Achievement motivation theory of entrepreneurship

What is the achievement motivation theory of entrepreneurship?

Harvard psychologist David McClelland developed the Achievement Motivation Theory in his book entitled The Achieving Society in 1967. McClelland sought to explain why some societies are more economically successful than others. For answers, he looks at the entrepreneurial behaviors of individuals, which he thought were key to the development of all economies.

According to McClelland, entrepreneurs do things in a new and better way and make decisions under uncertainty. Entrepreneurs are characterized by a need for achievement or an achievement orientation, which is a drive to excel, advance, and grow. By focusing in on a particular need, he was able to challenge the then prevailing great man theory of entrepreneurship as well as religious theories of entrepreneurship. He believed that entrepreneurship is learned and that such learning can be encouraged fruitfully.

Need for achievement

The need for achievement contrasts with the need for power—that is, a drive to dominate others in all situations, and with the need for affiliation—that is, a drive for close personal relationships. However, power and affiliate legitimacy may help with achievement and can thus be considered valuable means or resources that can help to satisfy the need for achievement.

Achievement orientation develops during middle childhood through family socialization emphasizing high standards, self-reliance, and less dominant fathers. It manifests in behaviors such problem-solving, need for and use of feedback, reaching goals through effort, and moderate risk-taking.

The need for achievement is partially culturally determined with some societies producing fewer individuals with achievement orientations. Societies lacking in achievement-oriented individuals are expected to have lower average incomes.

Controversy and evidence

A controversial implication of the theory is that lower-performing economies can be boosted by adopting social policies that alter socialization processes in ways that encourage the development of more individuals with achievement motivations. This can be criticized as being a kind of social engineering though, because some cultures may have different value structures. For instance, well-being, simplicity, and tradition may be more valued in some cultures than innovations leading to more desire for achievement.

McClelland was careful to note however, that achievements are not to be confused with outcomes such as wealth or income as these are merely measures of achievement, not achievements in themselves. The need for achievement is satisfied intrinsically with a feeling of personal accomplishment when getting something done in the world. Thus, the concept is quite broad and can be applied in most circumstances. For instance, in a culture that values well-being or human development, an individual may feel achievement by bringing about greater levels of achievement in other individuals in the society.

Evidence for the theory seems fairly strong, with meta-analyses confirming a positive relationship between need for achievement and entrepreneurial entry and performance (see Collins et al., 2004). There is also meta-analytic evidence that the need for achievement is stronger in entrepreneurs than in managers (Steward and Roth, 2007).

The problem with theories like these is that while many entrepreneurs may display a need for achievement, many non-entrepreneurs may also have a strong need for achievement that is satisfied with success in other professional careers. Thus, it offers only a partial picture of the drivers of entrepreneurial entry.

Interesting interview with McClelland:

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