Women Entrepreneurs - Can We Remove the Barriers?

on Thursday, 03 May 2012. Posted in Articles on Leadership / Gender

Women Entrepreneurs - Can We Remove the Barriers?
Women Entrepreneurs - Can we Remove the Barriers
Joan Winn, University of Denver, USA

Entrepreneurial activity among women continues to attract attention world wide. However, despite obvious gains, women lag behind men in business ownership and economic independence on every continent. This paper will review the research on entrepreneurship as a career choice for women, the motivations and career paths followed by women entrepreneurs, the attitudes and behaviors associated with successful ventures, the problems that persist and policies that conspire to keep women’s businesses few and small. A discussion of legislation and practices that have helped and hindered women’s entrepreneurship will follow, with suggestions for reframing the issues and reforming policies.

Women are changing the face of modern business. They are in the forefront of the service

sector, the fastest growing sector of the economy. Women entrepreneurs have created
organizations that serve their constituents and their employees. They have instituted
innovative systems and schedules. Yet the business world is still a man’s domain.
In 2002, women owned less than a third of independently owned businesses in the
U.S., generating $1.15 trillion in sales. These businesses employed 9.2 million people,
more people than the entire Fortune 500 list of America’s largest companies combined.
According to the Center for Women’s Business Research, in 1996 women in the U.S.
owned 7.95 million businesses. Despite the fact that the rate of women-owned startups
outpaced that of all new privately-held firms, there were only 6.2 million women-owned
businesses in the U.S. in 2002. Few of the largest or most profitable corporations in the
U.S. today are run or were started by a woman entrepreneur.

Women entrepreneurs have made substantial gains in terms of business education,
corporate experience, and technical expertise. More and more are starting businesses
in rapidly growing industries including financial services, biotechnology and software.
Still, women-owned businesses tend to be smaller than those owned by men whether
measured by size, by the number of employees, or the amount of revenues. In 2004,
women were majority shareholders of 30 percent of all privately owned businesses in
the United States and they claimed a 50 percent share in another 18 percent. Yet they
received only five percent of all venture capital investments (Brush, Carter, Gatewood,
Greene and Hart, 2004).

Womenin otherwestern countries showsimilar patterns. In theU.K.,womenaccount
for 26 percent of business owners, remaining in traditional sectors such as service and
retailing (Shaw, Carter and Brierton, 2001). In transition economies,women still lag behind
men in the number of independent ventures, despite the near-parity in employment
under communism. Romania, Croatia, and Poland lead the rest with self-employment
as a percentage of total employment of 32.6, 25.9, and 23.3%, respectively, for men,
and 17.4, 14.4, and 18.4%, respectively, for women. Self-employment in Lithuania and
the CzechRepublic follow close behind, with 19.2 and 18.8% of men and 12.7 and 9.0%
of women, respectively (Ruminska-Zimney, 2002). These data indicate similar patterns
of men outpacing women in new business creation by roughly two to one, despite the
fact that women absorbed a disproportionately large share of employment cuts and
suffered from less access to job opportunities in the private sector during the initial
post-communist privatization (Ruminska-Zimney, 2002).

Interestingly, in transition countries with lowlevels of entrepreneurial activity in general,
such as Moldova, Ukraine and the Russian Federation, the numbers of womenowned
businesses in 2001 approached parity with men (45–48%) (Erdem, 2004). In
Romania, Croatia, and Poland, countries with the highest level of self-employment
among former Communist countries, women owned 31.8, 29.9, and 36.4% of independent
businesses, respectively, in 2001. Between 1993 and 2000, the growth of womenowned
businesses outpaced men-owned businesses in Croatia, Latvia, Slovakia, and
the Russian Federation (Ruminska-Zimney, 2002). Women in the Czech Republic account
for over 27% of business owners, unchanged from 1993 through 2000 (UNECE,

Policymakers have been concerned about the barriers faced by women who wish to
start their own companies, since women’s participation in the global economy and a
democratic society is necessary for a country’s economic advancement (Jalbert, 2000;
MONEE, 1999; Schl¨ ogl, 2004). As an increasing number of families with children are
headed by single mothers (US Census Bureau, 2003),women’s economic status becomes
not only an economic concern, but a social concern as well. This paper will review the
research on entrepreneurship as a career choice for women, the motivations and career
paths followed by women entrepreneurs, the attitudes and behaviors associated with
successful ventures, and the problems that persist in keeping women’s businesses few
and small. A discussion of legislation and practices that have helped and hindered
women’s entrepreneurship will follow, with suggestions for reframing the issues and
reforming policies.

Entrepreneurship as a career choice

The decision to start a business is a complex process that incorporates one’s personality
and interests, upbringing and role models, skills and opportunities. Sonnenfeld
and Kotter’s (1982) career life cycle model emphasizes the evolution of people, their
families and their careers over a lifetime. Bowen and Hisrich (1986) included education,
work history and family history in their career development model. A person’s
career choice, according to these models, depends on adult development, the family
and life-style, as well as the particular stage of one’s career. Career outcomes are the
result of the interactions of occupational, personal, and family factors throughout a
lifetime. For men, career choice is assumed to be an integral part of their lives, while
many women view personal goals as separate fromcareer goals (Fernandez, 1981). It is
not uncommon for a young woman to talk about the choice between career and family,
rather than to envision a career path that incorporates family life, or vice versa.
Independent business ownership appears to have all the ingredients for women who
wish to have both a career and a family. Women seek entrepreneurship for flexibility
and autonomy, satisfaction and personal growth, and income and prestige (Goffee
and Scase, 1985; Orhan and Scott, 2001; Scott 1986; Winn, 2004). Like their male
counterparts, some women start a business because of an idea or innovation. Others
choose to start their own business because of employment experiences that have been
unsatisfying. Many women report frustration with demanding and inflexible work
environments (Hewlett, 2002), failure to break through the “glass ceiling” to higherpaid
managerial positions (Glaser and Smalley, 1999; Weiler and Bernasek, 2001), or
the belief that working for a large corporation will not accommodate their personal
situations or satisfy their professional goals (Moore and Buttner, 1997). Some women
initiate or join partnerships (Still and Timms, 2000), starting their businesses either as
part of a team or as part of a family business. Business ownership sometimes results
from a forced unemployment, either from a layoff or lack of marketable skills, or a
family-business crisis that leaves the woman in charge of a business she didn’t start—or
want—herself (Goffee and Scase, 1985; Shannon, 2003).

Career choice models that focus specifically on newventure creation emphasize vision
and intentionality as primary factors. New venture initiation is viewed as a conscious
decision, implemented by individuals with “precursor attitudes” and characteristics.
This intentionality is present in Greenberger and Sexton’s model of venture initiation
which “depicts the decision to initiate a new venture as arising from the interactions of
a number of factors, including personality, situational variables, self-perceptions, and
social support” (1988, p. 2). Greenberger and Sexton see personality, vision (“a new
way of viewing the environment”), and “desire for control” as necessary conditions for
initiating an independent business.

Entrepreneurs are typically defined as organization creators; however most new
ventures are not creatively inspired (Brockhaus, 1987), even though there are numerous
examples of tinkering in garages—or laboratories—to create new products. New
product creation (in and of itself) is not generally viewed as an entrepreneurial activity.
In fact, most new ventures are virtual carbon-copies of existing enterprises,
with few expectations for growth. Brockhaus “found that as many as 60 percent
of entrepreneurs decide to start a business before they know what type of business
they want to undertake” (1987, p. 4), thereby casting doubt on the role of creative
inspiration or “vision” as motivating new venture creation.

An admitted limitation of most career models is the fact that they rely on male subjects,
thereby weakening the model’s applicability to women.While most career models
account for the influence of family support and self-perceptions, self-report surveys
reveal marked differences between the values held by men and women concerning family
and achievement. Stevenson (1986) acknowledges that men and women come to entrepreneurship fromvery different educational and business experience backgrounds.

For men, the decision to start a business seems to follow a logical progression. Men
typically replicate a business in which they have prior knowledge. Most women gain
their first management experience in their own business, having prior work experience
in traditional fields such as teaching, nursing, and clerical work. While formal education,
per se, has not been shown to be an essential ingredient for owning a business,
there is some evidence that the type of education, e.g. technical or managerial skills over
liberal arts, positively affects business success (Menzies, Diochon and Gasse, 2004).
Most self-report surveys (e.g. Brenner, Pringle and Greenhaus, 1991; Neider, 1987)
show that men’s career decisions focus on income, risk-taking, and control; while
women desire work that provides personal satisfaction, intellectual growth, and independence.
Women, unlike men, typically rate their family higher in importance than
their career (Konrad and Langton, 1991). Moore (1990) asserts that many “modern”
women, like men, are career focused, rather than family focused. Like men, women
want to make money, to be independent, to achieve, to use their skills and talents, and
to enhance their job satisfaction.

While women entrepreneurs allegedly seek self-fulfillment (Moore and Buttner,
1997), men claim to start their own companies because they believe that by doing
so they can increase their income. For women, however, the choice of self-employment
often results in lower economic status (Weiler and Bernasek, 2001). Working for an
organization is perceived by men as providing mundane outcomes: job security, leisure
time, clearly defined rules and procedures and regular, but not necessarily higher, income.
Women report that operating their own business provides more opportunity to
take risks and develop their own methods of doing work (Brenner et al., 1991).

In order for career models to be of use in understanding or facilitating new venture
creation for prospective entrepreneurs or policy makers, they must not only differentiate
between the factors that drive certain individuals to compete in the corporate
world and those that compel others to strike out on their own, but they must also
differentiate between the priorities and pulls that differently affect men and women.
So far, researchers have failed to find significant differences between managers and
entrepreneurs in personality characteristics, achievement motivation, locus of control,
or risk taking (Brockhaus, 1987; Masters and Meier, 1998; Scott, 1986;Waddell, 1983),
all of which contribute to both the propensity to start a business as well as the success
and longevity of the enterprise. While research on women entrepreneurs has yielded
some significant differences, both on career stages and on intentionality to initiate their
own businesses, evidence points heavily to situational (and societal) factors as playing
pivotal roles.

Entrepreneurial attitudes, behaviors and competencies

Entrepreneurship encompasses a broad range of activities, including the identification
of opportunities (Kirzner, 1973, 1979; Penrose, 1959; Stevenson and Jarillo, 1990),the
creation of organizations (Gartner, 1988), the carrying out of new combinations of
methods, products, supplies, or markets (Schumpeter, 1934), and the bearing of uncertainty
(Knight, 1921). An entrepreneur, then, is not someone who is narrowly specialized
or wedded to one way of doing things. Wheelen and Hunger identify an entrepreneur
as someonewho has (1) the ability to identify potential venture opportunities
better than most people, (2) a sense of urgency that makes them action-oriented, (3)
a detailed knowledge of the keys to success in the industry, and the physical stamina
to make their work their lives, and (4) access to outside help to supplement their
skills, knowledge, and abilities (2002, pp. 312–313). Other studies of entrepreneurs
tout achievement motivation, inner strength (“locus of control”), the propensity to
take risks, and boldness to challenge the status quo as critical for entrepreneurial success
(Brenner et al., 1991; Brockhaus, 1987; Scott, 1986;Waddell, 1983). Levander and
Raccuia (2001) suggest that successful entrepreneurs are impulsive, reacting to environmental
stimuli and deriving satisfaction from engaging in stimulating tasks. However,
entrepreneurs often perceive themselves as risk avoiders (Hyatt, 1992), who engage in
strategic thinking and challenge themselves to excel (Hyatt, 2004).

Womenwho achieve success as business owners stress the importance of tenacity and
determination to weather the stress of owning a business (Moore, 2003). Entrepreneurship
is not for the faint of heart. Business ownership often requires long hours, without
regard to one’s family needs or personal preferences. Entrepreneurs must be willing to
change course when the environment dictates. This means not only the recognition of
the need for change, but the humility to abandon a pet project that is doomed to fail.
Brodsky (1993) found entrepreneurs to be less trusting and to have higher control
needs thanmanagers. “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. Although managers view corporate environments as safe and supportive,
entrepreneurs consider them confining” (Brodsky, 1993, p. 341).
Most entrepreneurs are sales people,whose passion comes throughwhen selling their
ideas, their business, themselves. Unless they can show competence and confidence,
others will not seek out their business. Self-employment coach Karyn Greenstreet
(2004) thinks that too many women rely on passion, rather than planning, mistaking
business for a hobby and neglecting to ascertain whether their business idea is viable
and potentially profitable.While all businesses are vulnerable to environmental change,
management and finance skills are particularly crucial in young enterprises (Thornhill
and Amit, 2003).

Hart, Stevenson and Dial (1995) found industry experience to be an important
ingredient in an entrepreneur’s ability to identify the full range of capabilities and
potential contributions of partners and alliances. Experienced entrepreneurs are able
to locate resource suppliers quickly and assess the relative value of available resources.
However, few entrepreneurs claim a detailed knowledge of their industry (Hyatt, 1992).
Brenner et al. (1991) point out that most business schools offer courses or programs
that deal with corporate management, not start-ups. This may convey the attitude that
starting one’s own business does not require formal training, or that entrepreneurial
skills cannot be taught. While it is true that one does not need credentials to start
a business, many would-be entrepreneurs fail as a result of skill deficiencies, despite
386 WINN
their motivation, ingenuity or creativity (Menzies, Diochon and Gasse, 2004). While
men and women alike cite financial, marketing, and management skills as essential
ingredients for business success, the business owner does not need to have such skills
herself. Rather, it’s the mix of skills within an organization that matters, not the skill
set of any one person.

Roadblocks along the path

Two of the biggest hurdles women face in starting and running a company revolve
around funding and family support. Despite a woman’s level of education, corporate
experience, and technical expertise, private equity lenders and venture capitalists still
harbor lingering concerns about women’s commitment to their enterprises, their qualifications
for leadership of high growth businesses, and their ability to garner crucial
resources. Lack of capital, which has proven to be invaluable in the expansion and development
of high potential companies, has starved many promising ventures (Carter
and Anderson, 2001; Thornhill and Amit, 2003). Bankers tend to holdwomen to higher
standards than men in assessing loan requests (Fay and Williams, 1993; Hisrich and
Ozturk, 1999). In 2004,womenwere majority shareholders of 30 percent of all privately
owned businesses in the United States and they claimed a 50 percent share in another
18 percent. Yet they received only five percent of all venture capital investments. Brush
et al. (2004) believe that this funding gap represents a major market failure and prevents
women from attaining the highest level of entrepreneurial achievement.
Although most women approach entrepreneurship with objectivity and openmindedness,
they still suffer from gender specific barriers.Weiler and Bernasek (2001)
observed that discrimination from male-dominated supplier systems, such as preferential
treatment in timing and delivery of orders, may have particularly damaging
impacts on the relative competitiveness and profitability of women-owned enterprises.
Hart et al. (1995) found that “being known” was as important as “knowing” in enabling
an entrepreneur to attract and assemble resources efficiently and economically.
On the other hand, long-term persistence of perceived network-based advantages may
make women-owned businesses less successful in a competitive market place (Moore
and Buttner, 1997).

Women entrepreneurs are often excluded from trade and business associations and
informal “old-boys” networks, which has a negative impact on their access to information,
credit, training opportunities, business partners and new market entry. In transition
economies, gender-biased privatization resulted in the redistribution of public
assets in favor of men, leaving women with less collateral to use in obtaining financial
resources. The traditional perception about women’s role in society creates a less
favorable social climate towards women entrepreneurs, discriminatory treatment by
the state administration and/or limited access to bank loans (Erdem, 2002; Carr and
Chen, 2004).

Family structure in the context of the particular role played by the entrepreneur,
e.g., husband or wife, father or mother, imposes critical familial and societal variables
that may explain the different forces that are exerted on women and men to form
independent organizations. Women in transition economies suffered from traditional
perceptions about women’s role in society, and these attitudes persist (Erdem, 2002;
Hovet, 2004). In the early 1900s, “work” became differentiated from“housework”, with
women excluded from the ranks of productive enterprise and confined to “supportive”
domestic roles for the male head-of-household. And still today, among students and
professionals alike, when given a forced choice of advancing their own careers or following
their husbands (orwould-be husbands),women will usually subjugate their own
careers to that of their spouse, rather than the other way around (Fernandez, 1981),
despite the fact that on self-report questionnaires women in professional schools or in
early stages of their careers will expound on their independence and the importance of
their career.

While career opportunities for women have changed, family role models typically
have not.While the percentage of stay-at-home dads has soared, their numbers are still
few. Most young men andwomen see their mother doing the lion’s share 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 business-related pressures that impinge on their role in
the family (the role that they were taught to play).White, Cox, and Cooper 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 (1997, p. 31). Women burdened with family responsibilities
have less time for learning and/or exploring business prospects.
Even in the most liberal of households, boys and girls are presented with different
views of theworld. Froman early age men expect towork to support themselves or their
families and are encouraged to achieve; women have been socialized to nurture and to
find someone to support them.Two-career households reinforce these stereotypeswhen
the mother attends to mundane household duties after work—“the second shift”—as
the father either relaxes or attends to more “important matters,” such as finances or
home improvement projects (Shellenbarger, 1991). Even in the 2000s, few men buy
their children’s clothes or school supplies or volunteer at their children’s school. In
most two-career families, the man’s job is still viewed as more important or prestigious.
For married women, especially those with children, business ownership takes its
toll in stress and, in many cases, divorce (Winn, 2004). 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 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 flexibility than
their employees. Owners of new businesses find that they have more time constraints
and less discretion than they anticipated in the planning stages of their business. For
women, this is particularly troublesome.
While many mothers become successful business-owners, the difficulties of balancing
their families with their business obligations cannot be overemphasized. While
self-employed women may put in fewer hours per week at their jobs than the average

full-time worker (OECD, 1991), women too often underestimate the extent to which
their own business will interfere with their family (Longstreth, Stafford and Mauldin,
1987), or to the extent that their family will encumber the business(Winn, 2004).Women
have been criticized for limiting the growth of their businesses (Armstrong, 2002; Brush
et al., 2004; Carter, Brush, Greene, Gatewood and Hart, 2003) but the combination
of undercapitalization and family obligations conspire to keep their businesses small.
Entrepreneurship requires complex and acute demands on one’s time, and men and
women prioritize their time differently. Research by Flinders University of South Australia
(1996) acknowledges that women with dependent children are typically the primary
caregivers, regardless of their professional status. Even in Western Europe, only
two percent of men take on household responsibilities such as washing and cleaning
(Armstrong, 2002). In transition countries, in particular, household chores are seen as
humiliating (Mar´?kov´a, 1999). Inmany countries, part-timework is rarely available, and
childcare and domestic services are scarce and expensive (Marksov´a-Tominov´a, 2003;
Open Society Institute, 2002). Women who choose self-employment or entrepreneurship
forego healthcare benefits,maternity leave, and pension plans (Ruminska-Zimney,

Family obligations do not always lessen as children get older. Day-care is easier to
find for young children. Older children pose more logistical problems, and when left to
their own devices are not always trustworthy. Even when husbands are willing to share
in the household and childrearing duties, women tend to suffer tremendous guilt and
anxiety when their businesses require long hours away from home. The businesses of
women who lack non-financial help from their husbands or “significant others,” are
often doomed to failure (Winn, 2004).
Work-home conflict is evident even for women who do not have children. Like the
women in the study by Stoner, Hartman and Arora (1990), Winn (2004) found that
the demands of their business affected their ability to relax at home, causing marital
unhappiness and work-home conflict. Even women who are encouraged by their
husbands report that the time and stress of the businesses strained their marriages.
Goffee and Scase (1985) point out that while “the wives of small businessmen are often
subordinated to the needs of their husbands,” the reverse is seldom true (1985, p. 5).
Even entrepreneurial couples, husband-wife teams who work closely together, “are
often trapped by a gender-based division of responsibilities and authority” typically
resulting in “the wife acquiescing to [ the husband’s] benevolent authority” (Marschak,
1998, p. 169).

Being older, being male, and being married are positive correlates to the propensity
to start one’s own business (OECD, 1991). For men, work and family are complementary;
for women, work and family present a dilemma. It should be no surprise that
overall birthrates have been falling in transition countries where women strive to better
themselves economically (Paukert, 1991). Too often a business affords flexible time
only when the children leave home, either to go off to school or to set up their own
households as adults. For some women, this is a time of reevaluating their role in the
business as well as their role at home (McKay, 2001; Winn, 2004).
The corporate world contains professional as well as social contacts. Starting an
independent business can be isolating (Winn, 2004). Single women often remain single,
reporting that they have no discretionary time or emotional reserves beyond the
demands of their business. In stark contrast to their male peers, successful, upwardlymobile
women in Fortune 500 companies tend to be single (55%), without children
at home (80%) (Stroh, Brett and Reilly, 1992). Brodsky’s study of women corporate
managers and entrepreneurs found that more women managers were married,
while more entrepreneurs were divorced (1993, p. 366). No one will dispute the fact
that young children thrive best in loving two-parent families with a stay-at-home
parent. But one cannot deny that single-parent homes exist. When self-employment
adds to the isolation and stress of the caregivers, many women opt for low-wage jobs
that provide the safety of predictable schedules and benefits, despite long hours and
unfulfilling work. As one would expect, female employment rates are high, yet entrepreneurship
is low, in countries such as Austria, Denmark, Norway and Sweden,
where childcare and social support systems cater to full-time wage earners (OECD,

Reframing the issues

It should be no surprise that family structure and gender influence career choice and that
men and women seek different paths. The fact that women are still underrepresented
in top management or boards of directors of the largest companies may be as much
a factor of choice as of opportunity. Among all privately held businesses in the U.S.,
nearly 46% of firms list majority ownership by women, 10.1 million businesses, (Center
for Women’s Business Research, 2004), and women are quite well represented among
the independent self-employed (U.S. Census, 2003). Large publicly-held corporations
may erect barriers for women’s advancement, but privately held businesses may not be
so hostile. However, the reverse is true for Central and Eastern European transition
countries, where employment practices, social services, lending and taxation policies
have placed increasing burdens on women who choose self-employment or venture
creation (UNECE, 2003).

Undercapitalization is recognized as a barrier to business growth and success, but
the main drivers of entrepreneurship—for women and men—are motives, aspirations,
and commitment (Carter et al., 2003; Greene, 2004). Today, men and women business
owners in the U.S. have comparable access to bank credit, and appear to be equally
satisfied with the amount of credit available to them (Center for Women’s Business
Research, 2004). The range of sources to which men- and women-owned businesses
are turning for capital is also very similar (Faulhaber, 1998). Moore (2003) observes
that women face more difficulty than men in obtaining capital because they generally
come to the table with fewer assets and unproven track records. In addition, women
entrepreneurs tend to be more conservative than men when borrowing money (Weiler
and Bernasek, 2001), so many women unwisely liquidate assets and go through their
credit cards before approaching a bank for help. Subsidized financing programs and

Table 1. Perceptions and realities of entrepreneurship.
Perception Reality
Flexibility Long hours
Autonomy “Beck and call”
Personal fulfillment Gender-role conflict
Support Family pressures
Respect Isolation
Teamwork Partner Conflicts
Financial independence Cash-flow difficulties
Data reflect comments about perceptions of businessownership,
from unstructured interviews with over 30
women entrepreneurs.
tax incentives, however, have resulted in dramatic increases in self-employment and
new venture activity in the UK (OECD, 1991).

Discussions about the differences between small businesses and entrepreneurial ventures
stress growth and opportunism, but women who seek autonomy and flexible
schedules are more apt to focus on internal matters than to look for growth or new
market opportunities. This hesitance to look outward keeps small businesses small,
with little plans for growth beyond the owner’s own managerial capabilities. Growth,
especially if accompanied by ownership dilution, can be seen as relinquishing control;
a change in business procedures can threaten one’s idealism and values.
It is too bold to suggest that gender can explain individual differences in personality
and behaviors. However, as illustrated in Table 1, women entrepreneurs openly admit
to family pressures and personal relationships undermining their business dreams.
The determination and drive needed to start a business can work against the patience
and compromise needed to maintain harmonious partnership relationships, especially
when the business is not going well.Women who see themselves as compassionate and
understanding expect the same from others, and undergo psychological stress when
partnership or employee relationships go awry. When partnerships work, they contribute
to the diversity of thought and experience that enhances strategic planning.
However, these very differences in points of view and personal style contribute to
business failures (Winn, 2004). Entrepreneurship texts delineate the legalities of partnerships,
but fail to emphasize the importance of delineating roles and responsibilities
commensurate with ownership risk and reward. Feminists balk at the suggestion that
women should act like men or engage in what they perceive to be a masculine style
of management that is impersonal or insensitive (Cleveland, Stockdale and Murphy,
2002). Rather, women are advised to develop a style of management that suits their
personality, yet is firm and unwavering in their beliefs and goals.

For many women, this is a contradiction. There is a fine line between tenacity and
stubbornness; a difficult middle ground between being firm and compassionate. Collaboration
is not always the preferred course of action, nor is standing one’s ground
appropriate on all occasions. While trust in oneself is critical, since the startup process
can be fraught with uncertainty, entrepreneurship cannot succeed without trusted
advisors, colleagues, and employees. Trust in others, however, opens oneself to vulnerability
(Brodsky, 1993). Entrepreneurs can mitigate this risk by setting up systems that
monitor the results of everyone’s actions, and that allow for corrective action without
recrimination or blame. These management skills can be taught, but fewer women than
men obtain training or experience before they start their own business. Rather, women
use networks for social support (Smeltzer and Fann, 1989) and seek advice when their
businesses are already in trouble.

In 2000, women accounted for only a third of full-time students in U.S. graduate
business programs (Alsop, 2004), despite efforts on the part of university recruiters
to target women. Women are not underrepresented in undergraduate classrooms, but
many women choose to enroll in part time graduate programs to better accommodate
either work or family obligations. On the other hand, a survey conducted by Catalyst
and the University of Michigan (Hildebrandt, Miller, Edington and Bond, 1987) suggests
that the main reason given for women’s hesitancy to major in business is a fear
of math, not business. The socialization of girls away from mathematics, science and
technology—from parents, teachers and counselors—is well documented (Hardman-
Matou?skov´a, 2004; Rakow, 1998; Rathgeber, 1995; Strauss, 1988). As more business
schools offer programs in entrepreneurship and small business development, prospective
entrepreneurs may realize that launching a new company requires a broad range
of skills. In addition to managerial and financial training, these programs would be
well advised to address the life-style decisions that can impede or facilitate new venture

Familial and societal variables differently impact women and men in starting and
sustaining independent organizations. However, education labeled as “feminist” that
focuses on the needs of women and families should be required for men and women
alike, all of whom need to anticipate the emotional and economic impact that starting a
business will have on all members of the family. School schedules, after-school activities,
and childcare providers assume someone at home with discretionary time during the
day. Household and childrearing chores are often invisible except to those who bear
the burdens. Independent business ownership can accommodate family obligations
if a woman chooses the right time, the right business, and the right partner. It falls
on women themselves to anticipate the demands of business ownership so that they
can embark on entrepreneurship with realistic expectations and requisite skills, and
acknowledge the support systems that they will need if they are to succeed.
Because the preponderance ofwomen-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. Embarking on any profession or
career without relevant training and experience creates hardships that need not exist.
But we can only provide a better system of education and support if we understand
and acknowledge the critical variables that affect the business-creation decision and
the roles that family structure and spousal and societal support play as the business

Reforming policies

Women business owners in America,Western Europe, and European transition countries
voice similar needs for their business’s development—access to capital, access to
education and training, access to networks and markets, and to be taken seriously.
Internationally, women entrepreneurs’ key business concerns are a blend of day-to-day
business management issues—maintaining profits, finding good employees, managing
cash flow; and external factors such as the economy, government, legal changes, and
access to technology and capital. Policy-makers and educators who are interested in
increasing the ranks of women entrepreneurs need to understand the biases and barriers
that adversely affect women who start their own businesses, in order to provide
proper guidance and enact appropriate legislation.

Carr and Chen acknowledge that there is no single remedy or “magic bullet” that
will “adequately address the complex mix of factors of exclusion” that keep women
entrepreneurs behind men in access to capital, training, and social support (2004,
p. 157). However, unless economic policies and legal structures recognize these barriers
and biases, women-owned businesses will continue to fight an uphill battle for funding
and recognition, and the current social biases will prevail.
Arguably, until women are among those in positions of political leadership, it is
unlikely that these issues will be addressed appropriately. Lawmakers need to be cognizant
of the different worlds occupied by small and large enterprises, and the undue
burden placed on small businesses by once-size-fits-all labor codes and social
services. Labor intensive service businesses are penalized for hiring workers. Equipment
is an expense to be deducted; wages are accompanied by social security and
employment taxes. In the U.S., businesses are expected to bear the brunt of health
insurance costs, putting small businesses at a disadvantage, both in the expense and
ability to provide attractive benefit packages. Entrepreneurs compete on an uneven
playing field with large companies for skilled workers and knowledgeable

In the corporate world the path to upper management has an established protocol
for men and women alike. However, policies that appear to be gender-neutral fail
to be gender-sensitive. The lack of appropriate mentors and the prevalence of traditional
attitudes towards women’s advancement is still the norm. Usually long hours
demonstrating ambition and loyalty to the organization are prerequisites to promotion,
adversely impacting anyone with household and/or family obligations. Men in
management experience gender role congruence pressures as well, and may be more
penalized in the workplace than women when they seek non-traditional schedules or
assignments. Women’s commitment is viewed with suspicion, but time spent devoted
to family obligations can hinder men’s advancement more than women’s (Konrad and
Cannings, 1997). However, as Hewlett 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” (2002, p. 331). In transition countries, women were given equal representation
in the workplace, but were clearly absent among decision-makers or political
leaders (MONEE, 1999), thus perpetuating the subordination and dependence of

What can be done? Policies that penalize women with children when they enter the
workplace perpetuate a cycle ofwomen’s dependence.Programs that ignorewomenwho
are not employed by large enterprises discourage women from starting their own firms.
Tax structures that cater to large capital-intensive corporations discourage business
growth in labor-intensive industries. Lending practices geared to high-growth ventures
cut off small and medium enterprise development and micro-enterprise. Legislation and
policies that subordinate a married woman’s status to that of her husband, perpetuate
the impression of women as second-class citizens. Devaluing lifestyle choices among
thosewho choose to followa non-traditional path not only denigrates their choices, but
puts their children at an undue social and economic disadvantage. Relegating social
services, such as health care and retirement benefits, to the private sector—those who
provide insurance benefits—perpetuates a class of underemployed and subtly disenfranchises
smaller employers. The wage and wealth gap will continue to get wider with
policies that close doors to those whose circumstances discourage individual initiative
and risk.

Under the right circumstances, initiating one’s own business has the potential of
creating an environment that accommodates individual needs and differences, and offers
a proving ground for innovative business models. Women business owners have
been at the forefront of providing alternative work arrangements and being sensitive
to the family burdens faced by working mothers. Women business owners are
more likely than their male counterparts to offer flex-time, tuition reimbursement and,
even among small firms, profit sharing to their workers (Center for Women’s Business
Research, 2001). In the U.S., women business owners employ a roughly genderbalancedworkforce
(52%women and 48% men), in contrast to the men business owners
who employ, on average, 38% women and 62% men (Small Business Administration,

But it will take more than the determination of enterprising women themselves to
lessen the current barriers to success. Biologically, women and men are not equal, and
suffer unequally from legislation and social stereotypes. When women are expected
to excel without relief, their families suffer. When women are expected to be primary
caregivers, their businesses suffer. Educators need to understand and address the factors
that are critical for independent business success and to present a more realistic
picture of what starting a new business entails. Legislators and policymakers must be
cognizant of the tax structures and social policies that, despite good intentions, work
against women who wish to achieve financial independence. Women who desire selfactualization
and economic advancement can succeed through independent business
ownership, but not without great personal cost. Proactive policy changes are needed in
order to erode gender-biased attitudes and practices so that women can choose a career
path that doesn’t require sacrificing their dreams, depriving their families, jeopardizing
their health, or selling their souls.

Women Entrepreneurs - Can we Remove the Barriers Joan Winn, Department of Management, University of Denver, USA

International Entrepreneurship and Management Journal 1, 381–397, 2005

(Article published with permission from the Author)



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