How Successful A Business Or An Entrepreneurial Decision

Introduction Surviving in a competitive market nowadays has become increasingly difficult. According to Kelly (2013), almost 90% of new start-ups fail and don’t make it to their second year. Some of those businesses have overly ambitious goals, while others are simple and just aim to survive. So what criterion do we use if we are to judge the soundness of the entrepreneurial decision? Do successful businesses have the distinct characteristic of achieving profits? And are the most successful of companies the ones that attain the highest profits? Or is it that we need to take other factors into account when assessing the successfulness of a company? These are the kinds of questions that this paper will be trying to answer in order to reflect on the different ways and approaches we go about assessing how successful a business or an entrepreneurial decision is. Rational Choice It is without a doubt that financial analysis and profitability ratios are key performance indicators and perhaps the first that pop to mind when thinking of the successfulness of a venture (PwC, 2007). They are in fact the easiest to use in order to judge how good the company has been performing with regards to selling their goods/services with a profitable margin. For instance, Reid and Smith (2000) conducted a research with 150 new small sized companies and tried to cluster them into high, medium and low performing organizations according to certain characteristics ofShow MoreRelatedThe Practice Of Entrepreneurship Through Time And The Global Enterprise1642 Words   |  7 Pagesof self-esteem and self-efficacy reduces the competence in decision making. Delgado-Garcia, Rodriguez-Escudero, and Martin-Cruz (2012) maintained that negative self-esteem increased negative mood and limited options. 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