Global Trends of Women in Private Spheres of Business

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Table of Contents

Introduction
Female Motivation for Starting up a Business
Barriers to Business Entry for Women
Personal Features of Male/Female Entrepreneurs
Conclusion
References

Introduction

Close attention to women in entrepreneurship has emerged from the recognition of the fact that women have become increasingly interested in starting up their own business. Global trends of women in private spheres of business witness the overwhelming percentage of women coming into business; the statistical data shows the female dominance in initiating business over the male entrepreneurship activity.

As noted by Dyson (2003), the 2002 Global Entrepreneurship Monitor showed that 38% of New Zealand entrepreneurs are women. This data supports the prior findings of McGregor and Tweed (2000) that twenty women started up enterprises a day in 2000, representing 40% of all entrepreneurs of the country, as compared to 35% of Canada’s entrepreneurship.

Though the UK tendencies show a steady decline in women’s participation in the private business sector, the late 1990s’ data showed that they used to comprise nearly a half of all private businesses (Fielden, Davidson, Dawe, & Makin, 2003).

These facts the literature methodology employed in the present work: identifying the recurrent topics in national and international research on female entrepreneurship, referring the conclusions and generalizations to New Zealand situation.

This statistical information serves as obvious evidence of the growing motivation women have to start up their own business. However, there have emerged a number of discrepancies in entrepreneurship area because of the specificity of female entrepreneurship. The claims that private business research is male-biased have also undermined the viability of traditional approaches to research.

Thus, a new methodological perspective is required for studying the dominant tendencies in female entrepreneurship; the most important fields demanding specific, female-focused attention, include the variety of barriers existing for female entrepreneurs at all stages of business management, the specificity of female motivation in business as compared to males; personal features of male and female entrepreneurs etc.

There is also a strong need to identify areas of research in which the gender factor should be taken into account as an essential variable affecting the judgment and conclusions, and where factors other than gender are enacted and allow generalizations on the issue of entrepreneurship devoid of any gender implications.

A set of research articles and publications have been taken as a source base for the present literature review: the theoretical implications of the role of gender are discussed in the article of Moult and Anderson (2005), de Bruin, Brush, and Welter (2007) research the theoretical framework of considering entrepreneurship in female aspects, and Shelton (2006) examines the family-work conflict as the major constraint in initiating an entrepreneurship.

National surveys are also considered in the course of the literature review: Kutanis and Bayraktaroglu (n.d.) provide data on female entrepreneurship trends in Turkey, Zinger et al. (2005) research the Canadian women’s entrepreneurship efforts, and Fielden et al. (2003) turn to the distinction between American and British female entrepreneurship practices.

The focus on New Zealand is provided by Dyson (2003) considering the progress in female entrepreneurship opportunities in New Zealand, Massey and Lewis (2003) turning to women and access to micro-finance in the country, and McGregor and Tweed (2000) examining previously utilized research practices in New Zealand.

Views are generally shared on the majority of issues, but geographical differences are still evident in the specific situations faced by female entrepreneurs.

Female Motivation for Starting up a Business

There are many personal motives for starting up a business named by women interviewed on the issue of their private business and those who are only planning to start up a firm.

These motives are diverse and include both the wishes and ambitions of women (e.g. the attraction of a new challenge and desire for a better life and work equilibrium) and necessities they experience in the current socio-economic environment (response to redundancy at the previous workplace or the need for flexibility in working time due to the responsibilities in child-rearing and keeping the household) (Dyson, 2003).

These were the motive drives for New Zealand women questioned; he opinions of Turkish women, reviewed for comparison, do not differ greatly: among the strongest drives to create a private business dissatisfaction by the previous workplace, the need to utilize personal skills and resources, the lack of personal autonomy and pursuit of independence and flexibility, difficult working conditions of the firms were named (Kutanis & Bayraktaroglu, n.d.).

However, there surely are some nation-specific differences in the female entrepreneurship trends and opportunities evident; the fact may be supported by the study initiated by Fielden et al. (2003) to find a solution to the sliding tendencies of female entrepreneurship percentage in the North West of the UK.

The method they used was to look for more successful practices in motivating women to enter the private business sector in the USA and this way to detect the barriers most problematic to overcome in the domestic economy.

Research of the female motivation to launch their own enterprise was the gender discrimination of many kinds at the corporate workplaces: the inability to overcome the ‘glass ceiling’ phenomenon at work, recurrent lack of recognition of their achievement at work, lack of serious attitude, isolation within an organization, and witnessing male promotions ahead of women (Fielden et al., 2003; Moult & Anderson, 2005).

These facts may imply that the UK corporate business was designed in a much more beneficial way for women, minimizing their desire to leave the public enterprise field and to start their private business. However, this was not so – the barriers to entry to the private entrepreneurship sector turned out more influential than the attraction of staying at the previous workplace.

Hence, a set of gender-neutral factors motivating women to start a private enterprise have also been found. Women have turned out to possess many of the features needed for a successful private business career. They were (and are) well-educated, energetic, resourceful, motivated by potential achievement, and self-confident (sometimes even at a higher level than their male counterparts) (Fielden et al., 2003).

Women in the USA initiating their own private business turned out more dynamic, coming from managerial backgrounds, and having a business start-up experience, which made them correspond to the image of ‘modern’ entrepreneurs.

The tendency showed the contrast between the current state of affairs and the 1980s’ tendencies of low-income, uneducated and inexperienced women mainly coming to the private sector of economy.

The conclusions made for the UK business settings included the business support by governmental and private institutions, introduction of mentoring schemes to provide support on the psychological level, and financial support to initiate start-up businesses in Great Britain (Fielden et al., 2003).

This research shows the genuine interest of the state in the promotion of both male and female entrepreneurship, hence the state’s role in building healthy motivation and opportunity for women is significant.

The fact that entrepreneurship becomes more and more attractive for women is obvious; speaking about New Zealand in particular, one should not that not only the desire to start up a business serves as a decisive factor for initiating an entrepreneur career, but the private business career as a socially acceptable option for women plays its significant role.

The country is ranked as one of the highest in encouraging women to become self-employed or start a business of their own (Dyson, 2003). Hence, the governmental help is a very influential factor in forming motivation for entrepreneurship.

Barriers to Business Entry for Women

Women and men generally have the same range of opportunities in starting up a private enterprise, mainly because of their ability to access funds and conduct managerial and financial activities. However, as noted by Moult and Anderson (2005), women still suffer from the specific gender-based disadvantages in starting a business.

They are diverse and refer to both the access to financial instruments such as micro-finance, more family and social responsibilities (e.g. child-rearing and domestic issues), higher need for flexibility at work etc.

Women’s private enterprise is always the issue of a compromise between a family and a job, hence family-business prioritizing often serves as an additional constraint restricting both time and effort allocated for developing a business (Moult & Anderson, 2005).

The problem is universal in its significance, and, as noted by Dyson (2003), New Zealand women also face the challenge of balancing work, family, whanau and community roles, preserving their own mental and physical health, safety and well-being at the same time.

The barriers to business entry for women result in more time spent on the business efforts, resulting in a work-family conflict in the lives of female entrepreneurs. This family-work conflict causes an inevitable tension in the women’s lives and urges them to apply management strategies such as elimination, reduction or sharing ones (Shelton, 2006).

As Shelton (2006) argues, the mitigation of the family-work conflict is female-specific, as males are rarely so actively involved in child-rearing and household chores.

The family-work conflict serves as an additional barrier in entrepreneurship; there are various roles preferred by women, so in case they prioritize their family roles, they implement participative management, competitive compensation etc., that is technologies that minimize the entrepreneur’s presence at the workplace.

Prioritization of work roles may involve hiring staff for childcare and household, seeking help of the family etc. (Shelton, 2006).

Some other barriers for female entrepreneurship include the overall negative attitude to women-entrepreneurs, lack of affordable business premises, high costs and overheads of running a small business, lack of support groups etc. (Fielden et al., 2003). Although these barriers constitute serious threats for women starting up a business, the lack of access to financing business starts-up is a more serious barrier.

Massey and Lewis (2003) have conducted a survey in New Zealand and have produced a set of highly relevant conclusions on the issue of financing and gender biases in the discussed context.

The lack of women’s access to loans and equity finance is considered to have the following set of reasons: low debt capacity of women, less demands for loans for women not apt to take risks, lower income of industry sectors preferred by women, less property of women resulting in their lack of ability to conclude collateral agreements (Massey & Lewis, 2003).

In addition, the researchers state that women have less experience in finance management, lack skills and knowledge to conform to the banking criteria, being literally unable “to speak the banker’s language” (Massey & Lewis, 2003, p. 16). The problem also has the institutional roots, with lack of attention to the women-specific needs in micro-finance:

“while there are a number of agencies that provide micro-finance to women, there is an almost total lack of interest in evaluating whether this is necessary, and whether the particular measures that are being undertaken are effective and/or efficient” (Massey & Lewis, 2003, p. 6).

Looking at the current situation in New Zealand, one can say that there are a large number of financing tools for women, including the Federation of Business and Professional Women, the Women’s Loan Fund, the Maori Women’s Development Inc., and many more funds such as the Nelson Enterprise Loan Trust, the Poutama Trust etc. (Massey & Lewis, 2003).

However, the situation is still considered not ideally equal for men and women, with some action needed to be taken to ensure easier access to financing for women.

Some of the proposed decisions called to solve the problem of barriers in financing a private enterprise for women are: to gain a deeper understanding of the women’s wants regarding the entrepreneurship; research the views of stakeholders in the field of financing, and link these data to the current initiatives and delivery methods of government agencies in the field of business finance (Massey & Lewis, 2003).

Personal Features of Male/Female Entrepreneurs

Though the gender bias is actively debated in the field of entrepreneurship, there is still a great body of evidence regarding the fact that women and men base their entrepreneurship efforts on a differing set of values, attitudes and skills.

McGregor and Tweed (2000) have marked the following set of differences in male and female entrepreneurs’ features: women are more concentrated in the micro business field; they are less growth-oriented than men because of their caution regarding business risks.

Women reported to prefer small and stable businesses, and wished to preserve the quality of life it gave them but not to develop further. Expansion was even often seen by women as a threat to their welfare. This tendency makes women “satisficers”, while men are more of “expansionists” by entrepreneurial nature (McGregor & tweed, 2000).

McGregor and Tweed’s (2000) findings are supported by the research of Zinger et al. (2005) in the Canadian settings: both teams agreed that women worked predominantly part-time, with their enterprises showing much lower levels of income than males’ ones.

In addition, women were found to be more conservative in their attitude to business, and tending to affiliation but not autonomy (while men expressed the wish for autonomy as one of the dominant incentives for a business start-up). Women preferred mentorship at the initial stages of entrepreneurship and sought reassurance from women in similar circumstances (McGregor & Tweed, 2000).

However, the categories of women entrepreneurs are also heterogeneous, with the various extent of confidence and prioritization, which can be seen on the example of Turkish women categorized into ‘conventionals’ (women who balance their work and family in a conventional way, not prioritizing any of the fields), ‘innovators’ (women more focused on business than on family roles), ‘domestics’ (women prioritizing family and sacrificing business in case a family-work conflict arises), and ‘radicals’ (women unable to balance their careers with family roles and prioritizing business) (Kutanis & Bayraktaroglu, n.d.).

Some other features specific for female entrepreneurs include the concentration in the retail trade and service sectors (Zinger et al., 2005; Moult & Anderson, 2005). Low levels of self-efficacy reported by many women affected the recognition of poor opportunity available for them in private business (Zinger et al., 2005).

These facts prove the point that male and female entrepreneurship models are substantially different based on the individual, social and cultural roles of women and men as well as their self-awareness and assessment of success opportunities.

Conclusion

Despite the fact that literature on female entrepreneurship is heterogeneous, covering may theoretical and practical aspects, some key concerns stand out and require specific attention. It is evident that entrepreneurship needs a much deeper and closer focus because of its specificity and variability of research.

The present literature review shows that there are many similarities in ways of doing business for men and women, but women still have a set of unique features, challenges and approaches to entrepreneurship requiring special attention.

As de Bruin, Brush, and Weler (2007) note, there may be no necessity for a separate theory on women’s entrepreneurship, while a certain expansion of existing theoretical concepts may still be needed to incorporate the vision of female entrepreneurship’s distinctiveness. Therefore, research may be based on some well-established methodological principles applied to the whole concept of entrepreneurship.

It is also clear that a set of practical solutions for the expansion, encouragement and promotion of female entrepreneurship worldwide. As women are known to have unique constraints such as the family-work conflict, lack of opportunity and access to finance, lack of experience and managerial training, the governmental and private initiatives in the field perform the number one necessity for female stimulation in the private sector.

Since women value mentorship at the initial stages of self-employment, the government should offer such services on a more accessible and efficient basis. Women lack self-confidence and lack flexibility, even under the conditions of being prosperous entrepreneurs. Hence, new solutions to face those problems are needed.

Finally, one can draw a conclusion that the generally known bias against women entrepreneurs is more a socio-cultural than an economic problem, so measures to overcome it have to be searched in the stereotypical, patriarchal views of the society and addressed accordingly.

Only this way may women receive the adequate access to information and resources related to business. The support on the psychological level, adequate business education and recognition of potential may also serve as the indispensible driving forces of female entrepreneurship.

References

de Bruin, A., Brush, C., & Welter, F. (2007). Advancing a framework for coherent research on women’s entrepreneurship. Entrepreneurship Theory & Practice, 31(3), 323-339.

Dyson, R. (2003). Address Her Business Conference. Email communication: [email protected]. 4 March 2003.

Fielden, S., Davidson, M., Dawe, A., & Makin, P. (2003). Factors inhibiting the economic growth of female owned small businesses in North West England. Journal of Small Business and Enterprise Development, 10(2), 152-166.

Kutanis, R.O., & Bayraktaroglu, S. (n.d.). Female Entrepreneurs: Social Feminist Insights for Overcoming The Barriers. Sakarya University. The Faculty of Economics and Administrative Sciences, Department of Business Administration, Turkey.

Massey, C., & Lewis, K. (2003). New Zealand women and micro-commerce. New Zealand Centre for Small & Medium Enterprise Research, Massey University. The paper prepared for the Ministry of Women’s Affairs.

McGregor, J., & Tweed, D. (2000). Towards a typology of female entrepreneurship: New directions from a nationwide study. Paper presented at the 30th European Small Business Seminar, Ghent, Belgium Conference publication, pp. 603-613.

Moult, S., & Anderson, R. (2005). Enterprising women: Gender and maturity in new venture creation and development. Journal of Enterprising Culture, 13(3), 255-271.

Shelton, L. (2006). Female entrepreneurs, work-family conflict, and venture performance: New insights into the work-family interface. Journal of Small Business Management, 44(2), 285-297.

Zinger, J.T., LeBrasseur, R., Riverin, N., & Robichaud, Y. (2005). Stages of Small Enterprise Development: A Comparison of Female and Male Entrepreneurs. Paper presented on the 21st Annual C.C.S.B.E. Conference, Waterloo, ON R. Oct. 26-28, 2005.

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