IS EMOTIONAL INTELLIGENCE PREDICTIVE OF

ENTREPRENEURIAL SUCCESS?

Brien C. Walton

A DISSERTATION

in

Chief Learning Officer Program

Presented to the Faculties of the University of Pennsylvania

in

Partial Fulfillment of the Requirements for the

Degree of Doctor of Education

2016

Supervisor of Dissertation:

_______________________________________
Stanton E.F. Wortham, Professor of Education

Dean, Graduate School of Education:

______________________________________
Pamela L. Grossman, Dean and Professor

Dissertation Committee:

Stanton E.F. Wortham, Professor of Education

Laurie Ann Carrick, Vice President, Global Organizational Development and Training,
Jarden Consumer Solutions

Herbert M. Turner, III, Adjunct Professor of Education





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 ii
ACKNOWLEDGEMENT

This dissertation could not have been completed without the help and support of

many people. I would like to start by thanking my chair, Dr. Stanton Wortham, whose

confidence propelled me forward and whose intellect challenged me to dig deeper;

committee member, Dr. Laurie Carrick, whose guidance on distinctions between

emotional intelligence theories inspired me to consider creative emotional intelligence

applications; and committee member, Dr. Herb Turner, whose expertise as a statistician

and psychometrician was invaluable in helping me derive meaning from a sea of data

points and envision broader implications of this study. I also want to thank Dr. Annie

McKee, whose encouragement and guidance throughout the doctoral program helped me

grow personally and professionally. I am also grateful for the love and support of my

parents, Mae and Tracy, and my mother-in-law, Marjorie. To my wife, Arvyce, and my

favorite girls, who have indulged my passion for life-long learning – thank you with all of

my heart.
 iii
ABSTRACT

IS EMOTIONAL INTELLIGENCE PREDICTIVE OF ENTREPRENEURIAL

SUCCESS?

Brien C. Walton

Stanton E.F. Wortham

There are more self-made, billionaire entrepreneurs than billionaires who simply

inherited their fortunes, but the majority of startup ventures fail within five years. A

possible factor in business success or failure could be the emotional intelligence (EI)

level of the entrepreneur, defined broadly as the ability to perceive, interpret, and manage

emotions. Although there is substantial literature on EI applications in established

organizations, there are few empirical studies exploring the predictive value of EI in the

context of success for startup entrepreneurs. The purpose of this study was to determine

whether EI scores can predict how successful an entrepreneur will be using objective

success criteria, as defined in this study (Hypothesis 1), and which, if any, EI

competencies are particularly relevant for entrepreneurs (Hypothesis 2). Hypotheses

were tested using Spearman correlation and Ordinal regression, with sensitivity testing

with Pearson correlation and Ordinary Least Squares regression, respectively. Each

analysis controlled for the entrepreneur’s demographic profile and subjective success

measures. Regression analysis (n=31); ordinal analysis and correlation analysis revealed

a statistically significant effect of only one of the 15 EI scores (Empathy) on

entrepreneurial success, as defined in this study, but the exponentiated coefficients from
 iv
the ordinal regression indicate that improving Overall EI scores can increase Overall

Success. Specifically, six of the 15 EI scores were more than two times more likely to

increase Overall Success scores (Empathy, Interpersonal Relationships, Social

Responsibility, Flexibility, Stress Tolerance, and Optimism), which is consistent with

Hypothesis 2. This study is one of the first to empirically examine the EI construct using

the EQ-i 2.0 emotional intelligence assessment in the context of entrepreneurial success

with a population of entrepreneurs seeking assistance. A key implication of the results is

that teachers, emergency services personnel, legal and financial services personnel, even

sports coaches and single parents, can all develop competencies to make them more

successful in their chosen endeavor, have a sense of fulfillment, and increase the success

rate of industries that go far beyond entrepreneurs.

 v
Table of Contents

ACKNOWLEDGEMENT ............................................................................................................. ii
ABSTRACT................................................................................................................................... iii
LIST OF TABLES ........................................................................................................................ vi
LIST OF ILLUSTRATIONS ...................................................................................................... vii
CHAPTER 1: INTRODUCTION ............................................................................................... 1
Statement of the Problem ................................................................................................................. 1
Theoretical Perspectives .................................................................................................................. 1
Entrepreneurship: Origin of the Term....................................................................................................1
Emotional Intelligence Models – Specific Ability vs. Mixed...........................................................3
Entrepreneurial Success: Associated with Emotional Intelligence (EI) ............................... 10
Research Questions .......................................................................................................................... 12
Significance and Implications ...................................................................................................... 15
CHAPTER 2: LITERATURE REVIEW .................................................................................. 17
Conceptual Framework .................................................................................................................. 17
Three Themes – Entrepreneurs Ÿ Emotional Intelligence Ÿ Success ......................... 18
Definition of an Entrepreneur ................................................................................................................. 18
Emotional intelligence and entrepreneurial leadership .............................................................. 22
Definition of entrepreneurial success .................................................................................................. 26
Tools for Measuring EI: MSCEIT, WLEIS, ESCI and EQi2.0 ......................................................... 29
CHAPTER 3: METHODS ......................................................................................................... 39
Research Design ................................................................................................................................ 40
Validity ............................................................................................................................................................... 41
Reliability.......................................................................................................................................................... 46
Steps taken to mitigate biases and influence .................................................................................... 47
Data collection procedures ....................................................................................................................... 50
Construct Measures ..................................................................................................................................... 53
Measures ........................................................................................................................................................... 60
CHAPTER 4: RESULTS ........................................................................................................... 63
Analytical Procedures ..................................................................................................................... 63
Demographic Profile of Entrepreneurs: ................................................................................... 63
Relationship between Entrepreneurial Success and EI: .................................................... 70
Predicting Entrepreneurial Success Using Emotional Intelligence: .............................. 81
CHAPTER 5: ANALYSIS.......................................................................................................... 95
Trends in the Descriptive Analysis........................................................................................................... 95
Trends in Spearman Correlation Analysis ............................................................................................ 98
Trends in Ordinal Regression Analysis ............................................................................................... 103
Hypothesis Testing .................................................................................................................................... 107
CONCLUSION .....................................................................................................................................108
APPENDIX ............................................................................................................................... 114
REFERENCES .......................................................................................................................... 117
 vi
LIST OF TABLES

Table 1 Summary of the Three Leading EI Models’ Major Categories 17

Table 2 Demographic Characteristics of Participants 71
Table 3 The Mean and Standard Deviation (SD) of EI Subscales 72
Table 4 Overall Emotional Intelligence Score Descriptives 74
Table 5 Success Score Descriptives 75
Table 6 Correlational Relationship Between Overall Success and Composite 79
EI Scores
Table 7 Correlational Relationship Between Overall Success and EI 80
Subscales
Table 8 Correlational Relationship Between Partnerships Success Factor 84
and EI Subscales
Table 9 Correlational Relationship Between Competitors Success Factor and 85
EI Subscales
Table 10 Correlational Relationship Between Employees Success Factor and 86
EI Subscales
Table 11 Regression Relationship Between Overall Success and Overall EI 89
Scores
Table 12 Regression Relationship Between Overall Success and EI Subscales 91
Table 13 Regression Relationship Between Partnerships Success Factor and 94
Overall EI Scores
Table 14 Regression Relationship Between Competitors Success Factor and 94
Overall EI Scores
Table 15 Regression Relationship Between Employees Success Factor and 95
Overall EI Scores
Table 16 Regression Relationship Between Partnerships Success Factor and 97
EI Subscales
Table 17 Regression Relationship Between Competitors Success Factor and 99
EI Subscales
Table 18 Regression Relationship Between Employees Success Factor and EI 101
Subscales
 vii
LIST OF ILLUSTRATIONS

Figure 1. Salovey and Mayer’s Four Dimensions of Emotional Intelligence 13

Figure 2. Goleman’s 12 Emotional Intelligence Competencies 14
Figure 3. Bar-On’s EI Competencies 16
Figure 4. Comparison of Targeted Competencies across Three Leading EI 18
Models
Figure 5. Conceptual Framework 25
Figure 6. Cronbach’s Alpha Reliability for ESCI Competencies 43
Figure 7. Cronbach’s Alpha Reliability for EQi2.0 Competencies 45
Figure 8. Scatterplots showing correlations between Success and Overall EI 77
Scores
Figure 9. Scatterplot showing correlation between Overall Success and 81
Overall EI Scores
Figure 10. Scatterplots showing each success factor’s correlation with 87
Subscale EI Scores
Figure 11. Scatterplot showing EI Subscale odds of moving to higher category 92
of success
 1
CHAPTER 1: INTRODUCTION

Statement of the Problem

In 2014, for the first time since 1984, Forbes Magazine reported in their “Richest

People in America List of 2014,” that the number of completely self-made, billionaire

entrepreneurs outpaced the number of billionaires who only inherited their fortunes

(Fontevecchia, 2014). Fontevecchia (2014) also found that the number of entrepreneurs

who become billionaires is currently three times (3x) the number from 30 years ago, and

the numbers are increasing. Because I am an entrepreneur, I find this upward trend

inspiring, but as a professional mentor to aspiring entrepreneurs in technology industries,

I am curious about the possible reasons behind this explosive trend of successful

entrepreneurs. Specifically, my interest is in why an entrepreneur becomes successful –

not how.

Theoretical Perspectives

Entrepreneurship: Origin of the Term

The formal identification and study of entrepreneurship began in the 17th century

and has slowly evolved over the past 300 years. The evolution came through

interpretations by economists and political thinkers, such as Richard Cantillon (1723),

John Stewart Mill (1848), and Joseph Schumpeter (1934), who considered entrepreneurs

to be great men of business - naturally attracted to the risk inherent to ventures and job

creation. Entrepreneurship is the broad topic investigated in this study and Cantillon

(1723) was the first economist to define a person as an “entrepreneur” when he

categorized them as people who are willing to pay a certain price for goods and services,

then resell those same goods and services at an uncertain price to earn profit. Mill (1848)
 2
advanced the definition a little further by making a critical distinction between a manager

and an entrepreneur – noting that the key difference was the ‘bearer of risk,’ because the

entrepreneur is the only person who bears 100% of the risk in a new venture, which

means they are entitled to 100% of the profit or loss. Specifically, in the context of this

study, I theorize an entrepreneur evaluates the relative risk (advantages and

disadvantages) of alternative business objectives, determines which paths to that goal

engages them emotionally in a positive and motivating way, then chooses the approach

that has the least risk of failure balanced against maximum profit potential.

One of the challenges of research on entrepreneurs has been identifying a

sampling framework that includes entrepreneurs instead of small-business owners. Hoy

and Carland (1983) suggested that entrepreneurs build businesses that are poised for rapid

and explosive growth, whereas small-business owners merely manage lifestyle

companies that provide income. Some researchers may assume that being a member of

an entrepreneurship club means that all members are entrepreneurs, but that is not always

the case. For example, my daughter has established an entrepreneurship club at her high

school and all members are proud to call themselves entrepreneurs, but none have created

a profit-making business - they are only at the idea stage, which does not qualify as an

"entrepreneur." An illustrative example is a study by Rhee and White (2007), where they

chose entrepreneurs from a club where "…members must be under 40 years of age, and

be a founder, co-founder, owner, or controlling shareholder of an operating business with

annual gross sales exceeding $1 million." The problem with that sample is there are

many founders and people who own a controlling interest in an operating business who

have zero involvement with the actual operations, e.g., passive owners who hold their
 3
interest as an investment. Distinguishable from studies that have an overly broad

definition of an entrepreneur, I am targeting individuals who are making a sacrifice of

time and energy to proactively drive their business forward - not being a passive business

owner as an alternative to being an employee.

Emotional Intelligence Models – Specific Ability vs. Mixed

Three leading theorists and psychometric models in the EI context are Salovey

and Mayer (1990), who use the Mayer Salovey Caruso Emotional Intelligence Test

(MSCEIT), Goleman (2002), who uses the Emotional and Social Competence Inventory

(ESCI) to measure EI, and Bar-On (2011), who uses the Emotional Quotient Inventory

(EQi2.0). According to Mayer and Salovey (1997), EI theorists follow one of two

approaches: 1) specific ability models (Mayer & Salovey (1990)); or 2) mixed models

(Goleman (1995) and Bar-On (1997)). The specific ability approach: 1) assumes that EI

develops over time; 2) can be measured with performance-based testing, and 3) that EI

can be correlated with IQ measures. In other words, the specific ability model is focused

on cognitive intelligence. Cherniss (2004) notes that a key distinction between the ability

and mixed models is that the specific ability model was developed using a process of

logical deduction originating from the general concept of EI, which was then built out

into the respective “abilities.”

Salovey and Mayer Model: Specific Ability

The specific ability model was the approach followed by Salovey and Mayer

(1990) when they asserted that EI reflect a person’s competency in monitoring and

regulating their feelings, the feelings of others, and their ability to use feelings to

influence thoughts and actions (p. 5). The Salovey and Mayer definition requires
 4
interaction in a social or professional setting, where a person monitors and regulates the

emotions (content) of people through the mental competencies of 1) perception of

emotions; 2) using emotions to facilitate thought: 3) developing understanding of

emotions; and 4) management of emotions (Salovey & Mayer, 2000) – see illustration of

model in Figure 1.

Figure 1. Salovey and Mayer’s Four Dimensions of Emotional Intelligence

Goleman Model: Mixed

In contrast to the specific ability model - the mixed model approach focuses on

non-cognitive intelligence and was developed through an inductive process where the

model assumes that EI abilities reflect a combination of personality, some cognitive

elements, and affective dispositions, such as a person’s Assertiveness, Optimism, or

Empathy (Goleman (1995) and Bar-On (1997)). Daniel Goleman made the term
 5
"emotional intelligence" popular by asserting that a person's intellectual intelligence (IQ)

was not the primary indicator of their social or business success (Goleman, 1995).

Goleman (1998) asserts that most employees vary greatly in emotional competency levels

and believes that employees who exhibit the highest level of emotional competency are

more likely to ascend to top executive roles in his or her organization faster than their

colleagues. In 2002, Goleman “fine-tuned” his definition without fundamental changes

to the Emotional Competence Framework, comprised of 12 competencies: 1) emotional

self-awareness, 2) emotional self-control, 3) achievement orientation, 4) positive outlook,

5) adaptability, 6) empathy, 7) organizational awareness, 8) influence, 9) coach and

mentor, 10) conflict management, 11) inspirational leader, and 12) teamwork (Boyatzis,

2007) - see illustration of framework in Figure 2.

Figure 2. Goleman’s 12 Emotional Intelligence Competencies

Bar-On’s Model: Mixed

Similar to Mayer and Salovey, Bar-On (2000) asserts that emotional intelligence

is a diverse aggregation of connected abilities (including personal, emotional, and social

competencies) that are required to cope proactively with daily demands on our time and
 6
attention. Bar-On also distinguishes between EI vs. social intelligence (SI), where EI

reflects personal self-management competencies (e.g., Impulse Control), and SI reflects

relationship-building skills (Bar-On, 2000). Pertaining to the development of EI

competencies, however, Bar-On (2006) asserts that people are not naturally experts in EI

and that we develop skills over time and improve by conscious guidance and training, but

people with higher than average EI skills are usually more successful in handling

everyday stress while meeting daily demands. Bar-On also asserts that people who

routinely have coping difficulties are deficient in EI Subscales of Problem Solving,

Impulse Control, Reality Testing, and Stress Management, but believes EI and cognitive

intelligence contribute equally to our general intelligence (Bar-On, 2006).

Bar-On (2006) is recognized as having developed the term "emotional quotient"

(EQ) and applying it to his emotional-social intelligence model, asserting that

recognizing and acting upon one's emotions consists of four key elements: (a) expressing

oneself, (b) relating to others, (c) responding to stronger emotions, and d) controlling

emotions. Bar-On’s model reflects the incorporation of inter-personal and intra-personal

skills as integrated domains of emotional intelligence and reflects the personality-based

attributes of adaptability, stress management, and a person's mood (Bar-On, 2006).

Cherniss (2004), also had insights into Bar-On’s development process and notes that Bar-

On’s approach began with his clinical research on life adjustment, from which he distilled

a set of life-coping skills using factor-analytic procedures that consisted of five core

competencies and 15 Subscales. The current Bar-On model (2011) is the EQi2.0, which is

comprised of the following five (5) composite Scales and related 15 Subscales – 3

Subscales per composite scale: Self-Perception composite scale (comprising Subscales of

 7
Self-Regard, Self-Actualization, and Emotional Self-Awareness); Self-Expression

composite scale (comprising Subscales of Emotional Expression, Assertiveness, and

Independence), Interpersonal composite scale (comprising Subscales of Interpersonal

Relationships, Empathy, and Social Responsibility); Decision Making composite scale

(comprising Problem-Solving, Reality-Testing, and Impulse Control), and Stress

Management composite scale (comprising Subscales of Flexibility, Stress Tolerance, and

Optimism) – see Figure 3 for illustration of composite Scales and Subscales.

Figure 3. Bar-On’s EI Competencies

Distinctions between the EI Models

The common theme between Salovey and Bar-On is that there are innate EI

abilities that everyone has to varying degrees, which reflect both personal and social

abilities. The distinction between Salovey and Bar-On, however, is Bar-On’s focus on a

person's "ability" to manage emotions and personality related behaviors, e.g., a person's

preference for sitting in the front of the room versus the back of the room. I am

researching patterns of behavior (e.g., affective dispositions), not maximum performance

on a test, which I theorize is best illustrated by a self-report assessment following a mixed

 8
model approach (excludes Salovey & Mayer), and without a focus on performance-based

subjective criteria (excludes Goleman). My approach, therefore, relies upon the EI

theories of Bar-On, who has extensively researched competencies reflecting leadership

performance. Table 1 summarizes the three major theorists.

Table 1

Summary of the Three Leading EI Models’ Major Categories

Salovey & Mayer (1997) Goleman (2002) Bar-On (2011)

Identifying Emotions Self-Awareness Self-Perception

Facilitating Emotions Social Awareness Self-Expression
Understanding Emotions Self-Management Interpersonal
Regulating Emotions Relationship Management Decision Making
Stress Management

EI Competencies Relevant for Entrepreneurs

Although there may be many factors that influence an entrepreneur’s success that

is beyond their control, e.g., competitor going out of business, it would be in the

entrepreneur's best interest to understand factors within their control that may increase

their chances of success. This process of self-evaluation for the entrepreneur begins with

a look at himself or herself and what appeals to their creative interests, followed by how

products or services related to that interest might be perceived by potential customers.

This process also requires that the entrepreneur has relevant competencies (skills) that

enable them to make an accurate determination of what their interests are and what a

potential customer may want.

For the entrepreneur to successfully channel their creativity to predict rationally

and validate potential customer outcomes, then create a structured approach to executing
 9
their vision, it would be reasonable to assume that they had competencies (skills) that

may be different from the majority of the population. This study narrows the scope of

potential competencies to those specifically related to the Bar-On model (the EQi2.0),

which is comprised of the following five (5) composite Scales and related 15 Subscales –

3 Subscales per composite scale: Self-Perception composite scale (comprising Subscales

of Self-Regard, Self-Actualization, and Emotional Self-Awareness); Self-Expression

composite scale (comprising Subscales of Emotional Expression, Assertiveness, and

Independence), Interpersonal composite scale (comprising Subscales of Interpersonal

Relationships, Empathy, and Social Responsibility); Decision Making composite scale

(comprising Problem-Solving, Reality-Testing, and Impulse Control), and Stress

Management composite scale (comprising subscales of Flexibility, Stress Tolerance, and

Optimism). Figure 4 provides a comparative illustration of the differences between EI

models.
 10

Figure 4. Comparison of Targeted Competencies across Three Leading EI Models

Entrepreneurial Success: Associated with Emotional Intelligence (EI)

One of the biggest challenges that I have faced during two decades of creating and

managing technology innovation incubators for entrepreneurs is bolstering the

capabilities of a management team where some members lack the knowledge, expertise,

or emotional intelligence, necessary to perform required operational tasks. As a result,

this study may be important to any entrepreneur trying to maximize their success

potential. For example, I do not find it difficult to identify experts in specific functional

business areas, but I do find it difficult to determine whether those individuals have the

requisite business acumen, cultural competency, and leadership traits, to grow a business
 11
beyond their specific functional area without significant "hand-holding.” The book

knowledge that a prospective entrepreneur has from business school may prepare them to

research “how” to manage a business, but they rarely have the practical experience or

competency to grow an actual business. Those entrepreneurs tend to recite theory on

how to grow a business without understanding how the context is different from their old

textbooks. I often find aspiring entrepreneurs desperately need a course in critical

thinking skill development to apply the theories they learned in business school

appropriately.

Unfortunately, these people often end up in front of my desk, where I am faced

with the challenge of determining ways to develop broader and more applicable skill sets,

after determining where the prospective entrepreneur is most lacking. The research

questions, methods, and results from this study will help me quickly and accurately

identify key factors in assessing the potential of an entrepreneur and guide my efforts to

support them in the EI areas where they are most deficient. Eventually, I would like to

develop a systematic program to help any businessperson convert past failures into future

success through targeted interventions that leverage their EI strengths, while developing

their EI weaknesses.

There can be many reasons that an entrepreneur succeeds, however, e.g., luck,

market timing, consumer demand, failing competitors, or decreasing costs of production.

As a result, there can be many factors that impact success beyond the EI-related

competencies of the entrepreneur. This study is not intended to imply that EI is the only

factor in entrepreneurial success. I theorize it is accurate to state that such other factors

are not mutually exclusive, but interrelated and that the occurrence of external factors
 12
requires EI-related internal factors (competencies) to take advantage of those external

factors. Having the ability and the initiative to take advantage of an opportunity also

indicates leadership attributes, which I also theorize is important for entrepreneurs. For

example, the entrepreneur must have the EI to recognize that consumer demand for a

product or service is increasing and then self-regulate to be a leader in taking the

necessary action that capitalizes on the resulting opportunity. For this study, the focus

shall be exclusively EI-related factors that may influence and predict the relative success

of an entrepreneur.

From this foundation, the research questions that I propose to address are in the

context of U.S.-based entrepreneurs, Bar-On’s EI competencies, and objective, financial

entrepreneurial success. The working hypothesis throughout this study is that EI

competencies can predict how successful an entrepreneur will be, and this study will test

this hypothesis (Hypothesis 1).

Research Questions

According to Wagner (2013), 8 out of 10 entrepreneurs who start businesses fail

within the first 18 months - 80% - and this happens for five (5) key reasons: 1) failure to

empathize with customers; 2) failure to recognize opportunities; 3) failure to convey

value proposition to customer; 4) failure to lead staff; and 5) failure to follow proven

business models. Because my focus is on the competencies and skills the entrepreneur

must have for success, in general, this study will focus on identifying trends in how

specific EI-related competencies may indicate the likelihood of success, in general.

Because all participants were pre-qualified for the service as entrepreneurs, the statistical
 13
analysis has been controlled for other entrepreneurial profile characteristics, making the

only variables EI and Success criteria.

The specific framework for the research questions are as follows:

Descriptive Questions

The purpose of the following descriptive questions is to determine whether the

distribution of values along the EI Subscale scores depart from normality or determine if

there is a restriction of range in the distribution based on low standard deviations.

Evaluating standard deviation is important because a restriction of range can reduce the

effect of the Correlation and Regression coefficients and possibly bias the results from

the Correlation and Regression analysis.

Legend:
1. Overall Success = all three (3) success factors of Partnerships + Competitors +
Employees
2. Overall EI Score = all fifteen (15) EI Subscales presented in the EQi2.0

D1. Entrepreneurial Profile: What was the demographical, revenue, and industry profile

of workshop participants that responded to the EQi survey?

D2. Entrepreneurial Profile: For each respective EI Subscale distribution, what is the

spread (Standard Deviation)?

D3. EQi2.0: For the Overall EI score, what is the Minimum, Maximum, shape (Skewness

& Kurtosis), center (Mean), and spread (Standard Deviation)?

Correlational (C) and Predictive (P) Questions

C1. What is the correlation between Overall Entrepreneurial Success and an

entrepreneur’s Overall EI score?

 14
C2. What is the correlation between Overall Entrepreneurial Success and each respective

EI Subscale score?

C3. What is the correlation between each respective factor of entrepreneurial success

(Partnerships, Competitors & Employees) and an entrepreneur’s Overall EI score?

C4. What is the correlation between each respective factor of entrepreneurial success

(Partnerships, Competitors & Employees) and each respective EI Subscale score?

P1. What is the predictive relationship between Overall Entrepreneurial Success and an

entrepreneur’s Overall EI score?

P2. What is the predictive relationship between Overall Entrepreneurial Success and each

respective EI Subscale score?

P3. What is the predictive relationship between each respective factor of entrepreneurial

success (Partnerships, Competitors & Employees) and an entrepreneur’s Overall EI

score?

P4. What is the predictive relationship between each respective factor of entrepreneurial

success (Partnerships, Competitors & Employees) and each respective EI Subscale score?

Applying the framework of EI competencies to the context of entrepreneurial

success, our focus narrows down to an entrepreneur’s ability to solve problems, control

impulses, distinguish between fact and fiction, and manage the stress of factors beyond

their control. An entrepreneur's ability to solve problems and cope with daily demands

on their time, energy, and resources, therefore, has a direct impact on whether they can

successfully identify an innovative way to provide a service that addresses unmet

consumer needs, e.g., the task of identifying and exploiting a new business opportunity.
 15
Significance and Implications

According to Fontevecchia (2014), it is definitely possible for an entrepreneur to

become wealthy (personal benefit), and entrepreneurs that create jobs may benefit society

through economic stimulation, but it is unclear as to what makes an entrepreneur

“successful” or if anyone can be taught to be a successful entrepreneur to increase the

benefits to society. In the broader context and relevant to the field of talent management

programs such as the Penn CLO Program, I theorize emotional intelligence is a key factor

in why one employee quickly experiences corporate promotions, while another employee

with similar credentials is slowly promoted, if they are promoted at all. Government

agencies that provide resources and financial support for entrepreneurs will also be

interested in this research – to support economic development initiatives in communities

nationwide more effectively.

This study is also significant in the area of Leadership Development because it

contributes to the field of entrepreneurship by evaluating the correlation between key

emotional intelligence (EI) competencies that may affect entrepreneurial success. This

study also contributes to the EI literature in that it should help scholars better understand

and predict performance by contrasting related skill sets. This study considers multiple

measures of entrepreneurial success (from a financial, personal, and relative perspective),

which is important to prospective entrepreneurs, executive coaches, and social science

disciplines interested in these key components of entrepreneurial performance.

Investigation of these research questions are important to the academic field of study

because I theorize business executives are not always born leaders, e.g., leadership skills

can be nurtured and developed over time. Also, concerning future training opportunities,
 16
implications of this study could eventually lead to the development of an instructional

methodology and pedagogical best practices that can cost-effectively train any

prospective entrepreneur in how to be the most effective leader possible.

On January 10, 2015, I conducted a search on ProQuest’s database of scholarly

publications to determine the existence of any studies correlating emotional intelligence,

entrepreneurial success, and using the EQi as the assessment tool, and none were found.

As a result, this study fills an important gap in the literature due to the absence of

correlation studies in the context of objectively measured entrepreneurial success and

emotional intelligence using the EQi2.0.

 17
CHAPTER 2: LITERATURE REVIEW

Conceptual Framework

Some studies do not sufficiently narrow the scope of influences, which can lead to

broad generalities that are inaccurate, for example, Yitshaki (2012) studied EI's impact on

a new venture's growth by focusing on the charismatic and inspirational behaviors of an

entrepreneur, which was believed to help them enlist and manage followers' emotions and

hence influence growth. The problem with that approach being the multitude of variables

in between the EI competency and the resulting growth, e.g., assuming the competency is

present, then it must control the employees' emotions (ignoring earning a paycheck as an

obvious motivating factor that would also control the employee's emotions). Growth

could also be influenced by a competitor failing, lower costs of production, or new

investment. As a result, I have chosen to focus on objective measures of success that

result from adjusting emotional and social competencies that are under an actively

engaged entrepreneurs control. For example, whether or not a profit goal was reached,

the emotional and social profile of the entrepreneur if there are trends across

entrepreneurs that can be attributed to EI strengths and weaknesses.

The key research variables and the conceptual framework for this study are

presented in Figure 5. As illustrated in Figure 5, entrepreneurs are theorized to possess

each of Bar-On’s 15 EI competencies in varying degrees - rated high to low mastery (the

independent variable). Those EI competencies lead to entrepreneurial actions and

behaviors that are theorized to be predictors of success (the dependent variable) and

result in achieving the goals of the entrepreneur, which is defined broadly as a success.
 18

Figure 5. Conceptual Framework

Three Themes – Entrepreneurs Ÿ Emotional Intelligence Ÿ Success

Definition of an Entrepreneur

Exactly one decade ago, Fayolle and Filion (2006) found that more than five

million Americans under the age of 34 aspire to be entrepreneurs and more than 60%

young adults between the ages of 18-29 have publicly stated that they would like to

create and manage their company. To understand the variables that comprise this study

on entrepreneurs, a key step is defining what constitutes being an "entrepreneur."

Carsurd and Brännback (2007) author a textbook used in college-level entrepreneurship

classes that defines entrepreneurship as "the process by which individuals, either on their

own or inside organizations, pursue opportunities without regard to the resources they

currently control" (Carsurd & Brännback, 2007, p. 21). They additionally state that

entrepreneurship is seen as "doing and making, [a life that] has to be lived" (p. 7) and that
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that to be successful, entrepreneurs must cultivate social networks that are value-adding

to their goals (Carsurd & Brännback, 2007, p. 29).

Schumpeter (1934) found that entrepreneurs differ from the majority of the

population in a social competence he identified as "Untemehmergeist" (entrepreneurial

spirit), reflecting their higher tolerance for risk, which enables them to see opportunities

that others may overlook, and then have the ability to overcome their aversion to risk and

take action. Schumpeter characterized entrepreneurs as highly creative people who are

willing and able to challenge the status quo, convert an idea into innovations, and serve

as catalysts for economic change (Schumpeter, 1934). Consistent with Schumpeter

(1934), according to the textbook “Small Business Management: Launching and Growing

Entrepreneurial Venture,” an entrepreneur is defined as: a person who is relentlessly

focused on an opportunity, in either a new or existing business, to create value while

assuming both risk and reward for his or her effort (Longenecker, Petty, Palich & Hoy,

2012).

According to Cunningham and Lischeron, (1991) there is an ongoing debate

among academics and researchers regarding the distinction between “entrepreneurs” and

“small business owners,” and if a distinction exists. Also, they noted how

entrepreneurship literature identify wide-ranging criteria from creativity and innovation

to personality, social, and emotional behavioral traits (Cunningham et al., 1991).

According to Gartner (1988), the key distinction between entrepreneurs and non-

entrepreneurs is that entrepreneurs create a business where a business did not previously

exist, through their initiative and actions, whereas non-entrepreneurs do not create

businesses. In other words, if a person simply “buys” an existing business that is already
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operational and profitable, then that person is simply a business owner because they have

not taken the risks and actions required to create something new.

Filion (1990) argues that an entrepreneur is a person who develops systemic

thinking to organize their business activities to achieve future goals and objectives. After

further study of the approaches taken by entrepreneurs to achieve their future goals and

objectives, Filion (1991) developed a definition that reflects how an entrepreneur is an

individual who conceives and develops “visions,” where the vision equates to their

expected market position and the business operations required to achieve that position in

the market. According to Bruyat (1993), Filion’s context of the entrepreneur infers the

active participation of the entrepreneur to create value for themselves and other, e.g.,

structuring their activities based on market demand to meet the needs of consumers and

thus attain higher market positioning by the perceived value of their goods and services.

Bruyat (1993) proposed two dimensions of value creation that define the field of

entrepreneurship: 1) the degree to which an individual must adapt (change) to the

personal risks inherent in starting an entrepreneurial venture; and 2) the intensity of the

potential value creation to be generated by the entrepreneurial venture. In other words, to

be an entrepreneur reflects a person who is driven to change the status quo, and despite

the personal or professional risks, in an attempt to create a product or service desired by

consumers, and that the more potential value the entrepreneur believes they can create -

the more they may be willing to take additional risks to achieve their goal. Studies by

McKenzie et al. (2007) corroborate that context, where they found that the creation of a

new business is just one aspect of entrepreneurship, and it is more important to the

definition of a person being entrepreneur that they proactively engage in a set of activities
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and behaviors that reflect recognition and exploitation of opportunities, and the desire to

innovate and create value.

A common theme throughout the literature defining entrepreneurs and

entrepreneurship are the concepts of individual initiative to innovate, willingness to take

action despite risks, and a desire to create opportunities that lead to value creation. I

believe these factors accurately define the ‘character’ of an entrepreneur and in the field

of entrepreneurship studies, Reynolds and White (1997) have extensively studied startup

entrepreneurs using validated testing measures to define an entrepreneur as someone who

initiates serious activities that are intended to culminate in a viable business startup.

Throughout each state in the U.S., Reynolds (2000) and a national network of

collaborators have developed and implemented a method for conducting panel studies of

the business startup process, where the definition and context of the business has

remained the same, e.g., the startup entrepreneurs’ business has not yet reached full

operating status (indicated by consistent positive monthly cash flow that covers expenses

and the owner-manager salaries for more than three months).

Instead of trying to distinguish further an entrepreneur by non-validated or

arbitrary attributes, such as the number of hours worked each week or title in the

company, which could vary greatly depending on the knowledge, experience, or personal

preference of the entrepreneur, I prefer to rely upon an aggregation of the objective

criteria reflected in the literature. Specifically, the definition of entrepreneur used shall

be in the context of a person currently engaged in “serious activities” (Reynolds, 2000)

(reflected by state registration of the business and filing federal tax forms where the

business is distinguished from being a hobby under IRC §183), and the entrepreneur
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bears 100% of the risk of their time and investment if the business fails (Mill, 1848).

Specifically, the five (5) criteria used are: 1) entrepreneur can demonstrate 12+ month of

operating history; 2) entrepreneur works 40+ hours per week in the venture; 3)

entrepreneur’s assets and income are at-risk of being lost if the venture fails; 4) annual

business revenue is less than $10 million; and 5) entrepreneur’s business is subject to

federal and or state tax filing requirements due to appropriate state registration.

Emotional intelligence and entrepreneurial leadership

In 2007, Rauch and Frese proposed that because the entrepreneurial behavior is a

function of individual differences, then personality and ability factors should predict

entrepreneurial activity and resulting success. According to Chamorro-Premuzic (2007),

EI is a person’s self-perceived ability to understand and manage his or her own, and other

people’s emotions, to cause them to engage in certain activities. Studies by Chell and

Baines (2000) corroborate the findings of Rauch and Frese (2007) and Chamorro-

Premuzic (2007), where they found that EI that the social nature of the activities

associated with entrepreneurship require the ability to interact effectively with other

people, which is associated with high EI, and essential to a person's ability to exploit

opportunities and innovations.

Having defined the basic parameters of who qualifies as an entrepreneur, defined

the focus on Competency-based EI theory, the next step is to define the specific context

of Competency-based EI theory that I will be using in this study, which is the context of

leadership. Based on the definition of emotional intelligence provided above, logic

dictates that the more entrepreneurial, success-related, EI competencies a person has, the

more successful they should be in their business venture. To test that logic, I plan to
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investigate whether emotional intelligence (EI) competencies are associated with

entrepreneurial success. I also want to determine which EI competencies are dominant in

successful entrepreneurs.

A key component of Wagner's (2013) theory mentioned previously is that

leadership from the entrepreneur is important, e.g., the entrepreneur must lead staff

throughout their growth. Consistent with Wagner’s theory, Mintzberg (1973) noted 40

years’ prior that entrepreneurial vision is the ability of a person to create an inspiring

mental representation of their ideal business strategy and have the ability to share that

vision with people around them. According to a study by Casner-Lotto and Barrington

(2006), leadership was the attribute most efficient in college graduates and they defined

leadership as the interpersonal skills and ability to leverage others to achieve common

goals, e.g., create and build a business. Corroborating the interrelation of intelligence and

leadership, Goleman (1995) asserts interpersonal skills refer to being able to understand

other people and work cooperatively with them, and Schutte et al. (2001) found that

individuals with higher levels of emotional intelligence tend to seek outcomes that benefit

the collective group of stakeholders - not just themselves. This is important because if

an entrepreneur is trying to build a company, while considering the needs of others, in

addition to their needs, there may be competing interests the entrepreneur must navigate,

which indicates that some level of business strategy is involved to balance the respective

interests.

Although it was initially developed more than 30 years ago, the current, dominant

framework used in interpreting business strategy is still the Miles and Snow's (1978)

framework, which uses the contexts of entrepreneurial, engineering, and administrative

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problems to group businesses into defenders, prospectors, analyzers, and reactors.

According to Miles and Snow (1978), the ability to locate and exploit new markets is the

distinguishing competency of Prospectors, whereas Defenders usually take the approach

of establishing a niche market to ensure stability of vendors and customers, in the middle

are Analyzers, who may model the success of Prospectors by expanding into new

markets, but only after having established a stable niche, and in contrast, the Reactor

usually has an unpredictable response to an entrepreneurial problem, which can reflect a

lack of business stability and unsustainable growth.

Corroborating and expanding upon the Miles and Snow (1978) premise, Akbari

and Safarnia (2012) interpret the four EI competency categories in the context of

leadership, as corresponding to the essential domains of self-awareness and management,

as well as social awareness, each of which is an important factor in business success. For

example, their research covers "self-awareness," which has a subset of leadership-related

competencies that distinguish between the accuracy of our self-assessments and the

impact on self-esteem (Akbari & Safarnia, 2012). The domain of self-awareness requires

a deep understanding of our emotional makeup including our respective value systems,

internal motivation, and personal strengths and weaknesses, but the challenge of self-

awareness, however, is that the subject may not be self-aware, and thus be unable to

make an accurate determination of their level of self-awareness (Akbari & Safarnia,

2012).

The second EI domain of "self-management," which has a subset of competencies

reflecting self-management, transparency/integrity, adaptability, achievement orientation,

and optimism, reflects our ongoing efforts to manage disruptive emotions and impulses
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effectively (Akbari & Safarnia, 2012). From a leadership perspective, I theorize an

adaptable leader is one that is able to quickly adapt to the invariable challenges that arise

in companies because they can be flexible in their thinking when encountering new data

or situations. I also theorize the final subset of "optimism" is also a key adaptability-

related competency because an optimistic leader can envision opportunities, where others

see obstacles, and their positive outlook can influence and motivate the people around

them.

Akbari and Safarnia (2012) interpret the third emotional intelligence domain of

"social awareness," as having competencies reflecting "empathy," "organizational

awareness," and "service orientation.” I hypothesize Empathy, Interpersonal

Relationships, and Problem Solving, are particularly relevant attributes for entrepreneurs

as key competencies because they reflect how attuned a person is to the various

emotional signals displayed by others - both verbal and non-verbal, which can make it

easier for empathetic leaders to demonstrate the patience to listen attentively and

understand the perspective of others, demonstrate the social skills to build a rapport

based on that understanding, and devise strategies to address the problems revealed by

their understanding, even if they do not share the same perspective (Hypothesis 2).

In support of the two dominant frameworks, Akbari and Safarnia (2012) explain

that successful Prospectors are characterized by their ability to develop innovative

products and services for the early adopter market segments, by stimulating market

demand and providing excellent customer service by using a selective distribution

strategy to educate consumers. They conclude that Prospectors are the most

entrepreneurial of the groups, which reflects their ability to establish a clear mission with
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supporting goals (Akbari & Safarnia, 2012). Different from Prospectors, Akbari and

Safarnia (2012) suggest that Analyzers can be recognized by their focus on growth and

stability, so their key to success is placing substantially more emphasis on the Innovation,

Growth, and Internal Business Perspectives. Defenders usually have narrow product

market domains, according to Akbari and Safarnia (2012), and although they are experts

in their domain, they do not venture beyond their domains for new opportunities,

focusing their attention on improving existing operations. In contrast, Reactors have the

ability to identify what changes are necessary for their companies but are unable to

respond effectively (Akbari & Safarnia, 2012).

From that foundation, the next step is to establish a reasonable standard of

“success” that can be validly and reliably measured within the context the leadership

actions were taken by the entrepreneur, and because many people perceive leadership and

success differently, I have turned to the literature to identify measures that have been

successfully applied to entrepreneurs in prior studies.

Definition of entrepreneurial success

From this study, I expect to gain insight into the relationship between emotional

intelligence and entrepreneurship. Specifically, I am interested in whether EI

competencies, as presented by Bar-On, are associated with the success of an

entrepreneur, whether those competencies are interrelated, and which, if any, are

predictive of entrepreneurial success. Before we can apply the emotional intelligence

competency framework to the actions of an entrepreneur, a key step is defining the

construct of "success" in the context of entrepreneurs. The definition of "success" in the

context of an entrepreneur can be tricky, because we are trying to apply an objective lens
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to an enterprise that was created, based on the subjective assessment of the entrepreneur

of their ability to succeed.

For example, I cannot accurately measure how much passion another person has

for their work because they may not express their emotions in public, whereas someone

equally passionate, may give hugs to everyone in the office and constantly high-five co-

workers in the hallway. In other words, part of the construct representing success is in

the eye of the beholder, which can be subjective, e.g., sense of fulfillment, self-esteem,

motivation. Other aspects can be viewed objectively, however, for example, financial

gains and customer or employee growth within a specific period. The subjective vs.

objective dichotomy was also observed by Watson, Hogarth-Scott, and Wilson (1998),

who concluded that the best method of measuring entrepreneurial success is by focusing

on a measurement of performance that comprises a mixture of both financial and

nonfinancial metrics as perceived from the entrepreneur.

A pioneer in the study of startup entrepreneurs, Cooper (1973) studied the

technology transfer environments at universities, in addition to early Silicon Valley and

the tech hubs around Boston, MA, to formulate a standard profile of an entrepreneur and

understand what led to the success or growth of the businesses created. Cooper and Artz

(1995) studied entrepreneurial satisfaction as a measure of “success”, based on a

theoretical framework called “discrepancy theory.” As they applied it, discrepancy

theory is where satisfaction is determined, in part, by the existence of the gap between

actual value creation (quantifiable benefits) and the entrepreneur’s goals and expectations

(Cooper & Artz, 1995). In their 3-year study, Cooper and Artz (1995) had a longitudinal

sample of 287 entrepreneurs, with a focus on measuring the entrepreneur's subjective

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satisfaction with their venture, their satisfaction with themselves (based on their

perceived performance and value creation), and the entrepreneur’s desire to repeat any

perceived success. They concluded that entrepreneurs emphasizing non-economic goals

showed higher satisfaction than entrepreneurs with primarily economic goals, e.g.,

achieving a certain level of personal wealth or business profits, which provided insight as

to why entrepreneurs experiencing similar financial performance may have varying

degrees of satisfaction with their ventures (Cooper & Artz, 1995).

As previously mentioned, there can be many factors that influence the success of

the entrepreneur that is beyond their control. For this study, however, I have chosen the

extensively tested and validated, objective entrepreneurial success factors identified by

Chandler and Hanks (1993), 1) Venture Growth; comprised of (a) market share growth;

(b) cash flow change; (c) sales growth; and 2) Business Volume; comprised of (a)

earnings; (b) sales; and (c) net worth. Because of the thoroughness in which Cooper and

Artz (1995) established and validated the satisfaction criteria in their studies, I have also

chosen to use their subjective entrepreneurial success criteria as a pre-qualification to

participate in this study – specifically, the entrepreneur must indicate: 1) satisfaction with

venture; 2) satisfaction with self, and 3) desire to repeat success, to be invited to

participate.

Having defined the contexts of an entrepreneur, EI, and success, to be used in this

study, I theorize entrepreneurs operate the same way as leaders in most corporate

settings, e.g., the entrepreneur needs to remain calm and manage the stress of employees

to keep them focused and committed to accomplishing the task. Doing so appears to

require core EI competencies of self-awareness, self-management, social awareness, and

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relationship management. As a result, my analysis focuses on EI both from an

entrepreneurial context and also from the broader leadership context.

I theorize emotional intelligence indicates that a person must consistently monitor

emotions and behavior, which is usually difficult without a strategy. Through the

examination of the emotions driving specific behavior patterns, however, it may be

possible to determine if a more appropriate emotion can be consciously leveraged to

counteract an undesired pattern of behavior. Also, important, a theme that appears to

permeate throughout the research referenced above is that EI focuses on competencies

related to managing oneself, as well as competencies for managing others. As a result,

the Bar-On competencies that I have identified as the focus of the study appear

appropriate to apply in an entrepreneurial leadership context.

Tools for Measuring EI: MSCEIT, WLEIS, ESCI and EQi2.0

Mayer- Salovey- Caruso Emotional Intelligence Test (MSCEIT)

The Mayer- Salovey- Caruso Emotional Intelligence Test (MSCEIT) is a leading

EI assessment tool developed by Mayer, Salovey and Caruso (2002b), and is specifically

designed to address the Salovey and Mayer (2000) Four Dimensions model, which reflect

a person’s ability to perceive emotions, use emotions, understand emotions, and manage

emotions. The Salovey and Mayer (2000) sequential Four Dimensions are comprised of:

1. Identifying Emotions, which involves the intellectual ability to distinguish, appraise, and

express emotion;

2. Facilitating Emotions, which involves the ability to facilitate and prioritize a person’s

interpretive judgment in adjusting to changing emotions;

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3. Understanding Emotions, which involves the ability to analyze, understand, and

categorize of emotions; and

4. Regulating Emotions, which involves the ability to manage emotions to achieve both

intrapersonal and interpersonal goals.

According to Caruso (2008), those four dimensions (abilities) work together as a

process model of emotions - an Emotional Blueprint that provides individuals with a

general approach for better understanding and addressing critical situations. For example,

a person must first accurately perceive how they, and others, feel; then they must use

emotions to guide more effective thinking; then accurately interpret the emotional data to

understand their situation and predict how emotions will change; then have the presence

of mind to remain open to additional emotional data and use that information to guide

their next steps (Caruso, 2008). The critical distinction between the MSCEIT and other

assessments is that the scores are not based on self-perceptions, nor is it based on a

person’s reputation or other political factors (Mayer et al., 2002b). As Caruso (2008)

explains, he, Mayer and Salovey, believe that the best way to measure a person’s ability

to identify accurately how people feel is by asking them to examine a photograph of

someone’s face and articulate the emotions being expressed. In other words, the MSCEIT

involves evaluating a person's response to photographs and images to see if how

accurately they identify the emotions expressed in the images.

Bradberry and Su (2003), however, assert that Mayer and Salovey’s personality-

based assessments are often criticized in the literature because they lack credence and

predictive validity in the workplace contexts of business. The perception of a lack of

credence is because the images are not specific to the context of the business environment
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and a picture of a person frowning may not be disapproval of someone else’s behavior in

a business context, but could be dissatisfaction with their performance. Also, a key

challenge of the Salovey and Mayer specific ability model was noted in a study by

Petrides and Furnham (2000), where they found that with ability-focused EI, which

focuses on actual abilities, those abilities are best measured with maximum-performance

tests within the area of psychometric intelligence instead of self-report assessments,

which tend to reflect a person’s typical (average) performance. This distinction has been

reflected in Mayer et al. (2008), where he notes that specific abilities are best assessed

through maximum performance testing with criteria such as achieving a certain level of

accuracy or completion within fixed time constraints. These studies appear to indicate

that in situations where a person’s daily state of being – their habits, routines, and

disposition - is being measured, a specific ability model and assessment may not be ideal.

In this study, I am trying to measure emotional intelligence attributes that are

consistently and accurately applicable to both personal and professional contexts. As a

result, although the MSCEIT may be popular and useful, the focus of the tool is on

cognitive skills and maximum performance, whereas my study is specific to non-

cognitive skills and skills used daily to cope with challenges that arise, and the EQi2.0

was designed and proven valid and reliable for the competencies examined in this study.

Wong Law Emotional Intelligence Scale (WLEIS)

Comparable to the MSCEIT, the 16-item, Wong Law Emotional Intelligence

Scale (WLEIS) is the most widely used and supported a self-reporting measure of EI,

which makes it the leading alternative to using the EQi2.0 or ESCI (Mayer et al., 2000).

The WLEIS is a validated survey that also measures items corresponding to Mayer and
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Salovey's (1997) four dimensions of 1) identifying; 2) facilitating; 3) understanding, and

4) regulating emotions. One reason to use this assessment is that it assesses both overall

EI as well as the four specific emotional intelligence branches identified by Mayer and

Salovey. The WLEIS reliability is also considered high, with coefficient alphas for each

of Mayer and Salovey's (1997) four dimensions (identifying, facilitating, understanding,

and regulating) at 0.89, 0.88, 0.76, and 0.85, respectively (Wong & Law, 2002). The

scale's response format is a 7-point Likert-type scale, with anchors at 1 (strongly

disagree) and 7 (strongly agree). According to Groves, McEnrue and Shen (2008), their

evaluation of the WLEIS found that it did not adequately measure understanding

emotions and using emotions to facilitate thinking. They found the inability of the

Assessment to measure accurately the understanding of emotions particularly problematic

when trying to use the WLEIS in a business context because more and more individuals

in organizations are operating in diverse ethnic and cultural environments either

domestically or internationally, and interpreting the meaning of emotions when working

with employees from high context cultures and understanding complex emotions are

likely to be important skills for managers under these conditions (Groves et al., 2008).

Also, the WLEIS, measures items corresponding specifically with Mayer and Salovey’s

(1997) four dimensions, which are not 100% compatible with the Bar-On competencies

that are the focus of this study, and as a result, it was not selected for this study.

Emotional and Social Competency Inventory (ESCI)

In Goleman’s Emotional Competence Framework, the ability to perform a self-

assessment and understand related emotions is the key to being self-aware (Goleman, et

al., 2002). As a result, self-awareness requires being present in the moment, recognizing
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your feelings, and then leveraging the most appropriate emotions relevant to your

situation to guide decision-making, and inherent in this process is having taken the time

to conduct a realistic assessment of your abilities and having the confidence to make any

necessary changes (Goleman, et al., 2002). Self-management involves the management

of opinions, influences, and emotional resources, through consciously delaying short-

term gratification to achieve a preferred benefit long-term, or to recover emotionally from

a traumatic or stressful experience (Goleman, et al., 2002). Initiative and motivation

results from leveraging one’s deep interests to initiate actions that help us evolve and

develop and also enables humans to persevere in the face of setbacks and frustration

(Goleman, et al., 2002). Social awareness entails understanding the views of others and

their associated emotions to develop a rapport (Goleman, et al., 2002). The relationship

management competency reflects the ability to elicit appropriate responses from others

and developing adequate social relationships enables a person to persuade and lead,

negotiate and manage disputes, and inspire cooperation and teamwork (Goleman, et al.,

2002).

Goleman (2006) has concluded that teams in the work environment are becoming

increasingly important and, even though all competencies are required for a business

leader, the competency of social awareness, empathy, in particular, is especially

important for business leaders today. His rationale for the importance of empathy is that

it helps leaders meet the challenges of understanding his or her team's emotions, and it

can help minimize misunderstandings between parties in a global work environment

(Goleman, 2006). Most important is that empathy enables a leader to be a better mentor

(coach) to employees, which leads to increased job satisfaction and employee retention,
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and better long-term performance (Goleman, 2006). In other words, the first two

competencies (self-awareness and self-management) reflect self-management skills, e.g.

management of ourselves, and the other two emotional competencies (social awareness

and relationship management) reflect our ability to manage relationships with others

(Boyatzis, 2007).

Goleman, Boyatzis, and the Hay Group, Inc. created the Emotional and Social

Competency Inventory (ESCI) in 2005, specifically to measure performance and

Goleman’s competencies in a business or organizational context, which makes it well-

suited for evaluating Goleman’s EI competencies (Boyatzis, 2007). The ESCI also uses a

360° approach to gathering data, which integrates employee perceptions about their

leader’s emotional intelligence, making it a more comprehensive tool than the MSCEIT

or WLEIS, and according to Boyatzis, the ESCI has higher predictive validity against

performance measures than the MSCEIT (Boyatzis, 2007). The ESCI examines 12 EI

competencies that help distinguish characteristics of superior (successful) performers vs.

average or failing performers, grouped into the four competencies of Goleman’s latest

framework: 1) self-awareness, 2) self-management, 3) social awareness, and 4)

relationship management. The 12 competencies examined by the ESCI include: 1)

emotional self-awareness, 2) emotional self-control, 3) achievement orientation, 4)

positive outlook, 5) adaptability, 6) empathy, 7) organizational awareness, 8) influence,

9) coach and mentor, 10) conflict management, 11) inspirational leader, and 12)

teamwork. According to the Hay Group (2008), Self-Awareness is at the heart of the

ESCI approach and reflects our ability to understand our emotions, motivation, and our

strengths and weaknesses, and hopefully, sustain emotionally and socially intelligent
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behavior over time despite life’s setbacks along the way. In our application of EI,

Relationship Management is where emotional and social intelligence - our lack of EI - is

revealed to those that interact with us, so the competencies in that cluster impact on the

motivation and performance of others, but they depend on strengths in the Social

Awareness and Self-Management competencies, which provide focus, initiative, and self-

regulation in the way we use Relationship Management competencies (Hay Group,

2008).

As a performance measure, the scoring of ESCI occurs on a 5-point frequency of

occurrence scale, where participants distinguish between frequencies of never, rarely,

sometimes, often, or consistently (Boyatzis, 2007). Responses are then aggregated with

responses from employees or colleagues, and an average score can then be calculated for

each competency. A score of ≥ 85% of the scale (score = 4.3) indicates a strength and

corresponds to a competency that is demonstrated frequently or consistently (Boyatzis,

2007). Reliability for the 12 EI competencies range from .74 – 87 (see Figure 6), but the

competencies are performance-based (tool measures behaviors), and the ESCI is an

inventory profile – not a psychometric assessment (arguable validity), although it does

have some psychometric attributes (Boyatzis, 2007). As a result, the ESCI was not my

preferred choice for this study.

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Figure 6. Cronbach’s Alpha Reliability for ESCI Competencies

Emotional Quotient Inventory (EQi) 2.0

In contrast to the assessment tools discussed above, Bar-On’s EQi tools include

both an individual (2.0) and 360° versions that allow for self-assessment plus

corroboration by others close to the individual having their EI evaluated. According to

Bar-On (2011), the EQi2.0 is a 133-item assessment with a 5-point Likert response scale

to short questions, with a textual response format ranging from "very seldom or not true

of me" to "very often true of me” or “true of me". Those individual responses are

designed to render a total EQ score based on the following five (5) composite Scales and

related 15 subscales: a Self-Perception composite scale (comprising subscales of Self-

Regard, Self-Actualization, and Emotional Self-Awareness); a Self-Expression composite

scale (comprising subscales of Emotional Expression, Assertiveness, and Independence),

a Interpersonal composite scale (comprising subscales of Interpersonal Relationships,

Empathy, and Social Responsibility); a Decision Making composite scale (comprising

Problem-Solving, Reality-Testing, and Impulse Control), and a Stress Management

composite scale (comprising subscales of Flexibility, Stress Tolerance, and Optimism)

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(Bar-On, 2011). EQi scores are computer-processed, automatically tabulating and

converting raw scores into standard scores based on a Mean (the average value of the

distribution) of 100 and Standard Deviations (the extent to which values deviate from the

Mean) of 15, with average to above average EQ scores suggesting that the respondent is

effective in emotional and social functioning, but there are no preset minimum or

maximum values in the distribution of scores (Bar-On, 2011). Also, regarding the

“shape” of the distribution of scores when graphically illustrated, the expectation from

4,000 previous implementations of the EQi2.0 (Bar-On, 2011), is that the Skewness (the

extent to which a distribution of values deviates from symmetry around the Mean) values

should range between -0.95 to -0.34, and Kurtosis (a measure of the "peakedness" or

"flatness" of a distribution) values should range between -0.15 to 1.11. These values

reflect a negative Skewness, which tends to indicate a greater number of large values

around the mean, and a positive Kurtosis, which usually indicates a shape that is flatter

than normal. As a result, the distribution of scores that approximates a bell-shaped

(Gaussian) curve, with only a very slight negative skew (e.g., a slightly flat bell-shape),

and the values for both Skewness and Kurtosis are within acceptable ranges for

psychometric studies (Bar-On, 2011).

During the research leading up to creation of the EQi2.0, Bharwaney, Bar-On and

MacKinlay (2007) found that the higher the EQ scores, the more positive the prediction

for effective executive functioning on a daily basis, and conversely, low EQ scores

indicate an inability to be effective with an increased likelihood of the individual having a

combination of emotional, social and behavioral problems. The EQi has a built-in

correction factor that automatically adjusts the scale scores based on scores obtained from
 38
two of the instrument’s validity indices (Positive Impression and Negative Impression).

The built-in correction factor is an important feature for self-report measures in that it

reduces the potentially distorting effects of response bias thereby increasing the accuracy

of the results.”

I believe the EQi2.0 attributes are consistent with my objectives and found the

EQi’s status as the world's first test of EI encouraging, with over 1,000,000 people across

66 countries having completed it, and continually improved until 2011 (Stein, 2011).

Another reason I have chosen the EQi2.0 is that it is considered one of the most reliable

EI assessment tools and more reliable than the ESCI, with a “Total Sample” EI scale at

.97 across 4,000 participants in the normative sample, values for the composite Scales

ranged from .88 to .93, and values were .77 or higher for all subscales (Bar-On, 2011) –

see “General (Total Sample)” column in Figure 7.

Figure 7. Cronbach’s Alpha Reliability for EQi2.0 Competencies

 39
CHAPTER 3: METHODS

The primary research question presented in this study is: Can entrepreneurial

success be predicted by emotional intelligence? In particular, which specific EI

competencies correlate with success, and which specific EI competencies can predict

success. To address these questions, I will first explain the assessment instrument used,

describing the entrepreneurial profile of the participants, the process of data collection,

and a description of the respective variables used to illustrate the results. In my

approach, I tried to collect and analyze emotional intelligence data systematically from

entrepreneurs participating in a workshop and explore the applicability of emotional

intelligence in predicting business success for entrepreneurs in the United States.

Specifically, I explored whether one or more of 15 EI competencies, as presented by Bar-

On, were associated with the success of an entrepreneur, whether those EI competencies

were interrelated, and which, if any EI competencies, were predictive of entrepreneurial

success. Using the compiled data, I addressed a series of descriptive, correlational, and

predictive research questions that together assessed the predictive validity of EI

competencies and facilitated making an evidence-based decision about how much weight

to assign EI competencies among a multiplicity of factors that can impact entrepreneurial

success, and determine if it was empirically appropriate to state that having EI is a

significant factor in entrepreneurial success.

To address these questions, I used (1) descriptive statistics generated from the

EQi2.0 Subscales to create an EI competencies profile and examined the trend in

entrepreneurial success outcomes and EI competency percentiles for Subscales and for

the Total EI score, (2) I used correlational analyses to examine which specific EI
 40
Subscale competencies were correlated with entrepreneurial success outcomes and how

those EI competencies were correlated with each other, and (3) I used linear regression

analysis to examine the predictive relationship between the Total EI score and the EI

Subscale competencies (the independent variables “IV”) and entrepreneurial success

outcomes (the dependent variables “DV”), controlling for other success factors. This

study is a correlational study with a predictive component, and given the paucity of

empirical evidence in the literature on the relationship between EI and entrepreneurial

success, a correlational study with a predictive component was a logical first step of

investigation because it can inform initial testing of hypotheses, and inform future, more

rigorous research in other settings or with other populations.

Research Design

In this section, I address the validity and reliability of the data collected and

analyzed for this study, which involved a quantitative research method evaluating

relationships between emotional intelligence and entrepreneurial success, as defined in

this study. The study’s variables had been identified from Bar-On’s (2011) emotional

intelligence competencies, from Chandler and Hanks (1993) objective measures of

success, and Cooper and Artz (1995) subjective success factors. After subjects had been

identified that meet the minimum subjective success criteria from a pool of entrepreneurs

that responded to an open solicitation of entrepreneurs interested in participating in a

business planning workshop and business development mentorship, the EQi2.0

assessment was selected to measure the variables of emotional intelligence. The EQi2.0,

objective and subjective criteria, survey distribution method, and the data collection
 41
process, were then submitted to the Institutional Review Board (IRB) for approval. Upon

IRB approval, the study commenced, and the data was collected.

I have performed a series of correlation analyses for the objective success and EI

paths illustrated in Figure 5, e.g., evaluating which of the Chandler and Hanks (1993)

objective measures of success are statistically relevant and the resulting implications, and

a similar analysis was conducted on each of Bar-On’s (2011) EI competencies. In

approaching this study, I also sought data from entrepreneurs that enabled me to identify

which of Bar-On’s emotional intelligence competencies were most often demonstrated by

the entrepreneurs meeting the success criteria, in addition to the relative mastery of the

competency as reflected by a high versus low score in the respective competency.

Validity

My research involved a quantitative research method that examined relationships

between Bar-On’s EI competencies; relationships between those competencies and

entrepreneurial success; and used linear regression to determine if EI (independent

variable) can predict entrepreneurial success (dependent variable). I also used the

relevant literature to identify the variables most appropriate to measure and submitted the

variables and EQi2.0 assessment to the Institutional Review Board (IRB) for approval.

Validity refers to how effectively the EQi2.0 measures emotional intelligence

(i.e., how well does the EQi2.0 do what it is supposed to do) (Stein, 2011). According to

Wainer and Braun (1998), validity in quantitative research is characterized as "construct

validity," where the construct is the initial concept or hypothesis that determines which

data is to be gathered and how it is to be gathered. Wainer and Braun (1998) assert that

quantitative researchers must proactively try to affect the interplay between the construct
 42
and data in a research study to validate their investigation, which is best done by the

application of a test or other procedure. If the test outcomes can be influenced by

extraneous factors, then the presumption is that the validity of the test is compromised.

To ensure construct validity for the constructs in my research, I used previously validated

measures selected from the relevant literature and also paid attention to any missing

information from how the entrepreneurs were selected.

Internal Validity

According to Woodman (2014), internal validity refers to the quality of research

done to investigate the results of a study and absent internal validity or the ability to rule

out alternative explanations for the outcome; it is impossible to conclude anything about

the effects of the independent variables. As a result, internal validity addresses the need

to control extraneous variables and outside influences that can distort the outcomes be

measured (Woodman, 2014). In this study, the variables were emotional intelligence, a

standardized definition of an entrepreneur, and a standardized definition of success. The

standardization was designed to control extraneous variables that could make the

definitions arbitrary or hard to identify. For example, given the definition of an

entrepreneur being the key executive of a startup company that files federal or state tax

documents, it helped ensure that hobbyists and regular employees were excluded from

the sample pool, and made the result more relevant to the specific context of

"entrepreneurs.”

To help ensure validity, I have conducted a correlation analysis that examined the

predictive relationship between EI and entrepreneurial success, while controlling for the

entrepreneur’s profile. Although, as a predictive study, at best, I can only conclude that
 43
EI and entrepreneurial success vary with each other and cannot definitively determine

whether there is a causal relationship between those constructs. A potential threat to the

internal validity of this study, however, could be missing data, e.g., incomplete EQi2.0

surveys or incomplete profiles of the entrepreneurs. This threat has been mitigated by

using the fully-automated survey administration process offered by the EQi2.0

administration team, which automatically detects incomplete surveys, asks multiple

questions on the same topic in different ways to ensure consistency and accuracy, and

separates incomplete submissions so that the researcher does not mistakenly use an

incomplete survey. Also, in my data collection process, I specifically asked questions to

elicit details on the entrepreneur’s profile, but also independently verified their business

registration and company role through numerous Internet searches. I also tried to

mitigate potential bias that could result from the entrepreneur trying to impress the

researcher or seek investment in their company by changing my Internet profile to

remove my role as an investor, informed potential participants in two separate statements

that their participation would not result in investment or any monetary benefit, and twice

stated to potential participants that it was critical that they provide open and honest self-

reflection, for which I could provide them with feedback. Otherwise, they would not

receive anything for the 60-90 minutes they would allocate, in total, for their volunteered

cooperation. From that foundation, the instructions for completing the EQi2.0 were the

standardized instructions, verbatim, that MHS recommends being provided in each

survey administration to ensure validity in the responses.

 44
External Validity

In contrast to internal validity, external validity reflects the extent to which

generalizations can be made about the results of a study or the extent to which those

generalizations can be applied to members of a larger population (Woodman, 2014). As

a result, external validity addresses the implications for the real world that are relevant

beyond a study’s parameters, e.g., the random selection process ensures that members of

the study a truly representative helps ensure that study participants are truly

representative of the larger population (Woodman, 2014). In this study, participants were

randomly selected from a sampling pool of 199 entrepreneurs that self-selected to

participate in entrepreneurial workshops designed to help them improve their business

skills between 2012-2014. The pool was distilled from an original pool of 976 total

entrepreneurs identified between 2012-2016, who participated in university-affiliated

entrepreneurial workshops or requested business development services from university-

affiliated mentors. The only criteria used to distill the pool from 976 to 199 was the year

the entrepreneur’s name was entered into the database, e.g., to ensure the business had at

least a two-year operating history, businesses that were entered into the database after

January 1, 2014, were automatically excluded from the sample pool. It is possible that

several entrepreneurs in the database from 2014-2016 would also qualify for this study,

but due to the inherent difficulty of obtaining access to a private company’s business

filings and financial data, a more objectively, verifiable criteria of being in business

before 2014 was used.

With the only selection criteria for the sample pool being registration in an

entrepreneurial database as a key executive before 2014, during a single day in 2016, all
 45
199 entrepreneurs were sent an invitation to participate separately in this study – an

invitation that asked the entrepreneur to respond only if the entrepreneur was a founder,

co-founder, of startup CEO, their company filed state or federal business registration

paperwork before 2014 (at least two years in business), and the entrepreneur currently

worked in the business full-time (40+ hours per week). These criteria helped ensure that

any entrepreneur that responded met the entrepreneurial profile and would have a

business history where changes in sales, market share, and cash flow could be more

easily identified. Entrepreneurs were given one month to respond to the invitation, and a

total of 56 entrepreneurs volunteered to participate within that one-month time frame.

Each of the 56 volunteers was assigned a randomly-generated, 6-digit number to

anonymize the entrepreneur for data collection purposes, and sent a link to complete the

automated EQi2.0 assessment on the MHS website within one month. The initial plan

was to accept 30 entrepreneurs from the 56 volunteers, randomly selected by converting

each 6-digit identifier into a fractional value, then using the random (RAND) formula in a

spreadsheet to populate 30 cells and the identifier most closely corresponding to those

cells would be included in the study. Because only 31 entrepreneurs submitted a

completed survey within one month, however, all 31 were used in this study to ensure an

adequate sample size. As a result, the only selection criteria for the 31 participants was

volunteering to complete the EQi2.0 assessment within a two-month window and being a

qualified entrepreneur who sought university-affiliated business development guidance in

a business that was launched before January 1, 2014. There were 143 non-responses to

the 199-person sample pool = 71.9% did not respond at all, and there were 25 non-

responses to the 56-person qualified volunteer pool = 44.6% did not complete the survey.
 46
Fortunately, 100% of the 31 participants completed 100% of the 133 EQi2.0

assessment questions, so there was zero non-response to specific survey items by

participating entrepreneurs. The implications of selecting a relatively small sample of 31

participants from a pool of education-focused/university event-affiliated entrepreneurs

are that the results may only be indicative of a narrow group of entrepreneurs that have

proactively sought a connection with a major university and not reflect the broader

population of entrepreneurs from varied industries. The entrepreneurs in this study are

also predominantly in startup businesses with less than 100 employees, and it is possible

that entrepreneurs that currently run large, publicly-traded organizations may have

different EI strengths and perspectives on entrepreneurship that vary from passionate

startup entrepreneurs still seeking a major milestone in their business. Because this study

is exploratory, however, it is not intended to address every type of entrepreneur in every

type of entrepreneurial venture, but it does serve as a solid foundation upon which to

conduct further studies in this field.

Reliability

Anastasi (1988) defined reliability as “the consistency of scores obtained by the

same person when re-examined with the same test on different occasions, or with

different sets of equivalent items, or under other variable examining conditions.” In the

specific context of the EQi2.0, reliability refers to the consistency or precision of scores

(i.e., how consistently does the EQi2.0 measure emotional intelligence?) (Stein, 2011).

In developing the EQi2.0, there were two statistical methods used for evaluating

reliability: internal consistency and test-retest reliability, where internal consistency

refers to the degree to which a particular set of items (EQi2.0 Scales and Subscales)
 47
assess a single construct (e.g., Empathy), and test-retest reliability refers to how stable the

scores are over time (e.g., if a score consistently .97 across thousands of participants over

two decades, then that indicates high stability (Stein, 2011).

Concerning reliability - I have used Cronbach’s alpha to determine the reliability

of the variables used. Internal consistency is typically measured using Cronbach’s alpha,

which is a statistical method to correlate survey items with each other, where a rule of

thumb suggests that a reliability of 1.00 is perfect (no noise whatsoever); a reliability

between .90 and 1.00 is excellent, between .80 and .89 is good, between .70 and .79 is

moderate, between .60 and .69 is low, and below .60 is very low (May, H., personal

communication, 1/14/13, Cronbach, 1951). My objective is to obtain alpha >.70, which

the EQi consistently exceeds (see Figure 7), and reflects excellent Total EI alpha scores

and near-excellent composite scale scores. According to Stein (2011), the high level of

internal consistency found in the EQi2.0 Total EI score supports the claim that the EQi2.0

items are measuring a single cohesive construct - emotional intelligence. To facilitate

measuring EI, I have tried to make collecting participant responses as easy as possible by

providing a web-based response system, and I sent periodic reminders to potential

participants to facilitate data collection.

Steps taken to mitigate biases and influence

A key threat to validity is that some entrepreneurs may be inclined to falsify their

data to appeal to my professional interests as a former investor in technology ventures. I

have directly notified all potential study participants that this study is not affiliated with

any of my former companies or activities conducted by those companies, and their

participation is strictly voluntary with zero compensation and no direct benefit during or
 48
after the study concludes. I have also informed participants that they will not be

individually identified to outside persons - specifically investors, including me, or any

other persons who may have an interest in working with, or affiliating with,

entrepreneurial ventures. Also, I have taken steps to collect the data anonymously by

having an assistant sanitize (strip identifying statements) and tag each incoming survey

response with a randomly generated file number, that I have not viewed, to ensure the

academic integrity of the research and deter any incentive to misrepresent the data

collected.

Additional threats to this study's validity pertained to the selection of the study's

participants and my reliance on workshop participants as a primary source. There was no

guarantee that the applicants would respond. My objective, however, was not to establish

a new, general theory of the correlation between EI and entrepreneurship because my

study pertains to a potential association that has not yet been clearly defined. For

example, there are multiple definitions available for entrepreneurs, EI, and success, and

as a result, my study is appropriately deemed exploratory, and I have focused on early-

stage entrepreneurs to generate a conceptualization of the potential association that will

be meaningful as the foundation for future studies.

Another threat was my personal bias and my subjective interpretation of the

definitions of an entrepreneur, relevant EI competencies, and success. My opinions and

values could have influenced the collection and analysis of the data, which could have

affected any conclusions reached in the study. To neutralize this threat, I remained

vigilant concerning my personal bias and tried to report findings objectively. The fact

that I am not producing subjective survey questions, e.g., I am only using the EQi2.0,
 49
which is completed without my direct interaction with the participant (an online,

automated, submission and scoring process), helped minimize potential bias.

Most participants in the workshops must apply or specifically request to

participate, and in doing so, self-select as being appropriate for this study, e.g., they

indicated their state of incorporation or provide a link to their Website so that their level

business involvement could be independently verified. The workshop application

process helps qualify their status as an “entrepreneur,” and it also included some financial

status information, e.g., current company valuation, which helped establish a basic level

of success. To further validate “success,” I chose workshop applicants who reported

being interested in expediting their business growth (they want to remain

entrepreneurial), and their business had a starting date before 2014. In other words, the

entrepreneur has been in business for at least two (2) years, they can show customer

acquisition during that time (partnerships with other companies, licensing arrangements,

and customer testimonials), and they have indicated their interest in continuing as an

entrepreneur – each of which I could independently corroborate with Internet research

and follow-up questions post-survey. According to Golafshani (2003), validity reflects

whether the means of measurement in a research study are accurate and whether they

measure what they are intended to measure, and reliability reflects the consistency with

which a research instrument (e.g., survey) yields similar results. To help ensure a valid

study, I used measures derived from previous studies with evidence of validity and

reliability to reduce the bias from using a single method, such as a survey.

As indicated above, to maximize validity and reliability, I have chosen to use

validated measures wherever possible to ensure consistent and accurate results from the
 50
aggregated pool of business plan competition applicants. I also remained vigilant

regarding my personal biases and was wary of the motives of respondents who

participated in the study. If I received any responses with personal requests to contact the

participant, or if they submitted an investment request or other indication of expecting an

exchange for their participation, I would have noted their exclusion from the data

collected for this study, but fortunately, there were no such requests.

Data collection procedures

Data was collected via surveys of 31 participants selected from an original pool of

976 entrepreneurs that applied/inquired to participate in university-affiliated technology

events and business/personal development workshops to enhance performance and

profits. To be included in the sample pool, each entrepreneur was asked for, or I was able

to verify independently through Internet searches, confirmation of their full-time status

working in their business, federal and state registration of their business, and the duration

of business existence. The invitation to participate in this study and the informed

consent documents also included a request to explain the entrepreneur’s reasons for

wanting to be included in the study. Participants indicating satisfaction with the

entrepreneurial lifestyle, but seeking ways to improve their personal and professional

performance to enhance their business opportunities were selected to meet this objective

Success criteria and control for that variable at the outset.

All inquiries and applications were compiled in a database that generated a

spreadsheet, where the pool could be narrowed by field entries, e.g., applicants who

checked a box on the application indicating that they only had a business idea, but no

actual business was easily removed from the spreadsheet. After deleting applicants that
 51
could be excluded as non-entrepreneurs or non-successful, the spreadsheet served as the

mail merge source for survey distribution. With the entrepreneurial profile independently

verified, and the Subject of success criteria addressed, I used basic word processing

software and a native PC emailing client to merge my IRB-approved, informed consent

with the email addresses in the database spreadsheet, and sent invitations to participate in

this study.

The EQi2.0 assessment is administered 100% online and automatically scored by

MHS (the company that owns the copyright to the assessment). In return for their

voluntary participation in this study, entrepreneurs were offered personalized feedback on

the results of their assessment responses from the context of leadership development,

which is the standard and appropriate practice with EQi2.0 assessment administration.

For this study, the only contact with the participant before completing the assessment was

via email, and only after the assessment was scored and tabulated, was personalized

assessment feedback provided via telephone.

Site and Participant Selection

Thirty-one (31) participants for the study were selected from an original pool of

976 potential candidates that qualified as both an entrepreneur and successful, according

to this study’s criteria. The participants self-identified as participating in an active

entrepreneurial venture in which they are engaged on a full-time basis. I only surveyed

individuals who were currently operating a business where their investment of time or

capital is substantial and at risk of not generating future returns, and the entrepreneur has

formally registered with federal and state regulatory agencies as entrepreneurs through

their business licenses or tax filings. This sampling methodology was appropriate
 52
because this study is an exploration of possible associations between EI and

entrepreneurial success, and most subjects had at least one measure of relative success

reflected by sales growth or customer acquisition relationships with other service

providers. The focus was on startup entrepreneurs because I wanted to focus on early and

growth stage companies where the entrepreneur is often reevaluating and pivoting their

marketing strategy to determine their maximum competitive advantage. In all cases, the

core data sought was from an entrepreneur who is both a founder and has been involved

in day-to-day operations for at least two years.

This study focused on entrepreneurs, as opposed to chief executive officers in

large, established organizations for the reasons noted above, and before the selection of

the study’s participants, an initial list of possible entrepreneurs was compiled by the

database, as described above. The list contained entrepreneurs that had their financial

and organizational information verified through a brief application completed by the

entrepreneur before the study, my follow-up research on the internet, and other publicly

available tracking data. Selected participants were assigned a six digit, randomly

generated number, which is the only means by which someone looking at their survey

responses on the MHS server can identify that someone has taken the assessment, e.g.,

the observer would only see a six-digit number without a name or other identifying

information. Once their unique number was entered into the MHS system, they were

automatically sent a link to the EQi2.0, where their responses were linked to the unique

identifier. Upon completion of the approximately 20-minute survey, I was notified of

how many surveys are awaiting my review, after which I could download the

automatically scored results from the MHS server and begin entering that raw data into
 53
the SPSS statistical software platform to conduct correlation and regression analysis.

Concerning participants, I also tracked Subject Non-Response, Item Non-Response, and

Implications for Sample Size.

Construct Measures

The EQi2.0 is an extensively validated emotional intelligence instrument, used in

evaluating more than 1 million subjects around the world, and approved by the University

of Pennsylvania Institutional Review Board as being appropriate for use in this study.

The dependent variable in this study was the entrepreneurial success, comprised of the

objective measures of increased sales partnerships, hiring additional employees, and

being identified as a competitor in industry press coverage or business plan competitions.

The independent variable was Bar-On’s (2011) emotional intelligence, comprised of an

overall EI score, five composite Scales, and 15 Subscales. For each of the respective

variables, the corresponding measures are defined below. Qualifying as an entrepreneur

was the threshold requirement to be considered for the survey pool, so it was not a

dependent variable factored into the analysis of the survey responses because all

participants qualified as "entrepreneurs.”

Definition of entrepreneur used

For this study, I have distilled definitions from the literature into a composite

illustration where an entrepreneur is defined simply as someone who is currently engaged

in serious business activities involving identification to federal and state regulatory

agencies as an entrepreneur, and whose time and cash investment in the business is 100%

at risk of being lost if the business fails.

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Definition of emotional intelligence used

As indicated above, the primary differences between Mayer and Salovey,

Goleman and Bar-On, is that Mayer and Salovey's 's approach has sole emphasis on the

interaction between the emotional competencies and cognitive abilities, whereas

Goleman and Bar-On include those concepts as well, but also integrate motivation, which

includes various human characteristics such as faith, positivism, and selflessness.

Goleman is distinguished from Bar-On because of Bar-On's focus is on a person's

"ability" to manage emotions, whereas Goleman's focus is on the actions taken by the

person – their actual performance. For this study, I focused on the competencies and

skills specifically related to Bar-On’s model.

Definition of success used

For this study, I used a success framework that has been extensively tested and

validated in the context of entrepreneurs, presented by Chandler and Hanks (1993).

According to Chandler and Hanks, (1993), objective, financial, entrepreneurial success is

best measured in broad categories of growth and business volume, and the three items

used to measure growth consist of (1) perceived growth in market share; (2) change in

cash flow; and (3) sales growth (Chandler & Hanks, 1993). The three items used to

measure business volume consist of (1) earnings, (2) sales, and (3) net worth. Also, I used

the subjective criteria proposed by Cooper and Artz (1995) consisting of 1) satisfaction

with venture; 2) satisfaction with self, and 3) desire to repeat success. As a result, in this

study, Success = dependent variable = DV - measured from 0 (unsuccessful) to 3

(successful for having met all 3 criteria of increasing a) Revenue, b) Market Share and c)

Sales Growth), which each factor increasing ordinal values by one (1) unit.
 55
Independent variable: Emotional Intelligence (Emotional Quotient)

Bar-On, R. (2011), defines emotional intelligence (EI), also known as emotional

quotient (EQ), as a set of emotional and social skills that collectively establish how well

we perceive and express ourselves, develop and maintain social relationships, cope with

challenges, and use emotional information in an effective and meaningful way. EI is also

estimated to account for 27 to 45% of job success, and whereas intelligence is fixed after

peaking at age 17, EI is not fixed and increases steadily with age (Bar-On, 2011). When

Reuven Bar-On invented the term “EQ” in 1985 to describe his approach in evaluating

emotional and social functioning, he recognized the need to create an appropriate tool to

measure EQ, which led to the first psychometrically valid and reliable assessment, the

“Emotional Quotient Inventory” (EQ-i) (Bar-On, 1997a).

Emotional Quotient Inventory 2.0 (EQ-i 2.0)

Since the creation of the EQ-i, the assessment tool has been peer-reviewed in the

Buros Mental Measurement Yearbook and has been vetted in more than 200 research and

applied manuscripts worldwide through more than one million administrations of the

assessment (Bar-On, 2011). As previously mentioned, the EQ-i 2.0 was designed

specifically to address Bar-On’s five composite Scales and 15 Subscales across 133

questions, addressing: Self-Perception composite scale (comprising subscales of Self-

Regard, Self-Actualization, and Emotional Self-Awareness); Self-Expression composite

scale (comprising subscales of Emotional Expression, Assertiveness, and Independence),

Interpersonal composite scale (comprising subscales of Interpersonal Relationships,

Empathy, and Social Responsibility); Decision Making composite scale (comprising

Problem-Solving, Reality-Testing, and Impulse Control), and Stress Management

 56
composite scale (comprising subscales of Flexibility, Stress Tolerance, and Optimism)

(Bar-On, 2011). The EQ-i 2.0 is also considered one of the most reliable EI assessment

tools with a Cronbach’s alpha for “Total Sample” EI at .97, composite scale values

ranging from .88 to .93, and values higher than .77 for all subscales (Bar-On, 2011). The

EQ-i 2.0 is being used in this study to process the data collected.

Specifically, the Bar-On’s (2011) competencies are:

1) Self-Regard = respecting oneself while understanding and accepting one’s

strengths and weaknesses and is often associated with feelings of inner strength and self-

confidence.;

2) Self-Actualization = the willingness to try persistently to improve oneself and

engage in the pursuit of personally relevant and meaningful objectives that lead to a rich

and enjoyable life.

3) Emotional Self-Awareness = recognizing and understanding one’s own

emotions, including the ability to differentiate between subtleties in one’s own emotions

while understanding the cause of these emotions and the impact they have on the

thoughts and actions of oneself and others.

4) Emotional Expression = openly expressing one’s feelings verbally and non-

verbally.

5) Assertiveness = communicating feelings, beliefs, and thoughts openly, and

defending personal rights and values in a socially acceptable, non-offensive, and non-

destructive manner.
 57
6) Independence = the ability to be self-directed and free from emotional

dependency on others, e.g., decision-making, planning, and daily tasks are completed

autonomously.

7) Interpersonal Relationships = the skill of developing and maintaining mutually

satisfying relationships that are characterized by trust and compassion.

8) Empathy = recognizing, understanding, and appreciating how other people feel.

Empathy involves being able to articulate your understanding of another’s perspective

and behaving in a way that respects others’ feelings.

9) Social Responsibility = willingly contributing to society, to one’s social

groups, and generally to the welfare of others. Social Responsibility involves acting

responsibly, having social consciousness, and showing concern for the greater

community.

10) Problem-Solving = the ability to find solutions to problems in situations

where emotions are involved, which includes the ability to understand how emotions

impact decision making.

11) Reality-Testing = the capacity to remain objective by seeing things as they

are, which involves recognizing when emotions or personal bias can cause one to be less

objective.

12) Impulse Control = the ability to resist or delay an impulse, drive or temptation

to act and involves avoiding rash behaviors and decision making.

13) Flexibility = adapting emotions, thoughts, and behaviors to unfamiliar,

unpredictable, and dynamic circumstances or ideas.

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14) Stress Tolerance = coping with stressful or difficult situations and believing

that one can manage or influence situations in a positive manner, and

15) Optimism = an indicator of one’s positive attitude and outlook on life, which

involves remaining hopeful and resilient, despite occasional setbacks.

For this study, Bar-On’s Emotional Quotient Inventory (EQi2.0) was used to

collect data pertaining to those competencies, and Emotional Intelligence = independent

variable = IV (predictor) - measured on a scale from 1 to 125, with an expectation

(assessment norms) that about 25% of the scores will be below 90 (Low EI Range), about

50% of the scores will be between 90-110 (Normal EI Range), and about 25% of the

scores will be above 110 (High EI Range).

Measurement tool: Emotional Quotient Inventory (EQi2.0)

In November 2015, I completed the EQi2.0 Certification workshop, to be able to

administer the assessment and rate the entrepreneurs on their EI competencies, based

specifically on Bar-On’s 15 competencies. Because the EQi2.0 is a survey designed

specifically for mixed model emotional intelligence assessments, such as those presented

by Bar-On, I theorize the EQi2.0 is the most appropriate assessment tool for this study

(Bar-On, 2007). For example, Bar-On has reported internal reliability of the overall

EQi2.0 to be .97, with composite Scales ranging from .88 to .93, and values for all

subscales being .77 or higher (Bar-On, 2011).

Dependent variable: entrepreneurial success

Objective and Subjective entrepreneurial success

Objective entrepreneurial success is the dependent variable, which was derived

from the validated research studies conducted by Chandler and Hanks (1993). A
 59
consistent challenge throughout this study was establishing criteria upon which to base

success. There can be many reasons and factors that lead to success ranging from luck,

competitors failing, to proactive customer engagement. Also, startup companies are not

subject to the disclosure requirements of public companies, which makes access to their

confidential financial and performance data extremely difficult to obtain and, once

obtained, difficult to measure accurately and consistently. According to Chandler and

Hanks (1993), it is possible to offset the challenges inherent in researching self-reporting

entrepreneurs via a three (3) factor approach that includes: (1) perceived growth in

market share (measured in this study via increased internet mentions as a Competitor

during past 24 months); (2) change in cash flow (measured in this study via increased

Employees during past 24 months); and (3) sales growth (measured in this study via

increased sales Partnerships during past 24 months). The Chandler and Hanks (1993)

factors listed were found by Nunnally and Bernstein (1994) to have psychometric

properties indicating the factors are valid and reliable for research involving financial,

entrepreneurial firm success with a coefficient alpha that exceeded the .70 recommended

for research purposes, e.g., the coefficient alpha was .72 for the three factors listed above.

In my approach, I first obtained data that helped identify EI competencies and then

obtained data that reflected a relative measure of success or failure in the entrepreneur's

business. The three items used to measure business volume consist of (1) earnings, (2)

sales, and (3) net worth. The subjective criteria from Cooper and Artz (1995) are: 1)

satisfaction with venture; 2) satisfaction with self, and 3) desire to repeat success. In this

study, I assessed financial data for the business (objective), and the perception of the

entrepreneur as to whether their business has met their personal needs and aspirations
 60
(subjective). As a result, my definition of success previously described enabled me to

conduct research that generated data indicating the relative success or failure of the

entrepreneur, and this was a dependent variable in the success correlation studies

pertaining to EI. I also conducted linear regression analysis to examine how EI

components (IV) might predict entrepreneurial success (DV), controlling for other

factors. Because this method was validated by Nunnally and Bernstein (1994), and a key

objective is to use only valid and reliable assessment measures, there was no need to

identify a duplicative measure.

Measures

Key considerations in this study were determining: 1) What resources are required

to conduct the research; (2) What type/form of data should be collected; and (3) What can

the participants expect to do during the research process. In this study, because my

approach was to focus on more objective measures, I examined how an entrepreneur

viewed themselves and compared those perspectives with objective measures, such as net

profit increases each year.

My focus in this study was specifically on Bar-On’s emotional and social

competencies, and the application of the most current, validated assessment tool designed

specifically for Bar-On’s competencies - the Emotional Quotient Inventory (EQi2.0).

Bar-On created the Emotional Quotient Inventory (EQi). In 1997, and it was the first

validated measure of emotional intelligence (Bar-On, 1997a) and has been one of the

most widely used measures of emotional and social intelligence (Bar-On, 2004). To

more accurately reflect how his model evolved, Bar-On updated the EQi to the EQi2.0 in

2011. The Bar-On model is predicated on the premise that emotional and social
 61
intelligence is represented by five (5) interrelated emotional and social core competencies

and related subscales that determine how effectively humans understand and express their

emotions, interpret and relate to the emotions expressed by others, and cope with

everyday circumstances (Bar-On, 2006). The EQi model is a self-report measure that

provides an estimate of emotional-social intelligence and was specifically designed to

operationalize the Bar-On model (Bar-On, 2006), which reflects how Bar-On perceives

the assessment tool as the most accurate and reliable measure of the specific

competencies that comprise his emotional intelligence model.

As a result, I used the EQi2.0 because it has the longest history of being a

validated assessment of emotional intelligence, the creator of the Bar-On model believes

the assessment to be the most accurate measure of the model being used in this study, and

I have found the other assessment tools do not fully address each of the competencies and

subscales of the Bar-On model in the relevant context of the model. Specifically, my

objective was to determine which EI competencies were most relevant to entrepreneurial

success, e.g., determining if there was a correlation between certain competencies and

entrepreneurial success.

Each participant had already completed an application/inquiry form in

anticipation of participating in a business plan competition or business planning

workshop that elicits data regarding the size, history, and profitability of the business, to

ensure the venture meets the minimum qualifying criteria. Those question were derived

from a validated survey conducted by Chandler and Hanks (1993) focusing on three (3)

approaches to estimating entrepreneurial performance when only self-reported data is

available: 1) measuring financial firm performance in broad categories; 2) using

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subjective measures of firm performance in relation to competitors, and 3) subjective

measures of owner satisfaction with the firm’s performance. The respective surveys were

distributed via email to participants and allowed to respond directly to the MHS server to

facilitate anonymous, autonomous, accurate and efficient data collection and scoring.

Also, SPSS Statistical software was used to facilitate calculation of Correlation and

Regression and due to the Ordinal (categorical) characteristics of the dependent variable

(Success), Spearman Correlational and Ordinal Logistic Regression analysis was applied

to the assessment results.

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CHAPTER 4: RESULTS

Analytical Procedures

Descriptive statistics were analyzed determine the appropriate relationships

between the variables, and given the highly validated attributes of the EQi2.0 and criteria

that are well-established in the literature, I was able to determine the measures are valid

and reliable. The statistical analysis includes calculations of minimum, maximum, mean,

standard deviation, skewness, and kurtosis, and due the ordinal characteristics of the

objective success factors used, bivariate Spearman’s correlation coefficients were used in

evaluating the relationship between all variables, both independent and dependent. Also,

ordinal regression analysis and testing of each hypothesis are presented at the end of this

chapter, to determine whether emotional intelligence can predict objective entrepreneurial

success.

Demographic Profile of Entrepreneurs:

D1. Entrepreneurial Profile: What was the demographical, revenue, and industry profile
of workshop participants that responded to the EQi survey?

There were 31 randomly selected entrepreneurs from 31 separate companies from

across the United States, Western Europe, Asia, and Africa, participating in the study,

randomly selected from a prequalified pool of 199. The 199 prequalified potential

participants were distilled from an original pool of 976 entrepreneurs that have sought

university-affiliated entrepreneurial support or guidance between 2012-2016. The

distillation process simply involved selecting entrepreneurs were registered in the

database before 2014 and verifying current operation of a state-registered company in the

same role, which ensured meeting the entrepreneur criteria of working full-time and

entrepreneurial venture with at least a two-year track record.

 64
The 31 companies are all considered startups with annual revenues less than $10

Million, and all companies were related to education in some way, e.g., enterprise

software that can be used in training, providers of education or training curriculum, all

but one entrepreneur was a founding executive of the company they are in, with that one

exception being a serial entrepreneur that was brought in as the new CEO to replace the

founding CEO. The focus on entrepreneurial executives from around the world having a

common interest in increasing their performance as business leaders are consistent with

the purpose of this study. As illustrated in Table 2, the participants consisted of 21 males

(67.7%) and ten females (32.3%) and their ages ranged from 24 to 66 years – no other

demographic information was recorded.

Table 2

Demographic Characteristics of Participants

Demographics N %

Gender

Male 21 67.7

Female 10 32.3

Age

24-34 7 22.6

35-45 9 29.1

46-56 10 32.3

57-67 5 16.1
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D2. Entrepreneurial Profile: For each respective EI Subscale distribution, what is the
spread (Standard Deviation)?

Table 3

The Mean and Standard Deviation (SD) of EI Subscales

EI Subscale M SD

Self-Regard 96.6 15.5

Self-Actualization 102.3 13.4

Emotional Self-Awareness 100 13.8

Emotional Expression 98.9 14.7

Assertiveness 96 13

Independence 103.7 12.1

Interpersonal Relationships 96.4 16.1

Empathy 102.2 13.3

Social Responsibility 107.7 10

Problem Solving 98.3 13.5

Reality Testing 96.7 12.4

Impulse Control 101.6 12.8

Flexibility 105.5 12.2

Stress Tolerance 99.8 13.1

Optimism 99.1 20.7

 66
The primary reason for this descriptive is to determine where there may be small

standard deviation values that may indicate a restriction of the range that can impact the

correlations and regressions. The Mean values reflect where the group (N=31) is, on

average, on each respective Subscale, whereas the standard deviation reflects how much

variation there was around the average. The Mean values for most Subscales were close

to the expected norm of 100 and well within the expected standard deviation of 15, with

the smallest Mean value at 96 (Assertiveness) and the largest Mean value at 107.71

(Social Responsibility). The expected Standard Deviation of 15 was also closely

approximated by most Subscales with a minimum standard of 10 (Social Responsibility)

and maximum standard of 20.7 (Optimism).

Because the expected norm of 100 was closely approximated with the smallest

Mean value only 4 points away, and the largest value almost 8 points way (approximately

one-half a standard deviation), the Subscale Mean scores appear to reflect that the

entrepreneurs are well-situated within the norm for professionals engaged in business

(Bar-On, 2011). Similarly, concerning standard deviation, the expected norm is 15, and

the amount of variation around the norm is ~5, either by the minimum standard of 10 or

the maximum standard of 20.7. The next closest minimum standard is 12.1

(Independence), and are several scores in the “12-range”, so SD=10 does not appear out

of line with expectations. It should be noted, however, that the SD=20.7 for Optimism is

more than 4.5 points above the next largest standard (16.1 for Interpersonal

Relationships), and although there is a score of 15.5 for Self-Regard, there are six scores

in the “13-range,” which is the range where most scores are concentrated. The large

standard for Optimism reflects that Subscale having the lowest reported minimum score
 67
(50) and the largest range of values (73), which can increase the standard deviation and

indicates an opportunity to follow up with the entrepreneur that reported the minimum

score to determine if the scores accurate, or if there were extenuating circumstances that

resulted in the score so far below the mean.

D3. EQi2.0: For the Overall EI score, what is the Minimum, Maximum, shape (Skewness
& Kurtosis), center (Mean), and spread (Standard Deviation)?

Table 4

Overall Emotional Intelligence Score Descriptives

N Range Min Max M SD Skewness Kurtosis

31 48 74 122 99.81 12.504 -.080 -.302

The mean value of 99.81 and Std. Dev of 12.5 is consistent with the expected

values noted in the EQi2.0 manual of 100 and 15, respectively. The Skewness value of -

0.080 is very close to zero, although slightly negative, which indicates that there may be a

few more, larger values around the mean than smaller values. Kurtosis of -0.302 is below

the expected range -0.15 to 1.11, which indicates that instead of a slightly flat bell-shaped

distribution than would normally be expected, the shape of the distribution is slightly

more peaked than normal. In aggregate, however, these values are consistent with

expectations, and there are no severe departures from normality, nor are there extreme

outliers that distort the analysis.

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D4. Overall Success: For the Overall Success score, what is the Minimum, Maximum,
shape (Skewness & Kurtosis), center (Mean), and spread (Standard Deviation)?

Table 5

Success Score Descriptives

Success Criteria NRange Min Max M SD Skewness Kurtosis

Overall Success 1 3 0 3 2.03 1.104 -.789 -.839

Partnerships 1 1 0 1 .84 .374 -1.937 1.868

Competitors 1 1 0 1 .55 .506 -.204 -2.098

Employees 1 1 0 1 .65 .486 -.638 -1.708

Descriptives for Overall Success help provide a more comprehensive illustration

of how success factors were represented in the study. Given the ordinal nature of the

factors and there only being three factors, the minimum (0), maximum (3), range (3),

Mean (2.03), and standard deviation (1.104) appear reasonable. Specifically, the values

reflect that most entrepreneurs have at least two success factors, with the most likely

alternative options being either one or three. The results also indicate that zero is outside

of one SD, indicating that zero success factors are less likely to occur. The Skewness

value of -0.789, which indicates that there are more, large values around the mean than

small values, e.g., >2.03. Kurtosis of -0.839 indicates that instead of a bell-shaped

normal distribution, the shape of the distribution is much more peaked than normal.

It is also interesting to note that all entrepreneurs that have at least one success

factor, will have Partnerships, which is an unusual finding because we would not expect

100% percent of successful entrepreneurs in the world to have business partnerships, e.g.,
 69
some entrepreneurs do all of their sales and marketing solo. This anomaly is reflected in

Table 5 by the very high Mean (M=.84), indicating that more than eight out of 10

entrepreneurs had a business partnership to increase sales, but that is not reflective of the

broader entrepreneurial community. The Employees criteria has the next highest

frequency with a Mean (M=.65), indicating that more than six out of 10 entrepreneurs

increased revenues enough during the past few years to afford hiring support staff.

Approximately half of entrepreneurs reporting at least one success factor had evidence of

being listed as a competitor for another business (M=.55).

Concerning Skewness, Competitors and Employees are similar to that reported

values are negative, but within 0 to -1, whereas Partnerships is greater than -1. The

Skewness values indicate substantially more, large values around the Mean than small

values, which would be consistent with the fact that all entrepreneurs noting a success

factor had Partnerships as a factor. Similarly, with Kurtosis, Competitors and Employees

are close in magnitude and negative, but reflect a greater distinction from Partnerships in

that the magnitude is about the same, but positive. In other words, the shape of the

distribution is much more peaked than normal with Competitors and Employees, but in

clear contrast, the shape of the distribution is much more flat than normal with

Partnerships. In aggregate, however, these values are consistent with expectations, and

there are no severe departures from normality, nor are there extreme outliers that distort

the analysis.
 70
Relationship between Entrepreneurial Success and EI:

C1. What is the correlation between Overall Entrepreneurial Success and an

entrepreneur’s Overall EI score?

Using Spearman rho (rs) to determine any correlation between the Overall EI

Score and Overall Success, the rank correlation value was rs=0.176, with p=0.344. This

result indicates that the correlation between the two variables is positive, weak, and not

statistically significant, which prompted me to conduct additional exploratory data

analysis and sensitivity tests to ensure the sensitivity of the results. Specifically, I have

mapped the data using a scatter plot with both variables and also used the Pearson

Product Moment correlation coefficient (r) to see if a dramatically different result was

produced. The Pearson correlation was r=0.150, with p=0.420, which is not dramatically

different from the rs=0.176 finding.

Figure 8. Scatterplots showing correlations between Success and Overall EI Scores

 71
Figure 8 reflects that a few entrepreneurs with relatively high EI scores were not

as successful as other entrepreneurs with relatively low EI scores, but it also shows that

the concentration of Overall EI Scores slightly increases as an entrepreneur incrementally

attains additional Success factors. For example, SPSS makes graphical positions with

lots of occurrences darker, which when connected, appears to be a dark line running from

the lower left to the upper right, suggesting a positive relationship - see bolded circles

plotted where y=2 and y=3, which reflect a concentration of data points through which a

hypothetical line can be drawn. With each of the respective Success factors, there is also

a concentration around the Mean for entrepreneurs indicating that they possess that

factor. Also, as reflected in Figure 8, the distribution of scores is not even, and there are

entrepreneurs with low EI scores, but exhibit all success factors. Conversely, there are

entrepreneurs with very high EI scores, but zero success factors. I found the magnitude

and direction of the Spearman correlation are consistent, but the correlation is not

statistically significant. The magnitude and direction of the correlation indicates that the

correlation observed may be due to chance. To help ensure that there wasn’t a

relationship that I had overlooked, I decided to compare the five (5) Composite EI scores,

with Overall Success, which yielded similar weak correlational results – see Table 6.
 72
Table 6

Correlational Relationship Between Overall Success and Composite EI Scores

Composite EI Score rs r

Self-Perception .019 -.029

Self-Expression .241 .248

Interpersonal .212 .272

Decision Making .071 .106

Stress Management .078 .036

Note. Results are statistically significant where *= p<.05 and **= p<.01.
No asterisk means the results are not statistically significant.

As a result, the lack of significant correlation indicates that there is no relationship

between EI Composite scores and Overall Success, as measured in the study.

 73
C2. What is the correlation between Overall Entrepreneurial Success and each respective
EI Subscale score?

Table 7

Correlational Relationship Between Overall Success and EI Subscales

EI Subscale rs r

Self-Regard -0.037 -0.127

Self-Actualization 0.08 0.096

Emotional Self-Awareness -0.069 -0.021

Emotional Expression 0.27 0.215

Assertiveness 0.017 0.059

Independence 0.163 0.221

Interpersonal Relationships 0.18 0.153

Empathy 0.334 .401*

Social Responsibility -0.136 -0.128

Problem Solving 0.191 0.19

Reality Testing 0.119 0.041

Impulse Control 0.008 0.008

Flexibility 0.045 0.013

Stress Tolerance -0.007 0.016

Optimism 0.041 0.064

Note. * = p<.05, ** = p<.01, *** = p<.001

 74
Unfortunately, the results for C2 similarly indicate a weak correlation between

overall success and each respective EI Subscale score. As in C1, I used Pearson as the

sensitivity test, which produced the values indicated in the 2nd column of Table 7. The

scores were not dramatically different when comparing Pearson and Spearman, but it is

important to note that the Pearson test found Empathy was considered statistically

significant where p<.05. Using Spearman, Empathy was also the largest correlation

value, although not indicated as statistically significant. Exploratory data analysis on the

respective Subscales indicates that some inverse expectations, e.g., some entrepreneurs

ranked more successful had some EI scores that were relatively lower than their less

successful colleagues. For example, Interpersonal Relationships, Assertiveness, and

Reality Testing are each lower in more successful entrepreneurs with the expectation was

that those scores with lower in less successful entrepreneurs – see scatterplot in Figure 9.

Figure 9. Scatterplot showing correlation between Overall Success and Overall EI

Scores
 75
C3. What is the correlation between each respective factor of entrepreneurial success
(Partnerships, Competitors & Employees) and an entrepreneur’s Overall EI score?

Partnerships

Using Spearman rho (rs) to determine any correlation between the Partnerships

success criteria and the Overall EI Score, the rank correlation value was rs=0.064, with

p=0.733. This result indicates that the correlation between the two variables is positive,

very weak, and not statistically significant, which prompted me to conduct additional

exploratory data analysis and sensitivity tests to ensure the accuracy of the results, using

Pearson see if a dramatically different result was produced. The Pearson correlation was

r=0.043, which is not dramatically different from the rs=0.064 finding.

Competitors

Similar to Partnerships, the Competitors success criteria was positive and not

statistically significant, but it was less weak than both the Partnerships and Employees

criteria. Using Spearman, the rank correlation value was rs=0.316, with p=0.084. I again

used Pearson to see if a dramatically different result was produced, but the Pearson

correlation was r=0.276, which is not dramatically different from the rs=0.316 finding.

Employees

The Employees success criteria produced results very similar to the Partnerships

criteria, with Spearman rs=0.026, and p=0.888, reflecting a positive, very weak, and not

statistically significant correlation. Sensitivity testing with Pearson produced r=0.032,

which is not dramatically different from the rs=0.026 finding.

In light of these Success factors not being significantly correlated with Overall EI

Scores, a possible explanation is that entrepreneurs do not proactively seek external

business partnerships to facilitate customer acquisition and instead rely on direct business
 76
to consumer relationships, internal sales teams, or the personal network of the

entrepreneur. Similarly, an entrepreneur may not participate in business plan

competitions, or proactively market their products and services in industry trade journals

or databases, instead relying upon the quality of the product to speak for itself, or

intentionally trying to “stay under the radar” and quietly gain market share before

potential competitors can change their strategy to combat the entrepreneur.

Although hiring employees can be associated with increased revenues and profit

margins as companies grow, the participants are startups, some with minimal revenue and

some generating millions of dollars annually. It is possible that some entrepreneurs with

very high emotional intelligence are simply too early stage in their respective industry

vertical to warrant hiring employees. Another possible occurrence is that the

entrepreneur has multiple professional skill sets, e.g., a licensed attorney and accountant,

which reduces the need to hire at least two professionals with those skill sets and the

pursuit of increased profit and payroll hassles.

Because the correlations are so small, I believe it is reasonable to conclude that

even with larger samples of participants, the results would not necessarily change.
 77
C4. What is the correlation between each respective factor of entrepreneurial success and
each respective EI Subscale score?

Table 8

Correlational Relationship Between Partnerships Success Factor and EI Subscales

EI Subscale rs r

Self-Regard -0.241 -0.265

Self-Actualization 0.059 0.069

Emotional Self-Awareness -0.232 -0.176

Emotional Expression 0.157 0.057

Assertiveness -0.138 -0.062

Independence 0.123 0.188

Interpersonal Relationships -0.005 0.023

Empathy 0.33 .414*

Social Responsibility -0.069 -0.075

Problem Solving 0.163 0.135

Reality Testing -0.025 -0.125

Impulse Control 0.089 0.061

Flexibility -0.148 -0.13

Stress Tolerance 0.034 0.054

Optimism 0.02 0.088

Note. * = p<.05, ** = p<.01, *** = p<.001

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Table 9

Correlational Relationship Between Competitors Success Factor and EI Subscales

EI Subscale rs r

Self-Regard 0.182 0.141

Self-Actualization 0.178 0.166

Emotional Self-Awareness 0.08 0.148

Emotional Expression 0.338 0.342

Assertiveness 0.128 0.157

Independence 0.149 0.167

Interpersonal Relationships 0.203 0.179

Empathy .364* 0.354

Social Responsibility -0.165 -0.178

Problem Solving 0.266 0.249

Reality Testing 0.176 0.125

Impulse Control 0.051 0.05

Flexibility 0.16 0.148

Stress Tolerance 0.109 0.067

Optimism 0.196 0.132

Note. * = p<.05, ** = p<.01, *** = p<.001

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Table 10

Correlational Relationship Between Employees Success Factor and EI Subscales

EI Subscale rs r

Self-Regard -0.193 -0.241

Self-Actualization -0.011 -0.001

Emotional Self-Awareness -0.152 -0.068

Emotional Expression 0.125 0.105

Assertiveness -0.027 0.021

Independence 0.167 0.201

Interpersonal Relationships 0.17 0.156

Empathy 0.253 0.253

Social Responsibility -0.03 -0.056

Problem Solving 0.087 0.082

Reality Testing 0.095 0.062

Impulse Control -0.057 -0.08

Flexibility -0.027 -0.023

Stress Tolerance -0.102 -0.074

Optimism -0.094 -0.056

Note. No correlations were statistically significant.

 80

Figure 10. Scatterplots showing each success factor’s correlation with Subscale EI Scores
 81
The results illustrated in Tables 8-10 and Figure 10, are similar to the results from

C2, examining the correlation between Overall Entrepreneurial Success and each

respective EI Subscale score, in that Empathy is the only Subscale indicated as

statistically significant, and this holds true for 2 of the 3 success factors (Partnerships and

Competitors). Aside from Empathy, however, there is a weak correlation between the

respective subscales and respective factors of success, and the correlations coefficients

for Spearman and Pearson are not dramatically different, which indicates that the results

are accurate. Next, I will evaluate Regression analysis to determine if any predictions

can be made using the Success and EI variables, but because the magnitude of the

correlations, except for Empathy, reflect small and not statistically significant results,

there is no relationship in terms of correlations, and the expectation is that the probability

of a predictive relationship will also be small.

Predicting Entrepreneurial Success Using Emotional Intelligence:

P1. What is the predictive relationship between Overall Entrepreneurial Success and an
entrepreneur’s Overall EI score?

Due to the ordinal nature of the dependent variable (Overall Success), Ordinal

Regression analysis (Ordinal) was applied to the variables to determine the predictive

value, if any, and to determine sensitivity of the testing, Ordinary Least Squares

Regression (OLS) analysis was also applied (see Table 11).

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Table 11

Regression Relationship Between Overall Success and Overall EI Scores

Predictor B p Exp(B)

Overall EI score 0.025 0.370 8.631

The results reflect minimal variation in Overall Success explained by the Overall

EI Scores, and the magnitude of the regression coefficient is positive, small and not

statistically significant. Specifically, I find that for every one (1) point increase in the

Overall EI score, there is a 0.025 increase in the 3-point Overall Success scale, which is a

positive relationship, albeit very weak, and it is also consistent with the scatterplot

provided in Figure 8. Also, the p-value for the slope coefficient of the independent

variable is 0.370, which is greater than the standard alpha of .05, suggesting the

probability of finding the linear relationship between Overall EI scores and Overall

Success by chance, assuming there is not, in fact, a relationship, is approximately 4 in 10.

These results do not indicate that increases in an entrepreneur’s Overall EI Score would

generate perceptible increases in Overall Success, but however small the increase, the

exponentiated coefficients ((Exp(B)) value of 8.631, which represents the odds of an

entrepreneur moving to a higher category of success for a 1-point increase in their

Overall EI score, while controlling for other variables in the study, is a promising finding.

That 8.6 value indicates that the odds of achieving a higher success level by finding a

way to increase Overall EI scores by 1-unit, is 8.6 times larger than doing nothing at all.
 83
This is an important finding because it indicates that, albeit small, improving EI scores

can positively increase entrepreneurial success, as defined in this study.

To check the sensitivity of the ordinal regression analysis, I conducted analysis

using the Ordinary Least Squares Regression as an alternative method. In estimating the

same relationship using OLS regression, I found that for every one (1) point increase in

the Overall EI score, there is a 0.014 (B) increase in the 3-point Overall Success scale,

which is a positive relationship, albeit very weak – consistent with the scatterplot

provided in Figure 8. The p-value for the slope coefficient of the independent variable is

0.420 (p), which is greater than the standard alpha of .05, suggesting the odds of finding

the linear relationship between Overall EI scores and Overall Success by chance,

assuming there is not, in fact, a relationship, is 4 in 10. In other words, the results for

ordinary least squares regression are not dramatically different from the results of the

ordinal regression analysis, so I cannot reject the null hypothesis that there is no

relationship between the two variables and cannot accept the alternative hypothesis that

there is a significant relationship between Overall EI scores and Overall Success. In

practical terms, however, increasing Overall EI Scores do not tend to increase perceptibly

the level of Overall Success.

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P2. What is the predictive relationship between Overall Entrepreneurial Success and each
respective EI Subscale score?

Table 12

Regression Relationship Between Overall Success and EI Subscales

Predictor B p Exp(B)

Self-Regard -0.076 0.071 0.361

Self-Actualization 0.053 0.507 0.327

Emotional Self-Awareness -0.011 0.799 0.452

Emotional Expression 0.019 0.673 1.98

Assertiveness 0.011 0.790 1.445

Independence -0.018 0.796 1.368

Interpersonal Relationships 0.052 0.178 12.261

Empathy 0.078 0.097 23.805

Social Responsibility -0.099 0.189 6.003

Problem Solving 0.055 0.413 0.456

Reality Testing -0.006 0.905 0.37

Impulse Control 0.008 0.877 0.221

Flexibility 0.010 0.853 3.665

Stress Tolerance -0.032 0.573 2.741

Optimism -0.011 0.794 2.23

The ordinal regression in Table 12 breaks down the Overall EI Score into its

component Subscale scores, and “Self-Regard” (p=0.071) appears closest to being

 85
statistically significant at p<0.05, but none of the Ordinal results are statistically

significant. The magnitude of the Ordinal regression coefficients ranged from p=0.071

(Self-Regard) to p =0.905 (Reality Testing), but the results, do not reflect the predictive

nature on the respective EI Subscale competencies, so I conducted an OLS analysis to

test the sensitivity of the ordinal regression analysis. Estimating the same relationship

using OLS regression produces similar coefficients and p-values (e.g., not dramatically

different), so I did not find a substantial difference that changes the outcome.

EI Subscales

Figure 11. Scatterplot showing EI Subscale odds of moving to higher category of

success
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The graph in Figure 11, however, illustrates exponentiated coefficients (Exp(B))

from the ordinal regression that builds upon the finding from Table 11 that improving

Overall EI scores can lead to increases in Overall Success scores. What I found most

interesting in this illustration is that Empathy, the value that was shown to be significant

in the Correlational calculations in Tables 8 and 9, has the best odds of moving to a

higher category of success for a 1-point increase in the Empathy score. Specifically,

referring to the 3rd column in Table 12, the odds of increasing Overall Success scores by

increasing your Empathy score by 1-unit is 23.8 times larger than not increasing the

Empathy score. Other “good” odds of increasing Overall Success scores were indicated

by Interpersonal Relationships (12.3 times larger), Social Responsibility (6 times larger),

Flexibility (3.7 times larger), and Stress Tolerance (2.7 times larger). These findings are

consistent with my initial hypothesis that entrepreneurs must have Empathy and excellent

Interpersonal skills (e.g., facilitates attracting and keeping customers) (Hypothesis 2).

P3. What is the predictive relationship between each respective factor of entrepreneurial
success (Partnerships, Competitors & Employees) and an entrepreneur’s Overall EI
score?

Because regression analysis using SPSS is best accomplished using a single

dependent variable, separate regression analysis will be conducted for each of the

following success factors, listed in order - Partnerships, Competitors and Employees.

Table 13

Regression Relationship Between Partnerships Success Factor and Overall EI Scores

Predictor B p

Overall EI Score 0.009 0.811

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The ordinal regression analysis reveals that there is no statistically significant

relationship between the Overall EI score and the Partnerships success factor. These

results are somewhat surprising because if this result holds true for the sensitivity test

(i.e., OLS), then it may explain why the EI scores do not show correlative or predictive

value in the context of Overall Success scores. In other words, because Partnerships are

1/3 of what constitutes the Overall Success score, then its lack of correlative or predictive

value significantly reduces the likelihood of the Overall Success score having

significance. To test the sensitivity of these results, I have conducted OLS analysis, and

in estimating the same relationship using OLS regression, I produced similar coefficients

and p-values, so the ordinal regression results appear to be accurate.

Table 14

Regression Relationship Between Competitors Success Factor and Overall EI Scores

Predictor B p

Overall EI Score 0.048 0.139

The results in Table 14 reflect the Ordinal analysis of the Competitors success

factor compared with the Overall EI Score. In contrast with the Partnerships success

factor, there appears to be a substantially greater relationship between Overall EI scores

and the Competitors success factor, although still not statistically significant. Before

attempting to interpret these results, I conducted OLS analysis to test the sensitivity of the

Ordinal results, and similar to prior results, in estimating the same relationship using OLS
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regression, produced similar coefficients and p-values, which led me to believe that the

results are accurate, and there is no statistical significance.

Table 15

Regression Relationship Between Employees Success Factor and Overall EI Scores

Predictor B p

Overall EI Score 0.005 0.858

The ordinal regression analysis results for the Employees success factor reflected

in Table 15 are similar to the results for the Partnerships success factor, but to test the

sensitivity of these results, I conducted OLS analysis and results indicate that the Ordinal

analysis was accurate with OLS B=0.001 and OLS p=0.864. Possible reasons for this

relatively non-predictive result are that additional revenue to hire employees may come

from investment capital for business loans, both of which can be accomplished without

integrating more than a few emotional intelligence attributes, or another reason may be

that the employees are working in exchange for equity stock in the company, instead of

cash compensation, which can be achieved in companies that have yet to earn any

revenue in something that is not uncommon in startup businesses. Evaluation of the

respective EI Subscale scores should clarify the reasons behind these results, and that

analysis is provided in the next section.

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P4. What is the predictive relationship between each respective factor of entrepreneurial
success (Partnerships, Competitors & Employees) and each respective EI Subscale score?

The analysis begins with ordinal regression analysis in Table 16.

Table 16

Regression Relationship Between Partnerships Success Factor and EI Subscales

Predictor B p

Self-Regard -0.968 1.000

Self-Actualization 2.628 1.000

Emotional Self-Awareness -1.363 1.000

Emotional Expression -0.238 1.000

Assertiveness 0.251 1.000

Independence -0.925 1.000

Interpersonal Relationships 0.525 1.000

Empathy 2.148 1.000

Social Responsibility -2.764 1.000

Problem Solving -0.057 1.000

Reality Testing -1.052 1.000

Impulse Control 1.589 1.000

Flexibility -1.415 1.000

Stress Tolerance 0.151 1.000

Optimism 0.125 1.000

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The Ordinal results are somewhat surprising because statistical significance is

1.000 (p=1). Because the p-value reflects the probability of observing an effect that is as

large, or larger, if the null hypothesis were true, than this result indicates that all other

possible outcomes would indicate a larger observed effect, which seems highly unlikely.

To test the sensitivity of the Ordinal analysis, the OLS results were dramatically different

from the Ordinal analysis and appeared more consistent with prior regression analysis in

that Self-Regard (B=-0.017, p=0.021), Empathy (B=0.011, p=0.128), Impulse Control

(B=0.010, p=0.208), and Self-Actualization (B=0.014, p=0.209), have relatively similar

regression coefficients with prior results. In either event, however, there are still no

statistically significant predictive qualities in the results that change the outcome. Next,

we will take a look at the results for the Competitors success factor.
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Table 17

Regression Relationship Between Competitors Success Factor and EI Subscales

Predictor B p

Self-Regard -0.030 0.655

Self-Actualization 0.275 0.131

Emotional Self-Awareness 0.053 0.502

Emotional Expression 0.035 0.622

Assertiveness -0.022 0.749

Independence -0.170 0.226

Interpersonal Relationships 0.133 0.088

Empathy 0.202 0.082

Social Responsibility -0.366 0.043

Problem Solving 0.157 0.210

Reality Testing -0.039 0.626

Impulse Control 0.133 0.159

Flexibility 0.205 0.143

Stress Tolerance -0.186 0.183

Optimism -0.146 0.167

These results are somewhat consistent with prior results, e.g. Empathy, Social

Responsibility, and Interpersonal Relationships, are closest to being statistically

significant. Self-Regard, however, is relatively far from being statistically significant in

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comparison with the other results, which may be because being listed as the competitor of

another company can be out of the control of the entrepreneur. For example, being

identified by industry standard codes attached to a business can be sufficient for an

industry reporter to acquire anonymously a sample of the product or service to make an

industry comparison and report the results, listing the entrepreneur as a competitor or

other similar services. The more often a company is listed by different sources as a

competitor, however, the more it serves as a form of marketing that can lead to more

customers choosing the entrepreneur’s product, thus increasing market share. How the

entrepreneur views their individual qualities may not play a factor at all in being listed as

a competitor or someone else. To test the sensitivity of the results, I also conducted OLS

analysis, and those results are consistent with the Ordinal analysis, e.g., several EI

Subscale scores reflect the same proximity to be being significant as in the Ordinal

analysis, which gave me confidence that the results were accurate. Still, none of the

Subscale scores were statistically significant in being predictive in the context of

Competitors for another business, which means that the relationships observed are

primarily due to chance, so I will now turn to the Employees success factor to determine

any predictive value for that attribute of Overall Success.

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Table 18

Regression Relationship Between Employees Success Factor and EI Subscales

Predictor B p

Self-Regard -0.111 0.055

Self-Actualization -0.028 0.792

Emotional Self-Awareness -0.036 0.567

Emotional Expression 0.019 0.743

Assertiveness 0.045 0.471

Independence -0.011 0.897

Interpersonal Relationships 0.067 0.205

Empathy 0.065 0.291

Social Responsibility -0.062 0.537

Problem Solving 0.093 0.363

Reality Testing 0.043 0.539

Impulse Control -0.047 0.524

Flexibility 0.020 0.785

Stress Tolerance -0.056 0.488

Optimism -0.010 0.864

The results from the ordinal regression analysis are not statistically significant,

but they do reflect some trends that would be expected in efforts to hire new employees.
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For example, Problem Solving, Interpersonal Relationships, and Stress Tolerance are

attributes that can serve an entrepreneur well in dealing with the process of identifying an

operational need, attracting potential employees, then being able to establish a rapport to

convince the prospective buyer that the entrepreneur would be a good manager. To test

the sensitivity of these results, I conducted OLS analysis, and in estimating the same

relationship using OLS regression, I produced similar coefficients and p-values, which

were not dramatically different from the ordinal regression analysis, so I am reasonably

confident that the results are accurate.

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CHAPTER 5: ANALYSIS

Trends in the Descriptive Analysis

The entrepreneurs that participated in this study were from 31 separate companies

from across the United States, Western Europe, Asia, and Africa, randomly selected from

a prequalified pool of 199. The 199 prequalified potential participants were distilled from

an original pool of 976 entrepreneurs that have sought university-affiliated

entrepreneurial support or guidance between 2012-2016. The distillation process simply

involved selecting entrepreneurs were registered in the database before 2014 and

verifying current operation of a state-registered company in the same role, which ensured

meeting the entrepreneur criteria of working full-time in an entrepreneurial venture with

at least a two-year track record. The ages of the entrepreneurs ranged from 24 to 66, and

approximately 2/3 (67.7%) of the entrepreneurs were male, and 1/3 were female (32.3%),

with the majority of entrepreneurs between the ages of 35 and 56 (61.4%). Each of the

entrepreneurs expressly noted their interest in participating in the study as being founded

on one or more of three factors: 1) a desire for self-discovery, 2) an opportunity to obtain

their EI profile from a university affiliated-study that could help them improve both

personally and professionally; and 3) an understanding from their independent research

that emotional intelligence may play a role in executive functioning. The demographics

reflect a middle-aged, male majority of respondents to my invitation to participate in the

survey, but no other demographic data was collected due to privacy concerns, and to

ensure conformity to the parameters of the EQi2.0 assessment format. As a result, any

interpretation of gender or age-based motivations to participate in the study would be

speculative.
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According to Bar-On (2011), the expectation from 4,000 previous

implementations of the EQi2.0 is that entrepreneurs in this study should exhibit a Mean

(average value of the distribution) standardized score of 100 ((M = 100.2 to 103.5), and

that mean should have a Standard Deviation (the extent to which values deviate from the

Mean) of 15 (SD = 13.7 to 16.3). Also, there are expectations about the shape of the

distribution of scores around the Mean when graphically illustrated, where the Skewness

values (the extent to which a distribution of values deviates from symmetry around the

Mean) range from -0.95 to -0.34, and Kurtosis values (a measure of the "peakedness" or

"flatness" of a distribution) range from -0.15 to 1.11 (Bar-On, 2011).

The analysis in Chapter IV reflects that the Mean (99.81) and Standard Deviation

(12.5) of the overall EI scores for the subject population are consistent with and very

close to, the expected values presented by Bar-On (2011), which indicates that the

Overall EI scores accurately reflect the expected emotional intelligence of the

entrepreneurs. Also, although the Skewness (-0.080) was slightly higher than expected,

and Kurtosis (-0.302) was slightly lower than expected, the difference is negligible, and

these values are consistent with expectations, indicating that the descriptive results are

valid and reliable.

Concerning the respective EI Subscale scores, however, there was some

divergence from the expected Mean of 100 per Subscale, with the lowest Mean score of

96 (Assertiveness) and the highest Mean score of 107.71 (Social Responsibility).

Similarly, the expected Standard Deviation of 15 had some divergence with the smallest

value being 10.007 (Social Responsibility) and the largest value being 20.658 (Optimism).

Given that the overall EI scores were very close to expectations, and the EQi2.0 reports
 97
did not flag any submission as having invalid entries (e.g., uncharacteristically high or

low self-assessments), it is reasonable to conclude that the lower than expected Means for

Assertiveness indicate that entrepreneurs may be less assertive, e.g., have more difficulty

communicating feelings, beliefs and thoughts openly, or defending personal rights and

values in a socially acceptable, non-offensive, and non-destructive manner. Also,

entrepreneurs may be slightly more inclined toward Social Responsibility, e.g., willing to

contribute to society, to one’s social groups, and generally to the welfare of others. All

other Subscale scores were within two (2) points of the expected Standard Deviation

range of 13.7 to 16.3.

There was one significant anomaly to note in the respective Subscale scores, and

that is the Optimism score, which had the largest standard deviation (20.658). Further

evaluation of that Subscale revealed that it had the lowest minimum score of 50 and the

greatest range of values (73) reported by the entrepreneurs, which supports my assertion

in Chapter IV that the wide variation may be due to a single outlier. Due to privacy

concerns, however, identification and follow-up conversation with the entrepreneur that

submitted the low Optimism score was not pursued, but viable reasons for low Optimism

can range from simply having a bad day when the assessment was taken to wrestling with

a decision to accept a high-paying job, or internal company disputes with a cofounder.

Concerning Skewness and Kurtosis of the respective EI Subscale scores, all

values were within an acceptable range for psychometric purpose and were thus valid and

reliable, but there were three (3) Skewness scores that were somewhat inconsistent with

expectations, in that they were all positive (Self-Regard (0.069), Reality Testing (0.595),

and Impulse Control (0.253)). Whereas the expectation is that there should be more,
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larger values closest to the Mean than smaller values, the three (3) inconsistent values

reflect that there are more, smaller values closest to the Mean than larger values. In other

words, for those three Subscale scores, there were more scores reported below the Mean

than above the Mean.

Kurtosis for the Subscale scores also presented an anomaly in that only three of

the 15 values were in the expected range of -0.15 to 1.11 (Emotional Expression (0.279),

Empathy (0.549, Optimism (0.059)) and most values were in the exceedingly negative

range, which indicates a flatter bell-shaped distribution than would normally be expected.

In other words, the difference between individually reported scores is farther apart, which

flattens the bell-shaped curve and indicates greater divergence within the range of scores

for that Subscale.

In aggregate, the descriptive statistics reflect “qualified” entrepreneurs, as defined

in this study (e.g., not simply having a hobby or being a full-time employee of someone

else), and that the Overall EI scores and respective EI Subscale scores are consistent with

extensively validated expectations considered valid and reliable for psychometric

purposes. Specifically, there was no evidence that the distribution of the respective

Subscales departed from normality or exhibited restrictions of range (e.g., indicated by

very small standard deviations) that preclude me from transitioning from the descriptive

analysis to the inferential analysis.

Trends in Spearman Correlation Analysis

There are three categories of variables in this study: 1) the entrepreneur, 2) the

emotional intelligence competencies, and 3) the composite success factors. Because the

entrepreneurs were independently verified as being entrepreneurs, as defined in this

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study, and statistical analysis revealed the reported independent variables in this study (EI

scores) are valid and reliable, it would be logical to assume that if my hypothesis holds

true, there should be a statistically significant correlation between Overall EI scores and

at least one of the three success factors, if not all three. I have evaluated the results in

detail in Chapter IV and will summarize below, but essentially, no statistically significant

correlation was found between any of the Success factors respectively, or collectively,

and Overall EI scores. Also, only one of the 15 Subscale scores (Empathy) was shown to

be statistically significant in any of the correlation calculations using SPSS statistical

software while applying Spearman rho (due to the ordinal success factors) or Pearson (to

test how sensitive the results were to using one type of correlation coefficient versus the

other).

Specifically, regarding the correlation between an entrepreneur’s Overall EI

score and Overall Entrepreneurial Success, the correlation was positive, but weak, and

not statistically significant using both Spearman (B=0.176, p=0.344) and Pearson

(B=0.150, p=0.420). As a result of the non-significant finding, I mapped the scores on a

scatter plot in Figure 8 to determine if there were any visible trends. The graph revealed

that a few entrepreneurs with relatively high EI scores were not as successful as other

entrepreneurs with relatively low EI scores. The graph reveals an inconsistency with my

hypothesis that as EI scores increase, overall success also increases. The graph does

reflect, however, that the concentration of Overall EI Scores slightly increases as an

entrepreneur incrementally attains additional Success factors. I have concluded that the

Spearman correlation was accurate, and possible reasons for the lack of statistical

significance between the Overall EI and Overall Success could be due to the varied
 100
lengths of time the entrepreneur has been in business (e.g., more experience can

accelerate growth), varied strengths of business partnerships (e.g., having an

international, S&P 500 partner can generate faster growth than having a local, non-profit

as a partner), or the reason could be more subjective, such as the entrepreneur’s industry

niche may be adversely affected by the economy, or the entrepreneur is more focused on

social impact than profits, or the entrepreneur may have a high overall score, but is

deficient in a key Subscale competency.

An alternative reason reflecting a key challenge of this study was the difficulty in

obtaining financial information on the entrepreneurs. As a result, it is possible that one or

more of the three designated success factors does not accurately represent a valid success

factor. For example, a traditional way to determine if an entrepreneur has increased

revenue annually is to examine their federal and state tax returns, documents filed

directly with government authorities and more likely to be an accurate reflection of

revenue, but requires authorization of the entrepreneur to obtain and thus, was not

practical under the parameters of this study. The alternative method chosen to

approximate an increase in revenue was a non-intrusive, independently verifiable

determination of employees hired since 2014. The rationale being that as companies grow

with increasing revenue, they tend to hire additional employees to keep pace with

demand. That measure, however, may be inaccurate in instances where the entrepreneur

obtains a loan to hire employees, or attracts investors (which does not increase revenue),

or the entrepreneur already possesses multiple skill sets that replace the need to hire

traditional, key positions, e.g., the entrepreneur is an expert software engineer as well as a
 101
licensed attorney. This alternative reason reflects an instance where the success factor is

not an accurate measure of success.

A third possible reason could be that the three success factors are insufficient,

respectively or collectively, to fully represent a correlative effect, e.g., designated success

factors may collectively represent only a fraction of what is required to achieve a

significant correlation result. For example, in addition to the three success factors

identified, five additional, relevant success factors may also need to be identified to be

considered an “entrepreneurial success.” The bottom line, however, is that the Overall EI

score in this study cannot be relied upon as the sole factor in predicting entrepreneurial

success and that, at a minimum, either additional success factors must be considered, or

different success factors must be identified. Applying Spearman and Pearson in the

evaluation of the Subscale scores with each respective success factor, the results were

consistent with the other results with only Empathy reflected as being significant (for

Partnerships using Pearson and for Competitors using Spearman).

When comparing the Overall EI score with each of the respective success factors

using Spearman and Pearson, it became clearer why the Overall Success score did not

show significant correlation. The results indicate a positive, weak, and non-significant

correlation between the Overall EI Score and each respective Success factor. The

“Competitors” factor reflects evidence of the entrepreneur acquiring increased market

share, either by increased mentions in social media and news outlets as a competitor with

other companies, or participation in business plan competitions, where the entrepreneur

was identified as a semifinalist or finalist. The “Partnerships” factor is designed to reflect

a relative increase in sales growth over prior years evidenced by the public announcement
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of business partnerships designed to facilitate customer acquisition and increase

distribution channels. The “Employees” factor is designed to reflect evidence of

increased revenue through the hiring of additional employees to support business

operations.

The results indicate that hiring additional employees does not significantly

correlate with a business being more successful, nor does being mentioned as the

competitor of another business, or arranging collaborative business partnerships. Another

circumstance that may explain the lack of significance of the success factors is that some

entrepreneurs may be too early-stage to have revenue, employees, or sufficient industry

traction to attract business partners. Although in existence for at least two years, some

businesses naturally grow slower than others, or the entrepreneur has a different level of

personal incentive to drive their business in a growth direction, or despite the best efforts

of the entrepreneur and cofounders the industry niche is slower paced. In mapping the

Subscale scores with each success factor using scatterplot in Figure 10, however, I did

find that descriptively (not inferentially), the “unsuccessful” entrepreneur appears to have

average Subscale scores that vary widely from high to low, but the closer the scores are

to normal EI (Mean=100), the more likely EI scores are influencing the result, as

reflected by the concentration of data points. From that context, the results may indicate

that being recognized as competition for another company may be more likely the result

of EI than being in a position to hire more employees. To validate the correlation results

and determine if there were any predictive attributes present, I performed analysis using

Ordinal Regression and tested sensitivity using Ordinary Least Squares Regression.
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Trends in Ordinal Regression Analysis

Due to the ordinal characteristics of the success factors, Ordinal Regression was

used in evaluating the predictive attributes of the emotional intelligence scores, and to

test sensitivity, the Ordinary Least Squares Regression (OLS) analysis was applied to the

same variables. The results confirmed the findings in the correlational analysis that there

was minimal variation in Overall Success explained by the Overall EI Scores, and the

magnitude of the regression coefficient was positive, small and not statistically

significant. Specifically, I found that for every one (1) point increase in the Overall EI

score, there was only an imperceptible 0.025 increase in the 3-point Overall Success

scale, which is a positive relationship, albeit extremely weak. Also, the p-value for the

slope coefficient of the independent variable is 0.370, which is much greater than the

standard alpha of .05, suggesting the odds of finding the linear relationship between

Overall EI scores and Overall Success by chance, assuming there is not, in fact, a

relationship, is approximately 4 in 10. Consistent with the correlational findings, these

results do not indicate that increases in an entrepreneur’s Overall EI Score would

generate perceptible increases in Overall Success.

These results were corroborated using OLS regression analysis which found that

for every one (1) point increase in the 3-point Overall Success scale, there is a 0.014

increase in the Overall EI score. The p-value for the slope coefficient of the independent

variable is 0.420, which was approximately the same as the ordinal regression. In other

words, the results for OLS are not dramatically different from the results of the ordinal

regression analysis, so I cannot reject the null hypothesis that there is no relationship

between the two variables and cannot accept the alternative hypothesis that there is a
 104
significant relationship between Overall EI scores and Overall Success. In practical

terms, it means that any increase in the overall EI score of an entrepreneur with no

success factors would be imperceptible when compared to an entrepreneur with all three

success factors.

It is interesting to note, however, that the results for Overall Success reflect p-

values that seem to decrease as more success factors are added to the equation, which

means that having only one success factor is less of relationship than having two factors.

For example, because Partnerships are 1/3 of what constitutes the Overall Success score,

then the resulting lack of correlative value substantially diminishes the likelihood of the

Overall Success score having significance. In other words, these results indicate that the

more factors that can be identified in future studies, the more likely I will be able to

determine if a relationship exists between Overall EI Scores and Overall Success. As a

result, it appears as though the reason for the lack of correlation is not due to the success

factors being inappropriate or irrelevant, the reason appears to be the absence of more

relevant, additional success factors to enable a clearer distinction as to how "success” is

defined.

To confirm that I have reached the appropriate conclusion, I conducted ordinal

regression using the respective Subscale scores compared with overall success, which

again revealed that no Subscale score was statistically significant. The magnitude of the

regression coefficients ranged from p=0.069 (Self-Regard) to p=0.960 (Reality Testing),

and provided some support for my hypothesis (Hypothesis 2), with higher coefficients

than the other Subscales, that Empathy, Interpersonal Relationships, and Problem

Solving, are relevant attributes for entrepreneurs. OLS analysis was not dramatically
 105
different from the ordinal regression, indicating that the results were accurate. Additional

ordinal regression and OLS analysis was performed on each respective success factor

with the overall EI score, which corroborated the correlational analysis and revealed a

substantially higher correlation between Overall EI scores and the Competitors success

factor, although still not statistically significant. Without extensive follow-up with the

entrepreneurs to determine exactly what they have done to be “competitive” and increase

their market share, however, I cannot identify what caused the Competitors success factor

to be more prominent, but a possible reason is that being recognized as “competitive”

may integrate more social and emotional attributes through which an entrepreneur enters

into a business partnership. For example, a large corporation with an extensive client base

and distribution channels may choose to partner with a startup company it plans to

acquire in the future. Such a relationship can also occur without any direct interaction

between the entrepreneur and the potential business partner, e.g., it could be based

entirely on financial incentives inherent in the arrangement.

There was a surprising anomaly in the ordinal regression results that is reflected

in Table 16, where each respective EI Subscale had the same p-value of 1.000. After

running the calculation three, separate times to determine if there was a data entry error, I

took a closer look at the raw data and discovered something unique. Although

unintentional, in every instance where at least one (1) Success factor is present in an

entrepreneur’s profile, the entrepreneur has arranged at least one collaborative business

partnerships. In other words, the only times that the Partnerships criteria would not be

reflected in the Overall Success score is when the Overall Success score is zero. Any

Overall Success score equal to, or greater than, one will include the Partnerships success
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criteria. Given the ordinal nature of the calculations by category, then the results do seem

reasonable, but it means that the usual assumptions used for the Ordinal approach do not

apply to that specific variable in isolation because there is no “success” without

Partnerships – a key data constraint. Because there are many businesses that operate

without collaborative business partnerships, this is also an indication that the sample size

may be too small, or that the data sources providing the names of entrepreneurs should be

expanded to other diverse sources.

I also ran OLS, which produced results dramatically different from the ordinal

regression analysis and appeared more consistent with prior correlations and regression

analysis. Using either form of regression analysis still resulted in a non-significant

correlated and predictive output, but in addition to the regression analysis indicating that

additional, relevant success factors should be identified to more accurately define

“success,” the results also reflect some trends that would be expected in efforts to hire

new employees or manage business operations in general. For example, Problem Solving,

Interpersonal Relationships, and Stress Tolerance are attributes that facilitate identifying

operational needs (Problem Solving) and establishing rapport with customers

(Interpersonal Relationships).

Having concluded that Overall EI scores are insufficient to determine a significant

relationship with emotional intelligence, I ran correlation analysis using Spearman and

Pearson with each respective EI Subscale score. Out of the 15 respective Subscales, none

were statistically significant, but the sensitivity test using the Pearson correlation revealed

a statistically significant result for Empathy (p<.05). The scores were not dramatically

different between Spearman and Pearson, which indicated that the lack of significance of
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the 14 other Subscales was accurate. The results for Empathy were consistent with my

original hypothesis (Hypothesis 2), and the results from the exponentiated coefficients

((Exp(B)) analysis provided positive reinforcement that Empathy is the strongest driver

((Exp(B)=23.805). Most important, six of the 15 EI Subscales were more than two times

more likely to increase Overall Success scores – almost half of all Subscale

competencies. Although the correlational and predictive values were not statistically

significant, the sensitivity testing corroborates that EI Subscale scores did have

substantial meaning in the context of increasing Overall Success scores and merits further

study. Specifically, it appears as though the extent to which any of the EI Subscales

could be significant was mitigated by limitations of the Success factors, which should be

the primary focus future research in this area.

Hypothesis Testing

To place this discussion into context and summarize the results, this study

addresses two hypotheses:

1. Hypothesis #1 - EI competencies can predict how successful an entrepreneur will be.

2. Hypothesis #2 - Empathy, Interpersonal Relationships, and Problem Solving, are

particularly relevant attributes for entrepreneurs as key competencies because they reflect

how attuned a person is to the various emotional signals displayed by others - both verbal

and non-verbal, which can make it easier for empathetic leaders to demonstrate the

patience to listen attentively and understand the perspective of others, demonstrate the

social skills to build a rapport based on that understanding, and devise strategies to

address the problems revealed by their understanding, even if they do not share the same

perspective.
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Regarding Hypothesis #1 – Aside from Empathy, which was statistically

significant, the results for the other 14 Subscales, and the Overall EI score did not predict

success, as defined and measured in this study. It is likely that additional, relevant

success factors must be identified to define accurately the objective measure of

“Success,” before predictive results can be obtained. Regarding Hypothesis #2 – My

initial hypothesis was that entrepreneurs must have Empathy, excellent Problem Solving

skills (e.g., leads to innovation), excellent Interpersonal skills (e.g., facilitates attracting

and keeping customers). The results of the correlational analysis did not confirm those

three factors and also suggested an expansion of my initial hypothesis to include two (2)

other the attributes: 1) a desire to be Independent (e.g., facilitates being innovative and

willing to challenge the status quo), and 2) having Reality Testing skills (e.g., facilitates

the ability to change strategy when not getting expected results).

CONCLUSION

The primary purpose of this study, was to explore a possible correlation between

Reuven Bar-On’s 15 emotional intelligence subscales (Bar-On, 2011) and composite,

objective measures of entrepreneurial success, using the extensively validated and

reliable EQi2.0 emotional intelligence assessment that was specifically designed to

measure Bar-On’s 15 subscales. In addition to evaluating the correlative properties of

the subscales, a secondary objective was to explore possible predictive qualities presented

by an entrepreneur’s overall EI score, or any of the respective 15 subscales, in the context

of entrepreneurial success. Initial interpretation of the statistical results produced by

SPSS correlational analysis using both Spearman (and Pearson methods as a sensitivity
 109
test) and regression analysis using Ordinal (and Ordinary Least Squares methods as a

sensitivity test), were provided in Chapter IV: Results.

From this study, I have developed a definition of an “entrepreneur,” evaluated the

validity and reliability of the EQi2.0 as an emotional intelligence assessment tool, and

established the foundation on which relevant, objective entrepreneurial success factors

can be identified in the context of startup businesses, where access to financial

information is not publicly available. The primary challenge of this study was

insufficient access to an entrepreneur’s financial information without being unduly

intrusive or violating an entrepreneur’s right to privacy. I believe this constraint limited

my measurement of entrepreneurial success, and future research should anticipate this

limitation and develop ways to accommodate that constraint so that a broader, richer, and

more realistic or real-world definition of entrepreneurial success can be used as a

dependent variable. Another major limitation of the study was the restricted range of

entrepreneurial success variables with only three categories. Statistical techniques used

in this study were designed to exploit variations to detect relationships. For example,

because ordinal regression simply categorizes items along the ordinal scale, no distinction

is made between having one success factor versus two success factors, or the magnitude

of the difference between those two factors (Cronbach, 1951). In contrast, linear

regression minimizes the sum of squares on either side of the regression equation by

considering the scale values of the variables used in the relative magnitude of the

differences between variables (Cronbach, 1951). As a result, using entrepreneurial

success as an outcome in this study restricted the chance of detecting such relationships.
 110
Throughout this process, reasonable alternative methods to determine objectively

entrepreneurial success were created based on the objectives and criteria that have

demonstrated to be valid and reliable measures in the literature, but those factors proved

to be insufficient to define objectively a “successful entrepreneur” in the absence of

privately held financial data. As indicated in the support of my hypotheses, there can be

numerous factors that impact the relative success or failure of a business, and the

correlation results seem to corroborate that assertion. In other words, the lack of

statistical significance may be the result of other factors that have yet to be identified, but

should be the basis of further study to distinguish how those variables may impact the

results.

It is clear that entrepreneurship is critically important to the global economy and

research in this field can lead to enhanced performance and productivity, having a

tremendous impact. It is also well-established that emotional intelligence is a valid

science that can be used to explain differences in performance based on social and

emotional interactions. The emotional intelligence literature is devoid of sufficient

studies specifically focused on startup entrepreneurs, so the research questions presented

in this study have significant implications for academia and business.

This study was exploratory, so the entrepreneur and success criteria were

experimental, and there was a strong possibility that no correlation or predictive qualities

would be found. I am encouraged by the fact that at least one emotional intelligence

subscale, Empathy, was found to be statistically significant in two of the three success

factors, which indicates that this study was on the right track. Also, although not

statistically significant, several other Subscales were shown to have some correlative
 111
properties consistent with my hypothesis, and my understanding of what could be

relevant EI attributes was expanded by the indication that two other Subscales should

have been included in my hypothesis. It is important to note, however, that I was able to

identify a reliable and valid measure of emotional intelligence that bodes well for future

research as it has 15 dimensions of emotional intelligence, is normed, and produced

variation among respondents. Specific emphasis should be placed on the outcome

(Entrepreneurial Success), which is not as well measured as emotional intelligence and

engenders privacy issues that restrict access to financial data and other more real-world

measures of entrepreneurial success. Specifically, additional research is warranted to

explore further, identify, and define viable, objective measures of entrepreneurial success

that can be validated in the absence of publicly-available financial data. This study also

included entrepreneurs from around the world, so additional research regarding

distinctions between entrepreneurs specifically from one country may also demonstrate

interesting trends, as would distinctions between socio-economic status and education

levels. Eventually, I plan to replicate this study with additional and possibly different

success factors with ordinal and scale attributes to make further distinctions relevant to

EI.

Although most Subscales were not statistically significant, I am also encouraged

by the fact that Empathy, Problem Solving, Interpersonal Relationships, Independence,

and Reality Testing, appear to be Subscales that have the potential to influence success.

As a result, I assert that this dissertation contributes to our understanding of the relevant

attributes of objective entrepreneurial success and provides the foundation for further

research in the application of EI in the context of predicting and influencing

 112
entrepreneurial success. Also, it is important to consider that although EI Subscales

(aside from Empathy) were not considered statistically significant in a correlational or

predictive context, the fact remains that 23/31 (74.2%) of the entrepreneurs had normal

Overall EI scores = normal executive functioning skills. An equal number (N=4 or

12.9% of entrepreneurs) had above-normal, Overall EI scores (above 1 SD (>115)) and

below-normal, Overall EI scores (below 1 SD (<85)), which also indicates that a strong

majority of entrepreneurs (23+4 = 27 or 87.1%) are reasonably considered “well-

functioning executives.” That fact indicates that there is a reasonable trend that merits

further study because it stands to reason that if a high percentage of entrepreneurs have

normal-high, Overall EI scores, then finding appropriate success criteria exhibited by all

entrepreneurs should indicate a relationship that can be measured as “significant.”

Given what I have learned, I would design the next study to have fewer EI

Subscales, e.g., follow-up with entrepreneurs from this study and determine which

Subscales they found most relevant, combined with results from the correlations and

regressions that showed the strongest relationships amongst the Subscales in the context

of the success factors. Such qualitative data would add context and meaning to the

determination of the “best” success factors to include and Descriptive data could be

compiled regarding the relative frequency that certain types of questions are suggested.

Such descriptives could be a rich source of data regarding what entrepreneurs value as

“important” to themselves, and other entrepreneurs, and possibly, reveal the drivers that

lead to conscious or unconscious competency development incentives.

I would also follow up with entrepreneurs to place themselves in the role of a

researcher and identify at least six questions they would ask an entrepreneur to establish
 113
objective and subjective criteria. After determining what five questions they would ask, I

will also try to incorporate at least 8 to 10 objective success factors to increase the

likelihood of finding correlational and predictive relationships. My focus would be on

criteria that can be independently verified, but is also unlikely to have occurred absent

conditions being in a place that more likely than not, accurately represent the subject

success measure. In other words, I will try to mitigate alternative justifications for the

success criteria. To facilitate that process, I will also try to incorporate at least 8 to 10

subjective success factors based on the observations of the entrepreneur on their relative

success and their expectation on what the objective success factors would reveal. The

additional insights from the entrepreneurs are an impromptu sensitivity test of whether

my objective observations are consistent with reality or expected norms. Also, important,

will be to diversify the pool from which entrepreneurs are selected, from different

industries, from different regions, from different stages of development to obtain a more

representative sample of the entrepreneurial population at large. I believe that following

the above approach should produce statistically significant correlational and predictive

results in future studies.

 114
APPENDIX

1. Workshop application to qualify entrepreneurs for study

Please provide no more than four sentences for any of the questions below.

Your Company Information

Company Name

Company Address

Company Structure C-corp, S-corp, LLC, Partnership, or Sole Proprietor + State of Registration

Founder, CEO or President

Phone or Cell

Email Please provide the best email address to reach you

Website

Executive Information
Business filing date with state

How is your business unique? Clearly describe your unique selling or value proposition

Annual revenue from last year

% of time spent on business

Is business primary income source?

Why did you start the business?

Why do you need this workshop?

Define the term “entrepreneur”

How do you fill market gap? Define your target market, supply and demand, and sustainability

Identify 3 competitors

How do you handle competitors?

Please identify a friend, family member, or employee, who has known you since the
3rd party perceptions
business launched, and provide their contact information
 115
2. EQi sample report summary
 116
3. Overall EI Scores, listed in decreasing value

N Overall Score

1 122
2 122
3 120
4 117
5 114
6 112
7 111
8 108
9 105
10 105
11 103
12 103
13 101
14 101
15 101
16 100
17 100
18 98
19 97
20 96
21 95
22 95
23 94
24 93
25 91
26 91
27 86
28 80
29 80
30 79
31 74
 117
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