The Big Five Personality of the Sme Manager and Their Company’s Performance

Abstract

This study addresses a certain research issue: how do the Big Five personality traits of managers of small and medium-sized enterprises (SMEs) impact the business performance of companies? A representative random sample of managers of SMEs in Slovenia was used for data collection through survey research. Hypotheses and the model were tested using structural equation modeling. A valuable contribution is made in the form of a new model of Big Five personality induced SME growth, profitability and new value creation. Openness of managers can be predictive of growth and new value creation of their companies, with the new value creation impact especially expressed in female-managed companies. Conscientiousness may not be crucial for performance, except for new value creation in females where this relationship can be negative. Extraversion can predict the growth and profitability. Agreeableness can have negative effects on all performance elements. Neuroticism can be predictive of growth and profitability. Practitioners must be aware of the importance of managers’ Big Five personality traits for SME performance. Where possible, managers may like to develop their levels of openness, extraversion, non-agreeableness and neuroticism.

Impacts of Entrepreneurial Openness and Creativity on Company Growth

“…The findings from this study extend research on entrepreneurial personality (e.g., Gimeno et al, 1997 ; Johnson, 2007 ; Antončič et al, 2018 ) and research on creativity and success (e.g., Çekmecelioğlu and Özbağ, 2016 ; Peljko et al, 2017 ; Tiwari and Verma, 2020 ) by adding constructs of entrepreneurial openness and creative personality in the model. The study confirms previous findings on the relationship between entrepreneurial openness and creativity (e.g., Shi et al, 2016 ; Friis-Olivarius and Christensen, 2019 ).…”

“…The empirical results based on the model of entrepreneurial openness, creativity, and firm growth contribute to the normative research on firm growth (for instance, research on creativity and firm performance: Von Nordenflycht, 2007;Weinzimmer et al, 2011;Khedhaouria et al, 2015) by revealing the importance of entrepreneurial openness and a creative personality for predicting the entrepreneur's creativity, and the importance of the entrepreneur's creativity for their firm's growth. The findings from this study extend research on entrepreneurial personality (e.g., Gimeno et al, 1997;Johnson, 2007;Antončič et al, 2018) and research on creativity and success (e.g., Çekmecelioğlu and Özbağ, 2016;Peljko et al, 2017;Tiwari and Verma, 2020) by adding constructs of entrepreneurial openness and creative personality in the model. The study confirms previous findings on the relationship between entrepreneurial openness and creativity (e.g., Shi et al, 2016;Friis-Olivarius and Christensen, 2019).…”

“…The right set of entrepreneurial characteristics can boost the results of entrepreneurial activities (for example, Zhao et al, 2010 ; Obschonka et al, 2013 ; Antončič et al, 2018 ). For instance, Ayala and Manzano (2014) note that three dimensions of entrepreneurial flexibility (courage, ingenuity, optimism) help predict entrepreneurial success, which might prove to be important for this study because flexibility is associated with creativity ( Tasan-Kok, 2008 ).…”

“…Entrepreneurs as individuals are the main drivers of entrepreneurship. The personality characteristics of entrepreneurs mean they can make a difference in how their companies perform ( Antončič et al, 2018 ). Despite the notion that variations in performance among companies can be explained by distinct differences among those individuals who lead companies, there is not much research in this area ( Mollick, 2012 ), except for studies that consider individual differences while studying firm performance, like studies investigating managers ( Lieberson and O'Connor, 1972 ; Bertrand and Schoar, 2003 ; Crossland and Hambrick, 2011 ; Mollick, 2012 ) or entrepreneurs ( Gimeno et al, 1997 ; Johnson, 2007 ; Antončič et al, 2018 ).…”

Working capital management of SMEs in COVID-19: role of managerial personality traits and overconfidence behavior

“…Sustaining a rational personality is imperative in the social and professional workplace ( Jeung et al, 2016 ). Personality facets are inherent and learned behaviors that enhance corporate management achievements ( Isaga, 2018 , Antoncic et al, 2018 , Shalender and Yadav, 2019 ). Corporate environment and workplace versatility are linked with individual personality and move to expedite critical indicators of corporate success ( Pletzer et al, 2018 ).…”