Levelling the playing field - women's entrepreneurship as an egalitarian choice : Women's Entrepreneurship as an Egalitarian Choice 9781845444211, 9780861769513

Citation preview

NEW-wimr_cover_(i).qxd

6/23/04

10:48 AM

Page 1

Volume 19 Number 3 2004

ISBN 0-86176-951-1

ISSN 0964-9425

Women in Management Review Levelling the playing field – women’s entrepreneurship as an egalitarian choice Guest Editors: Jeannette Oppedisano and Sandra L. Fielden

www.emeraldinsight.com

Women in Management Review Volume 19, Number 3, 2004

ISSN 0964-9425

Levelling the playing field – women’s entrepreneurship as an egalitarian choice Guest Editors: Jeannette Oppedisano and Sandra L. Fielden

Contents 134 Access this journal online 135 Abstracts & keywords 137 Guest editorial 139 Entrepreneurship and social inclusion Sandra L. Fielden and Adel Dawe 143 Entrepreneurship: not an easy path to top management for women Joan Winn

164 Women home-based business owners: insights from comparative analyses Karyn Loscocco and Andrea Smith-Hunter 174 Giving back: women’s entrepreneurial philanthropy Jeannette Oppedisano 178 Bookshelf

154 Women entrepreneurs: out from under the glass ceiling Mary C. Mattis

Access this journal electronically The current and past volumes of this journal are available at:

www.emeraldinsight.com/0964-9425.htm You can also search over 100 additional Emerald journals in Emerald Fulltext:

www.emeraldinsight.com/ft See page following contents for full details of what your access includes.

www.emeraldinsight.com/wimr.htm As a subscriber to this journal, you can benefit from instant, electronic access to this title via Emerald Fulltext. Your access includes a variety of features that increase the value of your journal subscription.

How to access this journal electronically To benefit from electronic access to this journal you first need to register via the Internet. Registration is simple and full instructions are available online at www.emeraldinsight.com/ rpsv/librariantoolkit/emeraldadmin Once registration is completed, your institution will have instant access to all articles through the journal’s Table of Contents page at www.emeraldinsight.com/0964-9425.htm More information about the journal is also available at www.emeraldinsight.com/wimr.htm Our liberal institution-wide licence allows everyone within your institution to access your journal electronically, making your subscription more cost effective. Our Web site has been designed to provide you with a comprehensive, simple system that needs only minimum administration. Access is available via IP authentication or username and password.

Additional complementary services available Your access includes a variety of features that add to the functionality and value of your journal subscription: E-mail alert services These services allow you to be kept up to date with the latest additions to the journal via e-mail, as soon as new material enters the database. Further information about the services available can be found at www.emeraldinsight.com/ usertoolkit/emailalerts Research register A web-based research forum that provides insider information on research activity world-wide located at www.emeraldinsight.com/researchregister You can also register your research activity here. User services Comprehensive librarian and user toolkits have been created to help you get the most from your journal subscription. For further information about what is available visit www.emeraldinsight.com/usagetoolkit

Choice of access Key features of Emerald electronic journals Automatic permission to make up to 25 copies of individual articles This facility can be used for training purposes, course notes, seminars etc. This only applies to articles of which Emerald owns copyright. For further details visit www.emeraldinsight.com/copyright Online publishing and archiving As well as current volumes of the journal, you can also gain access to past volumes on the internet via Emerald Fulltext. Archives go back to 1994 and abstracts back to 1989. You can browse or search the database for relevant articles. Key readings This feature provides abstracts of related articles chosen by the journal editor, selected to provide readers with current awareness of interesting articles from other publications in the field. Reference linking Direct links from the journal article references to abstracts of the most influential articles cited. Where possible, this link is to the full text of the article. E-mail an article Allows users to e-mail links to relevant and interesting articles to another computer for later use, reference or printing purposes.

Electronic access to this journal is available via a number of channels. Our Web site www.emeraldinsight.com is the recommended means of electronic access, as it provides fully searchable and value added access to the complete content of the journal. However, you can also access and search the article content of this journal through the following journal delivery services: EBSCOHost Electronic Journals Service ejournals.ebsco.com Huber E-Journals e-journals.hanshuber.com/english/index.htm Informatics J-Gate www.j-gate.informindia.co.in Ingenta www.ingenta.com Minerva Electronic Online Services www.minerva.at OCLC FirstSearch www.oclc.org/firstsearch SilverLinker www.ovid.com SwetsWise www.swetswise.com TDnet www.tdnet.com

Emerald Customer Support For customer support and technical help contact: E-mail [email protected] Web www.emeraldinsight.com/customercharter Tel +44 (0) 1274 785278 Fax +44 (0) 1274 785204

women who have lived in both worlds – that of the stable company and one launched and run on their own – give some insight as to the nature of the problems and perceptions faced by women as managers and entrepreneurs. Issues such as genderrole bias and work/life balance are concerns for women with and without children. Gathering information from women who decided to form their own organizations after they had worked in a large organization, this paper examines some of the decision-making factors and socio-personal constraints that affect such entrepreneurship.

Abstracts & keywords

Women entrepreneurs: out from under the glass ceiling Entrepreneurship and social inclusion

Mary C. Mattis

Sandra L. Fielden and Adel Dawe

Keywords Women, Entrepreneurs, Corporate ownership, United States of America

Keywords Women executives, Entrepreneurs, Corporate ownership, Social alienation Women in the UK frequently do not consider business ownership as an alternative to other forms of employment or as a means to gain economic benefits. The number of women currently entering in to businesses in the North of England is decreasing and is less than half of that in the South. This paper examines the preliminary findings from a longitudinal study exploring the socially created barriers to business start-up that inhibit the growth of women entrepreneurs and how they may be removed. The study employed an action research approach to investigate the experiences of UK women entering into micro and small business ownership, emphasising the social construction of many of the barriers faced by women in the pursuit of business ownership. In doing so it examined personal and motivational factors surrounding the start-up process, the economic and physical barriers encountered, as well as the perceived and actual support and advice available to women.

Entrepreneurship: not an easy path to top management for women

Women home-based business owners: insights from comparative analyses

Joan Winn

Karyn Loscocco and Andrea Smith-Hunter

Keywords Entrepreneurialism, Corporate ownership, Women, Gender, United States of America Despite the increased gender parity in the workforce today, few women attain top management positions in America’s largest corporations. Instead, an increasing number of women are achieving CEO status as entrepreneurs. In-depth interviews with

Women in Management Review Volume 19 · Number 3 · 2004 · Abstracts & keywords q Emerald Group Publishing Limited · ISSN 0964-9425

During the past decade, the incidence of women starting businesses dramatically accelerated in the US. A national, representative sample of women (and men) business owners was interviewed by telephone to understand better this phenomenon. This analysis focuses on women business owners who left corporate careers to start their own businesses. Respondents’ experiences with corporate “glass ceilings” and “glass walls”, such as lack of flexibility and challenge, lack of role models and mentors, lack of access to line positions with concomitant intrapreneurial opportunities, and failure of organizations to credit and reward women’s contributions, are examined. Differences among three age cohorts of women business owners, included in the analysis, portend increased difficulty for companies in retaining talented women professionals and managers, especially those with entrepreneurial interests. Recommendations to companies include identifying and eliminating barriers to women’s advancement in the corporate culture and work environment, and development of more intrapreneurial opportunities.

Keywords Women, Corporate ownership, Homeworking, Entrepreneurialism, Family, Economic growth Recent research on women business owners deemphasizes home-based business ownership, despite the fact that home-based ownership is on the rise. This study uses data from the Upstate New York Small Business Project to compare women engaged in home-based businesses to their counterparts, who locate their businesses outside the home. The results indicate that the women engaged in home-based business ownership experience less work to family

135

Abstracts & keywords

Women in Management Review Volume 19 · Number 3 · 2004 · 135-136

conflict than their counterparts. Yet their businesses enjoy less economic success than those run by their non-home-based counterparts. This suggests that home-based ownership may be a good option only for women who do not have strong financial needs.

Giving back: women’s entrepreneurial philanthropy Jeannette Oppedisano Keywords Entrepreneurialism, Women, Philanthropy, United States of America, Social action Traditionally, the concept of entrepreneurship included a for-profit bottom line. Recently, however, researchers have begun to explore an adaptation of

this model called “social entrepreneurship”; that is, creating organizations for the greater good of a community, region, nation, or the world. These entrepreneurs use money that they made or inherited to establish organizations from a missionary and visionary posture. This is an arena where women have had significant impact, yet little has been written to celebrate their contributions. The purpose of this paper is to explore the concept of such philanthropy, to suggest where this social ethic might have had its origins, and to provide samples of women who have been entrepreneurial in their social commitment. Suggestions for future research on women’s entrepreneurial philanthropy will also be made.

136

Levelling the playing field: women’s entrepreneurship as an egalitarian choice

Guest editorial

About the Guest Editors Jeannette Oppedisano ([email protected]) earned her BA in English Education and her MS in Educational Administration in Higher Education from the State University of New York at Albany. Her PhD in Management is from Rensselaer Polytechnic Institute. She is a Full Professor and Chair of the Department of Management/MIS in the School of Business at Southern Connecticut State University and is a participant in the Women’s Studies program there as well. Dr Oppedisano’s publications include: the first Encyclopedia of American Women Entrepreneurs 1776 to the Present; “Entrepreneurial women and life expectancy”, co-authored with Dr Sandra Lueder; and “Past journeys: lessons learned from entrepreneurial women in history”, for the forthcoming International Handbook for Women and Small Business Entrepreneurship. Sandra L. Fielden is a Lecturer in Organisational Psychology and Co-Director of the Centre for Diversity and Work Psychology, with interests in diversity, equal opportunities, women in management, female small business owners, gender and unemployment in managers, the psychological contract, and organisational change. She is involved in applied research within the public and private sector, including several European funded research projects into female and black and ethnic minority small business ownership and economic growth. Sandra is a chartered psychologist and editor of Women in Management Review.

Women in Management Review Volume 19 · Number 3 · 2004 · pp. 137-138 q Emerald Group Publishing Limited · ISSN 0964-9425

The domain of the Entrepreneurship includes the “creation and management of new businesses, ecological influences on venture creation and demise, and international entrepreneurship”. All of the papers in this special issue will be addressing the creation of new ventures from small, familybased businesses to socially-focused larger entities. Of particular importance is the struggle of women as they confront the “special problems of entrepreneurs” – ranging from corporate barriers, family/work role conflicts, diminished opportunity recognition based on regional economic and selfperception limitations, to societally-based gender discrimination. Women continue to struggle toward success in corporate and self-employment ventures under burdens that, at least on their surface, appear to be related to gender and gender bias. Since an “ecological” framework includes behavioural and psychological determinants, social groups – primary/institutional/community – as well as historical public policy impact and physical environmental, the contents of this special issue are directly relevant for all women. The themes running throughout this issue are women’s motivations for pursuing or not pursuing entrepreneurial ventures, the internal and external barriers that persist, the impact of the many dimensions of family on those decisions, and the direction research should take for greater understanding of women’s economic pursuits. It explores the constraints and opportunities encountered by women in all organizational structures. Though our topic may seem obvious as a relevant consideration for this division, we would like to highlight the fact that women’s entrepreneurship – with its multidimensional impact – is still a relatively new area for academic research. The “theoretical and methodological approaches to the study of gender” as they relate to the initiation of entities that involved human, physical, and financial risk and had economic and social impact. The techniques employed by these researchers ranged from qualitative personal interviews to quantitative statistical analyses of large databases, and the results are informative in their discussion of the uniqueness of women’s entrepreneurship. Using a social construction methodology, Fielden and Dawe conducted a comparative analysis of the barriers surrounding business startups in Northern and Southern England. Some of their findings support past research conclusions; namely, that women have a lack of access to support, finance, premises, and childcare. What is significant is their finding that women, themselves,

137

Guest editorial

Women in Management Review Volume 19 · Number 3 · 2004 · 137-138

did not recognize the external problems; instead, they perceived their experiences, their abilities, their socio-economic backgrounds to be the limiters. Fielden and Dawe used communitybased workshops run over six weeks for women who had considered a business start-up but had not acted on that desire. This action research model was designed to ensure that the process was driven by the women themselves, rather than being based on any previous model of business start-ups. The impact of self-perception, role models, and social deprivation on women’s decision to become or not become entrepreneurial will be discussed. Winn has also conducted a comparative analysis of women’s decision-making – this time the study was of women who have chosen both a corporate career and an entrepreneurial venture. In most of the cases, a woman’s choice of business was closely linked to her family situation and the constraints these responsibilities imposed. Even when the business was originally set up to be jointly run by husband and wife, more men than women kept their secure corporate job. In some cases, the husband perceived his wife’s business as a “hobby”, even if her business brought in the majority of the household income. Married women with children were the least likely to succeed if their husbands were not supportive or involved in the business. Like their corporate sisters, most of the women interviewed found business ownership created marital stress and was not compatible with raising a family. Mattis also analyzed the outcomes of interviews, this time with 650 women and 150 men, to compare women’s and men’s experience prior to starting their own businesses. Additionally, she wanted to ascertain motivating factors for entrepreneurial decisions, the dynamics that drew women away from and sometimes back towards corporate careers, and the satisfactions derived from their choices. Mattis found that, regardless of gender, the pull of an entrepreneurial idea was the single greatest reason for starting a business. The desire for greater flexibility, perceptions of gender inequities in former employment settings, lack of challenges and downsizing all played a more

significant role in entrepreneurial motivations of today’s generation of women business owners who have owned their businesses less than ten years, compared to those who started businesses 20 or more years ago. Combining the perspectives of a business and a sociology researcher, Smith-Hunter and Loscoco decided to look at the home-based business owner, since this woman has taken control over her employment and chosen to locate the business in the same place in which she lives. Their desire was to shed some light onto how operating a homebased business affects work/family balance or conflict, what the motivating factors for this decision were, and how these women entrepreneurs defined success. Using structured interviews of 300 women and 300 men who owned small businesses in the same six industries, they found that women were almost twice as likely to have home-based businesses as men; that they were, on average, smaller and “newer” than other small businesses; and that their focus was more likely to be in manufacturing or business services. Women, more than men, start their own business to make a social contribution; however, their impact has been largely ignored by historians, academic researchers, and fund raising practitioners. To begin to correct this void, Oppedisano conducted historiographical research into women’s giving and social impact when they used the entrepreneurial model – that is, starting an entity; taking human, physical, and financial risk; and having an economic impact. Women will be profiled and answers to the following questions will be explored: Who were their role models? Who were the recipients of their generosity? What types of philanthropic organizations did they initiate, do they exist today, and, if so, in what form? In essence, this special issue looks towards the creation of a female model of entrepreneurship, providing an increased understanding of the barriers and women’s roles in their prolongation and/or demise. Jeannette Oppedisano and Sandra L. Fielden Guest Editors

138

Introduction

Entrepreneurship and social inclusion Sandra L. Fielden and Adel Dawe

The authors Sandra L. Fielden is a Lecturer and Adel Dawe is Project Officer, both at the Manchester School of Management, UMIST, UK.

Keywords Women executives, Entrepreneurs, Corporate ownership, Social alienation

Abstract Women in the UK frequently do not consider business ownership as an alternative to other forms of employment or as a means to gain economic benefits. The number of women currently entering in to businesses in the North of England is decreasing and is less than half of that in the South. This paper examines the preliminary findings from a longitudinal study exploring the socially created barriers to business start-up that inhibit the growth of women entrepreneurs and how they may be removed. The study employed an action research approach to investigate the experiences of UK women entering into micro and small business ownership, emphasising the social construction of many of the barriers faced by women in the pursuit of business ownership. In doing so it examined personal and motivational factors surrounding the start-up process, the economic and physical barriers encountered, as well as the perceived and actual support and advice available to women.

Electronic access The Emerald Research Register for this journal is available at www.emeraldinsight.com/researchregister The current issue and full text archive of this journal is available at www.emeraldinsight.com/0964-9425.htm

Women in Management Review Volume 19 · Number 3 · 2004 · pp. 139-142 q Emerald Group Publishing Limited · ISSN 0964-9425 DOI 10.1108/09649420410529843

The UK small business literature, almost universally, regards business owners as white males, with women business owners of any social background being generally neglected (Fielden et al., 2003). Where women are considered, the focus tends to be on middle class women, from educated backgrounds, with a family history of business ownership (see Carter et al., 2001 for a comprehensive review). The reason for this is twofold. First, this is the profile of the majority of successful women business owners in the UK and hence they are the most visible and accessible. Second, the literature concentrates on women who have already made the decision to pursue business ownership, rather than those who have the potential to do so. The end of the last millennium witnessed a large growth in small-to-medium-sized enterprises (SMEs) in the UK, partly due to the economic philosophies of the conservative government (DfEE, 2003). Women’s importance as a largely untapped pool of entrepreneurial talent is still widely recognised in most western economies (Shaw et al., 2001) and the European Union spend millions each year in order to increase the profile of women entrepreneurs throughout its member states. Yet, despite the many initiatives that have been employed in the UK to increase the number of entrepreneurs, across the country the figures still remain low with women accounting for only 26 per cent of micro businesses (Macaulay, 2003). The locality of business ownership also appears to be a significant factor in predicting business startup. For example, in the Northwest of England where there is a long tradition of working women, the general uptake of women in self-employment and business is less than half of the national average (DfEE, 2003). Why should the gap between north and south be so great? In a study exploring the barriers surrounding business start-up in the Northwest, issues such as a lack of access to support, finance, premises and childcare were identified as key factors in determining women’s entry into enterprise (Fielden et al., 2003). In light of previous studies these findings are not surprising, however, what this study did suggest was that more subtle socially constructed barriers were responsible for inhibiting women’s progressions. For example, the male model of business start-up that underpins the majority of service provision in the UK, not only inhibits women who have reached the start-up stage but also impacts on those who may consider This research was jointly funded by the University of Manchester Institute of Science and Technology and the European Social Fund.

139

Entrepreneurship and social inclusion

Women in Management Review

Sandra L. Fielden and Adel Dawe

Volume 19 · Number 3 · 2004 · 139-142

business ownership as an alternative to other forms of employment. These barriers were not overtly recognised by the women themselves as problems but frequently underpinned their experiences and perceptions. Women from lower socio-economic backgrounds felt that business ownership was “something that other people did”, which was compounded by a total absence of female role models in either professional, managerial or entrepreneurial positions. Thus, women from areas of deprivation (the greatest prevalence being in the North of England) are less likely to view themselves as potential entrepreneurs.

The key factors and themes arising from the workshop discussions were recorded. In addition, questionnaires were developed to assess personal and motivational factors, including confidence, self-efficacy, self-esteem and fear of failure. Questionnaire responses were measured using a five-point Likert scale, with 1 ¼ “Not at all”, 2 ¼ “Rarely”, 3 ¼ “Sometimes”, 4 ¼ “Often” and 5 ¼ “Always”. These were distributed to all participants for completion at the first workshop, and are currently being reissued in order to evaluate any shift in perceptions over the intervening 12-month period. Progress tracking has also taken place with follow-up interviews conducted after six months and, of the 53 participants who attended the workshops, 23 have now entered small business ownership.

Methodology This longitudinal study was designed to examine the personal and motivational factors surrounding the start-up process, the economic and physical barriers encountered, as well as the perceived and actual support and advice available to women. In order to explore the factors influencing women in their desire to pursue business ownership, an action research approach was employed. This paper reports the interim findings of that study, with preliminary analysis of the experiences of women from socially excluded backgrounds entering small business ownership. In total, 53 women took part in the study who were recruited through community groups and advertisements in the local press. The average age of workshop participants was 46.5, of whom 50 per cent were married or cohabiting and 71 per cent had between one and five children. Their occupational backgrounds ranged from beautician to warehouse operative, incorporating a variety of blue and white collar occupations. In terms of education 44 per cent had professional qualifications and 60 per cent were educated to GCSE level (i.e. exams taken at 16 years of age) and above. Only 28 per cent of participants had some experience of small business operation, although 39 per cent did have family members who had been involved in running a small business. Community based workshops were run over a period of six weeks (two hours each) for women who had considered business start-up but who had not done anything to further that desire. The workshops were designed to provide a framework for determining the requirements of women in terms of advice, support and training and to provide a discussion forum to explore the participant’s experiences, desires and developmental needs. The action research approach sought to ensure that this process was driven by the women themselves, rather than being based on any previous model of business start-up.

Findings Many of the women who participated in the workshops have taken their first steps towards business start-up (35), with an increasing number actually becoming business owners (23). The preworkshop questionnaires showed that participants did possess a reasonably high degree of selfefficacy (x ¼ 3.64) and there was a strong feeling that they could have achieved more in life (x ¼ 3.48). “Hard work and effort” were ranked as the most important factor determining success (x ¼ 4.35), followed by “the right circumstances” (x ¼ 4.04). Participants reported using a range of coping strategies in approaching challenging tasks, although these tended to be used only sometimes with only “finding out what I need to do” and “going over in my mind what I will say or do” being used more frequently (x ¼ 3.85 and x ¼ 3.54 respectfully). In addition, participants reported that, on the whole, they did not experience negative feelings, with “frustration” and “nervousness” being the main exceptions (both x ¼ 3.00). The data collection for the 12 month period is still being conducted but interview data at the post six month stage, combined with the action learning findings, that explore specific barriers to business start-up are reported below. These are summarised as follows: (1) Fear of failure. Not having any guarantees of having enough finances to pay a weekly wage was preventing one women form progressing into self-employment. “What happens if I don’t make enough money to pay my wages? What do I do then? And what happens if noone wants my curtains?” (2) Lack of start-up capital/ fear of banks. Several women reported that they were unsure if they could approach a bank for business start-up

140

Entrepreneurship and social inclusion

Women in Management Review

Sandra L. Fielden and Adel Dawe

Volume 19 · Number 3 · 2004 · 139-142

capital. “I don’t know where to go to get help (financial).” When asked who they had approached one women commented, “I have not been to the bank. I never thought to. Would they lend me money? I’m not sure if I could ask them and if I did borrow money I might not be able to pay it. I couldn’t do that”. When approaching financial institutions women’s lack of confidence can be a significant barrier as the experience of one woman who went to her bank to apply for a start-up grant illustrates. “They wanted to know how much money I was putting into the business. When I filled the application form I had no money to put in. I’ve got two sewing machines that are worth about £2,000 but I didn’t think to mention those.” Her application was rejected. (3) Partners attitude. Several women found that their partners were unsupportive of them entering into self-employment. One women explained, “He (her husband) wants me to stay where I am, because we rely on my wages. Where I am now I get paid every week, what happens if I don’t get paid one week? Where will we get money from then?” (4) Lack of knowledge. One women reported that she went to get advice but was prevented from pursuing it further, as she had no knowledge of how to complete the necessary paperwork. “I went to see the Business Link advisor and he gave me a business plan to fill. See it’s here (the business plan). He wants to see me when I’ve done it. And I don’t know what to put in it.” (5) Lack of affordable and trustworthy childcare. Women with younger children appeared to have access to good childcare facilities. However, what presented itself as a problem for some women was the lack of adequate and affordable childcare for older children in the school holidays that needed daytime supervision. As one women explained, “The play schemes are good but they don’t cover all the school holidays and sometimes I have a problem getting my children to go.”

becoming entrepreneurs, rather it was an absence of others belief in their abilities. This is further supported by the finding that a key aspect in their decision to pursue small business start-up was the emotional support they had received from their workshop peers. They had learned to believe that they could translate their abilities into action, realising that, with the right encouragement and advice, business ownership was something that not only other people could do, but something they could do. Interestingly, although participant’s reported reasonable high confidence levels, it did not translate into their perceptions of mainstream provision. Women did not feel comfortable accessing mainstream advice and business support, especially as the vast majority of the available provision is centrally located rather than being community based. Thus, it is likely that their confidence levels are bounded by their social circumstances and within their known surroundings they do experience a sense of control and self-efficacy. However, a lack of experience and an absence of role models makes breaking through their own social boundaries difficult and uncomfortable, resulting in decreased confidence and an increase in their anxiety levels when they attempt to push back the barriers. The potential of women as entrepreneurs and the contribution they could make to the economy has been recognised by the UK government (Shaw et al., 2001), who have supported a wide variety of projects in order to assist women into enterprise. However, these initiatives have generally failed to increase the number of women business owners in the UK (Macaulay, 2003). The women who participated in this study reported that they were unaware of any such initiatives and, even when such initiatives were highlighted, they were perceived as being for “other” women, i.e. those from higher socio-economic backgrounds. These findings suggest that these initiatives are failing to tap into the vast pool of entrepreneurial talent that is waiting to be unlocked in areas of social deprivation, because they do not understand their target audience. They do not recognise the difficulties experienced by women from lower socio-economic classes in interacting with a maledominated business community that has little understanding of the world they live in. Furthermore, even initiatives that target women who have already taken the first steps towards business start-up fail to capitalise on that potential, again because of lack of understanding of the barriers they face both internally and externally. Advice agencies and funding bodies need to shift the emphasis from quantity outputs to quality, if they are to see any real long-term change in women’s participation in enterprise creation. They

Discussion The preliminary findings from this study indicate that there is a contradiction between the perceptions of women towards their abilities and how they translate that self-belief into action. The women in this study clearly did not lack the desire or motivation that inhibits many individuals from

141

Entrepreneurship and social inclusion

Women in Management Review

Sandra L. Fielden and Adel Dawe

Volume 19 · Number 3 · 2004 · 139-142

also need to recognise that in order to unlock the potential of women from socially deprived backgrounds they need to take their products and services to women in the community, rather than relying on women breaking through the boundaries imposed by their social backgrounds.

literature”, Report to the Small Business Service, University of Strathclyde, Glasgow. DfEE (2003), Labour Force Survey, HMSO, London. Fielden, S.L., Davidson, M.J., Dawe, A. and Makin, P.J. (2003), “Factors inhibiting the economic growth of female small business owners”, Journal of Small Business and Enterprise Development, Vol. 10 No. 2, pp. 152-66. Macaulay, C. (2003), “Changes to self-employment in the UK”, Labour Market Trends, December, pp. 623-8. Shaw, E., Carter, S. and Brierton, J. (2001), “Unequal entrepreneurs: why female enterprise is an uphill business” policy paper, The Industrial Society, London.

References Carter, S., Anderson, S. and Shaw, E. (2001), “Women’s business ownership: a review of the academic, popular and internet

142

Entrepreneurship: not an easy path to top management for women Joan Winn

The author Joan Winn is Associate Professor of Management at the Daniels College of Business, University of Denver, Colorado, USA.

Keywords Entrepreneurialism, Corporate ownership, Women, Gender, USA

Abstract Despite the increased gender parity in the workforce today, few women attain top management positions in America’s largest corporations. Instead, an increasing number of women are achieving CEO status as entrepreneurs. In-depth interviews with women who have lived in both worlds – that of the stable company and one launched and run on their own – give some insight as to the nature of the problems and perceptions faced by women as managers and entrepreneurs. Issues such as genderrole bias and work/life balance are concerns for women with and without children. Gathering information from women who decided to form their own organizations after they had worked in a large organization, this paper examines some of the decisionmaking factors and socio-personal constraints that affect such entrepreneurship.

Electronic access The Emerald Research Register for this journal is available at www.emeraldinsight.com/researchregister The current issue and full text archive of this journal is available at www.emeraldinsight.com/0964-9425.htm

Women in Management Review Volume 19 · Number 3 · 2004 · pp. 143-153 q Emerald Group Publishing Limited · ISSN 0964-9425 DOI 10.1108/09649420410529852

Corporate America’s “grey flannel suit” has undergone profound alterations within the last few decades. A brief tour inside the corporate walls reveals major changes, not just in technology and marketing, but also in management and operations. Traditional bureaucratic hierarchies are giving way to cross-disciplinary teams. Factories manipulate heavy equipment with the touch of a computer keyboard. The manager’s job has largely changed from director to facilitator, from provider to counselor. Flexibility, not force, is the code-word for success. We no longer regard competition as a battlefield but, instead, view it as a challenge of innovation, persuasion, and negotiation. Women have historically been viewed as having the requisite skills when it comes to cooperating, nurturing, adapting, and persuading. Yet only three women were listed among the CEOs of the world’s 500 largest corporations in 2000 (Northouse, 2001). Fewer than 6 percent of all corporate CEOs are women, a figure that has varied by a mere one percentage point over the last 20 years (Catalyst, 2001). Susan Ness, former FCC commissioner and director for the Annenberg Public Policy Center of the University of Pennsylvania, observed, “With few exceptions, we have not moved beyond tokenism in the number of women in top leadership positions” (Mediaweek, 2002). Furthermore, women held only 10.9 percent of all board seats in the top Fortune 1000 companies in 2001, an increase of less than 1 percent from 1999. Nearly 40 percent of the Fortune 501-1000 companies had no women on their Boards of Directors, an increase from all-male Boards in 1999 (Catalyst, 2001). Among those who run their own business, women are increasingly well represented. According to the Small Business Administration (2001), women own one-third of all American businesses. These US women-owned businesses employ more people than the entire Fortune 500 list of America’s largest companies combined. Between 1997 and 2002 the growth of womenowned firms outpaced the overall growth of businesses by nearly two-to-one and the revenues generated by women-owned enterprises grew by 40 percent (Center for Women’s Business Research, 2001). If so many women are capable of running companies of their own, why do so few women populate the top rungs of corporate America? Certainly the support systems in large companies are better, for example, there is an established network of policies and personnel available to keep operations moving smoothly and provide slack to

143

Entrepreneurship: not an easy path to top management for women

Women in Management Review

Joan Winn

Volume 19 · Number 3 · 2004 · 143-153

mitigate production spikes and unanticipated emergencies. Additionally, large companies typically have better benefits – including institutionalized vacation policies and mandated parental leave – critical components to those with family responsibilities. Does the Aristotelian view that women are less capable than men in the executive suite still prevail?

young children are increasingly leaving the workforce to become full-time mothers. Even among executives, an increasing number of women are “stopping out” to raise families as the demands of corporate life impinge on the quality and quantity of family time. Hewlett’s recent (2002) study indicated that women in companies that offered flexible hours or work-at-home options were more likely to stay after the birth of a child. Even with the opportunity for flexible work arrangements, women in her study were more likely to be childless (42 percent) or have stay-athome husbands (30 percent). Despite the near parity in overall workforce representation, the number of women CEOs is unlikely to swell anytime soon (Daily et al., 1999). Women may be gaining visibility as a select few attain upper management positions, but the corporate ladder is still populated by middle-aged men hanging onto the rungs. As this generation of corporate bosses approaches retirement, they are being replaced by up-and-comers who have been educated in modern business practices. Fewer women than men seek MBA degrees. Fewer women in the pipeline translates to fewer women ascending to the top. Formal training and mentoring programs can target women and minorities who might otherwise be overlooked, but there remains a dearth of role models and mentors for women. Mentor availability notwithstanding, as middle management positions fall by the wayside, the fasttrack slows to a crawl. Because of this, Baxter and Wright (2000), while acknowledging that women face greater obstacles than men as they move up the corporate hierarchy, question “systematic glass ceiling effects” for women in the US. After all, with each promotion, the opportunities for the next promotion for men and women alike are fewer as the playing field grows narrower. Nonetheless, women are scarce at all but the lowest ranks in most companies. Some researchers blame women themselves, not for their lack of abilities or drive, but for their lack of assertiveness in making their wishes known. Too often women wait to be recognized rather than ask for promotions, pay raises, or even acknowledgment of their contributions. Nevertheless, comparisons of men and women in management suggest that women’s career progression is a function of gender roles and bias (Kirchmeyer, 1998; Ragins et al., 1998), rather than assertiveness or competence. The Conference Board of Canada’s survey of female executives reported that “harassment and discrimination remain significant problems for women in management” (Maclean’s, 2000, p. 28).

A snail’s pace to the top The popular press is quick to headline the women who make it to the boardroom of corporate America. However, even Fortune magazine acknowledges that few women reach the ranks of upper management and, those who do, “don’t wear their power quite as comfortably as men do” (Sellers, 2002, p. 102). For the last two decades, women have cited lack of mentoring, lack of managerial experience, exclusion from informal networks, and male stereotyping as the prime barriers to advancement. Effective management may require nurturing and facilitating, but getting into management positions still takes directness and visibility – and time at the office. In the corporate world, for men and women alike, the path to upper management has an established protocol. Usually long hours, demonstrating ambition and loyalty to the organization are prerequisites to promotion. With no familial responsibilities to interfere, both men and women can compete on an even plane. This becomes difficult when marital and family situations change. Linda Stroh, Professor of Industrial Relations at Loyola University in Chicago, sees the problem as the “lingering and often unconscious perception (by others) that women are going to leave to have babies” (Fisher, 1992, p. 45). Sylvia Hewlett (2002) believes that women who choose to pursue corporate careers often realize too late that their childbearing opportunities have passed. Author and poet Ellen Gilchrist (2002, p. 256), sees family and work as a “war, with guilt as their nuclear weapon and mutually assured destruction as their aim”. Lately, personal and family responsibilities have risen to the top of the list of reasons women give for not rising to top management (Morris, 2002). For the most independent and ambitious of women, the role of wife may not alter her ability or willingness to climb the career ladder. However, for women with children, the corporate climb becomes more difficult. As guilt and stress outstrip the benefits of income and prestige, women with

144

Entrepreneurship: not an easy path to top management for women

Women in Management Review

Joan Winn

Volume 19 · Number 3 · 2004 · 143-153

The lure of entrepreneurship The contrast between the number of US women executives running large public corporations with the number of women running their own businesses is striking. The Center for Women’s Business Research (2001) estimated that there were 6.2 million majority-owned, privately-held women-owned firms in the US, employing 9.2 million people and generating $1.15 trillion in sales in 2002. Between 1997 and 2002, the Center estimated that the number of women-owned firms increased by 14 percent nationwide – twice the rate of all firms. Employment in these firms increased by 30 percent, which is 112 times the average employment rate. Sales grew by 40 percent – the same rate overall for US firms. Sylvia Hewlett (2002) reported that an increasing number of women choose entrepreneurship out of frustration with demanding and inflexible work environments. Self-report questionnaires and interviews of women who start their own businesses revealed that they believed that corporate America would not accommodate their personal situations nor satisfy their professional goals (Moore and Buttner, 1997). In stark contrast to their male peers, successful, upwardly-mobile women in Fortune 500 companies tended to be single (55 percent), without children at home (80 percent) (Stroh et al., 1992). Running one’s own business has long been perceived as more compatible with women’s role in child-rearing because of greater flexibility (Scott, 1986). Adults whose mothers were entrepreneurs tend to view their mother’s business – and the role-modeling of “independence and control over their own destinies” – in a positive light (Schindehutte et al., 2003). An increasing number of corporations recognize that women with young children may need nontraditional work schedules. Although corporate structures are usually less accommodating for women who desire middle or upper management positions, large companies can accommodate family needs easier than small companies. In 2001, 87 percent of Fortune 1000 companies provided childcare assistance and 77 percent offered flextime schedules. However, as Hewlett (2002, p. 331) points out, “even a generous package of benefits cannot help employees strike a meaningful, sustainable balance between professional and personal life unless there is a fundamental change in the mind-set of managers”.

Reality versus perception Is independent business ownership the answer? While independent business ownership appears to be more compatible with women’s family responsibilities, the reverse may be true. In order to identify some of the constraints that precipitate or affect entrepreneurship, this author embarked on a study of career paths of women who decided to form their own organizations after they had worked in a large organization. Unstructured interviews with 24 women (names have been changed to protect confidentiality) were conducted at various stages of business ownership, from conception to dissolution of the business in some cases. Some commonalities began to emerge, namely, the expectations and enthusiasm for a new venture during its infancy, the struggles to sustain the business through its early years, and the pivotal role of family structure and support in the decision to initiate and continue a business. An overview of these women’s paths into (and out of) entrepreneurship is given in Table I. The narratives of the women in this study did not differ markedly from the reports of entrepreneurs in previous studies (e.g. Goffee and Scase, 1985; Scott, 1986; Orhan and Scott, 2001). A woman’s choice of business was closely linked to her family situation and the constraints that these responsibilities imposed. She desired an incomeproducing situation that allowed flexibility and autonomy. These women were no strangers to business, having worked for established organizations before striking out on their own. Their stories reveal both surprise and satisfaction from their ventures – surprise that running their own business was so difficult and satisfaction at having taken the plunge. Nevertheless, many of these women realized too late that independent ownership was not a panacea. Table II illustrates the issues that these women felt impacted the satisfaction they derived from their businesses.

Insider perspectives Isolation While studies of women managers and entrepreneurs yield few differences between those who pursue corporate life and those who venture out on their own, Brodsky’s (1993) study found that women entrepreneurs were more independent and less trusting of others than those in corporate management positions. Perhaps this is the effect, rather than the cause, of independent business ownership. Corporate managers can seek support within their own organizations; entrepreneurs

145

Entrepreneurship: not an easy path to top management for women

Women in Management Review

Joan Winn

Volume 19 · Number 3 · 2004 · 143-153

Table I Transitions and lifestyles of women entrepreneurs

Name Kathy

Lifestyle Married with children Married no children Divorced no children Single

Prior employment Landscape architect for large firm

Married with children Married with children Married no children

Food service manager for hotel chain Public school teacher

Heidi

Tina

Initial form Solo

Major business issues Childcare, home/office conflict Isolation, lack of clients Harassment, cash flow Ideological conflicts Economic downturn, cash flow Cash flow, long hours

Management consulting Marketing consultant Graphic design Engineering consulting

Solo

Specialty retail

Solo

Public school teacher

Restaurant

Copreneur

Cash flow, partner conflicts

Single

Marketing manager

Corporate backing

Karin

Single

Sales manager

Marketing and fulfillment Employment agency

Economic downturn, cash flow Cash flow, partner conflicts

Annette

Married with children Married with children Married no children Divorced, grown children Single

Social worker

Nancy Jan Shirley

Lisa

Margaret

Marketing and sales

Type of business Landscape architect

Marketing and sales Graphic designer

Partnership Copreneur

Corporate/ partner backing Partnership

Business status End

Next stage Joined small firm

Spouse

End

Business and savings Business

End

Joined consulting company Back to school

End

Partner with existing firm Independent consulting and catering Public school teacher

Business (twoincome household) Spouse

End

Business (twoincome household) Business

Sold at loss

Teacher at local college

Sold at loss

New venture with new partner

Business

Relinquished share of business to partner Going concern

Independent consulting

Liquidated at loss

Cash flow, isolation

Spouse

Partnership

Partner conflicts

Spouse

Sold business for profit

Independent consulting

Collectibles boutique Specialty retail

Solo

None

Spouse

Writing a book

Solo

Cash flow, isolation

Business

Sold business for profit Sold business for profit

Restaurant manager

Restaurant

Partnership

Business

Going concern

Divorced no children Single, one childa Married no children

VP sales for digital imaging company Corporate accountant Corporate trainer for large company

Internet graphics Specialty retail Management consulting

Partnership

Cash flow, partner conflicts Financing, cash flow Cash flow, partner conflicts Cash flow, partner conflicts

Business and savings Business

Going concern

Bought out partners Bought out partners Bought out partners Divorced, split business, now solo

Linda

Married no children

Research scientist

Scientific consulting

Solo

Cash flow, long hours

Vicky

Divorceda no children Divorced, one childa

IT/finance manager

Software development Restaurant

Copreneur

Long hours

Solo

Married with children

Senior division manager for large company

IT consulting

Partnership

Cash flow, location and economy Economic fluctuations

Mary

Ellen Claire

Joni Chris Jane Anne

Lori

Maureen

Sales and marketing

Public school teacher Bank VP

Travel agency manager

Private counseling practice Financial services

Solo

Primary income Spouse

Partnership Copreneur

Going concern

Business (twoincome household) Business (some money from spouse) Business

Going concern

Going concern

Business

Going concern

Business (twoincome household)

Going concern

Split business, now solo

New venture Partnership

Going concern

(continued)

146

Entrepreneurship: not an easy path to top management for women

Women in Management Review

Joan Winn

Volume 19 · Number 3 · 2004 · 143-153

Table I

Name Kelly

Sarah

Joyce

Lifestyle Divorced with childrena Married with children Married with children

Prior employment Account executive

Type of business IT consulting

Major business issues Economic fluctuations

Initial form Partnership

Secretary

Specialty retail

Partnership

Schedule constraints

Journalist and teacher

Specialty products distributor

Franchise

Long hours

Primary income Business (twoincome household) Spouse

Business status Going concern

Spouse

Going concern

Going concern

Note: areflects status change after business startup

Table II Summary table of concerns of women entrepreneursa Reported problems/stressors

Total sample (n524)

With children (n 5 12)

Without children (n 5 12)

(%) 38 33 29 25 13

(%) 58 17 25 25 25

(%) 17 50 33 25 na

Family pressures/gender-role expectations Isolation Partner conflicts Long hours Childcare

Note: aRespondents could identify more than one area. Data reflect comments about issues that impact business-ownership satisfaction, from unstructured interviews, reported as percent of respondents.

must seek support through external networks. This often results in feelings of isolation and loneliness as articulated by the women in this current study. Annette, who quit her social worker job when her children were born, started a private counseling practice when her children entered school. She enjoyed being able to set her own hours, but missed the camaraderie of colleagues. She found herself clinging to friendships “and seeking more opportunities for social events than I used to” now that those needs were not satisfied at work. Heidi and Karin attended the monthly meetings of a women’s group. “I need other women to talk to”, explained Karin. “The people [who work for me] expect me to have all the answers”.

Lifestyle issues as a by-product of the isolation that entrepreneurship imposed was mentioned frequently among owners of independent businesses. Single women often remained single, reporting that they had no discretionary time or emotional reserves beyond those required to meet the demands of their business. Chris, who worked for two years to get her internet company launched, lamented, “I haven’t had a date in three years. My only contacts are venture capitalists and clients.” On the other side of the “date problem”, Nancy claimed to have changed her dress and behaviors to ensure that male clients took her seriously. “They wanted romance, I

wanted contracts . . . In order to have a real social life I had to get out of the business.”

Marital dynamics While career opportunities for women have changed, family role models typically have not. While the number of stay-at-home dads has soared, their numbers are still few. Most young men and women still see their mother doing the majority of home chores. The father’s job is still seen as more important in terms of both money and prestige. Women are not prepared for the corporate pressures that impinge on their role in the family (the role that they were taught to play). White et al. (1997, p. 31) found that even among those who were career-oriented from an early age, many successful women undergo “role conflicts which may lead to an extended period of identity ‘diffusion’” and missed opportunities. Married women, especially those with children, live in two worlds: one at work and one at home. Even with a stable marital relationship to mitigate risk and provide a financial safety net and moral support, child-rearing responsibilities can interfere with the best of intentions. Children do not plan their illnesses or school schedules with their parents’ needs in mind. While it is often

147

Next stage

Entrepreneurship: not an easy path to top management for women

Women in Management Review

Joan Winn

Volume 19 · Number 3 · 2004 · 143-153

permissible to miss a day at the office to tend to family problems, small businesses have less slack than large companies and small business owners have less independence than their employees. Owners of new businesses find that they have more constraints and less flexibility than they anticipated in the planning stages of their business. For women, this is particularly troublesome.

authority” typically resulting in “the wife acquiescing to (the husband’s) benevolent authority” (Marschak, 1998, p. 169). “We started the business together,” explained Margaret about the restaurant she and her husband started when they relocated to the west coast. “But then his [design] business took off and I was left managing the restaurant. I couldn’t handle it all, especially when he continued to . . . give orders, but didn’t spend much time at the restaurant anymore.”

Kelly and Maureen started their consulting business together, with the idea of balancing family and work in mind. Kelly’s father and father-in-law both had built their own companies, and her husband was a successful commercial real estate broker. “My father and father-in-law both had their own businesses, so they thought that this was a great idea until I became pregnant. Then they fully expected me to build and sell [the business] and become a stay-at-home mom.”

Work/home conflict is evident even for women who do not have children. Like the women in the study by Stoner et al. (1990), the women in this study found that the demands of their business affected their ability to relax at home, causing marital unhappiness and work/home conflict. Even those women who were encouraged by their husbands reported that the time and stress of the businesses strained their marriages. Goffee and Scase (1985, p. 5) pointed out that while “the wives of small businessmen are often subordinated to the needs of their husbands”, the reverse is seldom true. For men, work and family are complementary; for women, work and family present a dilemma.

When the business that Shirley and her husband founded started to lose money, she was the first to leave, despite her CEO title. Eventually all but three of the employees were laid off. Her husband continues to do consulting under the business name. Shirley still contributes some administrative assistance but draws no salary.

Women’s career commitment is still viewed with suspicion (Cordano et al., 2002; Lancaster, 1999). Despite some evidence that time spent devoted to family obligations may hinder men’s advancement more than women’s (Konrad and Cannings, 1997), the stranglehold of gender-role bias should not be minimized in exploring professional women’s exodus from corporate America. “I don’t think [my husband] would learn to cook if his life depended on it,” Annette mused. “I schedule myself part-time so that I can be there when my kids come home from school. I’m lucky – I haven’t had to break appointments very often.” One woman admitted in confidence that “My husband’s secretary does things for him that I would never ask anyone I worked for to do for me.” She claimed that her husband eagerly went to their children’s athletic events, but refused to take them to doctors’ appointments. “He claims to be [more] involved in his children’s lives [than he actually is],” she sighed.

Lori confided that her husband always attributed the success of her restaurant to luck. He thinks I don’t work hard . . . that I got a lucky break by locating here when the economy took off.” Joyce and Sarah had husbands who paid little attention to their businesses as long as it didn’t drain the family finances. “You get used to him telling people how prestigious his job is . . . he thinks I’m just having fun,” lamented Sarah. Tina abandoned her dream of continuing business ownership, citing difficulties in getting enough clients. She also explained that the isolation of working independently put pressures on her husband and her marriage. He wanted to relax after work; she wanted someone to talk to.

Interviews by researchers Goffee and Scase (1985, p. 48) suggested that husbands rarely contributed to the running of either homes or businesses. This contrasts strongly with the experience of male proprietors . . . many male-owned enterprises could not survive without the unpaid contribution of wives who, in addition, are also single-handedly responsible for the family and the home. Even entrepreneurial couples, husband-wife teams who work closely together, “are often trapped by a gender-based division of responsibilities and

Child-rearing While many women become successful businessowners, the difficulties of balancing their families with their business obligations cannot be overemphasized. Longstreth et al. (1987) found that self-employed women worked fewer hours per week at their jobs than the average full-time worker. However, the women in their study, as well as the women interviewed for this research, too often underestimated the extent to which their own business would interfere with their family life. These conflicts did not always lessen as their children got older. Day-care is easier to find for young children, despite the sleepless nights and guilt that accompanies late-evening business obligations. Older children pose more logistical problems, and, when left to their own devices, are

148

Entrepreneurship: not an easy path to top management for women

Women in Management Review

Joan Winn

Volume 19 · Number 3 · 2004 · 143-153

not always trustworthy. Schindehutte et al. (2003) report that even women who believe their business has an overall positive impact on their children, acknowledge that owning a business disrupts family life.

evaluating their role in the business as well as their role at home (McKay, 2001).

Lisa explained that her business was easy when her children were young. “They hung around the mall and everyone thought they were cute.” Later, afterschool care became difficult to coordinate. “You can’t just leave your business at 3 p.m. to pick up your kids.” “It was different before my daughter was born”, Jane recounted. “Now I have to be careful that she doesn’t suffer because I’m away so much”. Kathy found that catering to clients conflicted with taking care of her school-age children. “Working at home was great when the kids were at school, and I liked the comfort of being home to greet them when they came home from school . . . but [my husband and I] would argue over who should stay home when the kids were sick.”

The married women in this study who subordinated their business interests to their husbands’ careers were seldom successful on their own. Even when the business was originally set up to be jointly run by husband and wife, more men than women kept their secure corporate job. When the husband’s profession left little time for business involvement, their wives were left to run the business. Margaret and her husband started their restaurant together when they relocated. Neither had jobs or local contacts before the move, so they saw the restaurant as being a launching pad for their new life. Margaret’s husband became less involved in their business when he was able to solicit clients for his design business. Sarah and Tina admitted that they would not have been able to sustain the cash fluctuations of their business had their husbands not had steady paychecks. Annette and Kathy had marital problems that affected their ability to devote attention to their businesses.

Ellen explained that when her husband retired, he wanted to travel, but she was tied down to her business. “There’s no accumulated sick-leave” when you own your own company, Ellen explained. Claire’s children located in a distant state after they graduated from college. Her family gone, the business became isolating and unfulfilling. Both women sold their businesses.

As in Brodsky’s (1993, p. 341) study of women corporate managers and entrepreneurs, the divorce rate among women entrepreneurs is high. Brodsky’s study on measures of trust and level of control may pertain to acquiescence in a traditional marriage as well as in a traditional company. “Entrepreneurs see themselves as in need of control and intolerant of limits imposed by others, and seek to define their own work environments and parameters.” Orhan and Scott (2001) still see “male domination” and “women’s identity” as playing pivotal roles in the decision for some women to start their own companies. On the other hand, Aldrich (1989, p. 128) believes that even women entrepreneurs “must break into the ‘old boys’ network by deliberately invading male turf whenever possible” in order to be successful. The women in this study who were successful in business tended to be not married (single or divorced) or had husbands who were actively involved in the business. Married women with children were the least likely to succeed if their husbands were not involved in the businesses. Even when husbands were willing to share in the household and child-rearing duties, these women reported tremendous guilt and anxiety when their business required long hours away from home. Unless these women had non-financial help from their husbands or “significant others”, their businesses were likely to fail. “My husband never took my business seriously,” admitted Kathy. “When he started his own business I got pushed out of the den. It became a fight for space [and] a wrestling match over who would cook dinner.”

While some of these women had the financial resources to continue their businesses, others (especially those with children) could not endure the low or negative returns inherent in a new business without another source of income (usually from their spouse). In two cases, the husband viewed the wife’s business as a “hobby” even when the business income exceeded his salary.

“It’s tough,” explained Joni. “My family thinks I’m crazy for doing this. Sometimes I wonder if the stress is worth it.”

Transitions Too often, only when the children leave home either to go off to school or to set up their own household as adults, does the business afford flexible time. For some women, this is a time of re-

Familial and societal variables differently impact women and men in starting and sustaining independent organizations. In order for a new business to be successful, the owner/manager must fit family obligations to the business needs, thereby subordinating the family to the business, a difficult position for most women, especially those with children. If her husband does not provide encouragement and understanding when the

149

Entrepreneurship: not an easy path to top management for women

Women in Management Review

Joan Winn

Volume 19 · Number 3 · 2004 · 143-153

business demands long hours in exchange for minimal returns (and, often, high stress), the woman is unlikely to continue her business. Business Consultant Anne Fisher, writing for Fortune, believes that many women aspire to top management positions, even though “they know too much about the rigors of the journey” (Fisher, 1992). However, the women in this study, all of whom had worked full-time before launching their own business, expressed surprise at the time commitment and financial variability of their businesses. Many women entrepreneurs have unrealistic expectations, starting businesses in volatile service or retailing industries and with insufficient financial and managerial training. When the flexibility and profitability that women desire from independent business ownership are not forthcoming, the conflict between work and family obligations is exacerbated. For those in marriages and/or partnerships, this became a source of conflict which some couples could not resolve.

The relatedness of experience and businessownership choice should also not be overlooked. Few women have the educational or experiential foundation for starting their own business, despite expertise or training in specialized fields. Historically, most entrepreneurial women started their careers in traditional female occupations, e.g. secretary or teacher – non-business oriented training grounds (Brush, 1992; Moore, 1990). While for some women, managing adults may be easier than caring for children all day long (Conlin, 2002), juggling the financial, operational, and marketing tasks for a new venture proved to exceed the expectations, let alone capabilities, of most novice entrepreneurs. A typical comment from women in this study was, “What was I thinking?” Those women who began their businesses as a partnership – whether as part of a spousal arrangement or purely business initiative – found that working as a team had its own pitfalls. For many, the autonomy that they sought was compromised by power struggles and ideological disagreements. Rather than serving as a source of support, most women in this study found partnerships added stress. Division of responsibilities and conflicting expectations were most often cited as reasons for dissolving partnerships. In some cases, the business conflicts precipitated – or at least exacerbated – the condition that led to an eventual divorce.

Conclusions: a convergence of change Most men and women entrepreneurs have work experience before they start their own businesses. Many entrepreneurs have family members who served as role models or mentors (Brush, 1992; Orhan and Scott, 2001). Both men and women entrepreneurs desire autonomy and control. They believe that their own business will provide income and personal satisfaction. Women, more than men, start their own business to “make a social contribution in addition to pursuing economic motives (Still and Timms, 2000, p. 3) or to fulfill their own or their spouse’s dreams. Like their corporate executive sisters, most of the women interviewed for this study found business ownership was not compatible with raising a family. Some of the women in this study expected the business to facilitate their childcare responsibilities. Several women were childless by choice; others intended to postpone children until the business became successful. In some cases, the business demands circumvented earlier plans for a family. Increasingly, small and large organizations alike expect “24/7” availability, resulting in higher stress than productivity, and an increasing demand for stress management therapy (Daniels, 2002). In large companies, this may be imposed from above or by the (perceived) competition within the company itself. For small companies, it becomes a means for survival.

Where do we go from here? For corporate and entrepreneurial women alike, the competitive environment of business interferes with family life. If gender roles influence career choice, then we must be sensitive to the different needs of men and women. The role of marriage and family, while gaining popular-press attention for its effect on women aspiring to higher corporate positions, is inadequately addressed in the entrepreneurship literature. For men, marital status does not appear to affect their decision to rise in the corporate ranks or begin their own enterprise – fewer men than women in these groups are single or divorced. For women, family structure has a different impact on their ability to focus on running a business, or on the perception of their commitment to their business. The role of the spouse in initiating and sustaining independent businesses has been given little attention (Marschak, 1998) and is virtually absent in largescale studies that examine career paths and catalysts. Women in corporate ranks rely on intraorganizational mentors for their advancement;

150

Entrepreneurship: not an easy path to top management for women

Women in Management Review

Joan Winn

Volume 19 · Number 3 · 2004 · 143-153

spousal support is more important for women who start their own businesses. Policy-makers and educators who are interested in increasing women in the executive ranks need to understand the interaction between family and career aspirations in order to properly guide those who choose business leadership positions. Unless we can put the business/family interface into perspective, we cannot remove the barriers that women encounter as they pursue their careers. Unless we understand the nature of parental or spousal support in new venture creation, we cannot provide adequate support to independent women. Finally, we need to understand and address the factors that are critical for women to succeed in independent businesses and to present a more realistic picture of what starting a new business entails. Women often start their own business because of the flexibility and control that is perceived to be compatible with their role in child-rearing. If women-owned businesses are initiated with unrealistic expectations, in volatile service or retailing industries, with insufficient financial and managerial training, it is a wonder that any succeed. But we can only provide a better system of education and support if we understand the critical variables that affect the business-creation decision and the roles that family structure and spousal support play as the business matures. Prospective entrepreneurs may then come to understand how different life-style decisions can impede or facilitate new venture success. The women interviewed for this study do not constitute a representative sample of entrepreneurs. Their stories need to be told in a larger context. However, it is doubtful that these stories are unique. Examining organizations in different industries, different stages of growth and profitability, and different organizational forms would contribute to our understanding and awareness of the need – and potential – for change. Women need to understand better the demands of business ownership so that they can embark on entrepreneurship with realistic expectation and requisite skills, and acknowledge the support systems that they will need if they are to succeed. In addition to managerial and financial training, women and men alike need to understand the emotional and economic impact that starting a business will have on the entrepreneur herself, her spouse, family, children, and the overall family unit as well as the organizational enterprise.

References Aldrich, H. (1989), “Networking among women entrepreneurs”, in Hagen, O., Rivchun, C. and Sexton, D. (Eds), Womenowned Businesses, Praeger, New York, NY, pp. 103-32. Baxter, J. and Wright, E.O. (2000), “The glass ceiling hypothesis: a comparative study of the United States, Sweden, and Australia”, Gender and Society, Vol. 14 No. 2, pp. 275-95. Brenner, O.C., Pringle, C.D. and Greenhaus, J.H. (1991), “Perceived fulfillment of organizational employment versus entrepreneurship: work values and career intentions of business college graduates”, Journal of Small Business Management, Vol. 29 No. 3, pp. 62-73. Brett, J.M. and Stroh, L.K. (1999), “Women in management: how far have we come and what needs to be done as we approach 2000?”, Journal of Management Inquiry, Vol. 8 No. 4, pp. 392-8. Brodsky, M.A. (1993), “Successful female corporate managers and entrepreneurs: similarities and differences”, Group and Organization Management, Vol. 18 No. 3, pp. 366-78. Brook, J. (2002), “A promise to love, honor and bear no children”, New York Times, 13 October, p. 9. Brush, C.G. (1992), “Research on women business owners: past trends, a new perspective and future directions”, Entrepreneurship Theory and Practice, Vol. 16 No. 4, pp. 5-30. Buttner, H.E. and Moore, D.P. (1997), “Women’s organizational exodus to entrepreneurship: self-reported motivations and correlates with success”, Journal of Small Business Management, Vol. 35 No. 1, pp. 34-46. Catalyst (2001), 2001 Catalyst Census of Women Board Directors of the Fortune 1000, available at: www.catalystwomen.org/reseearch/censuses.htm (accessed 11 October 2002). Center for American Women and Politics (2002), available at: www.cawp.rutgers.edu/facts/cawpfs.html (accessed 5 December 2002). Center for Women’s Business Research (2001), available at: www.nfwbo.org (accessed 7 October 2002). Cleveland, J.N., Stockdale, M. and Murphy, K.R. (2002) Mahwah, N.J. (Ed.), Women and Men in Organizations: Sex and Gender Issues at Work, Lawrence Erlbaum Associates, Inc., Hillsdale, NJ. Colwill, N.L. (1997), “Women in management: power and powerlessness”, in Dunn, D. (Ed.), Workplace/Women’s Place, Roxbury Publishing Company, Los Angeles, CA. Conlin, M. (2002), “Mommy is really home from work”, BusinessWeek, November, pp. 101-4. Cordano, M., Scherer, R.F. and Owen, C.L. (2002), “Attitudes toward women as managers: sex versus culture”, Women in Management Review, Vol. 17 No. 2, pp. 51-60. Cromie, S. (1987), “Similarities and differences between women and men who choose business proprietorship”, International Small Business Journal, Vol. 5 No. 3, pp. 43-60. Daily, C.M., Certo, S.T. and Dalton, D.R. (1999), “A decade of corporate women: some progress in the boardroom, none in the executive suite”, Strategic Management Journal, Vol. 20 No. 1, pp. 93-9.

151

Entrepreneurship: not an easy path to top management for women

Women in Management Review

Joan Winn

Volume 19 · Number 3 · 2004 · 143-153

Daniels, C. (2002), “The last taboo”, Fortune, 28 October, pp. 137-44. Deam, J. (2002), “To have it all: women are realizing they’re not a failure if they don’t”, Denver Post, Vol. L1 May 12, p. 4. Dickinson, T. (1998), “Working women and their world: the new global work hierarchy and women’s struggles over nonwage work”, Journal for the Study of Peace and Conflict, available at: http://jspc.library.wisc.edu/issues/1998-1999/ article2.html (accessed 11 October 2002) Dyer, W.G. Jr (2004), “Toward a theory of entrepreneurial careers”, Entrepreneurship Theory and Practice, Vol. 19 No. 2, pp. 7-23. Ely, R.J. (1995), “The power in demography: women’s social constructions of gender identity at work”, Academy of Management Journal, Vol. 38 No. 3, pp. 589-655. Fisher, A.B. (1992), “When will women get to the top?”, Fortune, Vol. 21, September, pp. 44-56. Gilchrist, E. (2002), “The middle way: learning to balance family and work”, in Hanauer, C. (Ed.), The Bitch in the House: 26 Women Tell the Truth about Sex, Solitude, Work, Motherhood, and Marriage, William Morrow and Co., New York, NY, pp. 249-56. Goffee, R. and Scase, R. (1985), Women in Charge: The Experiences of Female Entrepreneurs, George Allen and Unwin, London. Greenberger, D.B. and Sexton, D.L. (1988), “An interactive model of new venture initiation”, Journal of Small Business Management, Vol. 26 No. 3, pp. 1-7. Greenhaus, J.H. and Beutell, N.J. (1985), “Sources of conflict between work and family roles”, Academy of Management Review, Vol. 10, pp. 76-88. Gutner, T. (2002), “Working moms: don’t feel so guilty”, BusinessWeek, 23 September, p. 127. Haber, S.E., Lamas, E.J. and Lichtenstein, J.H. (1987), “On their own: the self-employed and others in private business”, Monthly Labor Review, May, pp. 16-23. Hewlett, S.A. (2002), Creating a Life: Professional Women and the Quest for Children, Talk Miramax Books, New York, NY. Hurley, A.E. (1999), “Incorporating feminist theories into sociological theories of entrepreneurship”, Women in Management Review, Vol. 14 No. 2, pp. 54-62. Kalleberg, A.L. and Leicht, K.T. (1991), “Gender and organizational performance: determinants of small business survival and success”, Academy of Management Journal, Vol. 34 No. 1, pp. 136-61. Kirchmeyer, C. (1998), “Determinants of managerial career success: evidence and explanation of male/female differences”, Journal of Management, Vol. 24 No. 6, pp. 673-4. Konrad, A.M. and Cannings, K. (1997), “The effects of gender role congruence and statistical discrimination on managerial advancement”, Human Relations, Vol. 50 No. 10, pp. 305-29. Koretz, G. (2002), “Are women less competitive?”, BusinessWeek, Vol. 9, 9 December, p. 28. Lancaster, H. (1999), “To get shipped abroad, women must overcome prejudice at home”, The Wall Street Journal, Vol. B1 June 29, p. 4.

Longstreth, M., Stafford, K. and Mauldin, T. (1987), “Selfemployed women and their families: time use and socioeconomic characteristics”, Journal of Small Business Management, Vol. 25 No. 3, pp. 30-7. Maclean’s (2002), “Women still face workplace barriers”, Macleans, Toronto, p. 28. Mediaweek (2002), “Women still missing from executive suites”, Mediaweek, Vol. 12 No. 31, p. 21. Marschak, K. (1998), Entrepreneurial Couples: Making It Work at Work and at Home, Davies-Black Publishing, Palo Alto, CA. McKay, R. (2001), “Women entrepreneurs: moving beyond family and flexibility”, International Journal of Entrepreneurial Behavior and Research, Vol. 7 No. 4, pp. 148-65. Moore, D.P. (1990), “An examination of present research on the female entrepreneur – suggested research strategies for the 1990s”, Journal of Business Ethics, Vol. 9, pp. 275-81. Moore, D.P. and Buttner, E.H. (1997), Women Entrepreneurs: Moving beyond the Glass Ceiling, Sage Publications, Inc., Thousand Oaks, CA. Morris, B. (2002), “Trophy husbands”, Fortune, 14 October, pp. 79-98. Northouse, P.G. (2001), Leadership Theory and Practice, 2nd ed., Sage Publications, Inc., Thousand Oaks, CA. Orhan, M. and Scott, D. (2001), “Why women enter into entrepreneurship: an explanatory model”, Women in Management Review, Vol. 16 No. 5, pp. 232-43. Parasuraman, S. and Greenhaus, J.H. (1993), “Personal portrait: the life-style of the woman manager”, in Fagenson, E.A. (Ed.), Women in Management: Trends, Issues, and Challenges in Managerial Diversity, Sage Publications, Inc., Newbury Park, CA, pp. 186-211. Parasuraman, S., Purohit, Y.S. and Godschalk, V.M. (1996), “Work and family variables, entrepreneurial career success, and psychological well being”, Journal of Vocational Behavior, Vol. 48 No. 3, pp. 275-300. Pollock, E.J. (2000), “Deportment gap: the feminization of the workplace”, The Wall Street Journal, Vol. A1 February 7, p. 20. Powell, G.N. and Graves, L. (2003), Women & Men in Management, 3rd ed., Sage Publications, Inc., Newbury Park, CA. Ragins, B.R., Townsend, B. and Mattis, M. (1998), “Gender gap in the executive suite: CEOs and female executives report on breaking the glass ceiling”, Academy of Management Executive, Vol. 12 No. 1, pp. 28-36. Schindehutte, M., Morris, M. and Brennan, C. (2003), “Entrepreneurs and motherhood: impacts on their children in South Africa and the United States”, Journal of Small Business Management, Vol. 41 No. 1, pp. 94-107. Scott, C.E. (1986), “Why more women are becoming entrepreneurs”, Journal of Small Business Management, Vol. 24 No. 4, pp. 37-44. Sellers, P. (1996), “Women, sex and power”, Fortune, 5 August, pp. 42-54. Sellers, P. (2002), “True grit”, Fortune, 14 October, pp. 101-5. Small Business Administration (2001), Online Women’s Business Center, available at: www.onlinewbc.gov/docs/starting/ new_stats.html (accessed 11 October 2002)

152

Entrepreneurship: not an easy path to top management for women

Women in Management Review

Joan Winn

Volume 19 · Number 3 · 2004 · 143-153

Smeltzer, L.R. and Fann, G.L. (1989), “Gender differences in external networks of small business owner/managers”, Journal of Small Business Management, Vol. 27 No. 2, pp. 25-32. Stevenson, L.A. (1986), “Against all odds: the entrepreneurship of women”, Journal of Small Business Management, Vol. 24 No. 4, pp. 30-6. Still, L.V. and Timms, W. (2000), “Women’s business: the flexible alternative workstyle for women”, Women in Management Review, Vol. 15 No. 5/6, pp. 272-83. Stoner, C.R., Hartman, R.L. and Arora, R. (1990), “Work-home role conflict in female owners of small businesses: an exploratory study”, Journal of Small Business Management, Vol. 28 No. 1, pp. 31-8. Stroh, L.K., Brett, J.M. and Reilly, A.H. (1992), “All the right stuff: a comparison of female and male managers’ career progression”, Journal of Applied Psychology, Vol. 77 No. 3, pp. 251-60.

Wellington, S. and Giscombe, K. (2001), “Women and leadership in corporate America”, in Costello, C.B. and Stone, A.J. (Eds), The American Woman 2001-2002: Getting to the Top, W.W. Norton & Co., New York, NY, pp. 87-106. White, B., Cox, C. and Cooper, C.L. (1997), “A portrait of successful women”, Women in Management Review, Vol. 12 No. 1, pp. 27-34.

Further reading Hammonds, K.H. (2002), “Size is not a strategy”, Fast Company, September, pp. 78-86. Segal, A.T. and Aellner, W. (1992), “Corporate women”, BusinessWeek, 8 June, pp. 74-8. Smith, D.M. (2000), Women at Work: Leadership for the Next Century, Prentice-Hall, Upper Saddle River, NJ.

153

Women entrepreneurs: out from under the glass ceiling Mary C. Mattis

The author Mary C. Mattis is Senior Program Officer at the National Academy of Engineering, Washington, DC, USA.

Keywords Women, Entrepreneurs, Corporate ownership, United States of America

Abstract During the past decade, the incidence of women starting businesses dramatically accelerated in the US. A national, representative sample of women (and men) business owners was interviewed by telephone to understand better this phenomenon. This analysis focuses on women business owners who left corporate careers to start their own businesses. Respondents’ experiences with corporate “glass ceilings” and “glass walls”, such as lack of flexibility and challenge, lack of role models and mentors, lack of access to line positions with concomitant intrapreneurial opportunities, and failure of organizations to credit and reward women’s contributions, are examined. Differences among three age cohorts of women business owners, included in the analysis, portend increased difficulty for companies in retaining talented women professionals and managers, especially those with entrepreneurial interests. Recommendations to companies include identifying and eliminating barriers to women’s advancement in the corporate culture and work environment, and development of more intrapreneurial opportunities.

Electronic access The Emerald Research Register for this journal is available at www.emeraldinsight.com/researchregister The current issue and full text archive of this journal is available at www.emeraldinsight.com/0964-9425.htm

Women in Management Review Volume 19 · Number 3 · 2004 · pp. 154-163 q Emerald Group Publishing Limited · ISSN 0964-9425 DOI 10.1108/09649420410529861

Introduction Until recently, much of what has been known about the characteristics of entrepreneurs, their motivations, backgrounds, families, occupational experience, their successes, and failures, have been based on studies of male entrepreneurs (Carsrud and Olm, 1986; Bender, 2000). In addition, little attention in entrepreneurship studies has been given to underrepresented minority businessowners. In the 1990s, interest in women entrepreneurs increased as the numbers of women-owned businesses in the US surged. Statistics show that women-owned businesses are the fasting growing segment of new business start-ups; black women’s businesses are a larger share of black-owned businesses than white women’s businesses are of white firms (Inman, 1997). Researchers’ interest in entrepreneurship among women is reflected in the number of PhD dissertations on women entrepreneurs – 54 between 1993 and 2003 – and by the attention given to this topic at professional meetings such as the 2003 annual meeting of the Academy of Management. Women who contemplate becoming entrepreneurs continue to face daunting challenges. Data show that only 38 percent of new firms were open after six years (Phillips and Kirchhoff, 1989; Headd, 2003). Thomas (1999) found that in recent years, women-owned business start-ups have received less than 2 percent of available venture capital funds, especially in potentially lucrative new ventures in hightechnology fields (Zimmerer and Scarborough, 1997). Whereas men often list investors, bank loans, or personal loans, in addition to personal funds, as sources of start-up capital, women usually rely solely on personal assets, such as savings and credit cards (Hisrich, 1990). Women entrepreneurs have fewer role models available to them than men. Businesses headed by women tend The author who, along with Julie Weeks of NFWBO, was a co-principal investigator on this study and author of Catalyst’s report Women Entrepreneurs: Why Companies Lose Female Talent and What They Can Do About It (Catalyst, 1998a), acknowledges the contributions to the research effort of Catalyst, NFWBO, and C200 staff, especially Sheila Wellington, Sharon Hadary, Jennifer Allyn and Jennifer Byrne. Portions of this chapter have been excerpted from Catalyst (written by M. Mattis) and NFWBO (written by Julie Weeks) reports of the study findings. George Fisher and Hall Hirsch of Summit Analytics assisted with the data analysis. An advisory committee of women entrepreneurs provided helpful insights to the research team. Financial support for the research was provided by Salomon Smith Barney, the exclusive sponsor of this study.

154

Women entrepreneurs: out from under the glass ceiling

Women in Management Review

Mary C. Mattis

Volume 19 · Number 3 · 2004 · 154-163

to be small and to grow less quickly than those headed by men, suggesting, again, that women face greater obstacles to obtaining success as entrepreneurs (Cliff, 1998; Cooper et al., 1994). Also, entrepreneurs are perceived by the public as possessing stereotypically “masculine” traits, another factor working against women’s credibility as business owners (Baron et al., 2001). The decision to leave a present career and lifestyle is not an easy one. It takes enormous energy to change and create something new. How, then, do we explain the dramatic increase in entrepreneurship among women of all backgrounds: women-owned businesses are the fasting growing segment of new business start-ups, and black women’s businesses are a larger share of black-owned businesses than white women’s businesses are of white firms (Inman, 1997). In undertaking the research described below, Catalyst hypothesized that a major reason for the dramatic increase in women-owned businesses in the US was women’s desire to escape or avoid altogether the “glass ceiling” in corporate America, and to gain more flexibility in their work arrangements. While a small number of studies of women entrepreneurs challenge such assumptions about women entrepreneurs (e.g. Reed, 1999), many others have found the glass ceiling to be a contributing, if not primary factor in women’s decisions to start their own businesses. Weiler and Bernasek (2001) noted the impact of male-dominated networks as contributing to the radically accelerated openings of women owned businesses. Hagan and Sexton (1989) traced the roots of the increasing phenomenon of women’s entrepreneurship to the women’s movement. A special issue of Science Magazine (1993) describes women scientists as opting to launch their own businesses as a way of avoiding the glass ceiling in large corporations and the academic world. In a study of nurses that started their own businesses, Roggenkamp and White (1998) found that the desire for greater flexibility was a strong motivation to leave a traditional nursing setting and undertake an entrepreneurial venture. Mcatavey (2002) found that aligning with values, regaining excitement, being in charge, advancing oneself, and fulfilling a lifelong goal contributed to women’s decisions to start their own businesses; however, setting their own hours and the opportunity to balance family and work were stronger motivators. Smith (2000) argues that one of the reasons that black women comprise one of the fastest growing groups of new small business owners is that, in corporate settings, they bear the “double-yoke” of racism and sexism.

Definitional issues Studying women-owned businesses has presented some methodological problems for researchers (Stevenson, 1990). A major difficulty is the shifting definition of a woman-owned business. In 1997, it was determined by the US Census Bureau that a woman-owned business is one where a woman (or women) owned a 51 percent+majority interest in the business. Prior to 1997, businesses with 50 percent or more women ownership were included in the women business counts. Beginning with the 1997 census, the US Census Bureau chose to separate firms with 50 percent ownership from firms with 51 percent + ownership, allowing researchers to focus on the specific population of majority-owned womenowned businesses. In addition, publicly traded firms are not included in the definition, but are included in the overall count of all US firms (Center for Women’s Business Research, p. ES-1, 2002). The National Directory of Woman-Owned Business Firms uses the following criteria to define a woman-owned business (Business Research Services, 2001): . one or more of the principal owners, or the majority, of shareholders are women; . as a group, the woman owners or shareholders own at least 51 percent of the business; . the woman owners or shareholders have dominant control over the business and participate in day-to-day operations; and . the business is a going concern. Over the years, other organizations that have collected data on small businesses have included self-employed individuals or individuals who own franchises as business owners, although there is a clear difference between these three types of enterprise. The business owners selected for this study were identified through the Dun and Bradstreet list which conforms most closely to the definition used by Census Bureau beginning in 1997. The research collaboration In 1997, Catalyst, the Committee of 200 (C200) and the National Foundation for Women Business Owners (NFWBO, 1998) joined forces to carry out this benchmark study to ascertain women’s motivations for starting their own businesses and the paths they have taken to reach that goal. Catalyst is a nonprofit research and advisory services organization located in New York City that works with business and the professions to advance women. Its dual mission is to enable women to achieve their full professional potential and to help employers capitalize on women’s talent.

155

Women entrepreneurs: out from under the glass ceiling

Women in Management Review

Mary C. Mattis

Volume 19 · Number 3 · 2004 · 154-163

The Center for Women’s Business Research, known as the National Foundation for Women Business Owners when this research was undertaken, is located in Washington DC. The Center is recognized as the premier source of information on women business owners and their enterprises worldwide. Its mission is to strengthen women business owners and their enterprises through conducting research, sharing information and increasing knowledge. The Committee of 200, headquartered in Chicago, was founded in 1982. It is a professional organization of pre-eminent businesswomen who exemplify and promote entrepreneurship and corporate leadership among women of this generation and the next. At the time of the research, C200 had more than 375 US and international members from 70 industries.

term commitment to business careers; exclusion from informal networks and channels of communication; lack of access to mentors; managers’ lack of willingness to “risk” putting women in key developmental assignments, especially line positions; salary inequities; and sexual harassment (Hennig and Jardim, 1975; Kanter, 1977; McCall, 1988; Acker, 1991; Catalyst, 1996, 1998, 2000). Any one of these risk factors might provide a reason for women to seek alternative employment options. Few studies have examined the trends of women’s growing interest and participation in owning businesses from the viewpoint of corporations – the view that assesses the cost of losing female talent in which business organizations have considerable investment – Catalyst’s unique reason for undertaking the research. . The most obvious costs to companies of attrition of seasoned high-performing women professionals, along with more recently recruited high-potential women, are the opportunity cost of failure to leverage investment in recruitment and training, along with the cost of recruiting and training replacements. Research inside companies shows that there are many additional “invisible” costs to companies of turnover including reduced productivity and morale of work units, damage to relationships with clients/customers, the loss of intellectual capital, and the very real possibility that former employees will take customers and clients with them when they start.

Research methodology and objectives A nationally representative sample of 800 US business owners – 650 women and 150 men – was interviewed by telephone during the month of September 1997, using a structured interview protocol. The sample was drawn from Dun and Bradstreet’s list of business owners to ensure that most respondents would have owned their businesses for three or more years. The sample was stratified to ensure that the employee size distribution of businesses selected would be representative of that of the total population of small businesses. Firms with 500+ employees were over-sampled due to the fact that they represent less than 1 percent of all entrepreneurial ventures. Two focus groups, each consisting of 12 women business owners, were conducted to provide input for developing the survey instrument. A letter describing the study was sent to respondents prior to attempting to schedule the telephone interviews. The sampling error for the samples sizes 650 and 150, respectively, are (+) or ( 2 ) 4.0 percent and (+) or ( 2 ) 8.2 percent at the 95 percent level of confidence. The women and men business owners surveyed for this study were similar to one another in several respects, and they were generally representative of the business population at large. Most business owner respondents were in the age range of 40 to 50 years; most were married and the majority had children. Men business owners were more likely to be married than their female counterparts, who were more likely to be single, divorced, or widowed. Over the years, a number of studies have documented barriers to women’s advancement in corporate America including: stereotyping and misperceptions about women’s abilities and long-

Catalyst’s primary interest in collaborating on this particular research was to answer specific questions about women entrepreneurs who had worked in corporate (as opposed to other occupational sectors) jobs/careers immediately prior to starting businesses, including: . Why did the women studied leave what might be regarded as promising corporate careers? . What satisfactions do they derive from business ownership that were lacking in their corporate careers; what are their frustrations, if any, with owning their own businesses? . What, if anything, could corporations do to retain such women? We also wanted to know whether the loss of women like those represented in this research is inevitable. If not, what actions can companies take to channel entrepreneurial women’s (and men’s) interests/abilities into intrapreneurial activities, thus leveraging their investment in these employees and, ultimately, capitalizing on their entrepreneurial spirit?

156

Women entrepreneurs: out from under the glass ceiling

Women in Management Review

Mary C. Mattis

Volume 19 · Number 3 · 2004 · 154-163

Findings

Table I Educational attainment: women entrepreneurs and women executives

A 1999 book on women entrepreneurs divides women business owners who were interviewed for the study into two groups: intentional entrepreneurs and corporate climbers (Moore and Buttner, 1997). Intentional entrepreneurs – what our research team referred to as “born to be” entrepreneurs – are women who, though they always wanted to start their own businesses, worked initially for others to gain business experience. In contrast, corporate climbers intended to stay in corporate careers, but ended up leaving because of negative factors in the work environment or to take advantage of an unexpected business opportunity. Findings from this research reveal that the pull of an entrepreneurial idea is the more prevalent motivation for starting a business among women and men who were interviewed for this study: 44 percent of women business owners and 36 percent of men started businesses because they believed they had a winning idea, or because they came to realize that they would gain more from doing for themselves what they had been doing for an employer. That said, the number of women who chose entrepreneurship due to negative “push” experiences in their former positions was notable. And, an important finding of the research is that “push” factors played a larger role in the newest generation of women entrepreneurs’ decisions to start a business – those who had owned a business for less than ten years – than in the decisions of women who started businesses 20 or more years ago. The findings from this study were fairly extensive, including findings for male entrepreneurs (NFWBO, 1998). This analysis that follows focuses only on findings relating to women business owners who worked in corporations prior to starting their own businesses.

Personal and professional profile of respondents Education While census data show that women business owners are more highly educated than women in the US generally, data from this study suggest that overall the educational attainment of this group of women business owners was lower than for a group of high-level corporate businesswomen studied by Catalyst (1996) (see Table I). This unexpected finding may suggest another reason that women leave companies to start their own businesses, one that was not explored in the study. That is, that women with considerable business experience, but lacking advanced

Educational attainment College or less Master of business administration Other graduate school or degree

Women entrepreneurs N 5 650 (%)

Women executives N 5 461 (%)

81 7 12

36 31 33

Note: Comparative data on women executives were obtained from a Catalyst (1996) report on a survey of women at the Vice President level or above in Fortune 1000 companies

degrees, especially MBAs, were pushed out of corporate careers when their companies began to give preference to MBAs in entry-level manager hiring, training, and promotions. Marriage and children The majority (73 percent) of women business owners studied were married, as were the majority of the aforementioned corporate businesswomen (72 percent) surveyed by Catalyst. In both groups, the overwhelming majority of respondents were in their mid- to late-40s. Yet, women business owners were considerably more likely than the corporate businesswomen studied to have children – 82 percent compared to 64 percent. Business characteristics The women owners studied operated businesses in a wide range of industries; however, the largest number worked in the services sector (84 percent), while the remainder owned companies that produced goods. Contrary to a commonly held assumption that many women business owners work from their homes, the majority of respondents to this study (78 percent) worked from a location away from their homes. Of women business owners 62 percent started their own business as opposed to purchasing an existing business (25 percent) or inheriting/ acquiring a business without prior personal investment (13 percent). Nearly half (46 percent) had annual revenues between $100,000 and $999,000, with only 17 percent reporting an annual gross income of less than $99,999. Of the women, 74 percent said that 50 percent or more of their household’s income in the previous year was derived from their business. Prior work experience Based on responses to several questions about prior work experience, 58 percent of women business owners in the study were found to have spent a significant share of their careers in the private, for-profit sector (see Table II). Prior to starting their own businesses, 32 percent had worked for a firm with fewer than 100 employees,

157

Women entrepreneurs: out from under the glass ceiling

Women in Management Review

Mary C. Mattis

Volume 19 · Number 3 · 2004 · 154-163

Table II Prior work experience of women business owners Work experience Private sector Public sector Out of labor force Self-employed Other Nonprofit

% N 5 650 58 19 11 9 5 4

9 percent worked for a medium-sized firm (100499 employees), and 17 percent had been in a large company (500+ employees). Of the remainder, 13 percent came to entrepreneurship from the public sector, including education and health care, 11 percent had been out of the labour force for an extended period of time, 9 percent were selfemployed before opening their own business, and 4 percent came from a nonprofit background. Thus, the paths to entrepreneurship are varied. The phenomenon of women entrepreneurs gaining business experience in corporations before striking out on their own was aptly referred to as the “corporate incubator” by Moore and Buttner (1997) in their study of women entrepreneurs. Though we did not ask the question in our phone survey, women business owners participating in the focus groups said they personally had benefited in this way from their prior corporate experience. In fact, they said they would recommend corporate experience to any woman thinking of starting her own business, but cautioned women against remaining in corporate careers. Prior positions The positions held by women business owners just prior to staring their businesses were also diverse: 26 percent were in a professional position (such as attorney or certified public account); 16 percent held senior management or executive positions in corporations; 14 percent were middle managers; 14 percent were working in health care; and 5 percent, respectively, were teachers, owned another business, or worked in a technical field. The typical work history of a woman business owner has changed over time. Because employment opportunities were once much more limited for women, women business owners who had owned a business for 20 or more years were less likely to have held management positions prior to starting their businesses, and were much more likely to have been in clerical roles. Only 11 percent of women who had been in business for themselves for 20+ years were in senior manager or executive positions prior to starting their businesses, compared to 22 percent of women whose businesses were less than ten years old. Of the earliest cohort of women business owners 29

percent had formerly held clerical positions, compared to just 8 percent of the cohort who had been in business for less than ten years. The newest cohort of women business owners in the sample were almost twice as likely as the oldest cohort to have held line (e.g. sales and management) as opposed to staff positions (e.g. human resources and accounting) in their former corporate jobs – 45 percent compared to 21 percent. Women formerly employed in larger corporations (500+ employees) were significantly more likely to have been in a management position just prior to starting their own business than were women from smaller companies (47 percent compared to 35 percent). They were also twice as likely as women business owners formerly employed in small companies to have an MBA degree (11 percent compared to 5 percent). From a corporate perspective, it is particularly costly to lose women with these line and general management experiences. Why women leave the private sector Why are women leaving corporate jobs and turning to business ownership? What share are being “pushed” out of companies due to negative factors in the work environment and corporate culture versus those who are “pulled” toward entrepreneurship by images of self-sufficiency, autonomy, and opportunities to create something uniquely their own? Respondents were asked to rate their reasons for leaving companies to start their own businesses (see Table III.) The four reasons most frequently cited were the need for more flexibility, dissatisfaction with the work environment, experiences with glass ceiling factors and lack of challenges in the job. In contrast, only 5 percent of women reported that they had been made redundant by their companies and only 3 percent said they had experienced sexual harassment in their former job. Flexibility Half of the women who had left the private sector to start their own businesses and 44 percent of women from other employment backgrounds reported they wanted more flexibility, citing this as a primary reason for leaving their companies. Women business owners selecting this reason reported the following specifics related to their need for more flexibility: childcare obligations; participation in community affairs; personal health concerns; elder care; and other family obligations. The largest number – 30 percent – gave childcare obligations as a reason for leaving the private sector for more flexibility. This is not surprising since 82

158

Women entrepreneurs: out from under the glass ceiling

Women in Management Review

Mary C. Mattis

Volume 19 · Number 3 · 2004 · 154-163

Table III Major reasons for leaving prior job: private and non-private sectors

Private (N 5 377) Non-private (N 5 273)

Flexibility (%)

Glass ceiling (%)

Unhappy with work environment (%)

Unchallenged (%)

51 44

29 16

28 17

22 19

percent of the women studied had children and, at the time they were interviewed, nearly half had dependent children living at home, i.e. I think flexibility with children is one of the main obstacles. A lot of talented women will go into their own business when they start a family. The flexibility is there, having my own business and having the hours that I want to be there. My children need me now also.

The latter remark from a woman respondent was illustrative of why running one’s own business can provide more flexibility, even though business ownership requires enormous time commitment. Women business owners are not so much seeking reduced hours, although that may come later, when they can afford to hire more employees to manage the business on a daily basis. Rather, they are seeking more control over the hours they work. In contrast to traditional part time work, business ownership and telecommuting in corporate positions allow women (and, increasingly, men) to be productive on their terms, working hours that complement their other commitments. It is not that women want to be actively caring for children while doing their work at home. Rather, it is a way of reducing the distance (and resulting worry and anxiety) between themselves and their children, whether they are in school or cared for at a day care facility or at home. Not surprising, women who had owned their own businesses for less than ten years (and who were likely to be younger and more involved in child rearing) were significantly more likely (55 percent) to cite flexibility as a reason for starting their businesses than women who had been in business for more than 20 years (29 percent). Corporate glass ceilings/glass walls In 1986, two Wall Street Journal reporters coined the phrase “glass ceiling” to describe the invisible barrier that blocks women from the most senior positions in corporate America. Catalyst and other researchers have documented the persistence of the glass ceiling in limiting women’s career advancement as well as the phenomenon of corporate “glass walls” (Belle and Nkomo, 2001; Catalyst, 1994, 2000; Morrison et al., 1992.) Glass walls – functional segregation that prevents women from obtaining line and general

management experience – are a major factor in women’s lack of advancement to senior leadership positions in companies/firms. In this study, we wanted to examine the extent to which the glass ceiling and glass walls are contributing to women’s exodus from corporate America. Nearly one-third (29 percent) of women business owners in this study previously employed in the private sector cited the glass ceiling and dissatisfaction with the work environment (28 percent) at their former employer as a reason they left to start their own business. Women with nonprivate sector backgrounds were less likely to say they had experienced a glass ceiling (16 percent, or that they were unhappy with the work environment at their former place of employment (17 percent). In focus groups women described these experiences as follows: I worked for a corporation in the area and I just got tired of people coming in, especially male counterparts, who were being promoted above me. I spent about six years at a Fortune 500 company. Eventually, I topped out in my pay grade and there were always management changes; so you were always proving yourself over again to another team, and that got pretty old. So the option was to spread my own wings and try it.

Women from smaller companies were somewhat more likely to cite the glass ceiling as a reason for leaving than were women from larger companies (500+ employees) – 26 percent compared to 20 percent. This is probably explained by the fact that small companies have fewer layers of management and therefore fewer opportunities for vertical advancement. Furthermore, in the US, 80-90 percent of small companies are family-owned, which often limits non-family members’ initiative and advancement (Center for Women’s Business Research, 2002). In examining data for the three generations of women business owners represented in this study (women who have owned their businesses for less than ten years, for 10-19 years, and for 20 or more years), we found that the share of women who left salaried positions in the private sector because of a glass ceiling in their organization has more than doubled over the past two generations of these entrepreneurial women: 22 percent of women who had owned their businesses less than ten years cited the glass ceiling, as opposed to 15 percent of

159

Women entrepreneurs: out from under the glass ceiling

Women in Management Review

Mary C. Mattis

Volume 19 · Number 3 · 2004 · 154-163

women with 10-19 years tenure running their own businesses, and only 9 percent of women with businesses existing for 20+ years. This response pattern may have been influenced by the fact that the glass ceiling had not been named or talked about widely when the earliest generation of women business owners left their jobs. Furthermore, women of their generation did not have the same expectations about equity in the workplace that newer generations of women now have. Experiences that were most frequently cited by women respondents naming the glass ceiling as a reason for leaving former jobs/careers to start their own businesses were: . my contributions were not recognized or valued (47 percent); . I was not taken seriously (34 percent); . I felt isolated as one of few women or minorities (29 percent); . I saw others being promoted ahead of me (27 percent); . I was excluded from informal networks/ communications (21 percent); and . I was excluded from training opportunities (21 percent).

employment histories characterized themselves as “unchallenged” in their previous positions. The share of women business owners who left large (500+ employees) private sector companies due to lack of challenges has increased significantly over generations – from 14 percent of women who have been in business for themselves for 20+ years to 28 percent of women who have owned businesses for less than ten years. The born entrepreneurs in this study cited “being my own boss” as their most important reason to start a business, and what they like best about being business owners. A corporation probably could not retain women with this need/ drive. In contrast, for women who left for-profit businesses because of lack of challenge, “being my own boss” was not one of the top three aspects of business ownership they enjoyed most. Rather, what they enjoyed about being business owners was “independence”, “being in control”, and “setting one’s own hours”. Had these women been offered flexibility and more control over their work, they might have remained with their organizations instead of starting their own businesses.

As one woman described her experience: I think recognition is most important. I did a design that was published. The boss was credited because it was his firm; when you have your own firm that doesn’t happen.

Women from small companies (less than 100 employees) were twice as likely as women from companies with 500+ employees to feel that others were promoted ahead of them (11 percent compared with 5 percent). Another aspect of the glass ceiling is the work environment – the work practices and the characteristics of the overall organizational culture – that contribute in positive or negative ways to job satisfaction, productivity, morale, and organizational commitment. Of the women formerly employed in the private sector 28 percent reported that they were not happy or comfortable with the work environment of their previous employer compared to 17 percent of women with other employment histories. In Catalyst’s 1996 study, Women in Corporate Leadership: Progress & Prospects, 35 percent of the senior- and executivelevel women surveyed reported that an inhospitable corporate culture was a key barrier holding women back from advancing to the highest levels of corporate leadership in their organization. Lack of challenges in corporate positions More than one-fifth (22 percent) of women business owners formerly working in the private sector and 19 percent of women with other

What would attract women back to corporate jobs? Over half (58 percent) of the women business owners formerly employed in the private sector said that nothing would attract them back to a corporate job. Of those who offered reasons why they might return, 24 percent cited more money as an incentive and 11 percent said they might return for more flexibility: I think that if I was in an environment where it was a given, not a token but a given, that I had autonomy, made decisions, and my talents were part of the company, I could be a team member. Sometimes I fantasise what would happen if my business failed. What would I do? Well, there is no way I would go back to working for somebody, I just couldn’t do it. Question: Was there anything your company could have done to keep you? Answer: They could have made me a partner.

As would be expected, women who had owned their businesses for 20+ years were more likely to say that nothing would induce them to return to a corporate job (64 percent); they were also much less likely to say they would return for more flexibility (3 percent). Do women business owners manage differently? In response to an open-ended question about whether they were doing anything differently than their former employers with regard to their company’s personnel policies and employee

160

Women entrepreneurs: out from under the glass ceiling

Women in Management Review

Mary C. Mattis

Volume 19 · Number 3 · 2004 · 154-163

benefits, a majority of women business owners said they treated employees more fairly. Smaller percentages reported that they offered more flexibility and/or a more inclusive management style – 23 percent, and 11 percent, respectively. It is important to note that these findings are based on self-reports that could not be confirmed with women business owners’ employees. However, Moore and Buttner, 1997 also reported that the women business owners they studied tried to create a collaborative work environment in their companies, recognized the need for work/life balance, and included employees in important decisions.

the long hours involved; 17 percent mentioned being responsible for every facet of the business; and 16 percent cited the challenge of hiring and retaining good employees. These burdens of business ownership seem to remain, regardless of how long the woman had owned her business, while financial concerns appear to diminish with tenure as a business owner.

Family members and other mentors Nearly half (46 percent) of the women surveyed reported that they had a mentor or role model when starting out in business. Among those reporting that they had a mentor/role model, women with private sector experience were more likely than those with other work histories (38 percent compared to 18 percent) to point to their parents as a guiding influence. Spouses ranked second with private sector women, but were ranked first by women with public sector experience (29 percent). The third most cited mentor/role model was another business owner. Family history seems to have been an important influence on these women’s work-related decisions. Over half (55 percent) of the women interviewed for this study reported that a member of their immediate family was a business owner while they were growing up. The economic assistance provided by a working spouse was also cited as an important support: 51 percent said a second income was “critical” or “somewhat important”, while 30 percent said that they did not have a second income to rely on. Catalyst’s findings from a recent study of dual career couples found that 55 percent of survey respondents reported that they had more freedom to make career choices because their spouses worked full time (Catalyst, 1998b). According to that report, both men and women in dual career couples felt increased freedom to take risks, particularly career risks, such as changing jobs, stepping into and out of the “fast lane”, and starting their own businesses. The downside of entrepreneurship While there are many aspects of business ownership that women enjoyed, employee problems or concerns were at the top of their list of dislikes. In response to an open-ended question on this topic, 26 percent of women business owners mentioned personnel issues as something they dislike about owning a business; 21 percent cited

Conclusions and recommendations More than half of the women entrepreneurs studied who had held corporate positions prior to starting a business said nothing would attract them back. Therefore, companies would do well to address factors in their culture that negatively impact the retention of seasons and high-potential women professionals and managers. Findings from this research show: . Barriers to women’s advancement in corporations are persistent, preventing companies from retaining valuable female talent at great cost to their current operations and to the talent pool for future leadership of their organizations. . Lack of flexibility continues to be a feature of the corporate culture that leads to the attrition of high potential women and is contributing to the dramatic increase in entrepreneurship among women in the US. . Most women who leave the private sector to start businesses do not see themselves as “born” entrepreneurs; hence, their attrition is not inevitable. Companies can improve their retention outcomes with women by deliberately addressing “glass ceiling” issues that impede women’s development and advancement in corporate culture, and by creating more intrapreneurial opportunities. . Increasing expectations of women have “raised the bar” for companies. Successive generations of women entering the workplace are likely to have higher expectations for their employers to provide gender equitable policies and practices, and more flexible work arrangements. In short, companies cannot afford to ignore persistent barriers to women’s retention and advancement in their culture and work environments. Ensuring parity between male and female professionals’ salaries, rewarding women for their contributions, and providing flexibility in work scheduling and locations are major components of successful retention strategies.

161

Women entrepreneurs: out from under the glass ceiling

Women in Management Review

Mary C. Mattis

Volume 19 · Number 3 · 2004 · 154-163

Specific recommendations for companies seeking to retain women professionals and managers include: . articulate the business case for retaining employees who show entrepreneurial promise; . hold managers accountable for developing women and contributing to women’s advancement; . increase opportunities for women and men to use informal and formal flexible work arrangements; . develop intrapreneural opportunities in your business units; i.e. increase the number of opportunities for employees to exercise entrepreneurial interests/abilities within your company (e.g. sales, new business development). Provide women with equal access to these opportunities; . identify women professionals and managers with entrepreneurial abilities/interests early in their careers and ensure that they have development opportunities that build on these skills; and . recognize and reward women’s bottom-line contributions. Recruit women entrepreneurs to your corporate board and to senior line positions in your company. Additionally, Hisrich (1990) observed the following characteristics of organizational cultures that are favorable to intrapreneurship: . Experimentation is encouraged. The environment allows mistakes and failures. . New ideas are encouraged and supported, rather than discouraged, as frequently occurs in firms where rapid return on investment, and high sales volume requirements exist. . The organization has, as one of its business imperatives, to operate on the frontiers of technology. . There are no initial parameters to inhibit free creative problem solving, e.g. turf protection and silo operations. . Resources are available and easily accessible. Funds are allocated to the task of creating something new, rather than dedicated to solving problems that have immediate impact on the bottom line. . The organization establishes a long time horizon for evaluating the success of the overall program as well as that of each individual venture. . Leadership recognizes that intrapreneurship cannot be forced on people; it must be on a volunteer basis. Self-selection of intrapreneurs is accompanied by a policy to allow each individual to carry a project through to completion.

.

.

Intrapreneurship has sponsors and champions throughout the organization who not only support the creative activity and any resulting failures, but who have the planning flexibility to establish new objectives and directions as needed. Intrapreneurial activity is wholeheartedly supported and embraced by management.

References Acker, J. (1991), “Hierarchies, jobs, bodies: a theory of gendered organizations”, in Lorber, J. and Farrell, S.A. (Eds), The Social Construction of Gender, pp. 162-179, (originally published in Gender and Society, Vol. 4, pp. 139-158, 1990), Sage Publications, Newbury Park, CA. Baron, R.A., Markman, G.D. and Hirsa, A. (2001), “Perceptions of women and men as entrepreneurs: evidence for differential effects of attributional augmenting”, Journal of Applied Psychology, Vol. 86 No. 5, pp. 923-9. Belle, L., Edmondson, J. and Nkomo, S.M. (2001), Our Separate Ways: Black and White Women and the Struggle for Professional Identity, Harvard University Press, Boston, MA. Bender, S.L. (2000), “Seven characteristics of the American woman entrepreneur: a hermeneutic approach to developing a universal characteristics model” doctoral dissertation. Business Research Services (2001), National Directory of Woman-Owned Business Firms, 11th ed., Business Research Services, Washington, DC. Carsrud, A.L., Olm, K.W. and Ahigren, R.D. (1986), “Comparison of female entrepreneurs and MBA students: groomed for success or doomed to failure?” Dept. of Management, College of Business Administration and Graduate School of Business, University of Texas at Austin, Austin, TX. Catalyst (1994), On The Line: Women’s Career Advancement, Catalyst, New York, NY. Catalyst (1996), Women in Corporate Leadership: Progress and Prospects, Catalyst, New York, NY. Catalyst (1998a), Women Entrepreneurs: Why Companies Lose Female Talent and What They Can Do About It, Catalyst, New York, NY. Catalyst (1998b), Two Careers, One Marriage: Making It Work in the Workplace, Catalyst, New York, NY. Catalyst (2000), Cracking the Glass Ceiling, Catalyst, New York, NY. Center for Women’s Business Research (2002), “Facts on mothers and daughters in business”, press release, 22 April, CWBR’s materials can be accessed at hwarf@ attglobal.net Cliff, J.E. (1998), “Does one size fit all? Exploring the relationship between attitudes toward growth, gender, and business size”, Journal of Business Venturing, Vol. 13, pp. 523-42. Cooper, A., Gimeno-Gascon, F.J. and Woo, C. (1994), “Initial human and financial capital as predictors of new venture performance”, Journal of Business Venturing, Vol. 9, pp. 371-95. Hagan, O.L., Rivchun, C. and Sexton, D. (Eds) (1989), Womenowned Businesses, Praeger Publishers, New York, NY. Headd, B. (2003), “Redefining business success: distinguishing between closure and failure”, Small Business Economics, a journal from Kluwer Online, August.

162

Women entrepreneurs: out from under the glass ceiling

Women in Management Review

Mary C. Mattis

Volume 19 · Number 3 · 2004 · 154-163

Hennig, M. and Jardim, A. (1975), The Managerial Woman, Anchor Press/Doubleday, Garden City, New York, NY. Hisrich, R.D. (1990), “Entrepreneurship/intrapreneurship”, American Psychologist, Vol. 45 No. 2, pp. 209-22. Inman, K. (1997), “Women’s resources in business start-up: a study of black and white women entrepreneurs”, doctoral dissertation. Kanter, R.M. (1977), Men and Women of the Corporation, Basic Books, New York, NY. McCall, M.W., Lombardo, M.M. and Morrison, A. (1988), The Lessons of Experience: How Successful Executives Develop on the Job, Lexington Books, Lexington, MA. Mcatavey, J.M. (2002), “Women entrepreneurs: factors that contribute to women launching their own business and factors that satisfy women entrepreneurs”, doctoral dissertation. Moore, D.P. and Buttner, E.H. (1997), Women Entrepreneurs: Moving Beyond the Glass Ceiling, Sage Publications, Thousand Oaks, CA. Morrison, A.M., White, R.P. and Van Velsor, E. (1992), Breaking the Glass Ceiling: Can Women Reach the Top of America’s Largest Corporations?, Addison-Wesley Publishing Company, Reading, MA. National Foundation for Women Business Owners, and Catalyst (1998), Paths to Entrepreneurship: New Directions for Women in Business, The National Foundation for Women Business Owners, (now the Center for Women’s Business Research), Washington, DC. Phillips, B. and Kirschhoff, B.A. (1989), “Formation, growth and survival: small firm dynamics in the US economy”, Small Business Economics, Vol. 1, pp. 65-74. Reed, K.A. (1999), “Managing our margins: women entrepreneurs in suburban New Jersey”, doctoral dissertation. Roggenkamp, S.D. and White, K.R. (1998), “Four nurse entrepreneurs: what motivated them to start their own businesses”, Health Care Management Review, Vol. 23 No. 3, pp. 67-75. Science. Special section on women and science (1993), “Entrepreneurs say: ‘It’s better to be the boss’”, Science, Vol. 260, 16 April, p. 406. Smith, C.A. (2000), “Market women: learning strategies of successful black women entrepreneurs in New York State”, doctoral dissertation. Stevenson, L. (1990), “Some methodological problems associated with researching women entrepreneurs”, Journal of Business Ethics, 9 April/May, pp. 439-46.

Thomas, P. (1999), “When Venus talks to Mars”, Wall Street Journal, February 25, pp. B1-B8. Weiler, S. and Bernasek, A. (2001), “Dodging the glass ceiling? Networks and the new wave of women entrepreneurs”, Social Science Journal, Vol. 38 No. 1, pp. 85-103. Zimmerer, T.W. and Scarborough, N.M. (1997), Entrepreneurship and New Venture Formation, Prentice-Hall, Upper Saddle River, NJ.

Further reading Burke, R.J. and Nelson, D.L. (Eds) (2002), Advancing Women’s Careers, Blackwell Publishers, London. Center for Women’s Business Research (2001), A Comparison of National Statistics on Women-Owned Businesses in the US Executive Summary and Data Report, September, Center for Women’s Business Research, (founded as the National Foundation for Women Business Owners), Washington, DC. Davidson, M. and Burke, R.J. (Eds.) (2000), Women in Management: Current Research Issues II, Sage Publications, London. Ely, R.J., Foldy, E.G. and Scully, M.A. (Eds.) (2003), Reader in Gender, Work and Organization, Blackwell Publishers, London. Hartman, C. (1985), “The spirit of independence”, Inc., July, p. 460. Mattis, M.C. (1994), “Corporate initiatives in the USA for advancing managerial women”, in Davidson, M.J. and Burke, R.J. (Eds), Women in Management: Current Research Issues, Paul Chapman Publishing Ltd, London, pp. 261-76. Morrissey, C. (1998), “Breakaway women and the development of identity”, doctoral dissertation. NWBC (2002), ES-1, National Women’s Business Council, Washington, DC. Vogue (1982), “So, you want to start a business: the forces behind the fantasy . . . and the reality”, Vogue, Vol. 172, November, p. 90. Waldrop, J. (1994), “What do working women want?”, American Demographics, Vol. 16, September, pp. 36-7. Working Woman (1982), “The new pioneers”, Working Woman, Vol. 7, October, pp. 83-97.

163

Introduction

Women home-based business owners: insights from comparative analyses Karyn Loscocco and Andrea Smith-Hunter

The authors Karyn Loscocco is an Associate Professor at the University at Albany, Albany, New York, NY, USA. Andrea Smith-Hunter is Assistant Professor at Siena College, Loudonville, New York, NY, USA.

Keywords Women, Corporate ownership, Homeworking, Entrepreneurialism, Family, Economic growth

Abstract Recent research on women business owners de-emphasizes home-based business ownership, despite the fact that homebased ownership is on the rise. This study uses data from the Upstate New York Small Business Project to compare women engaged in home-based businesses to their counterparts, who locate their businesses outside the home. The results indicate that the women engaged in home-based business ownership experience less work to family conflict than their counterparts. Yet their businesses enjoy less economic success than those run by their non-home-based counterparts. This suggests that homebased ownership may be a good option only for women who do not have strong financial needs.

Electronic access The Emerald Research Register for this journal is available at www.emeraldinsight.com/researchregister The current issue and full text archive of this journal is available at www.emeraldinsight.com/0964-9425.htm

Women in Management Review Volume 19 · Number 3 · 2004 · pp. 164-173 q Emerald Group Publishing Limited · ISSN 0964-9425 DOI 10.1108/09649420410529870

Women are becoming entrepreneurs at a more than proportionate rate compared to men (Renzulli et al., 2000). There has been a corresponding interest in studying who these women are, what motivates them to become owners, and what affects their economic success (Clark and James, 1992; Loscocco et al., 1991; Moore and Buttner, 1997; Smith-Hunter, 2000; (Renzulli et al., 2000; Weiling et al., 2001). The woman home-based business owner (HBB), however, remains understudied. There has been more research on women working from home during the past decade (Heck et al., 1992; Waldrop, 1994; Jurik, 1998; Prestniz, 1989), but the bulk of the work in this area has been on homebased employment (Powers, 1995; Dannhauser, 1999; Edwards and Field-Hendrey, 1996; Ahrentzen, 1990; Bailyn, 1989), rather than HBB ownership. Though the work in these areas is a much-needed complement to studies of men small business owners, to our knowledge no study has yet to compare the woman home-based owner to her obvious counterpart, the woman who locates her business outside of the home. We seek to answer a number of questions about women who own and operate businesses from their home by comparing them to women owners whose businesses are run elsewhere. We are motivated by recent statistics showing that the HBB sector in the US is substantial in size and sales. In 1997, HBB represented 52 percent of all firms filing a tax form and produced 10 percent of the receipts of the economy, approximately $325 billion. There are an estimated 11 million of these firms today, up from about 9.2 million in 1997 (Phillips, 2002). In 1996, more than 55,000 HBBs had sales of more than $1 million and employed more than 3.5 million people (Phillips, 2002). The number of HBBs owned by women in the US numbered 3.5 million and provided full or part-time employment for an estimated 14 million people (National Association of Women Business Owners, 1996). Women HBB owners are an interesting focus for research, since they have taken control over their employment and chosen to locate the business in the same space in which they live. There are a number of interesting questions to pose about such women: In what ways might the women who make this choice differ from women who locate their businesses away from home? How are their businesses similar or different? Does the fact that HBB owners have less physical separation between This research was supported by a grant from the National Science Foundation (SBR 9618180). We thank Carolyn Corrado for research assistance.

164

Women home-based business owners

Women in Management Review

Karyn Loscocco and Andrea Smith-Hunter

Volume 19 · Number 3 · 2004 · 164-173

work and family matter when it comes to work/ family conflict? Is business location related to economic success among women business owners, and if so, is it explained by work/family variables? We draw on previous literature on women home/ based owners, women small business owners, and women home-based workers, to frame the analyses that will provide answers to these questions.

The lowered earnings of the woman homebased business owner when compared to other groups have been echoed in studies performed by others (Becker and Moen, 1999; Edwards and Field-Hendrey, 1996; Furry, 1992) and can partly be explained by three key reasons. The first reason is the types of industries in which women tend to be involved. Women HBB owners may be more likely to operate businesses that are seen as a hobby or an extension of their gendered roles as homemakers compared to their counterparts who locate outside of the home. Such gendered types of businesses have been referred to as “pink collar” businesses by some authors (Ehlers and Main, 1998). Such industries often offer lower returns for their participants (Loscocco and Robinson, 1991; Moore and Buttner, 1997; Smith-Hunter, 2000). The second reason is the lowered number of hours women involved in home-based businesses tend to work because of their other commitments (Priesnitz, 1989; Olson, 1997; Edwards and FieldHendrey, 1996). A third reason that can been advanced for the lowered earnings is the smaller amount of initial capital that women home-based business owners have to start a business (Priestnitz, 1989). This latter reason has been used to explain why women are more likely to locate a business in the home in the first place (Priestnitz, 1989). Bailyn (1989) has gone a step further and suggested that women who locate their businesses in the home are motivated more by the need for flexibility than the need to earn income. Such reasoning has been supported in the case of homebased workers, the majority of whom have been found to be supplementing the family income rather than acting as major wage earners in their households (Jurik, 1998; Olson, 1997; Rowe, Stafford and Owen, 1992). Additional research suggests that individuals are propelled into homebased employment because of the additional time that can be devoted to family (Hundley, 2000; Hundley, 2001; Becker and Moen, 1999). The desire for flexibility or control over one’s own hours has certainly been shown to motivate both women and men to own their own businesses. Yet women, especially, may use that control over their own time to juggle family responsibilities, and women may be expected to use their flexibility to accommodate work to family (Loscocco, 1997). Hundley (2000) looked specifically at the benefits of home-based business ownership for men and women. The results from the study support the proposition that home-based selfemployment provides women and men greater scope for adjusting their work efforts to meet their households’ needs for productivity and income

.

Literature review and discussion of proposed research Women are more likely to be involved than men in working at home, whether as paid employees or business owners (Danhauser, 1999; Edwards and Field-Hendrey, 1996; Olson, 1997). The home is an obvious place for a woman to start her business since it represents an inexpensive location option and presents an opportunity for her to combine work and family roles (Furry, 1992; Priestnitz, 1989; Jurik, 1998). Some studies have provided demographic profiles of women HBB owners: they are 42-46 years of age, on average, and generally married with children (Danhauser, 1999; Olson, 1997; Furry, 1992). Danhauser (1999) relied on a national survey for her sample, while Olson (1997) used data from the same nine state research project and Furry’s (1992) sample source was 899 randomly selected worker households in nine states that included business owners. Olson (1997) also found that fewer than 30 percent of the HBB owners in her sample had small children, indicating that the motivation to work at home was only partially inspired by the need to be with children. Perhaps women HBB owners are motivated more by pull factors, such as the need for independence, or interest in developing a hobby (Orhan and Scott, 2001). Comparisons of women and men HBB owners have shown that women’s HBBs tend to be younger and less profitable compared to those of their male counterparts (Priestnitz, 1989; Edwards and Fields-Hendrey, 1996). Olson’s (1997) study showed that women HBB owners were concentrated in industries that are primarily dominated by women in the labour market. The Olson study revealed that while the women and men in the study were of approximately the same age and had approximately the same human capital levels, the women in HBB earned 37 percent of what men earned in their businesses (Olson, 1997). This percentage is considerably lower than those typically reported (e.g. 72 percent) for the mainstream labour market (Jones and George, 2003; Hundley, 2000).

165

Women home-based business owners

Women in Management Review

Karyn Loscocco and Andrea Smith-Hunter

Volume 19 · Number 3 · 2004 · 164-173

(Hundley, 2000). While Becker and Moen (1999) did not focus on the home-based worker or the HBBs owner per se, their research is relevant because they looked at how dual-earning couples juggled their domestic and work lives. The authors found that couples have employed scaling-back strategies that restructure their home lives and reduce conflicts to accommodate increased domestic responsibilities. Such strategies include self-employment by one or both persons. Hundley (2000) also found that for women small business owners, earnings decreased with an increase in marriage, family size, and hours of housework. These results are supported by Trent (2000) who found that, among those studied, women who sought home-based employment did so to be closer to their family responsibilities, rather than because of a need to maximize income. Past authors indicate that a major motivator for women to work from home, whether as a worker or a business owner, is the potential to combine domestic responsibilities with an income earning status. Does this result in greater work/family balance or simply new forms of work/family conflict? Perhaps work/family conflict will be reduced as women juggle their dual responsibilities more efficiently when they work from home (Horvath, 1986; Bailyn, 1989; Edwards and FieldHendrey, 1996). Yet some studies have concluded that working at home results in a source of conflict for women as they juggle their income generating activities with their family life (Huff, 2003; Weigel and Ballard-Reisch, 1997; Heck et al., 1995). Ahrentzen (1990) looked at role conflict and role overlap for home-based workers. The author assessed role overlap from three dimensions: (1) In the mind, if the worker was thinking about their role as a worker and their family responsibilities at the same time. (2) Spatial, if the worker used the same space to perform work related and family related duties. (3) Role overlap, related to time spent simultaneously doing work related and domestic/family related tasks.

compared to non-home-based employed women. However, the analysis showed no significant difference between the home-based employed women and the non-home-based employed women in their levels of work/family conflict (Mills et al., 2000).

The results showed that while role overlaps were present, the respondents rarely reported any conflicts in the three areas, indicating that the overlaps were not necessarily disruptive. Further, Mills et al.’s (2000) study which compares women in home-based employment to those in non-homebased employment found no main effect of business location on work/family conflict. The authors originally hypothesized that women engaged in home-based employment would report lower levels of work/family conflict when

Objectives of this study This study investigates the general experience of women who not only bring their work home, but control that work as well. This can only be garnered by comparing women business owners who work from home to their counterparts whose businesses are outside the home. In doing so we aim to answer a number of largely unanswered questions about women HBB owners. Are the women who operate HBBs similar or different from other women owners in motivation, experience, and family situation? How do the characteristics of HBBs compare to non-HBBs? Is owning an HBB a good strategy for work/family balance, and if so why? Finally, what are the implications of running an HBB for women’s economic success? By focusing on women only, we can get a better sense of the HBB experience for women than is possible in comparisons of women and men. Having eliminated gender as a key source of variation, we can look more carefully at the dynamics separating home-based ownership from non-home-based ownership. Our comparison of two groups of women is also an important reminder that there is tremendous variation among women; surely not all women who own businesses have similar motivations and experiences. There is much to be learned from comparing groups of women to one another, rather than making the standard comparison to men. We begin the following analyses with descriptive statistics comparing women who own HBBs and women who own businesses outside of their homes in terms of human capital, family situation, and personal characteristics. We also look at motivation for business ownership, business characteristics, and aspects of the work itself. Because women who operate businesses from their homes combine work and family in a unique way, we compare the degree of work to family and family to work spill over for both groups of women. Finally, we examine how business success compares. We use multivariate models to explore why the two groups of women differ in work-family conflict and business success.

166

Women home-based business owners

Women in Management Review

Karyn Loscocco and Andrea Smith-Hunter

Volume 19 · Number 3 · 2004 · 164-173

Data and methods The data we analyse comes from the 1998-1999 Upstate New York Small Business Project, directed by Karyn Loscocco. Study respondents were drawn randomly from lists of small businesses (those with 100 or fewer employees) compiled by companies that track business activity. As part of this study, extensive data were gathered through structured, confidential interviews with approximately 300 women who owned small businesses in the same six industries (see Loscocco and Cozzens, 2000 for more detail on the study). We analyse data from the women who own HBBs (N ¼ 94) and the women who own businesses located elsewhere (N ¼ 229).

Descriptive results[1] Demographic characteristics There are a number of similarities in the personal characteristics of these women. The mean age of these owners, whether home-based or non-homebased, is about 47 years old. Similarly, a majority of women from both groups are married. It is noteworthy that there are no statistically significant differences between the two groups of women in how many children they have, how many children are living at home, or how many young children they have. There is no significant difference in the racial make-up of the home-based and non-homebased samples; both groups of women are overwhelmingly white and our results should be judged with this in mind.

Human and financial capital Similar percentages of women who own both kinds of businesses have attended college but owners who run HBBs are more likely to have graduated from college or pursued a graduate degree (53 percent compared to 33 percent for non-HBB). While this is a highly educated group, more of the HBB owners have some higher education (87 percent compared to 70 percent). However, there are no significant differences in the amount of training or experience of the owners across several different dimensions: having had a job in the same field; formal education that was directly useful to the business; seminars, programs, or courses relevant to the business; relevant hobby; experience in supervision, management, accounting, and sales or marketing. Prior to owning the focal business, the non-HBB owners were in the field for an average of 8.14 years, compared to 6.15 years for those running HBBs.

Consistent with previous findings, the home-based owners started their businesses with a smaller average amount of capital ($7,010.05) compared to their counterparts with non-HBB’s ($29,693.22). Home-based owners were also more likely to use informal sources of start-up capital (e.g. savings, gifts, loans from family) than women who own businesses outside of the home.

Paths to business ownership Although most of these women were working before they became owners of their current businesses, Table I displays some significant differences between the two groups of women in their paths to ownership. More of the home-based owners were homemakers prior to becoming owners. They were also less likely to have owned a business prior to the one studied. For both home-based and non-home-based women owners, the most important reasons for self-employment are quite similar. In fact, as shown in Table II, four out of the five top reasons for self-employment are the same for both groups: being your own boss, making more money, setting your own hours, and the fact that the opportunity presented itself. Furthermore, being your own boss ranked as the top reason for self-employment among both home-based and non-home-based Table I Paths to business ownership Prior to owning business, R was: Working for someone else full time Working for someone else part time Self-employed full time in another business Self-employed part time in another business Doing freelance or contract work Was a homemaker Was retired Was a student Was unemployed or laid off Note: * p , 0.05; ** p , 0.01

167

Home-based Mean (SD)

Non-home-based Mean (SD)

0.49 (0.50)

0.56 (0.50)

1.21

0.20 (0.40)

0.13 (0.33)

21.60

0.05 (0.23)

0.14 (0.34)

2.53**

0.03 (0.18)

0.03 (0.18)

0.14

0.09 (0.28) 0.26 (0.44) 0.01 (0.10) 0.03 (0.18)

0.05 (0.22) 0.15 (0.36) 0.01 (0.09) 0.06 (0.23)

21.01

0.01 (0.10)

0.02 (0.15)

0.68

t

2.10* 20.16 0.93

Women home-based business owners

Women in Management Review

Karyn Loscocco and Andrea Smith-Hunter

Volume 19 · Number 3 · 2004 · 164-173

Table II Most important reason for self-employment (number of responses) Home-based N 5 94 Be own boss (18) Balance work and family (16) Opportunity presented (11) Set own hours (10) Make more money (10) Make contribution (9) Needed a job (6) Always wanted to run b (4) Enjoy, create, challenge (3) Dissatisfied with work (3) Someone else (2) Inherited (1) Other (1) Do a better job (2) Hit ceiling or dead-end (2)

Non-home-based N 5 229 Be own boss (58) Opportunity presented (26) Make more money (23) Needed a job (20) Set own hours (19) Always wanted to run b (17) Balance work and family (15) Make contribution (12) Someone else (10) Dissatisfied with work (9) Inherited (7) Enjoy, create, challenge (6) Do a better job (4) Other (2) Hit ceiling or dead-end (1)

Note: Chi-square = 16.77

owners. Still, HBB owners were more likely to say that they had chosen the specific business that they did in an attempt to balance work and family. A question which asked why they chose the specific type of business they did revealed a similar pattern: home-based women were more likely to say they started the kind of business they did because they needed a low cost business or because they wanted to balance work and family, while women in nonhome-based business were more likely to say that the opportunity for that particular kind of business presented itself. Business characteristics and business work Table III shows that the HBBs are concentrated in manufacturing and business services, whereas the non-HBBs are more evenly distributed across the six industry categories represented in the study. At first glance it is surprising to find so many women running manufacturing businesses out of their

Table III Industry distributions of home-based and non-HBBs Homebased

Industry

% N Transportation Manufacturing Retail Wholesale Business services Personal services

94 2 34 7 16 31 4

2 36 8 17 33 4

Non-homebased % 229 29 34 42 25 34 65

13 15 18 11 15 28

Total % 323 31 68 49 41 65 69

Notes: Chi-square = 58.32*** ( p , 0.001); Phi = 0.425*** ( p , 0.001)

10 21 15 18 20 21

homes. However, the manufacturing businesses were primarily focused on small goods that are easily made from home, such as: window treatments, pottery, cookie gift baskets, jewellery, magnets, candles, and newsletters. Table IV presents comparative data on business characteristics and some aspects of business work. It shows that the average age of the businesses is similar: almost ten years for HBBs and almost 11 years for non-HBBs. Not surprisingly, the HBBs have fewer employees than do the non-HBBs. The HBBs are slightly newer, on average, but the difference does not reach statistical significance. There is a sizeable difference in business sales – the HBBs reported an average of $118,681.72 in business sales during the study year compared to an average of $384,383.11 in sales for the businesses located outside the home. Yet it is very interesting that there is no significant difference in how satisfied the two groups are with their current level of business success. Although women who operate HBBs are only slightly more likely than those with non-HBBs to say that having flexible hours is important to them, they report quite a bit more flexibility in the hours that they work (8.01 vs. 6.55 on a scale from 1 to 10). Those who work at home average ten fewer hours than their counterparts with businesses outside the home. Work and family Table V provides information on work and family conflict issues. It shows that women who operate HBBs are more likely to take calls during family or personal time, but they are no more likely to have friends call or visit when they are working. There are no location differences in terms of whether these women re-arrange or cut short work hours to fulfil family responsibilities; nor are HBB owners more likely to do business work when they are supposed to be tending to family/personal life. Interestingly, we find no significant differences in spill over from family to work between the two groups of women owners. There are no location differences in how much support the married or cohabiting owners get from their domestic partners. In fact, all of the women report getting a lot of support from their spouse/ partners (9 and 8.9 on a scale of 1 to 10). Yet women who operate their businesses from home score lower on a scale of spill over from work to family. They also report higher family satisfaction than their counterparts who have businesses elsewhere. The home-based owners contribute an average of 45 percent of the family income, compared to 55 percent for non-home-based owners, which might suggest that the home-based women have lower

168

Women home-based business owners

Women in Management Review

Karyn Loscocco and Andrea Smith-Hunter

Volume 19 · Number 3 · 2004 · 164-173

Table IV Business characteristics and business work: mean differences

Average age of business Number of full-time employees Want more employees (1 5 yes) Total sales of business last year Importance of flexibilitya Flexibility in work hoursa Number of hours on business work Satisfaction with level of business successb

Home-based Mean (SD)

Non-home-based Mean (SD)

9.52 (6.58) 0.21 (0.77) 0.30 (0.46) 118681.72 (343273.11) 8.96 (1.76) 8.01 (2.34) 38.15 (18.88) 3.83 (1.27)

10.65 (7.26) 2.10 (5.58) 0.48 (0.50) 384383.11 (660758.89) 8.06 (2.52) 6.55 (3.09) 48.45 (14.32) 3.72 (1.27)

t 1.30 5.02** 3.08** 4.69** 23.66** 24.61** 4.74** 0.682

Notes: *p , 0.05; **p , 0.01. a A single item on a scale of 1 to 10, with 1 = least and 10 = most b A single item on a scale of 1 to 3 with 1 = not very satisfied and 3 = very satisfied

Table V The work and family connection: mean differences

Take business calls during family time

a

Family/friends call/visit at businessa Rearrange business work to take care of family/personal lifea Do business work instead of time with family/friendsa Scale of spill over from family to workb Scale of spill over from work to familyb Supportiveness of spouse/partnerc Family satisfactiond

Home-based Mean (SD)

Non-home-based Mean (SD)

3.51 (1.19) 3.30 (1.09) 3.14 (1.09) 3.38 (1.12) 2.04 (0.64) 2.73 (0.89) 9.01 (1.69) 4.42 (0.96)

2.98 (1.22) 3.15 (1.04) 3.02 (1.00) 3.40 (1.07) 1.93 (0.64) 2.98 (0.88) 8.92 (2.06) 4.10 (1.21)

t 23.63** 21.10 20.89 0.11 21.29 2.25* 20.34 22.52**

Notes: * p , 0.05; ** p , 0.01 A single item indicator with a range from 1-5, for which 1 = never and 5 = very often; b a 4 item scale for which 1 = very little and 5 = a lot of spill over; c a single item indicator scale of 1-10, for which 1 = not very supportive and 10 = very supportive; d a single item indicator with a range from 1-5, for which 1 = not very satisfied and 10 = very satisfied.

a

financial need than their non-HBB counterparts. Yet unreported t-tests show no significant mean difference in the two groups of women’s assessment of how much responsibility they feel to provide for the family, whether they would have to put off major purchases if they didn’t have the business, and whether there would be a serious impact on their standard of living without the business.

Multivariate results We performed multivariate analyses to explore the differences we found in work/family conflict and business sales between the two groups of women. We drew from Gutek et al.’s (1991) work, replicating work/family conflict measures and models, although we focus on business location, rather than gender, as our point of comparison.

169

Women home-based business owners

Women in Management Review

Karyn Loscocco and Andrea Smith-Hunter

Volume 19 · Number 3 · 2004 · 164-173

The results of correlational analyses show that for both home-based and non-home-based women owners, hours spent in paid work are positively correlated with spill over from work to family. Also, work to family spill over and family to work spill over are positively correlated with one another (r ¼ 0.517, p , 0.01 for H-B women; and r ¼ 0.381, p , 0.01 for non H-B women). Thus a big part of why women who operate businesses from their homes experience less work to family spill over is because they are working fewer hours, on average, than their counterparts whose businesses are outside the home. It is also interesting that for women who operate nonHBBs, the more hours spent on family work, the greater is the family to work spill over (r ¼ 0.200, p , 0.01), yet there is no such correlation among the home-based women owners. Regression results for a model with these variables are presented in Table VI (Panel A)[2]. When domestic work hours are controlled, homebased workers experience even less work to family conflict than their counterparts who operate businesses in a separate location from home. As column 3 shows, the difference in work to family conflict between HBB owners and non-HBB owners is completely explained by the fact that home-based owners put in fewer work hours. Panel B of Table VI presents the results of a regression model of business success that features the same work/family variables. The difference in economic success between women who run HBBs and their non-home-based counterparts is explained partially by how much time the women spend on their housework and their business work.

In this model, for every one-hour increase in housework, business sales drop by $2293.19; conversely, for every one-hour increase in hours spent on business work, business sales increase by $4396.20. Though these HBB owners use less start-up cash than their non-home-based counterparts, this does not account for the difference in business success, as some past studies have suggested. To examine whether lesser family need on the part of home-based women might keep them from generating the kind of sales that their non-home-based counterparts do, we included a self-report of how much the owner contributes to family income. Yet this has no impact on business sales[3].

Discussion and conclusions To get a better understanding of women who operate HBBs, we compared them to women who operate businesses outside of the home. Our analyses show that despite similarities in race, personal background, motivation, experience, and family situation, the two groups of women owners differ on two key dimensions: work/family conflict and economic success. The background characteristics of the women in our sample and the size and age of their businesses are similar to reports from other studies (Olson, 1997; Kathryn Stafford as cited in Danhauser, 1999; Furry, 1992; Priestnitz, 1989; Jurik, 1998). We can thus have confidence in our sample and the accompanying results.

Table VI Panel A, regression of work interference with family on time spent in business, family and paid work. Panel B, regression of business sales on location of business, time spent in family and paid work, start-up capital, and percent respondent contributes to family income Panel A

Independent variables HBB (home-based 5 1) Hours spent in family work Hours spent in paid work

Work interference with family (N 5 319) (1) (2) (3) 20.259* (20.133) – – –

20.264* (20.135) 0.001 (0.041) –

20.003 (20.001) 0.002 (0.084) 0.025** (0.455) –

Start-up capital

–

–

Percent respondent contributes to family income

–

–

–

Constant R2

2.977 0.018

2.932 0.019

1.690 0.206

Note: Unstandardized regression coefficients are followed by standardized coefficients in parentheses. *p , 0.05; **p , 0.001.

170

Panel B Business sales (N 5 302) (1)

(2)

2257618.00** (20.198) – – – – –

2171559.00* (20.132) 22293.19* (20.122) 4396.20* (0.120) 0.78 (0.073) 1006.67 (0.056) 170989.10 0.081

– 374046.00 0.039

Women home-based business owners

Women in Management Review

Karyn Loscocco and Andrea Smith-Hunter

Volume 19 · Number 3 · 2004 · 164-173

One of our key questions was whether women HB owners tend to have a different path to ownership than their non-HB counterparts. The data suggest that this is true to some extent. While the majority of women were working before they became business owners, the home-based women were more likely to have been homemakers, and less likely to have been a previous business owner before starting their current business. The homebased women also start their businesses with lower amounts of capital that often come from informal sources. It is possible that for many women, low start-up capital levels is the main reason for locating the business in the home in the first place (Priestnitz, 1989; Rowe et al., 1992). Yet the home-based women are somewhat less likely to say that things were standing in the way of having exactly the kind of business they would have liked[4]. These results may be more in keeping with the view that home-based businesses are a “trial run” before venturing out of the home space into the “real thing” (Jurik, 1998; Rowe et al., 1992). Of course, it is also possible that many of the home-based women do not need more capital to start the kinds of businesses they choose to run. At first glance, the industry distribution figures of the home-based businesses are surprising, because home-based women owners are concentrated in male-dominated manufacturing and business services, as opposed to the more gender-balanced retail and personal services reported by other studies (Priestnitz, 1989; Olson, 1997; Ehlers and Main, 1998). However, a closer look shows that the actual types of businesses draw on skills typically associated with women (window treatments, pottery, etc.) and might be seen as an extension of women’s roles as homemakers. One surprising result is the large sales volume for both groups of women business owners. The average sales values for the home based businesses at $118,682 are much higher than the averages found in previous studies (Jurik, 1998; Priestnitz, 1989; Olson, 1997). This may be due to the fact that these home-based women are not concentrated in the retail and sales businesses typically associated with women. These homebased women are also highly educated. Clearly, we have studied a successful group of women small business owners, which may be due to the fact that the samples were drawn from companies that track business activity. Extremely casual businesses would be unlikely to appear. The home-based business owners worked fewer hours, on average, than their non-home-based counterparts (Furry and Lino, 1992; Priestnitz, 1989). These results contrast with Mills et al.’s (2000) study, which found that the women who worked at home were

more likely to work longer hours. This demonstrates an important difference between home-based employees and HBB owners: the ability to set one’s own hours. It is also the major reason that the home-based women report lower family to work conflict. Taken with the findings from other studies (Mills et al., 2000; Ahrentzen, 1990), our results suggest that while working from home may overlap with family life, it need not interfere in a way that produces conflict. When a woman can limit the number of hours she works, as the home-based women in our sample are able to do, it appears to reap personal and family benefit. Yet home-based women owners may be trading off work/family balance for economic success. Their businesses have much lower sales volume than those run by their non-home-based counterparts. This difference is explained partly by the fact that home-based women do more domestic work and less business work. Financial need does not have a significant effect on business success. Nor does the original difference in startup capital affect sales volume, as other authors have suggested (Priestnitz, 1989). Both groups of women report that their financial contributions to their families are very important. Still, the women who run HBBs contribute a smaller percentage of the family income than do the women whose businesses are outside of the home. Though their businesses generate far fewer sales, on average, the homebased women are not significantly less satisfied with their level of business success. They are also less likely to say that they would like to have more employees. These findings suggest that, as a group, these HBB owners are less interested in business growth. We have established the importance of studying home-based women by comparing them to women who own businesses outside the home. Further research is needed to identify more precisely the mechanisms through which business sales are determined for the two groups of women owners. We also need studies that distinguish between home-based women owners who have no desire for anything bigger or more successful than the business they have and those who may want their businesses to grow, but are holding back because of family or finances. Longitudinal studies that follow HBBs over time, identifying why some move out of the home and why others do not, would be particularly instructive. Finally, studies of women of colour in HBBs are needed to provide a fuller, more accurate picture of women and HBB ownership. Comparative studies of women from different racial/ethnic groups should investigate

171

Women home-based business owners

Women in Management Review

Karyn Loscocco and Andrea Smith-Hunter

Volume 19 · Number 3 · 2004 · 164-173

whether gender and race intersect in the work/ family dynamics we have uncovered. The overall picture that emerges from this study is that home-based ownership may be a positive option for women who do not experience a strong financial need. With control over the number of hours they put in, these home-based women business owners do not experience the kind of work to family conflict faced by home-based employees. With the apparent ability to limit their hours, they escape the degree of work to family conflict faced by their counterparts who own businesses outside of the home. HBB ownership offers select women the opportunity to juggle home and work responsibilities with greater ease. As a short-term solution to women’s enduring difficulties of balancing work and family, it is useful. Yet it is a choice, which may limit economic gain and greater gender equality. If home-based owners do not attempt to expand their businesses, they will sacrifice economic success. The challenge for academicians, social analysts, and business owners alike, is to identify ways to combine the work/ family benefits of home-based ownership with the economic benefits of non-HBB ownership.

multiple roles at home”, Environment and Behaviour, Vol. 22 No. 6, pp. 723-52. Bailyn, I. (1989), “Toward the perfect workplace”, Communications of the ACM, Vol. 32 No. 4, pp. 460-72. Becker, P. and Moen, P. (1999), “Scaling back: dual-earner couples’ work family strategies”, Journal of Marriage and Family, Vol. 61 No. 4, pp. 995-1007. Clark, T. and James, F. (1992), “Women-owned businesses: dimensions and policy issues”, Economic Development Quarterly, Vol. 6 No. 1, pp. 25-40. Dannhauser, C. (1999), “Who’s in the home office?”, American Demographics, Vol. 21 No. 6, pp. 50-6. Edwards, L. and Field-Hendrey, E. (1996), “Home-based workers: data from the 1990 Census of Population”, Monthly Labour Review, Vol. 119 No. 11, pp. 26-34. Ehlers, T. and Main, K. (1998), “Women and the false promise of micro enterprise”, Gender and Society, Vol. 12 No. 4, pp. 424-40. Furry, M. (1992), “Home-based work in nine states: an empirical study”, South-eastern Regional Association of Family Conference Proceedings. Furry, M. and Lino, M. (1992), “An overview of home-based work: results from a regional research project”, Family Economics Review, Vol. 5 No. 3, pp. 2-8. Gutek, B., Searle, S. and Kelpa, L. (1991), “Rational versus gender role explanations for work-family conflict”, Journal of Applied Psychology, Vol. 76, pp. 560-8. Heck, R., Rowe, B. and Owen, A. (1995), “What we know and do not know about the ‘home’ and the ‘work’ and the implications of both”, Home-Based Employment and Family Life, Chapter 8, Auburn House, Westport, CT, pp. 193-228. Heck, R., Winter, M. and Stafford, K. (1992), “Managing work and family in home-based employment”, Journal of Family and Economic Issues, Vol. 13 No. 2, pp. 187-212. Horvath, F.W. (1986), “Work at home: new findings from the current population survey”, Monthly Labour Review, Vol. 109 No. 11, pp. 31-5. Huff, P. (2003), “Home-based business myths”, Moms Business Magazine, June, pp. 11-13. Hundley, G. (2000), “Male/female earnings differences in selfemployment: the effects of marriage, children and the household division of labour“, Industrial and Labour Relations Review, Vol. 54 No. 1, pp. 95-114. Hundley, G. (2001), “Why women earn less than men in selfemployment”, Journal of Labour Research, Vol. 22 No. 4, pp. 817-29. Jones, G. and George, J. (2003), Contemporary Management, 3rd ed., McGraw-Hill Irwin Publishers, Boston, MA. Jurik, N. (1998), “Getting away and getting by: the experiences of self-employed home workers”, Work and Occupations, Vol. 25 No. 1, pp. 7-36. Loscocco, K. (1997), “Work-family linkages among selfemployed women and men”, Journal of Vocational Behaviour, Vol. 50, pp. 204-26. Loscocco, K. and Cozzens, K. (2000), The Upstate New York Small Business Project Preliminary Report, University at Albany, State University of New York, New York, NY. Loscocco, K. and Robinson, J. (1991), “Barriers to women’s small business success in the United States”, Gender and Society, Vol. 5 No. 4, pp. 511-32. Loscocco, K., Robinson, J., Hall, R.H. and Allen, J.K. (1991), “Gender and small business success: an inquiry into women’s relative disadvantage”, Social Forces, Vol. 70 No. 1, pp. 65-83. Mills, R.S.L., Duncan, K.A. and Amyot, D.J. (2000), “Home-based employment and work-family conflict”, in Hennon, C.B.,

Notes 1 All descriptive results are based on t-tests of mean difference, using the assumption of non-equivalent variances. We report as significantly different any t value with a p value of 0.05 or lower. 2 Following Gutek et al. (1991), we tested a model that included an interaction term for business location * hours spent in paid work, but the interaction term was not significant and the regression coefficients for the other variables had the same size and direction as in the additive model, so we present the additive model. 3 We are not trying to build a full model of business success, as other studies have done (e.g. Loscocco et al., 1991). Instead, we focus on whether key work/family variables affect business success. In a model with demographic variables respondent age, marital status, and number of children controlled, regression coefficients were identical in direction and similar in size to those shown in Panel B. 4 The question was, “On a scale of 1 to 10, how much did things get in your way of opening (buying) exactly the kind of business you would have liked, where 1 is very little and 10 is very much?” The average response for home-based women is 3.56 compared to 4.21 for non home-based women, a statistically significant ( p , 0.05) difference between the two groups.

References Ahrentzen, S. (1990), “Managing conflict by managing boundaries: how professional home workers cope with

172

Women home-based business owners

Women in Management Review

Karyn Loscocco and Andrea Smith-Hunter

Volume 19 · Number 3 · 2004 · 164-173

Loker, S. and Walker, R. (Eds), Gender and Home-Based Employment, Auburn House, Westport, CT, pp. 137-66. Moore, D. and Buttner, H. (1997), Women Entrepreneurs: Moving Beyond the Glass Ceiling, Sage Publication, Thousand Oaks, CA. National Association of Women Business Owners (1996), Journal of Accountancy, Vol. 181, Data taken from 1994-1995 survey of National Association of Women Business Owners. Olson, P. (1997), “Are the floors less sticky at home? Pay-equity in home-based work”, Consumer Interests Annual, Vol. 43, pp. 239-43. Orhan, M. and Scott, D. (2001), “Why women enter into entrepreneurship: an explanatory model”, Women in Management Review, Vol. 16 No. 5, pp. 232-43. Phillips, B. (2002), “Home-based firms, e-commerce and hightechnology small firms: are they related?”, Economic Development Quarterly, Vol. 16 No. 1, pp. 39-48. Powers, M. (1995), “Home is where the work is”, Human Ecology, Vol. 23 No. 1, pp. 8-12. Priesnitz, W. (1989), “Running a business out of your home”, Women and Environments, Vol. 11, pp. 4-8.

Renzulli, L., Aldrich, H. and Moody, J. (2000), “Family matters: gender, networks and entrepreneurial outcomes”, Social Forces, Vol. 79 No. 2, pp. 523-46. Rowe, B., Stafford, K. and Owen, A. (1992), “Who’s working at home: the types of families engaged in home-based work”, Journal of Family and Economic Issues, Vol. 12 No. 2, pp. 159-72. Smith-Hunter, A. (2000), “Oligopolistic discrimination: a new theory on women and minority business ownership”, Journal of International Business and Entrepreneurship, Vol. 8 No. 2, pp. 47-64. Trent, E. (2000), “Industry and self-employment analysis by gender”, in Hennon, C.B., Loker, S. and Walker, R. (Eds), Gender and Home-Based Employment, Auburn House, Westport, CT, pp. 167-87. Waldrop, J. (1994), “What do working women want?”, American Demographics, Vol. 16 No. 9, pp. 36-7. Weigel, D. and Ballard-Reisch, D. (1997), “Merging family and firm: an integrated systems approach to process and change”, Journal of Family and Economic Issues, Vol. 18 No. 1, pp. 7-31. Weiling, E., Winter, M., Morris, E. and Murphy, A. (2001), Women’s Policy Journal, Vol. 1, pp. 48-67.

173

Introduction

Giving back: women’s entrepreneurial philanthropy

While researching the history of women’s entrepreneurship in the US, this author observed that most of the women studied were active participants in social causes with overarching goals of local, regional, national, or international humanitarian impact. Their fields of interest were as varied as the women – education, the environment, religion, human service, the arts, health, etc. However, the perception of the economic impact of women’s giving has remained narrow because of limited information about this type of entrepreneurial endeavor. Typical assumptions are that women are more likely to give of their time than their money; that when they give money, they give small amounts; or that women are very parochial in their giving. Thus, this paper will explore the concept of such philanthropy, suggest where this social ethic might have had its origins, and provide samples of women who have been entrepreneurial in their social commitment. Suggestions for future research on women’s entrepreneurial philanthropy will also be made.

Jeannette Oppedisano

The author Jeannette Oppedisano is Professor and Chair in the Department of Management/MIS School of Business, Southern Connecticut State University, New Haven, Connecticut, USA.

Keywords Entrepreneurialism, Women, Philanthropy, United States of America, Social action

Philanthropy Abstract Traditionally, the concept of entrepreneurship included a forprofit bottom line. Recently, however, researchers have begun to explore an adaptation of this model called “social entrepreneurship”; that is, creating organizations for the greater good of a community, region, nation, or the world. These entrepreneurs use money that they made or inherited to establish organizations from a missionary and visionary posture. This is an arena where women have had significant impact, yet little has been written to celebrate their contributions. The purpose of this paper is to explore the concept of such philanthropy, to suggest where this social ethic might have had its origins, and to provide samples of women who have been entrepreneurial in their social commitment. Suggestions for future research on women’s entrepreneurial philanthropy will also be made.

Electronic access The Emerald Research Register for this journal is available at www.emeraldinsight.com/researchregister The current issue and full text archive of this journal is available at www.emeraldinsight.com/0964-9425.htm

Women in Management Review Volume 19 · Number 3 · 2004 · pp. 174-177 q Emerald Group Publishing Limited · ISSN 0964-9425 DOI 10.1108/09649420410529889

Historical perspective Philanthropy’s roots are burrowed in ancient history. In the US, the foundational elements of such humanitarianism were laid by the stream of diverse immigrants who came to this particular land in search of religious and political freedom as well as economic opportunity. As a consequence, “philanthropy has strong roots in religious beliefs, in the history of mutual assistance, in democratic principles of civic participation, in pluralistic approaches to problem solving and in American traditions of individual autonomy and limited government” (The Council on Foundations, 2002). Very often, the practice of giving has been, and is, modeled in the family unit – from helping a next door neighbor to traveling abroad and donating skills, time, and monies to benefit others. “Women business owners are more likely than men business owners to say that their interest in philanthropy was prompted by family tradition or parental example” (Center for Women’s Business Research, 2000). The economic reality and impact of such “giving” is quite dramatic. Financial impact The monetary reality of philanthropy is significant. “Since 1990, charitable donations by individuals have grown by half, from $110 billion to $164 billion in 2001” (Byrne, 2002, p. 83). Research from Indiana University’s Center on Philanthropy

174

Giving back: women’s entrepreneurial philanthropy

Women in Management Review

Jeannette Oppedisano

Volume 19 · Number 3 · 2004 · 174-177

indicated that the money was directed primarily to churches and religious charities; education; human services; and health – from $18.43 billion to $80.96 billion. Smaller amounts, though still significant in actual dollars, were given to causes to help the environment/animals, arts, culture and humanities – what they labeled “umbrella charities” (Byrne, 2002, p. 90). And according to the forecasts of Paul G. Schervish and John J. Havens from Boston College’s Social Welfare Research Institute, “$19.2 trillion to $50.2 trillion will be spent on philanthropy by 2052”. They suspect that “much of that money will find its way to new philanthropic ventures”. Family modeling becomes apparent here because there are almost 25,000 family foundations according to the Foundation Center, a figure on the rise. These foundations “. . . control $197.7 billion or almost half of all independent foundation assets, and they gave away $11.3 billion in 2000 accounting for half of all foundation giving”.

more currently visible new philanthropists, dominated by white male leaders from mainstream America” (Reis, 1999, p. 15). Wooster (2002), contributing editor to The Philanthropy Roundtable, pointed out that “historians have largely neglected the study of philanthropy”. This made little sense from his perception particularly when it came to the role of women:

Linkages of philanthropy and entrepreneurship Entrepreneurship became a subject of great interest nationally and internationally over the last 20 years because of the widespread recognition of the economic impact of such ventures. Traditionally, the concept of entrepreneurship included a for-profit bottom line. Recently, however, researchers have begun to explore the concept of social entrepreneurship (Brinckerhoff, 2000; Dees et al., 2001; Oppedisano, 2000); that is, creating organizations for the greater good of a community, region, nation, or the world. Researchers, Acs and Dana (2001), articulated the historical and uniquely American linkages in these practices. “What differentiates American capitalism from all other forms of industrial capitalism is its historical focus on both the creation of wealth (entrepreneurship) and the distribution of wealth (philanthropy)” (Acs and Dana, 2001, p. 66). They go on to describe the interactive and circular nature of these endeavors: “[P]hilanthropy provides a positive feedback mechanism for future economic growth, and a cumulative causation leading to higher levels of economic development” (Acs and Dana, 2001, p. 65). Thus, it is critical that we uncover the role and impact of women in these ventures. Invisible women In 1999, the ongoing invisibility of female entrepreneurial philanthropists was demonstrated in a report titled, Unleashing New Resources and Entrepreneurship for the Common Good, produced by Tom Reis for the W.K. Kellogg Foundation. The participants in this research project “involved the

. . . the people who run philanthropic organizations and their accomplishments would seem a ripe topic for today’s . . . feminists [since] plenty of strong, independent and articulate women either ran foundations or benefited from them. Social historians will find that most of the major social movements of the twentieth century – the welfare state, environmentalism, urban renewal, arts funding – were spurred by foundation grants (Wooster, 2002, p. 1).

Entrepreneurial philanthropy is an arena where women have had significant impact, yet they remain hidden because little has been written to celebrate their contributions.

Women’s role in philanthropy Though there is some difference of opinion on the motivations for the giving patterns of men and women, a generally accepted premise is that men are more likely to give to gain recognition. For example, men have sought a “naming opportunity”, that is, perhaps having a building or program with their name on it. Women, on the other hand, more characteristically give to make a difference – giving to causes that tug at their heart strings and that help others according to Nowell (1996). Shaw and Taylor (1995, p. 88) agree. “If there are any universals in what motivates women to give, they can be summed up in six categories, all beginning with the letter C: the desire to change, create, connect, commit, collaborate, and celebrate their philanthropic accomplishments.” This has been borne out in the research conducted for the National Foundation for Women Business Owners (1999) titled, Philanthropy Among Business Women of Achievement”. The business women surveyed were members of The Committee of 200, an organization whose members “own companies with revenues in excess of $15 million or manage divisions of US corporations that generate a minimum of $100 million annually”. The primary giving motivations of women identified through this research were desiring to support an issue or cause about which these women were passionate (66 percent of respondents) and wanting to give back to the community (40 percent of the respondents). Also, 40 percent did not want or need to be recognized for their philanthropy.

175

Giving back: women’s entrepreneurial philanthropy

Women in Management Review

Jeannette Oppedisano

Volume 19 · Number 3 · 2004 · 174-177

Women’s entrepreneurial philanthropy Entrepreneurial philanthropy is initiating an organization/entity, taking substantial risks in doing so, and having economic impact; in fact, it is no different than the original concept established by Richard Cantillon back in the seventeenth century (Brewer, 1992). The goal, however, is decidedly different. Entrepreneurial philanthropy is investing human, physical, and financial resources in the entrepreneurial framework of creating organizations for the express purpose of making a positive and constructive difference in societal members. These entities are typically set up in a not-for-profit structure but not exclusively so. To demonstrate the accomplishments of women in this arena, sample female entrepreneurial philanthropists will be briefly described within the same categories identified above: religion, education, human services, the arts, and the environment.

territories . . . five schools in Harlem . . . the first Black Catholic University, Xavier University . . . [Estimates are that Mother Katherine Drexel gave] more than $12 million in her philanthropic work” by the time of her death (Oppedisano, 2000, p. 84). Henriette Delille (1813-1862) also started a religious order but for women of color – the Order of the Sisters of the Holy Family. Delille was a woman of mixed blood born in New Orleans, Louisiana. As a free woman of color, she risked not only her inheritance, but her family relationships, possible incarceration, and hunger to educate persons still enslaved. She built the Hospice of the Holy Family to serve the sick, aged, and poor as well as the Asylum of the Children of the Holy Family for orphans of color. Today, the nuns of this order serve the underprivileged as far away from the original site as Belize, Central America (Oppedisano, 2000). Women also established organizations about which it is difficult, if not impossible, to assess a dollar impact. Josephine St. Pierre Ruffin was a founder of the New Era Club whose activities led to the formation of the National Association of Colored Women in 1896. She declared, “It is not enough to try to disprove unjust charges through individual effort . . .” and pointed out that their mission was directed at:

Early developments One of the earliest large foundations in the US was initiated by Margaret Olivia Slocum Sage (18281918) with money inherited from her husband, financial magnate, Russell Sage, and, after whom she named the organization. At the time the Russell Sage Foundation was established in 1907, the initial funding of $10 million was the largest single philanthropic contribution in US history. In a letter she wrote to the foundation trustees, “Olivia” as she was more commonly known, was clear that her goal was: “the improvement of social and living conditions in the United States of America . . . The scope of the Foundation is not only national but it is broad...its aim [is] to take up the larger and more difficult problems, and to take them up so far as possible in such a manner as to secure co-operation and aid in their solution . . .” (www.russellsage.org/about/ letter_of_gift.htm) (accessed 18 August 2002).

Among her many educational contributions, Sage established the Russell Sage College in Troy, New York as an educational opportunity for women. The long-term financial contributions of her philanthropy are estimated to be about $80 million. Starting more than one philanthropic entity is a pattern we can observe in other women, too. Katherine Drexel (1858-1955) and her sisters inherited their money from their father who set it up in such a way that no one other than his daughters could control their money. Katherine founded the Sisters of the Blessed Sacrament for Indians and Colored People. Although she, herself, was committed to a personal life of poverty, she used her inheritance to initiate a religious order for women, and establish “more than fifty missions and schools in fifteen states or

. . . the thousands of self-sacrificing young women teaching and preaching in lonely southern backwoods, for the noble army of mothers . . . whose intelligence is only limited by their opportunity to get books . . . for the sake of our own dignity, the dignity of our race, and the future good name of our children”.

Juliette Low (1860-1927) founded the Girl Scouts of the US modeling it after the Girl Guides that had been established in Europe. Low’s purpose was to teach girls to be self-sufficient and to do good in the community. “Estimates suggest that in the decades since this movement was begun by Juliette Gordon Low, over fifty million girls and women have been positively influenced by participation” (Oppedisano, 2000, p. 163). Jane Addams (1860-1935) was a co-founder of Hull House, a Chicago settlement facility established to provide services to the masses of immigrants who were living in abject poverty. Millions of people have benefited from the many activities of this operation that has included meals, day-care, housing, training, and entertainment.

Recent women’s entrepreneurial philanthropy The humanitarian commitment of women through organizational initiation has continued into the twenty-first century. Harriet Stimson Bullitt and her sister, Priscilla Bullitt Collins, carry on the

176

Giving back: women’s entrepreneurial philanthropy

Women in Management Review

Jeannette Oppedisano

Volume 19 · Number 3 · 2004 · 174-177

environmental preservation in the Northwest US of their mother, Dorothy Stimson Bullitt, founder of King Broadcasting and the family foundation. The Hunt sisters established the Hunt Alternatives Fund to help the poor and powerless. Recently, they added the “Women Waging Peace” project. “To me,” noted Swanee Hunt, “philanthropy, at its best, means bringing together many different voices and finding ways to modulate the ones that are too loud and raising the ones that can’t be heard so that you get a balance” (Marchetti, 2001, p. 1). One of the philanthropic efforts started by Oprah Winfrey, founder of Harpo Productions, Inc., is Families for a Better Life. Over a two-year period, one hundred families receive $60,000 each to improve their skills, get jobs, and move out of the projects. “That’s how I’m supposed to be using myself,” she explained (Gerosa, 1994, p. 280). Ellen Stewart opened up La Mama in New York City as an experimental theater venue for aspiring writers, directors, producers, and actors. Her personal philosophy is palpable, familial, and unifying: I believe that we are one big world and that all of us are connected. It’s as if there were some kind of genetic residue in each of us that binds us all together. If we could find a way to communicate through that part of our common geneticism, so to speak, there’d be an almost umbilical understanding among people” (Anderson, 1997, p. 30).

Summary and suggestions for future research What has been briefly described above is women’s utilization of entrepreneurial skills to create organizations for social good. The linkages between entrepreneurship and philanthropy are long-standing in the US – and demonstrated by the far-reaching accomplishments of women through this mechanism. Areas for future research on women’s philanthropic entrepreneurship might include an investigation of who the role models for giving were for women, who the recipients of their generosity were, and why were they chosen. Another area of interest would be more in-depth organizational analyses of the types of philanthropic organizations women initiated, whether they still exist today and, if so, in what form? Finally, comparative analyses of the similarities and differences between US women who were/are entrepreneurial philanthropists and

such women in other countries would be informative.

References Acs, A. and Dana, L. (2001), “Contrasting two models of wealth creation”, Small Business Economics, Vol. 16, pp. 63-74. Anderson, G. (1997), “Visiting La Mama’s founder: an interview with Ellen Stewart”, America, 8 February, pp. 28-32. Brewer, A. (1992), Richard Cantillon: Pioneer of Economic Theory, Routledge, London. Brinckerhoff, P. (2000), Social Entrepreneurship: The Art of Mission-based Venture Development, John Wiley and Sons, New York, NY. Byrne, J. (2002), “The new face of philanthropy”, Business Week, December 2, pp. 82-94. Center for Women’s Business Research (2000), Leaders in Business and Community: Philanthropic Contributions of Women and Men Business Owners, National Foundation for Women Business Owners, Washington, DC. Dees, J., Emerson, J. and Economy, P. (2001), Enterprising Nonprofits: A Toolkit for Social Entrepreneurs, John Wiley and Sons, New York, NY. Gerosa, M. (1994), “What makes Oprah run?”, Ladies’ Home Journal, November, p. 200. Marchetti, D. (2001), “A donor’s alternative energy”, The Chronicle of Philanthropy, 8 March, pp. 1-5, (accessed 9 April 2002). National Foundation for Women Business Owners (1999), Philanthropy Among Business Women of Achievement, National Foundation for Women Business Owners, Silver Springs, MD. Nowell, I. (1996), Women Who Give Away Millions: Portraits of Canadian Philanthropists, Hounslow Press, Toronto, ON. Oppedisano, J. (2000), Historical Encyclopedia of American Women Entrepreneurs 1776 to the Present, Greenwood Press, Westport, CT. Reis, T. (1999), Unleashing New Resources and Entrepreneurship for the Common Good, The W.K. Kellogg Foundation, Battle Creek, MI. Shaw, S. and Taylor, M. (1995), Reinventing Fundraising: Realizing the Potential of Women’s Philanthropy, JosseyBass Publishers, San Francisco, CA. The Council on Foundations (2002), An Abbreviated History of Philanthropic Tradition in the United States, available at: www.cof.org/whatis/history.htm (accessed 18 August). Wooster, M. (2002), “First suppression, then gibberish: American philanthropy’s enduring historical void”, The Philanthropy Roundtable, March/April, pp. 1-3.

Further reading McClintock, N. (1997), Women Donors: Are They Really Different?, Canadian Centre for Philanthropy, Toronto, January 1-2, pp. 1-2. Strom, S. (2002), “The newly rich are fueling a new era in philanthropy”, The New York Times, April 27, p. A12.

177

Bookshelf

Women in Management Review Volume 19 · Number 3 · 2004 · 178-179

Bookshelf Difference Matters: Communicating Social Identity Brenda J. Allen Waveland Press Long Grove, IL 2004 253 pp. (including index) ISBN 1-57766-304-7 $19.95 USA Keywords Difference, Social identity, USA Review DOI 10.1108/09649420410529898

As a little black girl Brenda Allen learnt how to internalise oppression by singing with her friends, “When you’re white, you’re right; when you’re brown, stick around; but when you’re black, oooh baby, get back, get back, get back.” Today, as Associate Professor at the Department of Communication at the University of Colorado and volunteer at a soup kitchen, she argues for change, and motivates students to be aware of prejudice. The title of her book, Difference Matters was inspired by Cornel West’s controversial book, Race Matters. Allen takes up West’s argument that race is important, and extends it to examine five additional social identity categories: gender, social class, ability, sexuality and age. It is probably no accident that the cover is in suffragette colours of purple, green and white. Allen envisages her book being used as a textbook for undergraduate and graduate papers in organisation and communication, as well as other training courses and curricula. She has opened a web site with ideas and resources to be used in conjunction with it: http://communication. cudenver.edu/, ballen/Difference-Matters.html (currently still under construction) and invites readers to email her. Interactive educational tools like these ones are particularly relevant in this area, as society continues to become increasingly diversified and organizations attempt to develop strategies to deal with the changes. The book begins with an introduction on why difference is important and the obstacles that impede us from valuing it. Allen makes it clear from the outset that she is looking at difference through a social constructivist lens, because she sees this as the best perspective for discovering how amenable to change social identities are. In the second chapter, Allen describes power dynamics and how power is communicated, introducing

students to the ideas of Foucault and Gramsci. The next six chapters focus on each of the six social identities: race, gender, social class, ability, sexuality and age. In each of these she includes a section on history, and then synthesises research from several disciplines, such as sociology, anthropology, philosophy and psychology, on how social identity relates to communication in organisations. In the final chapter Allen concludes by urging the reader to be aware of prejudice, stereotypes and dominant ideologies, and to initiate change proactively. From a teaching perspective, Difference Matters has mixed merits. On the positive side, Allen consistently makes an effort to keep the content interesting so that class discussion will flow easily. By including historical contexts and using a broad definition of organisation to include all social collectives with goals, she introduces a variety of material. We learn, for example, about the industrial revolution’s “ugly laws” which prohibited diseased, maimed, mutilated or deformed people from being in public places. For those more interested in contemporary culture, Allen outlines research showing that Academy Award nominees and winners tend to be younger women and older men. Another strength of the book is that Allen engages the reader. She writes in the first person and is lucid in her discussions of Foucault, concertive control and hegemony (clarifying the pronunciation – hih-jeh’-minny – for students who may be new to the word). Each chapter begins with a personal story, and several times I put the book down to reflect on these. Similarly, exercises at the end of each chapter ask readers to relate the subject matter to their experiences. While it may seem that tasks such as analysing your interaction with a romantic partner, parent or work supervisor by applying Foucault’s conception of power, may lend themselves to injustice collecting, I expect they will make the material meaningful to students. Another feature that students might appreciate is Allen’s acknowledgement of the anxieties members of dominant groups may have as they try not to offend, and I would have enjoyed more of this (John Cleese’s frustrated cry, “Have you any idea what it’s like to be English?” has long resonated with me). Notwithstanding the book’s engaging content and style; I have some questions about its use as a text. The first is that all the material relates to the US, and the heavy American slant, especially in the chapter on social class, limits its use in other countries. I gather (from looking up Allen’s Western States Communication Association profile on the Internet) that the book’s subtitle was initially going to be Communicating Social Identity

178

Bookshelf

Women in Management Review Volume 19 · Number 3 · 2004 · 178-179

in the United States, and in the United States was later dropped. This omission is misleading, and ironic given that one of the book’s purposes is to teach us how important it is to acknowledge cultural difference. Another limitation, I feel, is the book’s social constructionist stance, and this is especially evident when we come to the chapter on gender where Allen uncritically adopts the old binary logic that characterises the essentialism debate. Thus, although less than 30 pages earlier she has warned us against using simplistic dichotomies, Allen explains her social constructivist perspective by contrasting it with essentialist theories (which suggest that differences are innate), and argues that the latter obstruct change and can be used to justify patriarchy. The idea that if we accept that there are innate differences, then we perceive them as unchangeable and thereby preserve the status quo, has been hotly rejected by biologists (see the discussion in Segerstra˚le (2000) and Wilson’s (1998) argument that knowledge of innate impulses helps us to master them). If I were to play devil’s advocate to Allen (excuse the patriarchal Judeo-Christian image) I would argue, as a female academic, that biological research which developed contraception has brought me more freedom than Foucauldian philosophers, and that the social research that connects with the sciences will enhance women’s lives more than scholarly rivalries. Again, we encounter the limitations of social contructionism in Allen’s chapter on disability in which she concludes that disability is socially constructed, suggests that the medical model oppresses the disabled and promotes the social model instead. Allen is only able to sustain this argument by excluding from her discussion people with disabilities that are characterised by chronic physical pain, for whom the social model ignores – to use Wendell’s (1996, p.45) phrase – “the hard physical realities”, and is not much help. These issues raise a deeper educational question: Should a textbook, especially one that overtly asks students to make ethical changes and be aware of prejudice, be based on an ideological stance – in this case social constructionism – and imply that other research findings and models are somehow less ethical? Dismissing biological research as potentially oppressive seems to have the same logic as excluding research on protein from nutrition texts because it is used to justify the slaughter of animals for meat. Would it not be more productive to give students a range of perspectives and present them not so much as

opposites, but as complementary angles on the same phenomena, and allow students to form their own views? Kingsley Browne’s (2002) Biology at Work, for example, would be an interesting choice of additional reading for the chapter on gender. Further questions arose for me in Allen’s conclusion in which she urges readers to “snip the invisible strings that control your behaviour” and “rewrite the scripts” to bring liberty and justice to all. Aside from the issue of whether these rousing exhortations strengthen or weaken Allen’s scholarship, the practical suggestions that follow do not sound very liberating to me. Students are urged to be vigilant about TUIs – occasions when they are thinking under the influence of prejudices, stereotypes and dominant ideologies, and to monitor their thoughts, attitudes and feelings for any assumptions. Perhaps it is Allen’s use of the word “vigilance” that leaves me feeling tight around the collar, and reminds me of Sommer’s (1995, p. 27) comparison of modern feminists with religious adherents who relentlessly search for sins. Or maybe it is just that I am wary of analysis paralysis. Whatever the case, I find it difficult to believe that developing one’s own internalised thought inquisitor – the very oppression that Foucault spent his career exposing – will help anyone, however well-meaning Allen’s intention. Despite these issues, I would recommend Difference Matters as a book for students, managers and educators to discuss. Even as a critical reader I found parts that engaged and motivated me. As a writer hoping to inspire the reader to think deeply about the importance of difference, Allen succeeds, and I can see why she has been voted “Most influential professor” by Department of Communication graduates. Heather Kavan Department of Communication and Journalism, Massey University, Palmerston North, New Zealand

References Browne, K. (2002), Biology at Work: Rethinking Sexual Equality, Rutgers University Press, New Brunswick, NJ. Segerstra˚le, U. (2000), Defenders of the Truth, OUP, Oxford. Sommers, C.H. (1995), Who Stole Feminism? How Women Have Betrayed Women, Touchstone, New York, NY. Wendell, S. (1996), The Rejected Body: Feminist Philosophical Reflections on Disability, Routledge, New York, NY. Wilson, E.O. (1998), Consilience: The Unity of Knowledge, Alfred Knopf, New York, NY.

179