship for their effort in the start up ventures. Moreover, the greater responsibilities of women at domestic front to look after their children and old parents engage them to a large scale and therefore it have made it much tougher for women entrepreneurs to balance their time and energy between home and work. (Carter et al., 1997) III. Conclusion Women do not have to sacrifice a lot in order to launch a company in order to get recognized in their professional field. They need to only have a lot of self confidence among themselves so as to participate in debate and gatherings with their superiors and colleagues. One should bring on light women role models so as to motivate the female entrepreneurs. Female speakers are found to be very less in majority of the industry events. One should highlight women who can project a major impact on the companies’ business. Women who possess entrepreneurial interest should be encouraged. There should be more classes on entrepreneurship in business schools so as to bring in women entrepreneurship into the limelight. Reference: 1. Mirchandani. K., 1999. "Feminist Insight on Gendered Work: New Directions in Research on Women and Entrepreneurship,” Gender, Work and Organization, 6(4): 224 Boden, R., 2000. "Analyses of Business Dissolution by Demographic Category of Ownership." Contract report for the Office of Advocacy, U.S. Small Business Administration, 2. www.sba.gov/advo/research/rs204tot.pdf. 3. Office of Advocacy, 2006. Women in Business, U.S. Small Business Administration. 4. http://www.sba.gov/advo/research/rs280tot.pdf. 5. Srinivasan, R., Woo, C., and Cooper, A., 1993. "Performance Determinants For Male And Female Entrepreneurs." In Bygrave, W., Birley, S., Churchill, N., Gatewood, E., Hoy, F., Keeley, R., and Wetzel, W. (eds.), Frontiers of Entrepreneurship Research, Babson Park: Babson College, 43-56. 6. Robb, A., and Wolken, J., 2002. "Firm, Owner, And Financing Characteristics: Differences Between Male And Female-Owned Small Businesses," working paper, Federal Reserve Board of Governors, www.federalreserve.gov/Pubs/FEDS/2002/200218/200218pap.pdf. 7. Brush, C., 1992. "Research on Women Business Owners: Past Trends, a New Perspective and Future Directions." Entrepreneurship Theory and Practice, 16(4): 5-30. 8. Carter, N., Gartner, W., Shaver, K., and Gatewood, E., 2003. "The Career Reasons of Nascent 9. Entrepreneurs," Journal of Business Venturing, 18: 13-39. 10. Birley, S., 1989. “Female Entrepreneurs: Are They Really any Different?” Journal of Small Business Management, 27(1): 32-37. 11. Connelly, R., 1992. “Self-Employment and Finding Childcare,” Demography, 29(1): 17-29. 12. Georgellis, Y., and Wall, H., 2004. “Gender Differences in Self-Employment,” working paper, The Federal Reserve Bank of Saint Louis. http://research.stlouisfed.org/wp/1999/1999-008.pdf. 13. Lombard, K., 2001. “Female Self-Employment and Demand for Flexible, Nonstandard Work Schedules,” Economic Inquiry, 39(2): 214-237. 14. Boden, R., 1996. “Gender and Self-Employment Selection: An Empirical Assessment.” Journal of Socio-Economics, 25(6): 671-682. 15. DeMartino, R., and Barbato, R., 2003. "Differences Between Women and Men MBA Entrepreneurs:Exploring Family Flexibility and Wealth Creation as Career Motivators," Journal of Business Venturing, 18: 815-832. 16. Jurik, N., 1998. “Getting Away and Getting By: The Experiences of Self-Employed Homemakers,” Work and Occupations, 25(11): 7-35. 17. OECD, 1998. Women Entrepreneurs in Small and Medium Enterprises, OECD: Paris. Read More