DIPLOMA INFORMATION TECHNOLOGY

YEAR 2
SEMESTER 2.2

MATHEW WAHOME SCT121-0236/2021

BRIAN NYAGA SCT121-0458/2021
WINNIE MAINA SCT121-0736/2021
GODWIN JOEY SCT121-0571/2021

ENTREPRENEURSHIP SKILLS
CHAPTER 7: ENTREPRENEURSHIP MOTIVATION (ME)

 Motivation
 Types of Motivation
 Importance of Motivation
 Entrepreneurial Motivation Factors
 Abrahams Maslow’s hierarchy of needs
 Incentives
 Reference
ENTREPRENUERSHIP SKILLS
ENTREPRENUERSHIP MOTIVATION
Motivation
It denotes a person’s needs, desire, wants, or urges.
It is the process of motivating individuals to take action in order to achieve a goal.
The entrepreneurial motivation is the process that activates and motivates the
entrepreneur to exert higher level of efforts for the achievement of his/her
entrepreneurial goals.
Entrepreneurial motivation is the result of stimulated desires and activated enthusiasm in
entrepreneurs which makes them attain a particular goal. This result is by various factors
called entrepreneurial motivation factors.

TYPES OF MOTIVATION
There are two types of motivation.
1. Extrinsic
2. Intrinsic
Extrinsic motivation
Extrinsic motivation is doing something for the external rewards you get from it. This
includes financial gain, benefits perks and even avoiding getting fired.
When you find your inspiration waning, re-focusing on external rewards is a quick way to
recommit to a goal or activity, whether that be performing well at work or sticking to an
exercise routine. If you find yourself grumbling through your commute each day (to perform
a job you’re not crazy about) try focusing on the external rewards — be it the pay check that
pays your rent, the health insurance or even the free fruit in the cafeteria — to get motivated.

Intrinsic motivation
It’s an internal drive for success or sense of purpose.
Intrinsic motivation is doing something because it feels good to you. You feel internally
rewarded for doing it.
In a job, this can be doing work that feels purposeful, enjoying time with your teammates or
achieving goals you’ve set for yourself.”
WHY MOTIVATION IS IMPORTANT
 1. Motivation improves your relationships

If you lack motivation, problems go unaddressed, distance is created, and everyone involved
feels neglected.

2.Motivation helps build new skills

Developing a new skill depends on two thing: motivation and habit.

When you’ve done something for a while, you don’t always need to “feel” motivated; you
can power through and just do the thing out of habit. However, while you’re still forming
those habits, you need motivation.

3.Motivation helps you learn more

 Motivation helps you weed through what can seem like countless resources, absorb, and
analyse the information, and keep learning.

4. Motivation increases your productivity

If you want to be more productive, think about your motivations. 

 If you’re motivated by something, even if it’s a reason as simple as wanting to put away
work and have dinner right at 6 pm, you’re more likely to be more productive.

5. Motivation inspires others

They say happiness is contagious. Motivation is, too. If you hang around motivated people,
you’re more likely to feel inspired.

6.Motivation gets you through hard times

 When things get harder, however, it’s easier to lose sight of the finish line.  You can own
your feelings, but still remember that you’re capable of getting through this time. Your
motivations compel you to keep trying.

7.Motivation is essential for good leadership

Leaders have a lot of responsibilities, but one of the most important ones is motivation. If a
team isn’t motivated, their work will suffer. Leaders need to study the best ways to motivate a
group and avoid strategies that aren’t as effective.
ENTREPRENURIAL MOTIVATION FACTORS
Here there are 6 Cs: Choice, Challenge, Control, Collaboration, Constructing meaning and
Consequences. This are key factors that lead to factors listed below.
I. Achievements, challenge, and learning
The drive of accomplishing a challenge motivates one to be in the entrepreneurship
field. The biggest lesson is learning. One is layered up in a challenge and the mind
effectively seeks knowledge through learning and rewarded through achievement.

II. Independence and autonomy

Independence and autonomy are profound and compelling human desires.
Entrepreneurs set their own goals, pick their own factors, and face the consequences
of their decisions.
III. Income security and financial success
I think this is really two motivations. Some entrepreneurs are motivated by the desire
to create the next “unicorn”- a privately held company with a valuation of over $1
billion. Far more common is the entrepreneur who is seeking financial security. They
might be excluded from traditional employment because of limited education, poor
language skills, illegal discrimination, or previous incarceration. For them, one of the
best options for achieving financial security is starting a business and creating their
own opportunity.

IV. Recognition and status

Depending on the community and culture, entrepreneurs can either be celebrated or
vilified. Entrepreneurs who create enormous wealth for themselves and their
communities are not automatically recognized as citizens as we would like our
children to emulate. Much depends on how they made their money and what they do
with it.

V. Family
In many parts of the world, the family business is the only way to maintain financial
and social stability. The well being of the family is a powerful motivation for young
entrepreneurs looking for a vocation.

VI. Dissatisfaction with current work arrangements

A bad boss, poor pay, job discrimination, forced retirements and no opportunity for
advancement are strong motivators for potential entrepreneurs. So as being fired.
Research has shown that layoffs associated with the great recession resulted in a
rapid and significant increase in business startups and entrepreneurial activity.

VII. Community and social motivation

Many entrepreneurs are motivated by a desire to give back to the community or
solve an ongoing social problem.
ABRAHAM MASSLOWS OF HIERACHY OF NEEDS.
Maslow's hierarchy of needs
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Maslow's hierarchy of needs is an idea in psychology proposed by American psychologist
Abraham Maslow in his 1943 paper "A Theory of Human Motivation" in the journal
Psychological Review. Maslow subsequently extended the idea to include his observations
of humans' innate curiosity. His theories parallel many other theories of human
developmental psychology, some of which focus on describing the stages of growth in
humans. The theory is a classification system intended to reflect the universal needs of
society as its base, then proceeding to more acquired emotions. The hierarchy of needs is
split between deficiency needs and growth needs, with two key themes involved within the
theory being individualism and the prioritization of needs. While the theory is usually
shown as a pyramid in illustrations, Maslow himself never created a pyramid to represent
the hierarchy of needs. The hierarchy of needs is a psychological idea and also an
assessment tool, particularly in education, healthcare and social work. The hierarchy
remains a popular framework in sociology research, including management training and
higher education.
Maslow's hierarchy of needs is often represented as a pyramid, with the more basic needs at
the bottom.
Moreover, the hierarchy of needs is used to study how humans intrinsically partake in
behavioral motivation. Maslow used the terms "physiological", "safety", "belonging and
love", "social needs" or "esteem", "self-actualization" and "transcendence" to describe the
pattern through which human needs and motivations generally move. This means that,
according to the theory, for motivation to arise at the next stage, each prior stage must be
satisfied by an individual. The hierarchy has been used to explain how effort and
motivation are correlated in the context of human behavior. Each of these individual levels
contains a certain amount of internal sensation that must be met in order for an individual to
complete their hierarchy. The goal in Maslow's hierarchy is to attain the level or stage of
self-actualization.
Although widely used and researched, Maslow's hierarchy of needs lacks conclusive
supporting evidence and the validity of the theory remains contested in academia. One
criticism of the original theory which has been revised into newer versions of the theory,
was that the original hierarchy states that a lower level must be completely satisfied and
fulfilled before moving onto a higher pursuit; there is evidence to suggest that levels
continuously overlap each other. Other criticisms include the placement location of sex in
the hierarchy, the assumption of individualism in the theory, and lack of accounting for
regional variances in culture and availability of resources.
INCENTIVES IN ENTREPRENUARAL MOTIVATION
Incentives is encouraging productivity.
There are two types of incentives financial incentives and non-financial incentives.
Financial incentives
Financial motivation involves motivating employees with money and things associated
with money. The main methods of financial motivations are remuneration, bonuses,
commission, promotion, and fringe benefits.
 Remuneration
It is the money employees are paid for working in a business. Different roles in a business
are awarded with different levels of remuneration. Many employees are motivated by
remuneration and pay rises can often make employees feel more motivated.
Example, a company director might earn Kshs 100,000 per month whereas a data entry clerk
might earn 30,000 per month. Many businesses offer regular monthly or yearly increase in
remuneration to help increase motivation.

 Bonuses
A bonus is a form of additional remuneration. Some businesses and industries use bonuses to
motivate their employees. For example, when in an electronic shop a salesperson might be
awarded a Kshs 10,000 bonus at the end of the year for selling many TVS this could be
because they created a certain amount of revenue for the business. This highly motivates the
employee.

 Commission
Commission is usually given as a percentage of a sale or a specified amount of money per
sale. For example, if a salesperson sells a car, they might receive 25 to 30 per cent of the
profit as a commission. Earning additional money is often a motivating factor for employees
and generally makes them work harder.

 Promotion
It’s another way to improve an employee’s motivation. When an employee is promoted, they
are provided with a higher-ranking job and more responsibility in a business. Often a
promotion means the employee earns a higher wage and receives more financial benefits.
This makes employees feel more valued by a business.

 Fringe benefits
Fringe benefits are additional employment perks awarded to employees, such as a free gym
membership, a company car, free holidays, additional holiday allowance, free transport, or
free food. Fringe benefits are often ways of saving employees money rather than providing
them with additional money. Many businesses use fringe benefit to motivate their employees

Non-financial Incentives

Entrepreneurs have non-monetary needs be it psychological, emotional, or social. They need

to fulfil these needs within the job or else they may leave it for better opportunities
elsewhere. It is important that any company focuses on them as well while they provide
financial perks to their workers. The Non-Financial Incentives take care of these needs to
motivate employees to perform better in their roles.
Types of Non-Financial Incentives
The different types of Non-Financial Incentives are as follows:
1. Autonomy: Entrepreneurs value the freedom and independence to make their own
decisions and pursue their vision. They want to be their own boss, work on their terms,
and create something they are passionate about.
2. Creativity: Entrepreneurship often involves creating something new or solving a problem
in a unique way. Entrepreneurs enjoy the challenge of coming up with innovative ideas
and developing them into successful businesses.
3. Impact: Many entrepreneurs are motivated by the desire to make a positive impact on the
world. They want to create products or services that will benefit society or solve a
particular problem.
4. Personal growth: Entrepreneurship can be a challenging and rewarding experience that
provides opportunities for personal growth and development. Entrepreneurs often learn
new skills, overcome obstacles, and develop resilience and grit.
5. Recognition: Entrepreneurs enjoy the recognition and validation that comes with building
a successful business. They want to be known as a successful entrepreneur and to make a
name for themselves in their industry.
6. Flexibility: Entrepreneurship allows for a flexible work schedule and the ability to work
from anywhere. Entrepreneurs can structure their work around their personal lives and
create a work-life balance that works for them.
Overall, non-financial incentives are a crucial factor in motivating entrepreneurs to take the
risks and put in the hard work necessary to start and grow a successful business.
REFERENCES

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Learning, A. (2014). Incentives in entreprenueral motivation (2014th ed., p. 1). Account Learning.
https://doi.org/16/02/2023
Foss, N. J., & Klein, P. G. (2012). Entrepreneurship, subjectivism, and the resource-based
view: Toward a new synthesis. Journal of Management, 38(2), 479-501.
Baron, R. A. (2008). The role of affect in the entrepreneurial process. Academy of
Management Review, 33(2), 328-340.
Cardon, M. S., Zietsma, C., Saparito, P., Matherne, B. P., & Davis, C. (2005). A tale of
passion: new insights into entrepreneurship from a parenthood metaphor. Journal of Business
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Parker, S. C. (2014). Do serial entrepreneurs run successively better-performing businesses?
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