Q&A with Nicos Nicolaou
Professor And Head, Entrepreneurship And Innovation Group, Warwick Business School
Nicos Nicolaou is a Professor and the Head of the Entrepreneurship and Innovation Group at Warwick Business School. His research interests include entrepreneurship, genetics of entrepreneurship, middle market firms, social networks, and innovation. We spoke to Nicos about his recent research and how a better understanding of the health implications of being an entrepreneur can help to boost innovation.
The Biology Of Entrepreneurship
T50: What aspects of the 4th industrial revolution particularly interest you?
The 4th industrial revolution has the potential to really disrupt the labor market. Ability, talent, people, will become more critical than ever before. As a result understanding how our biology influences our ability to perform will be more important. Recent advances in the sciences enable us to understand much more about how our body and our biology work. And how to change our biology to make us more productive and more effective.
T50: What have you looked at in this area?
The biology of management, in particular the biology of entrepreneurship.
T50: Why entrepreneurs? Is entrepreneurship particularly relevant for 2018?
Well first I need to clarify that I define entrepreneurship as recognizing and exploiting entrepreneurial opportunities.
T50: That’s entrepreneurial activity inside, outside or across organizational boundaries?
Yes it includes corporate entrepreneurship. It is not just about starting new businesses. It is also about people in existing organizations thinking and acting entrepreneurially. Being engaged in strategic renewal, in corporate venturing activity and so on. It is much more than starting businesses, it is about a way of thinking, about an entrepreneurial mindset. Most of that happens within existing organizations.
T50: And what about 2018?
Every time we are at the initial stages of an industrial revolution entrepreneurship becomes far more important, more critical, than at other times. Because there are so many opportunities to recognize and exploit gaps in the market. Look at the explosion in entrepreneurial activity at the moment – whether it is focused on robotics, AI, the internet of things, or any of these new technologies. In addition, when we face an industrial revolution, the core competencies of firms often become core rigidities and firms have difficulties changing their organizational routines to adapt to the new circumstances.
T50: What, in particular, did your research investigate with respect to entrepreneurs?
So, for example, I have looked at the relationship between entrepreneurs and stress. Entrepreneurs face a number of potentially severe stresses, from very long hours to very high failure rates of their ventures. We looked at how entrepreneurs’ cortisol levels changed during the day – that’s a chemical released by our body when we are stressed.
T50: And you used identical twins, I believe, to try and control for genetics and environmental influences in development?
It is a nice way to control for confounding variables. We find that entrepreneurs are much more chronically stressed than non-entrepreneurs.
T50: And why does this finding matter?
Well it has important implications for their health. If you have sustained activation of your body’s cortisol, it can lead to suppression of the body’s immune system. What our study captures is chronic stress, and that entrepreneurs are chronically stressed. They need to find a way to relieve that stress. Otherwise it has serious health implications.
T50: What should they do?
Well, they would benefit from health monitoring to check for abnormal cortisol responses.
T50: Otherwise their performance is going to be impaired?
T50: You have also looked at the “are entrepreneurs born or made?” question. Again with twins.
Yes we examined a few thousand twins, half identical, half non-identical. If identical twin pairs have higher twin concordances for entrepreneurship that non-identical twin pairs, this difference can be attributed to genetics.
T50: What did you discover there?
That there is a 40% genetic predisposition to entrepreneurship.
T50: This is about likelihood or propensity rather than genetic determinism, though. Is that right?
Yes, it doesn’t mean people are born to be entrepreneurs. People can overcome their genetic predisposition. The study also shows us that unique environmental factors, such as work environment, friends and colleagues, and external career advice are more important than genetic factors in accounting for the variance in entrepreneurship.
T50: To maximize entrepreneurship we should focus on these unique environmental factors?
Our findings should hearten managers and policymakers. Because discovering those right environmental influences whether they are training, working conditions, career incentives, will prove useful in stimulating entrepreneurship. It is about having a corporate culture that drives and is supportive of corporate entrepreneurship.
T50: Your research appears to show that these factors are worth spending money on? That they matter when it comes to influencing entrepreneurship?
Picture by www.edwardmoss.co.uk. All rights reserved – Warwick Business School staff portraits.