The Motives Driving Forest Products Entrepreneurship in Southern Malawi

Transcription

1 The Motives Driving Forest Products Entrepreneurship in Southern Malawi E. Brad Hager, MF, MBA Ndalapa Mhango, PhD Tom Hammett, PhD

2 The Warm Heart of Africa

3 Challenges Poverty (53%) Least Developed Country Status HIV/AIDS Pandemic

4 Forest Products Important source of income Much hidden in informal sector Low technology-inefficiency Native tropical hardwood resource exhausted

5 Goal of Project Develop a foundation on which to base a series of Social Action Research Projects promoting entrepreneurship in the region.

6 Entrepreneurs in Sub-Saharan The Nature of Entrepreneurship varies by Socio- Cultural Context Africa The Informal Sector or Hidden Economy

7 Categorizing by Motives (Necessity/Opportunity Dichotomy) 1. Necessity-driven: forced into self-employment by necessity 2. Opportunity-driven: drawn into self-employment by desire 3. High Expectation Gazelles : opportunity-driven but with potential to make large impact

8 Necessity-driven Enter and exit self-employment as need arises survival umbrella Short-term oriented Most often found in Informal Sector Create few jobs and little wealth Extrinsically motivated by immediate rewards

9 Opportunity-driven Positive factors convince them to choose self-employment Intrinsically motivated-they like what they are doing Long-term goal oriented Formal and informal sectors

10 High Expectation 1. Growth Oriented 2. Key to Economic Growth 3. Highly Educated 4. Access to Capital and Networks 5. Often form international relationships

11 Conceptual Model (Push/Pull Model of Entrepreneurial Behavior) Looks at Situational Forces E Total = E(Push, Pull, Other Factors) Originally used to explain total entrepreneurial activity in society Later used to investigate driving motives of the individual

12 Conceptual Model Push Forces: Negative forces pushing person (ex. no job opportunity, discrimination) Pull Forces: Positive forces pulling or enticing person (ex. desire autonomy, social responsibility) Other Factors: Examples such as education level, family history, role models, socio-cultural influences such as ethnicity

13 Conceptual Model Dominant Forces Push Pull Entrepreneur Type Necessitydriven Opportunitydriven Pull + Certain Other Factors Gazelle High Expectation

14 Methods In-depth Interviews (Story Telling) averaged 42 minutes Respondent-Driven Sampling Access to the Hidden Economy Goal to include key groups rather than select representative sample Objective is to create knowledge that can be transferred from one situation to other similar situations

15 Analysis 1. Identify and Classify Motives for each Entrepreneur 2. Assign Entrepreneur to Category 3. Look for Clusters 4. Profile Entrepreneurs by Type and Cluster

16 Forest Products Participants (15 of 35) Sawyer/Timber Suppliers (4) Furniture Manufacturers (4) Coffins and Cabinets (3) Wooden Fishing Boats (1) Toys and Crafts (3)

17 Clusters (All Participants)

18 Clusters (Forest Products)

19 Necessity-driven: Coffin Maker

20 Necessity-driven: Coffin Maker

21 Opportunity-driven: Boat Builder

22 Opportunity-driven: Boat Builder

23 High Expectation: High Quality Furniture

24 High Expectation: High Quality Furniture

25 Themes Entrepreneur types seem to cluster by Education Level and by Business Experience Long and short-term needs vary by cluster Programs to encourage entrepreneurial activity should be designed to target specific clusters of entrepreneurs

26 Finding: College educated entrepreneurs start with the great advantages of access to capital, technical expertise, and human networks. They start off as opportunity entrepreneurs. Implications 1. Should help this group become successful High Expectation entrepreneurs as their business experience increases 2. Those in Forest Products industry need help training skilled employees 3. Need technology and marketing consulting to enable them to compete internationally

27 Finding: Entrepreneurs with a secondary level education typically start as necessity-driven and either become opportunity-driven with experience or find other employment. Implications 1. Should help this group remain selfemployed long enough to make the transition to opportunity-driven 2. Those working in Forest Products need access to capital to purchase basic powered tools (i.e., routers) 3. Need wood drying technology 4. Need basic business management and marketing training

28 Finding: Entrepreneurs with only a primary school level education become skilled craftsmen but seldom are able to transition into opportunity-driven entrepreneurs. Implications 1. Should help this group receive some basic vocational training beyond primary school 2. Need incentives to encourage this group to commit to self-employment for long-term 3. Basic business training should start in primary school

29 Questions? Comments?