14 DAY TRIAL // Taking risks is in the very nature of entrepreneurs, says a new scientific study, conducted by University of Cambridge researchers. Volatile situations are handled better by people owning their own businesses than by those working in managerial positions inside a company. Actually, the whole process of starting one's venture is a risk in itself, which the new boss takes, hoping it would pay off, and that the potentially harmful effects would be averted.
In a test conducted during the study, 16 entrepreneurs and 17 managers from Cambridge's "Silicon Fen" hi-tech company cluster, were asked to answer a questionnaire concerning decisions they would make during real-life situations, such as hiring new staff, expanding and investing in other enterprises.
While both groups responded relatively similarly to "cold" situations – when they were asked about employment plans and other daily occurrences – entrepreneurs showed increased positive results in the "functional impulsiveness" test, which refers to one's ability of making important decisions, while under a great deal of stress.
Managers tended to be more reserved in their assessments, and also refrained from taking risks, which they deemed to be unnecessary for the development of their companies. The outcome of the hypothetical situations, however, showed that they were wrong not to risk. Entrepreneurs took the chance and they won.
Health experts say that this proneness to taking that "extra step" can be traced medically, in that the neuroreceptor dopamine is responsible for these types of actions. They also add that, in the future, it may be possible to create drugs that could boost these connections, so that managers and entrepreneurs alike would be able to make more inspired decisions, while also keeping the best interest of the company at heart.
"This study has shown that not all risk-taking is disadvantageous, particularly when combined with enhanced flexible problem solving. In fact, risky or 'hot' decision-making is an essential part of the entrepreneurial process and may be possible to teach, particularly in young adults where higher risk taking is likely and age-appropriate," concluded lead study author, Cambridge professor Barbara Sahakian.