Influences of External Stressors and Factors on Exit
There is good academic debate about what causes a tipping point to exit; whether it is a gradual process and a ‘straw’ that breaks the camel’s back or whether, as evidenced in employed work, the role of the shock is the main cause.
Each argument has its own merit.
In a paper by Sardeshmukh et al (2021) there is argument, especially within female owned businesses, that work-family conflict ‘was a bigger stressor for women business owners’, contributed towards emotional exhaustion and potentially drove their exit intentions.
We know from literature, considering papers by Toppinen et al (2002) and Wei et al (2015), that persistent emotional exhaustion can lead to burnout and several other negative outcomes (see last week’s depression post!)
We have discussed previously that reducing cognitive ability is a critical problem in the entrepreneur’s skillset. Simply put, if you have challenges at home, you’ll have problems at work. Furthermore, for entrepreneurs to thrive there needs to be psychological safety and within that a steady and consistent home life. But these situations are cyclical. A gradual external influence, economy, politics etc is very likely to have an influence on home life. More time away, more time dedicated to work, harder efforts for similar reward. This continues to put pressure on a home life situation. And repeat in ever decreasing circles and suddenly you have a big challenge and some big decisions to make.
This is an issue in our challenging world with swathes of external factors we cannot influence that impact our working lives and business ambitions. In turn it becomes less attractive to be an entrepreneur. Simple risk reward mechanics. Emotional invested vs reward is out of kilter.
Conversely in the Morrell et al paper (2004) the argument is steered towards the role of a shock, a particular salient event, and turnover within employed turnover. A salient event that jolts from a concept of entrepreneurial inertia (a novel concept without much research), and expediated toward exit. The challenge with an external factor enabling exit is that it is, mostly, unexpected, and unprepared for. See Brexit, see Covid, see global inflation, see rapidly accelerating labour costs. Latest Construction Products Association figures reveal that 3500 construction businesses closed in the last 12 months. One hypothesis would be that these are as a direct result of one, or a number, of those external factors.
It could be that the two arguments, the gradual influencers and the role of the shock, alongside a multi combination lock model, cause an exit. It could be that the two models have standalone merit. It continues to be the topic of good academic debate and equally further research that is an enabler to help entrepreneurs, and business owners, to prepare for the unexpected with an armoury of tools of how to survive both at work and, importantly, at home. Balance.