Business Research
BaylorBusiness

Taking an Anthropological Approach to Categorizing Entrepreneurs

by Franci Rogers

When Matthew Wood thought about what makes an entrepreneur unique, he often adopted the same stereotypes as everyone else. That is, thinking of entrepreneurs as driven, Type-A people who are in business to make as much money as they can. But in reality, he knew that wasn't always true.

"My colleagues and I started talking about how our interactions with entrepreneurs in everyday life didn't support that," said Wood, an assistant professor of Management and Entrepreneurship. "When you walk into some entrepreneurs' businesses, they are neat and clean, some are chaotic. We started noticing how really different they are."

Their casual observation led to Wood; Bryan Stinchfield, assistant professor of Organization Studies at Franklin & Marshall College; and Reed Nelson, professor of Management at UNINOVE; to begin researching.

"In research of entrepreneurs, they are often put into one homogeneous group that assumes the reason they go into business is to make lots of money," Wood said. "But we felt there was a lot more variance, so we started looking at this from a more anthropological approach."

Using the guiding principles of anthropologist Claude Levi-Strauss, the researchers began developing categories of entrepreneurs based on their observations and on the self-perceptions of the business owners. After interviewing and observing 23 entrepreneurs, the team developed five types of entrepreneurs, differentiated by how they define success, what they feel are their limitations and other observations.

"There is a lot of variability, and much of it is a perceived identity thing, but we did find five different types," Wood said. Their findings were published in the April 2012 issue of Entrepreneurship Theory and Practice.

The first type identified by the researchers was artistic. "Like all entrepreneurs, artists are independent," Wood said. "But it's not just that they don't want to be told what to do. Their ventures represent personal freedom to them. And they definitely aren't in it to make money."

Artists are limited only by their own imagination, and their actions aren't at all dictated by the market. Success, to an artist, was often defined in staying true to one's self.

The second group, craftsmen, has some similarities to the art group, but are more structured.

"Craftsmen or tradesmen have certain ways of doing things, and the end product is extremely important to them," Wood said. "They usually have very tidy workspaces and take very good care of their tools. They tend to feel that their work reflects their training and heritage."

One subject told the researchers, "The whole difference between being a craftsman and being just another slack-worker out there is that your trade comes first. Your work is always impeccable."

Craftsmen are also not in their professions to make lots of money. For many, client relationships and reputation are large motivations. One subject summed up the thinking of this group by telling researchers, "My goal is to make a special wine, not to be the biggest winemaker."

Engineers are the third group identified by the researchers and were the most "traditional" of the groups.

"Engineers are always looking for ways to increase efficiencies, finding the newest methods and best plans, " Wood said. "They are the ones who make the most money, and they are proud of the way they run their businesses."

Engineers pride themselves on efficiency, not only because it increases their earnings, but also because it is a trait that they value. They also tend to pride themselves on lessons learned from previous experiences.

"All of the companies that I worked for failed, and so I started learning," one subject told the researchers. "First, what I learned was that none of the managers cared about me or any of the other employees. They had no people skills and were all programmers. Second, I learned the companies failed because they were poorly managed. So I caught the religion of management." In the engineering group, entrepreneurs might feel limited by standards and codes.

Brokers make up the fourth group. "Brokers are the ‘buy low, sell high' group that we tend to think of as the ‘whatever it takes' type of entrepreneur," Wood said. "This group is all about making money. That is the way they identify their own success."

The market drives every aspect of their behavior, so those in the brokerage group pride themselves on staying very updated. They are concerned with client relationships only to the extent that they are profitable, and feel limited only by money and market conditions.

"It's the easiest thing in the world," one subject said. "You buy things and you sell them for more than you buy them for."

The final group is bricoleurs. "This is the group that operates with only what they have on hand," Wood said. "They often have stockpiles of what appears to be junk, but they pride themselves on using and combining those resources in unique ways and problem solving from just what they have."

Entrepreneurs in the bricolage category define success by "making it work" by any means and without regard to a timeframe. They are limited only by the items they have on-hand. Workspaces for bricoleurs is usually unorganized and cluttered. Codes and regulations have little or no impact on this group, not because they want to break the rules, but because they do not consider them important in their quest to making something work. Legal and social conventions are not a part of the business. However, researchers discovered that bricoleurs did have a keen sense of their market niche, and exactly how much their customers would tolerate of their unusual practices. Money is not a motivation for this group.

Wood is very excited about where this research could lead and the ways it may shape future research.

"Prior to this, we talked a lot about what makes entrepreneurs different from non-entrepreneurial business people," he said. "But we assumed they were one big group. But it only makes sense to talk about them as a group if what they define as success is the same. Now we know that they are not one, but five distinct groups. We need to spend more time talking about the differences between entrepreneurs. It's a much more useful endeavor."

Wood has already put his research to work in the classroom setting.

"It broadens students' perspectives about looking at success," he said. "It forces them to put aside the idea that entrepreneurship is all about making money, and take a closer look at what gives people a sense of success, of who they are and what they want to achieve. I think it's an exciting step in this growing field."

Matthew Wood
Baylor University