Personality Type and Business Ownership
A common question I get in media appearances for The Successful Entrepreneur: American dream done right (Glenbridge Publishing, LLC is, “is there an entrepreneurial personality?” The answer is “Yes.” Entrepreneurs are different from the people who prefer the security of a job working for someone else. Entrepreneurs, like all people, are complex and show a combination of personality traits that can predict success and happiness with the entrepreneurial lifestyle.
Why? Entrepreneurial personality is made up of several factors including personality type, decision making skills, ability to handle stress and uncertainty, and sociability. In addition to having experience in the business area, adequate working capital and cash reserves, an established customer base, a robust market, excellent products or services, a good economy, and, perhaps most importantly, the guts to dive into uncertain economic waters head first. That’s quite a lot, and successful entrepreneurs are people who are able to handle quite a lot--and then some.
A frequent topic on my appearances in Jim Blasingame’s Small Business Advocate radio show is entrepreneurial personality. In this series, I’ll examine in-depth the psychology of entrepreneurship, including decision making and handling stress and uncertainty. For now, I’ll relate personality type and business ownership.
One of the best tools for looking at entrepreneurial personality type is the MBTI ® , based on Carl Jung’s theory of personality. The MBTI is the world’s most popular psychological test and is given over 2 million times a year. If you’re interested in your own personality type, take the test at no cost by clicking on the link below from HumanMetrics. The best test is the Consulting Psychologist’s Press, Inc. version. You can take that version for a small fee. Check cpp.com for more info.
The MBTI measures four areas. For each area, each of us has a preference for one or the other.
INTROVERT OR EXTROVERT – This concerns our sociability, communication patterns, and motivation.
SENSING OR INTUITIVE – How much detail we need to feel comfortable.
THINKING OR FEELING – How we want to world to perceive us? Our preference for emotional vs. logical decisions.
JUDGING OR PERCEIVING – This concerns our views on time, particularly as it relates to decision making.
Within each pair, each of us has a preference. For example, after reading the descriptions below for Introvert and Extrovert, you might think, extrovert describes me more often than not, or you might feel Introvert is a better fit for you. If the descriptions seem dead-on for you, you have a strong preference. I you feel you have both Introvert and Extrovert characteristics, with maybe one a little more strongly than the other, you likely have a less definite preference. Don’t be surprised: No one is a pure type: even strong Extroverts have a few Introvert’s traits and vice versa.
Let’s take a look at the four areas. But first, if you haven’t taken the HumanMetrics version at http://www.humanmetrics.com/cgi-win/jtypes2.asp do so. You can relate the descriptions to your own MBTI type.
Now that you’ve taken it, your score will be four letters each representing one of the two types listed above. With four areas and one preference in each area, there are 16 personality types. (N is the abbreviation for the Intuitive type because the I is used for Introvert.) They are:
ENTJ ENTP ENFJ ENFP
ESTJ ESTP ESFJ ESFP
INTJ INTP INFJ INFP
ISTJ ISTP ISFJ ISFP
Now that you’ve taken the test, here’s some detail on what those letters mean for you and your business or possible new venture.
INTROVERT/EXTROVERT
The first set of letters is either an E (Extrovert) or I (Introvert). What do these traits mean to entrepreneurs?
Extroverts are motivated by being with people; Introverts, by being alone. Neither way is better or worse; just different. Extroverts say what’s on their minds, and speak their thoughts quickly. Introverts tend to filter what they say internally before speaking and think to themselves for about 10 seconds before they respond.
IMPLICATIONS FOR ENTREPRENEURS
One of the biggest shockers for entrepreneurs is how much time they spend selling. The cash register is the focal point of any business. Entrepreneurs are instantly sales reps and sale managers and can spend most of their time in those roles, which is why there is an entire section dedicated to sales and sales management in The Successful Entrepreneur.
All that human interaction will be natural and energizing for Extroverts. However, Introverts can be great salespeople, too. Sales success has little to do with type and has much more to do with product knowledge and being customer focused. Sales enjoyment, however, has much to do with type. Would you like to talk about your product or service to many people every day for several hours, often answering the same 10-20 questions again and again as if it’s for the first time? Extroverts are likely to say yes, while Introverts are more likely to say that’s not for them.
Strong Introverts will find sales exhausting. Will all that talking be worth the revenue it brings in? That depends on the person – however it’s important to ask that question and answer it honestly.
As mentioned above, Extroverts tend to answer questions immediately. However, if they are talking, the customer isn’t. If you ask if someone has a question, wait 10 seconds to answer. Why? That’s how long Introverts take to form a question in their mind. Extroverts should count to themselves for about 10 seconds, which can seem like an eternity. But without doing that, you’ll find there are many questions you could have answered, but didn’t.
As far as personality type, Extroverts will tend to like selling. This will increase the number of calls made, which is positive. But they can also find they spend a lot of time schmoozing with friends instead of doing the hard work of selling – they need to balance the two.
A lot depends of the type of business one starts as well. Introverts will flourish when they start a business like contract programming or design or landscaping where they’ll be spending the majority of their time alone or dealing with the same people time and again. Introverts like having few customers and nurturing them – they are more like shepherds.
Extroverts will want to start businesses that require much more interaction. Anything sales oriented or customer service driven will be for them. Running a B&B, starting an insurance agency, or running an ad agency are more down the Extroverts’ alley.
Of course, you can’t clump the world into two piles of Introvert and Extrovert and make broad generalizations. Below is a list of common occupations of Introverts and Extroverts, which, of course, doesn’t mean that if you’re an Extrovert, you can’t start a car repair shop. However, you must know that that type of job will give you less human interaction during work hours that you might find ideal. Likewise, if you’re an Introvert, your dream might be to start your own insurance agency. You must realize that you will be speaking to people in-person and on the phone all day long and you may find that exhausting.
The Introvert/Extrovert preference is the first of four preferences. Next we’ll look at the Sensing Intuitive preference.
SENSING/INTUITIVE
The second pair of letters is Sensing (S) or Intuitive (N).
Sensing types like facts and details. Intutitives like the big picture. When describing an apple, Sensing types will say that it’s red, round, has a stem and seeds. They will use their senses and describe what it is. They are matter-of-fact “give me the data” people. They tend to be very good at noticing things. Intuitives, when describing an apple, will give associations like apple trees, apple computers, New York City (the big Apple) and Adam and Eve, but never mention that it’s red.
Sensing types want to know how things work before they can fully understand what they are good for. Intuitives are the opposite; they want to know function and often don’t care how things work. Before signing a tax return, Sensing types will want their accountants to go over every aspect of it so they’ll know what they’re signing. Intutititves just want to know how much they’re paying in taxes and are overwhelmed at the thought of understanding a tax return and hope the state did a good job vetting accountants during the licensing exam.
Sensing/Intuitive is like Introvert/Extrovert in that various types tend to gravitate toward different professions. Accountants, programmers, and bankers tend to gravitate toward detail-oriented professions and you’ll find many more sensing types. Intuitives find themselves in more creative professions like advertising, psychology, and marketing.
IMPLICATIONS FOR ENTREPRENEURS.
Take a look at the list below – and the same caveat applies- don’t pigeonhole yourself, but based on a large sample, you can find that people in various professions can gravitate toward professions and those are the types of businesses you should consider owning.
THINKING/FEELING
The third MBTI personality area is the Thinking/Feeling preference.
Thinking types like to make decisions logically and unemotionally. They want the world to think they make smart decisions. They’re willing to sacrifice short-term pain for long-term gain. “Take your medicine. It’s good for you” is their rallying cry. Feeling types like harmony and try to include stakeholders in decisions. They want the world to think they make compassionate decisions.
Thinking types try to depersonalize and compartmentalize as much as they can and try to make the decisions that make the most sense, independent of how popular the decision might be. They like their decisions to be rule governed. They value logic.
Feeling types try to empathize when they make decisions, and hate rule-governed choices. They care about the human element in any decision.
IMPLICATIONS FOR ENTREPRENEURS
Take a look at the list below. Many Feeling types prefer to start service businesses or businesses with the ability to improve people’s lives. Thinking types might prefer a tech start up or a business that involves a lot of problem-solving.
JUDGING/PERCEIVING
The final type is the fourth letter combinations (J) Judging or (P) Perceiving. Judging types like schedules and deadlines and keeping to them. They like planning, organizing, and closure, or the sense that a decision is complete. They’re the types who arrive five or ten minutes early for meetings. They have lunch at noon because noon is lunch time. In school, they prepared their assignments well before the due dates except for some final editing the day before.
Perceiving types have a more general sense of time, dislike closure, and will want to put off decisions until they’ve had time to think them through. If there’s a meeting at 4:00, they’re more likely to say at 4:10, “I have to get going; the meeting has started.” They’ll have their first meal of the day at 3:00 PM. In school, these folks would cram for tests and spend all night writing a term paper the day it was due.
IMPLICATIONS FOR ENTREPRENEURS
If you are the type of person who is very deadline-oriented and likes planning and getting things done on time, or better still, early, consider one of the Judging professions. If you’re the type of person who likes a more relaxed schedule and thrives under pressure because you waited until the last moment, then a Perceiving profession is more for you.
Conclusion
The MBTI tool isn’t good for labeling, but it can be very good for predicting the types of businesses you’ll be happy giving your heart and soul to for thousands of hours. Because of that, the MBTI is very useful for predicting entrepreneurial happiness.
You may pick a venture that goes outside your type, but carefully consider if the struggles outweigh the benefits. There are many examples of people who started businesses outside their types, because they liked being their own bosses, or because of the financial rewards that came with owning that business.
Tom Anastasi has worked with small businesses for over 25 years and the title of his fourth book is The Successful Entrepreneur: American Dream Done Right. Copyright 2012, author retains ownership. All Rights Reserved.
