factors influencing entrepreneurial success of businesses...

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*Corresponding author: Farzad Eskandari, Assistant professor, Department of Agricultural Economics, University of Kurdistan, Sanandaj, Iran. E-Mail: [email protected]

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Management and Administrative Sciences Review

Volume 4, Issue 2

Pages: 449-462

March, 2015

e-ISSN: 2308-1368

p-ISSN: 2310-872X

Factors Influencing Entrepreneurial Success of Businesses Supported by the Foundation of Martyrs and Veterans Affairs of Alborz province, Iran

Farzad Eskandari1*, and Sardar Hassanzadeh2

1. Assistant professor, Department of Agricultural Economics, University of Kurdistan, Sanandaj, Iran.

2. Ms.c. in Business Administration, Azad Islamic University of Tehran, Central Branch, Tehran, Iran.

One of the organizations involved in the development of entrepreneurial activities in the country, is the Foundation of Martyrs and Veterans Affairs, which has many jobseekers across the country. It expends a lot of money, and performs several programs to develop entrepreneurial activities among its target audience, but not all succeed. Therefore, the aim of this study is to identify factors influencing the success or failure of businesses established by individuals supported by the Foundation of Martyrs and Veterans Affairs of Alborz province (FMVAA). The statistical population of this survey included those supported by FMVAA that by the end of 1389 established a business in various fields, including industrial, manufacturing and agriculture services under the auspices of the Foundation of Martyrs and Veterans Affairs. The number of these businesses were totally 3,200 units, which we determined 240 units by using a simple random sampling method. A questionnaire was used to collect the data which was reliable and valid. Logistic regression analysis showed that the entrepreneurial characteristics, prior self-employment and entrepreneurship experiences, skills and entrepreneurial abilities, entrepreneurial skills training courses, training programs of Foundation of Martyrs and Veterans Affairs and some demographic characteristics have significant effect on entrepreneurs' success, whom are supported by Foundation of Martyrs and Veterans Affairs. According to the results, several suggestions are presented to improve entrepreneurs' activities supported by the Foundation of Martyrs and Veterans Affairs of Alborz Province.

Keywords: entrepreneurial success, entrepreneurial failure, psychological Characteristics, Foundation of Martyrs and Veterans Affairs of Alborz province, entrepreneurship development

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Manag. Adm. Sci. Rev. e-ISSN: 2308-1368, p-ISSN: 2310-872X Volume: 4, Issue: 2, Pages: 449-462

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INTRODUCTION

According to Kuratko and Hodgetts (1998), three factors influencing individuals' entrepreneurial behavior include: psychological and sociological characteristics and environmental factors. Various studies, relate many psychological characteristics to entrepreneurs. Analyzing various studies concerning the psychological approach, Kent (1990) concludes that entrepreneurs have certain psychological characteristics such as internal locus of control, discipline, self-motivation, risk taking and Ambiguity tolerance.

Van (1989) defines entrepreneurs as individuals who are opportunist, risk taker and lucky. From Miller and Toulouse (1986) perspective, entrepreneurs are provident with good predictive power, identify future needs, try to encounter and deal with them and take risks.Van dan van et al.. (1984) believed thatcharacteristics such as competence, confidence, high imagination, commitment and risk taking are the main entrepreneurs' characteristics.In addition to the psychological approach, another approach to study entrepreneurship is sociological approach, which focuses on demographic characteristics of individuals, society, history, educational background and sociology of individuals. Ashmore (1990) states that there is no need to have a college degree if one wants to start a successful entrepreneurial business. But surely entrepreneurship training and expertise have positive effects on growth and development of the business. Sexton and Bowman (1991) concluded that there is a significant and positive relationship between education and employment.Nelson et al. (1997) concluded that there were more self-employment activities among people with a university degree than nonacademics.

In their study, Evans and Leighton (1987) found that education has a weak positive correlation with entrepreneurship in men but it has stronger correlation in women. Reynolds (1991) showed that educated people are more interested to create new business. Another important point is that in regions with universities and scientific centers, the rate of entrepreneurship is higher.

However, Vesper (1992) found that experienced entrepreneurs with no educational degree are more likely to fail. The second group of entrepreneurs who are likely to fail, even more

than the first group, are trained entrepreneurs who do not have enough experience. Entrepreneurs who are trained and have sufficient experience are considered to be the most successful entrepreneurs.Studies show the average age of entrepreneurs is higher than the average age of salaried employees (Arnosen, 1991).Evans and Phillips (1986) showed that there is a positive correlation betweenage and the tendency towards self-employment. Several studies conducted in different years shows that most entrepreneurs begin their entrepreneurial activities between the ages of 25 to 44. Perhaps, because they have acquired the minimum skills, knowledge and experience, necessary forthe job and also they have encountered job stress and economic pressures in this age, so they dare to accept the risks.Most male entrepreneurs are in the early 30-40 years old and female entrepreneurs are in the mid 30-40 years old.

One of the important factors that encourages and stimulates individuals to choose an entrepreneurial career is role models. They are the peoplewho affect the choice and type of entrepreneur's life (Feyzbakhsh, 2003). One of the organizations involved in the development of entrepreneurial activities in the country, is the Foundation of Martyrs and Veterans Affairs, which has many jobseekers across the country. Therefore, from the beginning ofthe country'sattitude change towards entrepreneurship,all levelsof this organization performed organizational policies,practices, and several programs to promote entrepreneurship among its target audience.

According to thedata obtainedfrom job seekers' martyrs and veterans database, by the end of the 1391, 8000 martyrs' children and other 42,000 veterans are unemployed and seeking employment in 2013. (Directorate General for Employment and Entrepreneurship of the Foundation of Martyrs and Veterans Affairs, 2013).

However, based on available statistics on the number of registered unemployed, there are currently 132,000 martyrs' children and the children ofveterans with a disability rating%25 are in foundation, bachelor, master and doctoral students and nearly 230,000 school students whom willbe added to job seekers, gradually.


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In this regard, the 5-year plan of arranging veterans' employment is presented with respect to Fifth Economic Development Plan, community capacity, government policies and programs and commensurate job opportunities with respect to age, education,etc. andthe capabilities of these job seekers. Therefore, several programs performed to develop entrepreneurial activities among target audience a lot of money, and performs several programs to develop entrepreneurial activities among Foundation of Martyrs and Veterans Affairs 's target audience, but not all succeed, andmany successful entrepreneurs under the support of the Martyrs and Veterans Affairs failed.

The key question planners of these activities in Foundation of Martyrs and Veterans Affairs concerned is that why, despite the great efforts by the managers of Foundation of Martyrs and Veterans Affairs, a number of supported entrepreneurs have failed? Is it because of personal and psychological characteristics of individuals? Or the programs and projects presented by the Foundation of Martyrs and Veterans Affairs have a defect?

It is clear that not all the factors could be studied in a single research. Given the importance of this issue for the Foundation of Martyrs and Veterans Affairs, the role of personal and demographic factors and impactsof Foundation of Martyrs and Veterans Affairs programs on successes and failures of businesses which areestablished by the supported entrepreneurs, were studied.On the other hand, because of the vast area covered by the Foundation of Martyrs and Veterans Affairs and cost and time constraints, there was no possibility to study all 30 provinces in the country.Therefore, because of the high number of activeentrepreneurs in Alborz Province, and the province's high entrepreneurship development activity, this area was selected for the study. As mentioned above andin line with the research problem, the aim of this study is to identify factors influencing the success or failure of businesses, established by individuals as they are supported by the Foundation of Martyrs and Veterans Affairs of Alborz province. In line with the general objectives, specific objectives of the study were as follows:

1. To study the effects of entrepreneurial characteristics on businesses success established by individuals who are supported by FMVAA

2. To study the effects of previous self-employment experience on businesses success established by individuals who are supported by FMVAA

3. To study the effect of entrepreneurial skills and abilities on businesses success established by individuals who are supported by FMVAA

4. To study the effects of entrepreneurship education on the success of businesses established by individuals who are supported by FMVAA

5. To Study the effects of demographic characteristics on the businesses success established by entrepreneurs who are supported by Foundation of Martyrs and Veterans Affairs of Alborz Province.

RESEARCH METHODOLOGY

In order to achievethe research objectives and answer theresearch questions, survey methodwas applied. Statistical population includes those supported by FMVAA that by the end of 2010 established a business in various fields, including industrial, manufacturing and agriculture services under the auspices of the Foundation of Martyrs and Veterans Affairs. According to the latest statistics in Alborz Province, by the end of2010 there were 3,200 businesses launchedunder support of FMVAA. Employing Cochran's formula, 209 businesses were considered for sample size and then, the sample size was increased to 240 to maximize sample validity and reduce sampling errors. Since the aim of this study was to compare two groups of successful and unsuccessful businesses, 120 businesses of each group were selected by simple random sampling method.

VARIABLES AND MEASUREMENT

Dependent variable

Dependent variable is "business success or failure" which is a dummy variable (success and failure of entrepreneurial businesses).


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Independent Variables

Independent variables of the study were as follows:

Entrepreneurial Orientation

entrepreneurial tendency of business owners were measured by using the scale developed by Shanthakumar (1992), which has been used by many researchers. In this study, the scale was adjusted according to the conditions in Iran. Various aspects of this tendency include: achievement motivation, independence, innovativeness, internal locus of control, risk takingpropencity, toleranceof ambiguity and competitiveness.

Entrepreneurial-related trainings

In order to measure the role of entrepreneurship related training in performance of studied entrepreneurial businesses, the most important trainings that affect the entrepreneurial businesses were determined at first (Gibb, 2003; Pat et al, 2008). After that, applying a five-point Likert scale, respondents were asked to mention the amount of training they have acquired.

Entrepreneurial competencies: in order to measure the organizational capabilities of the business, the business representative was asked to determine on a five-point Likert scale (from very weak to very strong), the degree of skills and capabilities of the business.

Other independent variables were: Knowledge and previous experience related to entrepreneurship and self-employment, Role model, Gender, Age, Education and Business Field of activity.

Research Tool

Data collection was done through a valid and reliable questionnaire including questions to measure dependent and independent variables.

RESULTS

Descriptive statistics of socio-economic variables is listed in Table 1.

TABLE 1 HEE

Table 1 shows thatmost surveyed entrepreneurs were male. Considering the median value listed in Table 1, it can be inferred that most of the entrepreneurs were 30 to 35 years old. Considering the mode value (in table 1) generally, it can be inferred that entrepreneurs supported by the Foundation of Martyrs and Veterans Affairs of Alborz Province had a tendency to invest in the services sector. In addition, mode distribution suggests that entrepreneurs supported by the Foundation of Martyrs and Veterans Affairs of Alborz Province, generally had Foundation and bachelor's degree.

Entrepreneurial characteristics

The data in Table 2 gives seven aspects of entrepreneurial characteristics among the two successful and unsuccessful entrepreneurs groups.

TABLE 2 HERE

The data in Table 2 gives detailed aspects of entrepreneurial characteristics among thetwo successful and unsuccessful entrepreneursgroups. The most importantdetails are:

A) Bothentrepreneurs are middle to high level, in terms of having entrepreneurial psychological characteristics (all theMeans are 2.5 and above, which indicates the amount of characteristics is moderate to high level). So that the people who are supportedby the Foundation of Martyrs and Veterans Affairs of Alborz Province andrequested private businesses,had their entrepreneurial psychological characteristics in the middle to upper levels.

B) Successful entrepreneurs were better in terms of achievement motivation, internal control, ambiguity tolerance, and competitiveness compared to unsuccessful entrepreneurs.

Themeanslisted in the table above for the two groups, show that in the four characteristics mentioned above, the number of mean successful entrepreneurs' is higher than unsuccessful entrepreneurs.

Entrepreneurial skills and abilities

Table 3 shows the rating of successful and unsuccessful entrepreneurs' entrepreneurial skills and abilities which are listed separately.

TABLE 3 HERE


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The data in Table 6 provides a lot of information about entrepreneurs' entrepreneurial skills and abilities. The information is as follows:

A) Entrepreneurial skills and abilities in unsuccessful businesses are poor in comparison with successful entrepreneurs. And except business regulations (mean: 3.1) and HRM (mean: 2/8), unsuccessful entrepreneurs didn't have better conditions and they were in "poor" conditions (mean: 2 to 2/49).While successful entrepreneurs were only weak on strategic planning (mean: 2/4).And in other skills and abilities they were in a good level.

B) Entrepreneurial skills and abilities in successful businesses: technical skills (mean: 4.3), marketing (mean: 4) financial and accounting skills (mean: 4/1), Business Feasibility (mean: 3/7) and customer orientation (mean: 4/1) are in "high" levels. These groups were in middle levels in terms of preparing business plans, human resource management and familiarity with business regulations.They were only poor in strategic planning.

Previous trainings related to entrepreneurship

The participation in entrepreneurship training courses for both successful and unsuccessful entrepreneurs is listed in Table 4.

TABLE 4 HERE

The data listed in table 4 shows:

A) In general, successful entrepreneurs had moreentrepreneurship education compared to unsuccessful entrepreneurs. As the mean training time for successful entrepreneurs is about 42 hours. (Of course for those who have been trained).While it is about 24 hours for unsuccessful entrepreneurs, which is 28 hours lower than that of successful entrepreneurs.

B) Numbers of successful entrepreneurs who have participated in courses related to entrepreneurship is more than theunsuccessful entrepreneurs.

So that the overall mean percentage of successful entrepreneurs participating in courses related to the items listed in Table 8, is equal to 27%, while this amount is around 5% forunsuccessful entrepreneurs.And itshows a huge difference.

C) Approximately 73% of successful entrepreneurs, and 95% ofunsuccessful entrepreneurs, had no training in entrepreneurship skills and abilities which shows a severe weakness.

Previous Knowledge and experience

In Table 6, Previous Knowledge and experience in self-employment and entrepreneurship statusof successful and unsuccessful entrepreneurs is published.

TABLE 5 HERE

According to statistics provided in Table 5, about 80% of the entrepreneurs had no previous experiences in self-employment and entrepreneurship before the launch of the current business. In addition,among successful entrepreneurs, more caseshad previous experiences in self-employment and entrepreneurship before the launch of the current business, so that these percentages were 33% in successful entrepreneurs and 8% in unsuccessful entrepreneurs.

Role models

The status of entrepreneurs from the standpoint of having role models in making decisions in accordance with current businesses is listed in Table 6.

TABLE 6 HERE

According to the data listed in Table 6, only 24% of the entrepreneurs (57 out of the total sample) statedthat they had role models before the launch of the current business which is a very small percentage. In other words 76% of the entrepreneurs stated that they had no role models before the launch of the current business and knew no one as a model.

According to the data listed in Table 6, it can be inferred that there are more role models among successful entrepreneurs than the unsuccessful entrepreneurs

Logistic regression

Logistic regression was used to study the effects of factors inEntrepreneurs' success or failure.Here, the results of the logistic regression are presented:

TABLE 7 HERE


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Table 7 shows while none of the independent variables were entered into a logistic regression equation;the model has correctly classified and predicted57/3% of businesses.Then, other findings related to the next steps of logistic regression, are discussed.

TABLES 8-12 HERE

In fact tables 9 and 12, show a fit fulfilled logistic regression model.

Table 9 shows Omnibus test. The chi-square of the model is estimated 76/02, with a significance level of 0/001 in accordance to the data in Table 9, whichshows that the model was appropriate. Andthe prediction of entrepreneurial success and failure based on the data was well-managed.

Table 11 shows Hosmer-Lemeshow test. The chi-square of the model is estimated 10/02, with a significance level of 0/001 in accordance to the data in Table 11, which shows that the model was appropriate and confirms the results in Table 10. Therefore, estimated logistic regression model (Table 12) is an appropriate model to predict factors affecting the businesses success and failure launched by Entrepreneurs.

According to data in Table 10, it can be inferred that the variables entered in the regression model (Table 12) are capable to explain 31 to 39% of the variance in businesses success and failure.

Table 8 (if compared with Table 7) shows the extent of predicting entrepreneurs' success and failure after the introduction of independent variables in the model, compared with when the independent variables are not considered.According to the As shown in Table 8, the estimated regression model has predicted 75/1% of entrepreneurs'success or failure based on independent variables. In fact, after entering variables, prediction accuracy of entrepreneurs' success and failure reachedto 75/12% as it was 57/3% (Table 7). It shows that appropriate regression was met.

Table 12 shows theeffects of independent variables on entrepreneurs' success and failure, supportedby Foundation of Martyrs and Veterans Affairs of Alborz Province. This table explains the extent to which each independent variableaffects theentrepreneurs' success or failure.The most findings obtained from Table 12 are:

Age, gender, education level and field of entrepreneurs' activity have no significant impact on their success and failure. In other words, the success or failure of businesses established by individuals supported by FMVAA has no significant relationship with age, sex, education level and the field of activity.

According to regression coefficient (B), variable that has the most effect on the success or failure of entrepreneurs who are supported by FMVAA, are previous experience in self-employment and entrepreneurship. B value for this variable is 2/95 which is greater thanthat of all independent variables. After this variable, the other variables that have significant impact on the success or failure of the entrepreneurs who are supported by FMVAA, include:Entrepreneurial abilities and skills, entrepreneurial characteristics (the B valueis 2.12), passing the previous training in the field of entrepreneurship (the B value is 1/87) and having an appropriate role model ((the B value is1/65).

According to the relative probability column (last column of the table), a person who has previous experience entrepreneurship and self-employment has 36.5 times higher relative probability of job success than someone who lacks such experience.

Based on the relative probability the column (the last column of the table), someone who has good entrepreneurial skills, compared with someone who has the skills and entrepreneurial abilities in "poor" condition, has 5.18 times higher relative probability of entrepreneurial success. The individual with the skills and entrepreneurial abilities in the "middle" condition is 35/4 times more successful, in comparison with that of "weak" conditions.

Individuals who have "high" entrepreneurial characteristics, the relative probability of their success in starting and managing a successful business is 19 / 5 times higherthan those in the "middle" level.

For those experienced sufficient entrepreneurial skills and abilities training,each extra hour training makes them 2.11 times more likely to succeed which demonstrates the effectiveness of one hour effective and appropriate entrepreneurship training.


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As with Individuals who used role models in their business operation and management andchose successful people as mentors or role models, the probability of their success increases 3/75, compared with those who didn't consider the use of role models.Final estimated regression model for the effects of variables on the success and failure of businesses supported by the Martyrs and Veterans Affairs of Alborz is:

Entrepreneurial success = 5/54 + 2/95 * previous experience in entrepreneurship + 2/73 * entrepreneurial skills and abilities + 2/12 * entrepreneurial characteristics +1/87 * previous entrepreneurship trainings + 1/65 * having role model

DISCUSSION

The results of logistic regression showed that the entrepreneurial characteristics have a significant impact on entrepreneurial success. The higher entrepreneurial characteristics people have, the more successful they will be in launching and managing a business.Therefore it could be concluded that one of the variables that would determine the entrepreneurs' success in businesses is having more entrepreneurial characteristics. A total of seven key entrepreneurial characteristics were studied, which according to the findings, successful people and unsuccessful people were similar in three characteristics: independence, innovativeness, and risk taking. And there was no difference between the two groups. In fact, the reasons that made successful entrepreneurs, superior in having entrepreneurial characteristics were higher achievement motivation, internal control, ambiguity tolerance and competitiveness compared with unsuccessful entrepreneurs. In general, the obtained results about the effects of entrepreneurial characteristics on success weresimilar to the previous results (see for example: Dvir et al., 2010; Tu et al., 2012) except for independence, innovativeness, and risk taking characteristics.

In other words, this study did not show whether the independence, innovativeness, and risk taking have any effect on entrepreneurs' success and failure or not? The reason is the all three characteristics were equal in the two groups, which made it not to have a significant effect on

entrepreneurial success. Our results showed that in general, successful entrepreneurs are more likely to have a higher level of entrepreneurial characteristics.

Logistic regression showed that people who had previous self-employment and entrepreneurship experience were more likely to be successful compared with those who didn't have such an experience. And its probability significancelevel is 0/001. Therefore, it can be concluded that the previous self-employment experience is one of the factors which influences the entrepreneur's success who aresupportedby MFVAA.Descriptive statistics in Table 6 show that maximum 21% of the entrepreneurssupported byMFVAA had previous employment experience. The results showone of the main reasons for the failure of many businesses supportedby MFVAA, is the lack of experience. These results are consistent with the literatureand concords previous results (Lafuente et al., 2013; Audet and Couteret, 2012; Ayala and Manzaom 2014; Kase 1989; Vesper 1992; basaranet al., 2003) which are: most of entrepreneurial ideas obtained from previous work experiences.

According to the results from the logistic regression of variables, the second variable that has the most effect on the success or failure of entrepreneurs is the mastery of entrepreneurial skills and abilities of entrepreneurs.So we can say that one of the main factors determining the success or failure of entrepreneurs is mastery or non-mastery of entrepreneurial skills and abilities. The results are quite consistent with the entrepreneurship literature and itconfirms previous researches (for example: Leunter and Ahmetoglu, 2014; Unger et al., 2011; Song Teng, et al., 2011)

The results of logistic regression shows that experiencing training related to entrepreneurial skills and abilitieshassignificant impact on the success of businesses, if done properly.So that each 1 hour of appropriate training in entrepreneurial skills and abilities, effectively makes 2/11 times more the chance of success in managing the business.

The descriptive statistics for this variable (Table 4) showed that only 27% of successful entrepreneurs have participated in entrepreneurship courses, which shows extreme lack of education in the


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majority of entrepreneurs supported by MFVAA. So, one of the main results of the present study is that one of the main reasons for entrepreneurs' failure is lack of entrepreneurship education.

It has repeatedly been pointed out in the research literature, that one of the main weaknesses of the Iranian entrepreneurs is that they neglect to attend entrepreneurship courses, which wasconfirmed in this study.

In this study, those demographic variables that were studied included:Age, gender, education, role models. Age, gender and educational level have no significant effect on entrepreneurial success and failure.On age case,perhaps the main reason is that entrepreneurs were not diverse in terms of ageand most of them (70%) were between the ages of 25 to 35 years.In previous researches related to the effect of aging on entrepreneurial success, results have been contradictory.And yet we cannot conclusively say whether there is a relationship between age and entrepreneurial success or not. Usually in different fields and different countries,the results have been different. For theminor effect in gender on entrepreneurial success;one major reason is that about 90% of entrepreneurs are men. So, statistically, studying gender effects on entrepreneurial success does not give a significance result or personal gain. Because evaluating the effects of a particular variable on entrepreneurial success needs enough data aboutvariable levels, in order to be statistically correct. In addition, in previous researches related to the effect of gender on entrepreneurial success, results have been contradictory. And just like"age" variable, there is no certain conclusion.Education variable has no significant impact on their success effects on entrepreneurial success.And just like the impacts of gender and age on entrepreneurial success, there is no conclusion between education and entrepreneurial success relations.Most scholars believe that more education level increases entrepreneur's understanding (see for example: Unger et al., 2011; Hurst et al., 2008). And thus makesit likely to be successful.However in many previous studies, negative relationship between education and entrepreneurial success wasfound.

Perhaps, one of the main reasons that this study did not find a significant relationship between

education and entrepreneurial success is because about 80% of entrepreneurs who are supported by MFVAA had Associate and Bachelordegree. Therefore this group cannot statistically be used for statistical inference with other groups of people (in terms of the effect of education level on success)

However, Role models had significant effect.One of the important factors that encourages and stimulates individuals to choose an entrepreneurial career is role models.They are the ones that affect the choice and type of entrepreneur's life. Role models themselves are entrepreneurs who demonstrate feasibility of entrepreneurship to individuals and spread the entrepreneurial culture into the community. (Feyzbakhsh, 2003).

COCLUSION

This study produced interesting findings in the area of successful entrepreneurship in economies like Iran. Based on results, it could be concluded that one of the variables that would determine the entrepreneurs' success in businesses is higher rate of such entrepreneurial characteristics as higher achievement motivation, internal control, ambiguity tolerance and competitiveness. Notwithstanding the insignificant effect of the independence, innovativeness, and risk taking characteristics on success, the results showed that in general, successful entrepreneurs are more likely to have a higher level of entrepreneurial characteristics as compared to unsuccessful entrepreneurs.

It could also be concluded that the previous self-employment experience and mastering entrepreneurial skills and abilities are among important factors which positively influences entrepreneurial success. It has repeatedly been pointed out in the literature that one of the main weaknesses of the Iranian entrepreneurs is that they neglect to attend entrepreneurship courses, which was confirmed in this study.

As for demographic variables, we studied the effect of Age, gender, education and role models. Age, gender and educational level had no significant effect on entrepreneurial success. This result is contradictory as in previous researches in


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different fields and different countries, the results have been different. So we cannot come to a clear conclusion in this regard and more research should be conducted in economies like Iran to solve this contradiction.

IMPLICATIONS

According to theresults, following recommendations are presented for the improvement of entrepreneurial activity supported by FMVAA.

1) The entrepreneurial activities applicants (who aresupported by FMVAA), are required to, prior to any kind of activity, acquire sufficient experience in the relevant field. Such experience leads them to be about six times more successful. It is recommended that before granting any facility to the applicants, the Foundation of Martyrs and Veterans Affairs convinced them to gain some experience according to the type of the activity, and then proceed to establish their businesses.

2) FMVAA,should encourage itssupported applicants (who are willing to start self-employed business), to achieve some entrepreneurial skills and abilities, and attend the training courses to gain practical experience, so then they can proceed to establish a business.

3) It is recommended that FMVAAput its supported applicants onentrepreneurial characteristics testbefore granting any facility to them. They should be encouraged to start a business only if they pass the test. Otherwise they should first be encouraged to go through some training experience on entrepreneurial psychological traits then decide whether to pursue entrepreneurial business. Requiredentrepreneurial characteristics are those listed in Table 3.

4) It is recommended that all applicants (supported by FMVAA) who are thinking of starting an entrepreneurial business attend entrepreneurship skills training courses listed in Tables 4 and 5 and strengthen their skills before establishing any business. Then they can decide whether to start their businesses.it is recommended that participating in these trainings (which should be designed according to the

principles of entrepreneurship education) bemandatory for each applicant.

5) Given the importance of role models and their impact on entrepreneurial success, it is recommended thatFMVAA find a solution to those who decide to adopt a business, soby working with entrepreneurs and successful individuals, they can use these role models, and consult themwhen necessary.

Some of the important suggestions for future research are as follows:

A) Thisstudy could not determine the impacts of sex, age and educational level on entrepreneurial success. It is recommended that in other studies enough samples be selected based on age, gender and education level, so that the effect of these variables on the success or failure of entrepreneurs can be studied.

B) The dependent variable in this study wasdummy. It is suggested in other studies the effect of studied variables on entrepreneurial success (where entrepreneurial success is measured by the Multidimensional Scale) be studiedand be compared with the present study, in order to understand the effects of selected variables on entrepreneurial success, better.

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APPENDIX

Table 1: descriptive statistics of demographic variables

Variable Median Mode

gender --- Male

age 30 to 35 ----

field of activity ---- Service businesses

Literacy ---- Associate and Bachelor degree

Table 2: Descriptive statistics of businesses owners’ entrepreneurial characteristics

Name

Successful Entrepreneurs Unsuccessful entrepreneurs

Mean (from 5) Mean (from 5)

Independence 8/3 8/3

Motivation 4/4 7/3

Internal control 8/3 5/3

Modernism 33/2 33/2

Ambiguity tolerance 7/3 4/3

Risk-taking 5/3 5/3

Competitiveness 5/3 3

Table 3: Status of Entrepreneurial skills and abilities in the businesses:

Skill and ability Successful Entrepreneurs Unsuccessful entrepreneurs

Mean (from 5) Mean (from 5)

Preparing a business plan 2/3 4/2

HRM 9/2 8/2

customer orientation ¼ 4/3

Business regulations 1/3 1/3

Strategic Planning 4/2 3/2

Business Feasibility 7/3 3/2

Accounting and finance skills ¼ 1/2

Marketing 4 4/2

Technical skills ¾ 4/2

Table 4– status of the two entrepreneurs groups in entrepreneurship education.

Training Subject

Successful Entrepreneurs

Unsuccessful entrepreneurs

Percentage of trained individuals

training (hours)

Percentage of trained individuals

training (hours)

Technical skills 42 44 12 15

Business Feasibility Studies 25 54 3 54

Marketing and customer analysis 33 45 7 54

Operating procedures to start-up businesses 25 54 3 54

business plan preparations approaches 25 35 5 15

Creativity and Innovation 25 54 5 54

Finance and Accounting 42 44 7 14

HRM 25 54 - -

Terms and business regulations 25 54 - -


461

Strategic Planning - - - -

Table 5: Previous Knowledge and experience in self-employment and entrepreneurship

Previous experience in

self-employment and entrepreneurship

successful entrepreneurs unsuccessful entrepreneurs

frequency percentage frequency percentage

yes 44 33 14 8

no 84 37 114 92

sum 124 144 124 144

Table 6: role models among entrepreneurs

role models successful entrepreneurs unsuccessful entrepreneurs

frequency Percentage frequency percentage yes 45 27/5 12 10 no 75 62/5 108 90 sum 120 100 120 100

Table 7- Classification Table in Block 0

Observed

Predicted Business Success

Percentage Correct Yes no

Business Success

Yes 120 - 100

No 120 - 0

Sum 57/5

Table 8- Classification Table in Block 1

Observed

Predicted Business Success

correctness Yes no

Business Success

yes 110 28 79/7

no 32 70 68/9

Sum 75/1

Table 9-Omnibus test for regression coefficients

Step Chi-squared Degrees of freedom Significance Level

Step Zero 76/02 9 441/4

The first step 42/73 9 441/4

Model 42/73 9 441/4


462

Table 10: Regression Model Summary

Step Probability Cox-Snell R2 nagelkerkeR2

first 98/252 31 /4 39/4

Table 11: Hosmer-Lemeshow Test

Step Chi-square Df Significance Level

first 42/14 12 23/4

Table 12: The variables in the regression equation

variable (B) (S.E.) Wald df Sig. Exp. (B)

Age 48/4 441/4 11/2 1 21/4 49/1

Gender 13/4 25/4 87/2 1 32/4 45/1

Field of activity 17/4 28/4 23/3 1 33/4 48/1

Literacy 49/4 441/4 34/2 1 25/4 41/1

Entrepreneurial characteristics (good)

12/2 25/4 31/17 1 441/4 19/5

Entrepreneurial Competencies Entrepreneurial Skills (Good) Entrepreneurial skills (average)

73/2

25/2

32/4

18/4

89/24

78/13

32/9

2

441/4

441/4

441/4

18/5

35/4

Previous training in entrepreneurship

87/1 44/4 12/13 1 441/4 11/2

Previous self-employment and entrepreneurship experience (Yes)

95/2 38/4 51/24 1 441/4 33/5

Having a role model (yes)

35/1 25/4 85/9 1 441/4 75/3

Constant 54/5 13/1 91/7 1 441/4 54/5

factors influencing entrepreneurial success of businesses...

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