October 29, 2024

What Australian female entrepreneurs can learn from their Sri Lankan counterparts

New study reveals the importance of psychological capital to survive and thrive in uncertainty

In the face of growing global uncertainties – from the global financial crisis to the COVID-19 pandemic – entrepreneurs worldwide have been navigating uncharted waters. Despite this, women’s entrepreneurship is on the rise globally.

An unexpected place where small business entrepreneurs have thrived in uncertainty is Sri Lanka, where women in the small-scale floriculture industry have shown remarkable resilience and adaptability.

Their success was a source of interest for researchers who wanted to explore how female entrepreneurs survive and thrive despite facing numerous limitations. The resulting study, published in the Journal of the International Council for Small Business, offers a roadmap for leveraging individual capacities to thrive amidst current economic uncertainties.

Lead researcher Dr Nelly Liyanagamage from the University of Wollongong’s (UOW) School of Business said the experiences of female small-business owners in Sri Lanka can provide valuable insights for Australian small business.

“In emerging markets and low to lower-middle-income contexts, women entrepreneurs face many limitations in initiating and sustaining their businesses,” Dr Liyanagamage said.

“In developing contexts female entrepreneurs face challenges such as limited access to finance and lower levels of formal education.

“They can also struggle with cultural norms which may impose expectations of caregiving and household duties. Nevertheless, for these women and their families, entrepreneurship represents not only a pathway to socioeconomic change and financial independence but also a source of happiness.”

The researchers found women entrepreneurs in developing countries, with limited access to economic, human and social capital, rely heavily on their psychological capital to survive and thrive in uncertainty.

“Our research findings suggest that female entrepreneurs in developing contexts can’t rely as heavily on what they have, what they know and who they know. Instead they rely heavily on individual-level psychological capital – so this is about who they are,” Dr Liyanagamage said.

Psychological capital includes four key capacities: self-efficacy, reflecting confidence in one’s abilities; optimism, resilience and hope.

The findings suggest that women entrepreneurs’ psychological capacities enabled them to navigate various uncertainties, including the challenges posed by the COVID-19 pandemic, natural disasters, and economic instability, ultimately allowing them not only to survive but also to thrive in their businesses.

So what can Australian female small-business owners take away from this research?

Dr Liyanagamage says the experiences of women entrepreneurs in Sri Lanka who have successfully navigated through natural disasters, economic turmoil, terrorism, a pandemic and deep-rooted socio-cultural barrier is more relevant in Australia than people realise.

According to Australia’s Minister for Small Business, The Hon Julie Colins MP, small businesses form the backbone of the Australian economy, but they are struggling in today’s challenging environment. And one third of these small business owners are women.

“Women entrepreneurs in Australia are bearing the brunt of these difficulties with unpaid work and caregiving responsibilities, insufficient government support, investment disparities and financial instability,” Dr Liyanagamage said.

Australian small businesses employ more than five million people and contribute more than $500 billion to the national GDP, however findings from a survey undertaken by Women’s Agenda of 800 women business owners revealed that 70 per cent expressed feeling unsupported by their governments.

The researchers believe using the Sri Lankan female entrepreneur experience can provide invaluable insights and inspiration to Australian female business owners and policy-makers alike.

“What we found fascinating in Sri Lanka was that even in resource-constrained environments, women can harness their individual psychological resources to not only survive but to thrive,” Dr Liyanagamage said.

“Ultimately, we’d love to see more targeted funding to develop entrepreneurial psychological capital. This is critical to business success, on par with access to finance, networks, and knowledge. It certainly deserves more attention in policy discussions.”

More information

For a summarised version of the research please see “Surviving” and “thriving” during uncertainty: Uncovering the stories of women entrepreneurs in Sri Lanka published in the Journal of the International Council for Small Business.

For an in-depth version of the research please see Psychological capital and emotions on “surviving” or “thriving” during uncertainty: Evidence from women entrepreneurs in the Journal of Small Business Management. 

It is authored by Nelly Liyanagamage, Charmaine Glavas, Lisa Schuster and Thilakshi Kodagoda.