Professor and Deputy-Dean Tales Andreassi, FGV-EAESP, with fellow researchers Vânia Maria Jorge Nassif, University of Sao Paulo, and Professor Maria José Tonelli,FGV-EAESP, share results from their critical incident-based research* into women entrepreneurs. What impacts them behind their business veneer and how do they cope with it?
By Tom Gamble. Related research: Nassif, V. M. J., Andreassi, T., & Tonelli, M. J. (2016). Critical incidents among women entrepreneurs: Personal and professional issues. Revista de Administração [RAUSP], 51(2), 212-224. doi: 10.5700/ rausp1235.
Let’s go critical
There have been many studies on women entrepreneurs throughout the world focusing on everything from their competencies, decisions to innovate and take risks to gender differences in business administration. This is good news. However, many studies have concentrated on the behaviour and characteristics of these women or else highlight the subordination of women in comparison with men – consequently missing out on the key dimension of the specific problems women entrepreneurs face and how they deal with them.
Prof. Tales Andreassi and his fellow researchers have come up with something different, orienting their research, much in the vein of Dr. Helene Ahl, towards making women the central element of analysis in their role of active agents in business entrepreneurship. This they do using the critical incident technique or CIT, a method first introduced by John Flanagan based on studies he conducted during World War II. Since then, the technique – which typically involves asking respondents to recount a critical experience – has been used in many fields of knowledge to identify significant events and examine how they are managed. In Prof. Andreassi’s analysis, a critical situation is understood as a very serious occurrence experienced by the women entrepreneurs who were interviewed that could have led to the closure of their businesses. Many of these occurrences were rooted in the lives behind the role of entrepreneur, meaning that the research succeeds in extracting not only an understanding of the issues related to the management activities of women entrepreneurs, but also the lives, events and emotions behind the purely entrepreneurial mask that indeed tend to interconnect and shape women’s business development.
The Brazilian context
As far back as 2001, the OECD pointed to the need for a better understanding of how to promote entrepreneurship among women with a view to eliminating the specific obstacles they face when it comes to creating businesses. The organisation identifies three areas regarding the importance of women as owner-managers of small enterprises: the economic contribution and how they create employment, social relevance and work-family balance, and women’s autonomy in the work environment.
In this context, Brazil is an interesting arena for studies, not least because the country has a high rate of entrepreneurs in relation to its population – 32.3% of 18 to 64 year-olds according to figures from the GEM (Global Entrepreneurship Monitor) – and despite a battery of specific administrative difficulties a would-be Brazilian entrepreneur faces. Indeed, among a list of 185 countries, the World Bank places Brazil 130th in terms of how easy it is to conduct business and it comes as no surprise then to learn that 25% of all companies close their doors within the first two years of their creation. What is surprising, however, is that although faced by the double shift of work (i.e. managing a business and managing a family) and unfavourable conditions for entrepreneurs in the country, the number of new entrepreneurs who are women reaches a hefty 52,2%. Furthermore, for businesses that manage to stay afloat above the 42-month mark, that figure remains at 42.2%, higher than the 33% of other countries included in the GEM report.
And Brazilian challenges
Studies on the reality of women entrepreneurs in Brazil show that the main challenges they face in a professional context are linked to acceptance, lack of affective and social support, financial difficulties, lack of female entrepreneur role models, lack of knowledge and dedication to achieving success, and finally work-family balance. These studies show that a series of challenges, difficulties, prejudice, lack of education and resources interfere more sharply in the development of businesses run by women. However, they also reveal that women entrepreneurs who have had the opportunity to develop skills and competencies, with or without formal training, have achieved their goals despite their barriers and limitations.
Together with his colleagues, Prof. Andreassi’s research – part of an international project conducted simultaneously in a number of countries – covered 115 women entrepreneurs who were interviewed with a total of 126 critical incidents identified. Almost all the incidents focused on the business rather than the personal (4%). 86% of the women interviewed had business partners and 67% of them ran businesses in the services sector, generally employing from 4 to 15 employees. The critical incidents recorded showed two major themes: on the one hand, aspects resulting from family relationships or relationships with partners and friends in their business and, on the other, practical managerial aspects. Moreover, it was found that there was a link between the growth of the business, for instance in a period of expansion, and the type of incident that was brought to the forefront during the interview – missed deadlines for refurbishing or financing for changes, for example.
Overcoming the entrepreneurial obstacle course
The interviews highlighted that practical, daily management issues had a critical impact on businesses, notably in the finance, human resources, marketing and operations side but also on the Brazilian-specific context of legalizing the business and moving from the informal economy to fully-legal and tax-paying status. However, the affective and emotional factors cited by the interviewees also pointed towards an overlap with professional issues and showed that critical incidents of a personal nature experienced by Brazilian women entrepreneurs are more recurrent than with their international counterparts. Indeed, individual, family, group and social factors influence every phase of the entrepreneurship process.
The greatest difficulties encountered by Brazilian women entrepreneurs were finance, people management and the business environment, as well as issues related to clients, uncertainty and the transition from the informal to the formal market. Many of them had experienced unpleasant situations in their business partnerships – suppliers, employees, partners, etc. – stating that it was difficult to deal with people, even in small groups: either they acted impetuously or recoiled from conflict – something that led to awareness that there was a need to find balance in this area they identified as their major obstacle. Many of the descriptions of critical incidents indeed showed that these relationships involved high intensity emotions that led to reactions that, in turn, influenced the reorganization of businesses.
So how did they cope with these challenges and setbacks? Strategies included, despite the intensity of emotions, in keeping an emotional balance in the face of difficulties and seeking rational and practical solutions to keep the business afloat. Top-heavy administrative obligations, bureaucracy and unreasonable requirements for small businesses were met with women entrepreneurs seeking more training in order to open up perspectives and widen their network.
There were many situations reported by the women entrepreneurs in which strong emotions involving family members and business partners affected the development of their businesses. And although coping strategies were common enough by entrepreneurial standards, regardless of gender (overcoming fear and anger, starting over from scratch, going back to school to gain the necessary skills for the development of the business, attending business fairs and hard work), there was a clear expression for the need to learn how to separate their personal lives from their professional lives.
The critical incidents experienced and reported by the women entrepreneurs in the Brazilian context affect both their personal and professional lives and, in both cases, emotions are always highly intense. However, one characteristic that stood out in their reports of critical incidents is their persistence never to give up and to learn how to deal with different unexpected situations in their daily lives. From the results of their research, Prof. Andreassi and his colleagues claim that women entrepreneurs are objective, clear and persistent, and have will power. They are also creative when it comes to coping with situations, as they create support strategies for handling their double functions of family and work. In the face of personal and professional difficulties or both, entrepreneurial characteristics were identified that differed from non-entrepreneurial characteristics, showing women’s persistence, courage and determination to overcome obstacles and, above all, ensure the survival of their businesses.
Behind the lives of Brazilian women entrepreneurs are emotions, doubt, anger, setbacks and sadness – but there is also that fighting spirit specific to those who dare to enterprise and no doubt laughter that goes with it, sometimes in adversity and especially in those heady moments of success.
Tales Andreassi, Maria José Tonelli and Vânia Maria Jorge Nassif
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