Promoting Youth Entrepreneurship: The Role of Mentoring*
Ayodele Ibrahim Shittu
The risks and rewards associated with mentoring young people for entrepreneurship are attracting growing attention among policymakers, development organisations and scholars. This article examines entrepreneurship mentoring relationships from the perspective of young people. Based on the model of youth mentoring, it explores how entrepreneurship mentoring can influence the entrepreneurial intentions of young people. Findings from the review of the literature show that mentoring relationships are beneficial whether they are formal or informal. The implications of mentoring relationships for the promotion of youth entrepreneurship are discussed.
Keywords: youth, unemployment, employment, Africa, entrepreneurship, group monitoring.
Despite the dominant discourse that highlights the many inherent benefits associated with youth entrepreneurship (Chigunta et al. 2005; Brixiová, Ncube and Bicaba 2014), there can be issues and challenges which discourage young people from embracing entrepreneurship. For example, the short durations of youth empowerment initiatives, undue emphasis on supply-side training, insufficient or non-existent financial support, the tenuous linkage to viable market opportunities, and the strong focus on bringing together young people as a group rather than as stand-alone entrepreneurs can all be problematic (ILO 2012; Flynn et al. 2017). Yet, economic uncertainties, and the limited supply in formal paid jobs and other career opportunities, push young people into self-employment, what some have called 'entrepreneurship by necessity'. However, they are neither prepared nor equipped with the requisite skills and knowledge needed to establish and manage a business successfully.
In terms of benefits Chigunta et al. (2005) argue that youth entrepreneurship promotes employment opportunities, fosters innovation and resilience among young people, and increases their social and cultural identity. The suggestion is that these empower young people to contribute positively to their own development and the economic development of their local communities (Gilmore 2009). Through employment creation, entrepreneurship can bring marginalised youths into the mainstream of economic activities. While evidence abounds that many young people, especially in developing countries, are pushed into entrepreneurship due to lack of or limited options for formal employment (Schoof 2006; Amin 2010), their motivations for establishing micro-enterprises also shift over time (Williams and Williams 2014). Indirectly, it ameliorates the socio-psychological position of jobless youths at large. The growth in the sense of community acceptance and appreciation among these young people, therefore, shapes their cultural and social identity, irrespective of their background.
Despite these benefits, there are constraints that impede young people from starting businesses. A few of the common barriers include access to information, access to credit, acquisition of relevant skills, access to market, and relevant institutional supports. While these barriers are common in both developed and developing countries, the perception of the severity of each barrier varies among the young people (Chigunta 2002; Gilmore 2009). When they persist unabated, these barriers pose serious threats to the promotion of youth entrepreneurship. The International Labour Office (ILO 2012) identified five measures for promoting effective youth entrepreneurship: (1) target specific barriers confronting the youth; (2) offer a broad range of services including mentoring; (3) embed entrepreneurship curricula in both secondary and tertiary education; (4) establish a favourable regulatory environment for promoting business expansion; and (5) undertake impact assessments for continuous improvement.
Three specific barriers that have received attention in the literature are: fear of failure; disengagement with entrepreneurship; and diminishing levels of awareness. Fear of failure is a personality trait that results in the avoidance of the possibility of failure irrespective of the prevailing circumstances. In relation to entrepreneurship, this has two broad dimensions (Singh, Corner and Pavlovich 2007). The first is the problem-focused dimension, which emphasises distress due to unemployment and financial pressures. This is associated with the strong dislike of shame, embarrassment, and loss of one's self-worth. The second is the emotion-focused dimension, which emphasises emotional reactions such as guilt, depression, anger and frustration. These set in when potential entrepreneurs pay too much attention to what their immediate family members, relatives, and other members of society think about their performance. In addition, the feeling of having limited entrepreneurial experience and skills, poor ability to plan and implement priorities, and low self-esteem can trigger avoidance behaviour among young people. When it persists, it becomes a potential barrier to youth entrepreneurship.
Young people can disengage themselves from entrepreneurship depending on the extent to which they perceive the barriers confronting them. Specifically, limited access to capital, loss of cultural identity, and weak institutional support capabilities can influence young entrepreneurs' decision to abandon their start-up efforts. This is also known as uninformed entrepreneurial exit. Conversely, young entrepreneurs can exit the start-up process based on informed decision-making – for example, that the existing business is unlikely to succeed. This is also known as the intelligent exit. Whether the disengagement is voluntary or not, the importance of feasibility analysis as a learning tool cannot be overemphasised (Yusuf 2012).
Even though there are young people who have decided not to be entrepreneurs in a business sense (Chigunta et al. 2005), it is not enough to diminish the importance of entrepreneurial awareness in the pursuit of youth entrepreneurship. There are three channels to promoting entrepreneurial awareness: (1) improving entrepreneurial mindsets; (2) creating a sustainable climate for inspiring people to embrace entrepreneurship; and (3) raising motivation, and capacities to identify and take advantage of economic and social opportunities. Despite these, the paucity of information and limited access to professional networks or mentoring programmes increase the difficulty young people have in identifying, starting, growing and sustaining an enterprise. Consequently, the level of entrepreneurial awareness is not only low, but also the link between the realities and mentorship programmes is characterised by ambiguity.
Against this backdrop, this article focuses on the role of mentoring in the promotion of youth entrepreneurship, and specifically responds to the growing call for systematic inquiry into the relationships between entrepreneurship and mentoring from the point of view of young people (Bisk 2002; O'Neil 2005; Cull 2006; Tonidandel, Avery and Phillips 2007; St-Jean and Audet 2013).
Nigeria provides a useful context for an exploration of entrepreneurship and mentoring. The entrepreneurial attitude of young Nigerians is generally considered to be high (GEM 2013) and many observers assume that they are naturally ready to embark on an entrepreneurial journey. In fact, the GEM report, Supporting Africa's Young Entrepreneurs (2015), states that 82 per cent of young Nigerians, irrespective of gender, are 'potential entrepreneurs'. Yet their entrepreneurial activities are heavily oriented towards trading: 50 per cent prefer to invest in wholesale and retail activities; 24 per cent in consumer services and hospitality; and less than 7 per cent invest in the agro-industry. Further, more than 23 per cent struggle to develop a viable business (Amorós and Bosma 2013). This situation has led some to call for greater attention to entrepreneurship mentoring (Herrington and Kelle 2012; Schøtt, Kew and Cheraghi 2015). Mentoring is generally considered to be useful when starting a new business venture (Waters et al. 2002; Smith and Perks 2006).
In the last four years, there has been a surge in the development of formal entrepreneurship mentoring programmes. These programmes are meant to provide young entrepreneurs with access to sponsorship, exposure, visibility, coaching, protection, and challenging assignments that are designed to enhance skills and improve the entrepreneurial mindset. Generally, such programmes are based on the premise that mentoring is a purpose-driven channel for transferring entrepreneurial knowledge, skills and ability to young entrepreneurs (Taylor and Bressler 2000; Rhodes 2002; Rhodes et al. 2006; Wilbanks 2013), and to develop their entrepreneurial identity.
Nigerian commercial organisations have put forward a number of justifications for investing in entrepreneurship mentoring. The Bank of Industry, for example, suggested that mentoring is necessary to improve the quality of life of aspiring young nascent entrepreneurs (Punch Newspaper 2016), while the Central Bank of Nigeria (CBN) stated that mentoring can strategically help the nation to harness its youthful resources for its economic development agenda (Onuba 2016). The Lagos Chamber of Commerce and Industry (LCCI) argued that mentoring is a means of investing in the future of Nigerian youths (Okon 2016) and the SABMiller Foundation claimed that through mentoring, the bright business ideas inherent in the teeming youths of south-east Nigeria can be turned into reality (Ogunfuwa 2016). There is clearly a belief that entrepreneurship mentoring can help nascent entrepreneurs develop into successful business operators.
The academic literature around mentoring is significant. Crisp and Cruz (2009) review this literature between 1990 and 2007 and conclude that neither mentoring nor a mentoring relationship has an operational definition. Tonidandel et al. (2007) discuss how to maximise returns on mentoring. O'Neil (2005) acknowledges that a mentoring relationship is, indeed, a complex set of helping behaviours and suggests the need for a distinction between the effects of formal versus informal mentoring. Fagenson-Eland, Marks and Amendola (1997) suggest that more research on mentor–mentee relationships is needed, particularly around structural factors.
In relation to mentoring within the entrepreneurship domain, St-Jean and Audet (2009) explore mentees' satisfaction with a mentoring programme for entrepreneurs in Quebec, Canada. Gimmon (2014) uses the case study approach to investigate mentoring and its influence on entrepreneurship within higher education. Turker and Sonmez Selcuk (2008) wonder why entrepreneurship mentoring is hard to find in Turkish universities. These studies focus more on formal entrepreneurship mentoring relationships with little or no attention accorded to informal relationships. Existing studies are yet to explore entrepreneurship mentoring relationships from the perspectives of recent university graduates. Schøtt et al. (2015) assert that skill development and/or market access is unlikely to produce a significant increase in youth entrepreneurial activity without a concomitant investment in mentoring.
3 Conceptual framework
Mentoring is one of a variety of interventions for promoting positive development of young people (Rhodes 2002; Grossman and Rhodes 2002). Despite its increasing popularity, the extant literature suggests that there is much ambiguity around the concept (Noe 1988; Crisp and Cruz 2009). Scholars approach mentoring from a number of organisational, educational and developmental perspectives.
Building on the work of Grossman and Rhodes (2002), Rhodes and DuBois (2008) provide a useful model of youth mentoring (see Figure 1). This model is particularly relevant because it spells out in clear terms the processes and conditions necessary for understanding the effects of a mentoring relationship on young people. Specifically, it posits that entrepreneurship mentoring can influence the entrepreneurial intentions of young people through three processes: socio-emotional development, cognitive development and identity development (see also Rhodes et al. 2006).
The ultimate goal of socio-emotional development is improved ability to relate to others. Following Erikson's (1950) eight stages of development and Etzioni's (1988) decision-making model, the socio-emotional capability of both the mentor and the mentee can be developed through shared value commitment and emotional involvement within a social space. This implies that a mentoring relationship that is rich in companionship, genuine care and proximal relationships can increase the chances of learning how to communicate, act, react, interact, and to interpret others' feelings. Thus, when the mentee learns how to get along with others, it increases his or her chances of making informed business-related decisions. Consequently, the exposure of the mentee to genuine care and companionship through a mentoring relationship should have a significant impact on his or her intention to be an entrepreneur, and indeed on subsequent outcomes.
Bandura (1993: 144) posits that individuals with a high sense of efficacy see difficult tasks as challenges to be mastered, and attribute failure to insufficient effort, knowledge, and skills that are acquirable. This implies a positive correlation between perceived self-efficacy and cognitive development. Albert and Luzzo (1999) add that outcome expectations and goals can also make any given career option seem unattainable. So, when a mentoring relationship focuses on building both cognitive and affective capacities, it empowers the mentee with new skills and new approaches to effective problem-solving and decision-making (Rhodes et al. 2006). Consequently, higher cognitive development should have a positive impact on the intention of a mentee to be an entrepreneur.
Identity development helps to shift young people's order of consciousness (Komives et al. 2006), leading to a generational shift in aspirations towards a 'dream career' (Fernández-Kelly and Konczal 2005). With respect to entrepreneurship, development of an entrepreneurial identity is viewed as a dynamic process of self-identification (Jones, Latham and Betta 2007), self-definition (Vesala, Peura and McElwee 2007), or self-picturing (DeFillippi and Arthur 1994) that is associated with either the category of entrepreneurship or the role of entrepreneurs. The determinants of entrepreneurial identity include know-how competencies (ibid.), self-awareness (Komives et al. 2006), experience (Donnellon, Ollila and Middleton 2014), and social bonds and networks (McKeever, Jack and Anderson 2015). On the one hand, a mentoring relationship impacts entrepreneurial identity (Rhodes and DuBois 2008); while on the other hand, entrepreneurial identity has a strong influence on the outcome of nascent entrepreneurship (Jones et al. 2007).
The relationships displayed in Figure 1 are indications that the path of influence between mentoring relationships and positive entrepreneurial outcomes may not necessarily be linear. For instance, the Rhodes and DuBois (2008) model of youth mentoring acknowledges that for mentoring relationships to have a significant effect on socio-emotional, cognitive and identity development, both the mentor and the mentee must share a strong sense of mutual trust and empathy. In addition, the model emphasises that when the odds of interaction between socio-emotional and cognitive development, as well as cognitive and identity development are high, the chances that the mentoring relationship will positively influence the expected outcome is also high.
Mentoring relationships have been broadly categorised into two types: formal and informal. While the former are often initiated by an organisation or programme, the latter arise through a variety of circumstances. Formal and informal mentoring relationships can be differentiated in relation to five properties: formation, intensity, visibility, focus and durability (Table 1).
Mentoring relationships within organisations can also reflect an element of formal supervision. Three specific forms of supervisory mentoring relationship are acknowledged in the literature: the traditional relationship with the mentor multiple levels away from the mentee; peer mentoring with the mentor occupying a similar level to the mentee; and step-ahead mentoring with the mentor one level ahead of the mentee (Tonidandel et al. 2007: 106). On the other hand, informal, non-supervisory mentoring relationships are often based on a personal relationship or commitment between the mentor and the mentee.
4 Evidence from the literature
This section reviews literature relating to different aspects of mentoring, with the objective of identifying insights relevant to the use of mentoring in youth entrepreneurship programmes.
4.1 Mentoring process
A mentoring process defines the various stages in the development of a mentoring relationship. Kram (1988) showed that a mentoring process is systematic, differentiated and complex. Its systematic nature is attributed to the developmental needs surrounding the evolution of a mentoring relationship. As seen previously, according to Rhodes and DuBois (2008), developmental needs include socio-emotional, cognitive and identity development, and these require different levels of structure, direction and support. As such, the differences in the ability of mentors to manage the inherent challenges associated with the developmental needs of mentees are critical. The mentoring process is also believed to be complex because the channel of leading mentees through levels of dependency to autonomy and self-reliance is non-linear (Rhodes and DuBois 2008). Besides, understanding of the relational processes that underpin the mentor–mentee bond is relatively limited (Spencer 2006).
4.2 Mentoring functions and roles
Evidences from classical studies show that mentors perform a number of functions within a mentoring relationship. According to Schockett and Haring-Hidore (1985), mentors perform eight different functions in a mentoring relationship: as role model, motivator, counsellor, friend/colleague, educator, consultant, sponsor and protector. They also function as transitional figures. In their discussion of how adult relationships with peers offer opportunities for personal and professional growth in a work setting, Kram and Isabella (1985) highlight nine mentoring functions: sponsorship, coaching, exposure and visibility, protection, challenging work assignments, acceptance and confirmation, counselling, role modelling and friendship. They suggest that these functions can be categorised as either career-related or psychosocial. An empirical study of Noe (1988) lends support to the proposition that mentoring supports these two groups of functions. On the other hand, Jacobi (1991) proposes 15 mentoring functions that are broadly divided into three dimensions: emotional and psychological, career and professional, and role modelling. Scandura (1992) proposes three slightly different groupings of mentoring functions: vocational, role modelling, and social support functions.
Crisp and Cruz (2009) critically review and synthesise emerging empirical literature on mentoring with the broad objective of reframing and updating Jacobi's (1991) characteristics of mentoring. They show that for college students, the provision of support, role modelling, friendship, empowerment and career advice top the list of mentoring functions.
4.3 The mentoring relationship
Empirical evidence comparing the effect of formal versus informal mentoring relationships on mentoring outcomes is relatively scarce. Chao, Walz and Gardner (1992) conducted a field study with a view to comparing three measures of outcome (i.e. organisational socialisation, job satisfaction and salary) between individuals with and without a mentoring relationship. Their findings suggest that mentees in informal mentoring relationships enjoy more favourable outcomes than non-mentored individuals. Outcomes for mentees in formal mentoring relationships are not significantly different from: (1) mentees in informal mentoring relationships, and (2) individuals without mentors.
A comparative study of Ragins and Cotton (1999) shows that mentees who are in informal mentoring relationships are more satisfied than those in formal relationships. They are also more effective and earn more than those in formal mentoring relationships. Compared to non-mentored individuals, those in informal mentoring relationships also benefit more in career outcomes because they are more responsive to a mentor's career development capabilities. The duration of relationship between the mentor and the mentee also accounts for the accrued benefits from informal mentoring relationships. Consequently, mentees in informal mentoring relationships enjoy improved commitment, motivation, trust, and communication with their mentors. In spite of these findings, the authors warn that formal mentoring relationships have inherent values that cannot be overemphasised.
Evidence suggests that individuals who engage in mentoring relationships, whether formal or informal, benefit one way or the other (Chao et al. 1992; Ragins and Cotton 1999). But formal and informal mentoring relationships are not equally beneficial: empirical evidence shows that the odds of a significant effect are higher for informal mentoring relationships than formal mentoring relationships. For instance, the findings of Noe (1988), Ragins and Cotton (1999), Scandura and Williams (2001) and Allen, Day and Lentz (2005) support the argument that organisations that expect mentees to have the same benefits from both formal and informal mentoring relationships will be disappointed.
5 Implications for the promotion of youth entrepreneurship
The results of this review suggest that mentoring can influence entrepreneurial intentions among young people. However, the literature that specifically addresses mentoring of young people in developing countries is limited, and does not provide a very clear picture of what kind of mentoring works, and for whom. This lack of clarity is a major constraint to policy and programmes promoting youth entrepreneurship.
Over 15 years ago, Chigunta et al. (2005: 15) noted that 'even though the benefits of youth entrepreneurship are visible to all, there is little empirical data to show how the perceived benefits are realized in reality in Africa'. In the intervening period, the situation has not changed significantly, and the need for rigorous research into entrepreneurship mentoring among young people is even greater now.
One objection to investment in mentoring as a development intervention arises because of the potential expense of scaling up what are most often conceived of as intensive one-to-one relationships. It is one thing to identify and organise mentors for tens or even hundreds of young people, and quite another to try to address Africa's youth employment challenge in this way.
Future research around young people and mentorship might focus on competing motivations for starting a business venture, and the relationship between mentorship and 'temporally fluid motivations' (Williams and Williams 2014). The gender dimensions of entrepreneurship mentoring in Africa also deserve attention. Future research might also explore the social and economic benefits and costs of mentoring initiatives for young people with different levels of education, and in rural and urban settings. Besides exploring the situations in which group mentoring can be successful, it is now imperative to situate the challenges of youth entrepreneurship training and mentoring within different African contexts.
* The author wishes to acknowledge that the research was funded in partnership with The MasterCard Foundation. He is also grateful to the anonymous reviewers for their stimulating comments.
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This article is part of IDS Bulletin Vol. 48 No. 3 May 2017: 'Africa's Youth Employment Challenge: New Perspectives'; the Introduction is also recommended reading.