How understanding your personality type can make you a better entrepreneur

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Entrepreneurs play a vital role in the global economy by driving innovation, fueling job creation and pioneering entire industries. By helping entrepreneurs understand themselves, personality type information can help them operate more efficiently, resulting in tangible benefits for the economy and society at large (not to mention their employees).

Psychometric assessment can be a powerful tool for providing insight into how entrepreneurs tend to operate and what drives them to function. A recent study conducted by my company found a relationship between an individual’s Myers-Briggs Type Indicator® (MBTI®) personality type and the attributes they perceive as helping or hindering their success as an entrepreneur.

In this article I will explore how type preference can provide clues to areas that entrepreneurs can leverage or need to pay attention to. But first, let’s look at some of the more general characteristics typically exhibited by entrepreneurs and how they can impact performance.

Related: Your Personality Type Determines Your Leadership Potential. Here’s how to find it and exploit all its power.

General attributes that contribute to success or failure

My company’s research found that entrepreneurs showed a greater inclination towards creativity, risk-taking, impulsiveness and autonomy. Likewise, the businesses they lead tend to be less structured and hierarchical than typical organizations.

While there may be clear positives to these characteristics and this approach to business, the study indicates that entrepreneurs may overemphasize passion, enthusiasm and cooperation. Instead, they may underestimate the more practical aspects of the business such as administrative tasks, attention to detail, marketing and sales. Likewise, those who expressed disdain for data, statistics, finance-related issues, and networking tended to demonstrate comparatively poorer performance.

While these findings can provide a general starting point for self-improvement, I have observed in my counseling that these types of descriptions are usually a little too vague to be actionable. However, when people begin to understand the nuances of how these descriptions may play out based on their personality type, they can be addressed in much more tangible ways.

According to the MBTI model, personality can be described by preferences along the following dimensions:

  • Extroversion or introversion (EI), which describes people’s orientation to the outside world and how they obtain/focus their energy

  • Sensitivity or intuition (SN), which reflects an individual’s preference for how he or she acquires information

  • Thinking or feeling (TF) describing people’s emphasis on tasks and logical consequences or personal/social values ​​in their decision-making processes

  • Judging or perceiving (JP), which describes whether people tend to orient themselves towards the external world in a more decisive and planned or flexible and spontaneous way

Let’s explore, according to a few different MBTI personality types, the intrinsic entrepreneurial strengths that can contribute to success as well as the aspects that, if left unattended, could potentially hinder it.

The Conservative Entrepreneurial Approach (ISTJ, ISFJ)

Those with preferred introverted sensing processes often tend to be detail-oriented, knowledgeable, structured, organized, focused, reliable, punctual, and natural avoiders of procrastination. However, as the study notes, these individuals may want to exercise caution regarding their potential:

  • Propensity to be risk averse which could lead to missed opportunities

  • Hesitation in making critical decisions and temptation to engage in less strategically significant activities as a form of travel

For example, imagine an ambitious tech startup founder who possesses extensive knowledge in their field and is incredibly detail-oriented, organized, and reliable. Despite these clear advantages, their risk-averse nature and hesitation in decision making pose challenges as they navigate the unpredictable startup landscape.

Recognizing the need to sharpen their entrepreneurial skills, they may seek specific training focused on strategic thinking and decision making under uncertainty. Successful training would enable them to learn to reframe their perspective on risk, understanding that they can leverage their natural talent for detail and structure in calculated risk taking. It would also help to learn methodologies to analyze and prioritize tasks critical to a startup’s success, avoiding the trap of putting off strategically significant actions.

As they apply these new skills, they will evolve into more dynamic, well-rounded entrepreneurs, finding a balance between their meticulous, detail-oriented nature and a more strategic, risk-taking mindset.

Related: What Your Personality Type Says About Your Career Destiny (Infographic)

The Explorer’s Entrepreneurial Approach (ENFP, ENTP)

At the other end of the spectrum, those with preferred Extraverted Intuition processes may exhibit strong social trust, evidenced by a strong network of contacts. Additionally, they may be well served by curiosity, innovation, a willingness to explore new approaches and accept risks, adaptability, and a generally enthusiastic demeanor. However, they may also possess:

  • Tendency to be easily distracted by the boredom of administrative tasks which could lead to overlooking errors, even in financial matters

  • Aversion to structured approaches that can produce disorganization

  • Susceptibility to distraction from immediate critical tasks by new and intriguing ideas

For example, consider an entrepreneur leading his own innovative tech startup, known for his social confidence and extensive network of industry contacts. The curiosity, innovative spirit and enthusiasm that initially guided the creation of their company, however, go hand in hand with challenges that make them less effective in managing the administrative aspects of the business.

Recognizing this, they seek training that focuses on improving their organizational skills, attention to detail and time management.

During the training sessions, the tendency to overlook details in financial and administrative matters is addressed, focusing on tools and techniques for effective management. They also explore how to improve their approach to structured planning. To mitigate their aversion to structure, they focus on flexible planning methodologies and creating adaptable yet comprehensive plans that allow for creativity while maintaining organizational coherence.

As they implement these strategies and techniques, they develop a flexible yet structured approach, which allows them to maintain the organization while promoting innovation and remaining diligent in overseeing detailed matters and administrative tasks.

Tying it all together with a personality type approach

These two scenarios are, of course, descriptive of only four of the sixteen MBTI types. But either way, understanding the type offers important clues about how they are likely to fall prey to some of the traps common to entrepreneurs running their own businesses.

By understanding their key entrepreneurial strengths and vulnerabilities, they can take a tailored approach to their growth areas, leaning into their strengths and preferences. In some cases, this involves identifying a somewhat modified approach to an area of ​​interest that, rather than forcing them to be something they are not, allows them to comfortably flex to be what their company needs them to be.

Related: 10 Personality Traits of Legendary Entrepreneurs

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