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Increasing entrepreneurial engagement and persistence through education and training in a virtual organization with global operations: an innovation study

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Increasing entrepreneurial engagement and persistence through education and training in a virtual organization with global operations: an innovation study

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Content Running head: ENTREPRENEURIAL ENGAGEMENT 1

INCREASING ENTREPRENEURIAL ENGAGEMENT AND PERSISTENCE THROUGH
EDUCATION AND TRAINING IN A VIRTUAL ORGANIZATION WITH GLOBAL
OPERATIONS: AN INNOVATION STUDY

by

Alexandra McDermott Wilcox

A Dissertation Presented to the
FACULTY OF THE USC ROSSIER SCHOOL OF EDUCATION
UNIVERSITY OF SOUTHERN CALIFORNIA
In Partial Fulfillment of the
Requirements for the Degree
DOCTOR OF EDUCATION

August 2016

Copyright 2016 Alexandra McDermott Wilcox

ENTREPRENEURIAL ENGAGEMENT 2
Acknowledgements
I would like to express my sincere gratitude to the incredible faculty and amazing
administrators of the Global Executive Doctor of Education degree program at the USC Rossier
School of Education. Our learning and travel experiences have been life-changing.
I would also like to thank my dissertation Chair, Dr. Larry Picus, for his extraordinary
mentorship, engagement, guidance, and support. A special thank you to my dissertation
committee, Dr. Rob Filback and Dr. Singh-Bentis, and my Professor, Dr. Cathy Krop. Your
comments throughout the process were incredibly helpful in exploring new avenues and guiding
this dissertation.
A special thank you to Dr. Singh-Bentis and Robyn Lewis. You worked tirelessly to
ensure the program ran smoothly and all of our needs were met. Thank you a million times for
providing us with world class experiences.
Thank you also to the incredible team of seasoned distributors who were willing to share
their experiences and challenges with me. I am in awe of what you have done to improve
people’s lives and create opportunities for them. You have helped women gain financial
independence in areas of the world where they have few opportunities and you have helped
people gain valuable business skills and life skills.
To my incredible colleagues: this journey with each of you has been amazing. We
continued to push each other throughout the program to ask more, reach further, and work
harder. Kiley Adolph and Ruth Claire-Black, I am indebted to you for your willingness to be
open about your experiences and learn without boundaries. I am eternally grateful. Now let’s go
change the world.
ENTREPRENEURIAL ENGAGEMENT 3
Finally, thank you to my unconditionally supportive family: Dad, Christine, Kim, Rod,
Laura, and Sam. You have always encouraged me to grow personally and professionally. I
appreciate each one of you. Most importantly, thank you Brian. You are an incredible partner
and best friend. Thank you for always knowing what to say or how to fix something. Argelia, I
can’t thank you enough for taking care of everything and everyone in my absence. Thank you
Raul, Ethan, Liam, Chloe, Naomi and Makena for encouraging me to pursue my goals in life and
pushing me to always find a way to be my best. Lastly, Mom, thank you for endowing me with
your strength and providing your angelic wisdom throughout my journey. I miss you every day.

ENTREPRENEURIAL ENGAGEMENT 4
Table of Contents
Acknowledgements 2
List of Tables 6
List of Figures 7
Abstract 8
Chapter One: Overview of the Study 9
Organizational Context and Mission 12
Organizational Performance Status 12
Related Literature 13
Importance of the Organizational Innovation 16
Organizational Performance Goal 17
Stakeholders and Stakeholders’ Performance Goals 17
Stakeholder for the Study and Stakeholder Performance Gap 18
Purpose of the Project and Questions 19
Methodological Framework 19
Definitions 20
Organization of the Study 21
Chapter Two: Review of the Literature 23
Multilevel Marketing Organizations 23
History of Multilevel Marketing Organizations 25
Multi-Layered Entrepreneurship 27
Entrepreneurial Motivation in a Multilevel Marketing Organization 29
Entrepreneurship Challenges 33
Entrepreneurial Competencies and Education 34
Methodological Framework 36
Assumed Performance Needs 39
Preliminary Scanning Data 40
Learning and Motivation Theory 42
Conclusion 46
Chapter Three: Methodology 47
Participating Stakeholders 47
Data Collection 51
Interviews 52
Other Data Collection Methods Considered 53
Validation of the Performance Needs 53
Validation of Performance Needs: Knowledge 53
Validation of Performance Needs: Motivation 54
Validation of Performance Needs: Organization/Culture/Context 54
Data Analysis 56
Trustworthiness of Data 57
Role of Investigator 57
Limitations 58
Delimitations 58
Chapter Four: Results and Findings 60
Results and Findings for Knowledge Needs 60
ENTREPRENEURIAL ENGAGEMENT 5
Sufficient Conceptual Knowledge Regarding Assisting New Distributors 64
Mixed-Results in Procedural Knowledge 67
Sufficient Procedural Knowledge in How to Conduct Personal Growth Trainings and
Leveraging Company Training Philosophy 68
Insufficient Procedural Knowledge in Leadership Trainings for Distributors 71
Partially Sufficient Metacognitive Knowledge Regarding Training New Distributors 72
Summary of Results and Findings for Knowledge Needs 74
Results and Findings for Motivation Needs 77
Task Value 79
Goals 83
Self-Efficacy 85
Summary of Results and Findings for Motivation Needs 87
Results and Findings for Organizational Needs 88
Cultural Models 91
Cultural Settings 97
Summary of Results and Findings for Organization Needs 102
Chapter Five: Solutions and Implementation 104
Selection of Validated Needs and Rationale 104
The Cost of Doing Nothing 107
Fiscal Impact of Engagement 108
Impact of Engagement on Social Good 109
The High Cost of Doing Nothing 109
Adult Learner Issues 114
Types of Trainings 116
Elements of a Successful Lead-the-Leader Training Program 121
Implementation Plan 124
Language Barriers 124
Cultural Barriers 125
Factors Affecting Women Entrepreneurs 126
Implementing the Lead-the-Leader Program 127
Summary Implementation Plan 134
Evaluation Plan for Lead-the-Leader Training Solution 136
Reaction 136
Learning 138
Transfer 140
Results 143
Strengths and Weaknesses 146
Limitations 146
Questions for Future Research 147
Conclusion 147
References 149
Appendix A: Summary of Assumed Needs for Knowledge and Skills, Motivation, and
Organizational Challenges 160
Appendix B: Interview Protocol - Email 161

ENTREPRENEURIAL ENGAGEMENT 6
List of Tables
Table 1: Organizational Mission, Global Goal and Stakeholder Performance Goals 18
Table 2: Summary of Assumed Needs and Sources 54
Table 3: Summary of Assumed Needs and Validation Method 56
Table 4: Summary of Results for Knowledge Needs 61
Table 5: Summary of Distributor Membership, Countries, Headquarters, and
Concentrations 64
Table 6: Summary of Interview Responses from Seasoned Distributors Highlighting
Different Approaches to Developing Leaders 71
Table 7: Summary of Results and Explanation for Knowledge Needs 75
Table 8: Summary of Results for Motivation Needs 79
Table 9: Summary of Results and Explanation for Motivation Needs 88
Table 10: Summary of Results for Organization Needs 91
Table 11: Summary of Distributor Comments Regarding Mutual Trust 94
Table 12: Summary of Results and Explanation for Organization Needs 103
Table 13: Summary of Assumed Needs and Results 105
Table 14: Implementation Plan for Lead-the-Leader Solution: Key Action Steps, Format,
Human Resource Needs, and Time Frame 134
Table 15: Evaluation Plan for Lead-the-Leader Training Solution: Proposed Questions,
Instrument, and Assessment Level 137
Table 16: Lead-the-Leader Level 2 Learning Observation Checklist 139
Table 17: Lead-the-Leader Level 3 Transfer Post-Training Survey 142
Table 18: Lead-the-Leader Level 4 Results Assessment that Measures Entrepreneurial
Engagement at H. Enterprises 145

ENTREPRENEURIAL ENGAGEMENT 7
List of Figures
Figure 1: The gap analysis framework adapted from Clark and Estes (2008) 39
Figure 2: Binary Compensation Structure in A Multilevel Marketing Organization 49
Figure 3: Distributor levels in H. Enterprises 50
Figure 4: Assumed Factual Knowledge Needs of Seasoned Distributors Regarding What
New Distributors Know About the Operation of a New Distributorship 62
Figure 5: Assumed Conceptual Knowledge Need of Seasoned Distributors 65
Figure 6: Assumed Procedural Knowledge Needs Regarding the Operation of a
Distributorship 67
Figure 7. :Assumed Metacognitive Knowledge Need of Seasoned Distributors 73
Figure 8: Assumed Motivation Knowledge Needs of Seasoned Distributors 78
Figure 9: Assumed Organizational Needs of Seasoned Distributors 90
Figure 10: Earnings Per Share Comparison Emphasizing Impact of Engagement 108
Figure 11: Action steps to develop, Conduct, and Implement Lead-the-Leader
Training Program 128
Figure 12: Human Resources Required to Implement Lead-the-Leader Training Program 129
Figure 13: Elements of entrepreneurial engagement at H. Enterprises that can be
assessed to determine effectiveness of Lead-the-Leader Training Program 144

ENTREPRENEURIAL ENGAGEMENT 8
Abstract
The global economic crash of 2008 prompted many people to explore new entrepreneurial
opportunities, including many who avoided traditional businesses and, instead, pursued
multilevel marketing organizations. Many multilevel marketing organizations turn over 100% of
their distributors annually. As a result, a significant issue was the persistence of these new
entrepreneurs and their ability to overcome business challenges and remain engaged. This
innovation study interviewed 12 seasoned global distributors in an international multilevel
marketing organization. The purpose of this study was to identify the knowledge and skills,
motivational, and organizational needs necessary for seasoned distributors to train new
distributors based upon best practices principles in a standardized manner. The study confirmed
several assumed needs. Specifically, findings from the 12 seasoned distributor interviews
showed that seasoned distributors need to have a systematic method for providing
entrepreneurial and leadership trainings to distributors to ensure they are able to lead their own
global teams. Seasoned distributors also need to see the value in developing entrepreneurial and
leadership trainings and prioritize education and training for their global teams to keep them
engaged. An extensive literature review of engagement confirmed the negative impact of
disengagement on the economy and on society. As a result, the proposed solution, a lead-the-
leader training program, addresses the confirmed needs and is critical to the success of the
entrepreneurs in the multilevel marketing organization. The dissertation concludes with a
detailed plan for implementation and evaluation of the lead-the-leader training program.

ENTREPRENEURIAL ENGAGEMENT 9
CHAPTER ONE: OVERVIEW OF THE STUDY
In a struggling global economy, more people are trying to identify entrepreneurial ways
in which to generate income. Instead of turning to a traditional business model, people are now
exploring opportunities in the direct selling industry, particularly with multilevel marketing
companies. By 1999, 77.3 percent of direct selling revenue in the United States came from
multilevel marketing efforts (Sheffield, 1999). In 2009, the number of direct selling members
engaged in multilevel marketing rose to approximately 94.2 percent (DSA, 2010). Multilevel
marketing, also known as network marketing, accounts for $20 billion of annual sales in the
United States, and is moved by approximately eight million distributors (Yarnell & Yarnell,
1998). On a global level, more than $182 billion of products and services are being moved by
approximately 100 million independent distributors (World Federation of Direct Selling
Associations [WFDSA], 2014; Wood, 2012; Yarnell & Yarnell, 1998). Some higher profile
multilevel marketing companies include Avon Products, Inc., Mary Kay, Inc., Amway, and
Tupperware Brands Corp.
One of the biggest issues plaguing the multilevel marketing industry is the survival rate
of entrepreneurs during their first year in the industry. According to several studies, veteran
multilevel marketing companies, like Avon, lose a majority of their distributors, approximately
60% annually, while other companies lose 100% of their distributors annually (Berry, 1997;
Yarnell & Yarnell, 1998). H. Enterprises, a worldwide distributor for Vitality Global, is no
different. The survival rate of independent distributors in H. Enterprises is also relatively low.
This problem has a negative impact on H. Enterprises’ ability to achieve its strategic growth
objectives, which ultimately impairs its ability to offer a sustainable, entrepreneurial platform for
people in approximately 100 countries.
ENTREPRENEURIAL ENGAGEMENT 10
The problem investigated in this dissertation is related to the larger international issue of
lack of entrepreneurial and small business success in the recent worldwide financial crisis (Yang,
2012). After the global financial crisis in 2008, many people lost their jobs and were forced to
reassess their employment options. Instead of reentering the labor force in a traditional
employment role, many people began exploring alternative careers and entrepreneurial routes
(Fairlie, 2013), including joining the direct selling industry. Thus, the issue of entrepreneurial
survival rate is critical not only in the context of solving a multilevel marketing organizational
issue, but also for the entrepreneurs who left traditional employment roles and the security that
comes with it.
This issue of entrepreneurial survival rate is further magnified in the context of
developing countries in which H. Enterprises’ distributors operate. With rising unemployment in
countries around the globe, more people are turning to multilevel marketing as a business
venture because it is relatively inexpensive and offers financial and social benefits. Notably,
multilevel marketing start-up costs typically consist of a marketing kit and initial products. In
addition, many multilevel marketing organizations continue to evolve operations due to the
internet revolution and, as a result, many business functions are performed online. Accordingly,
a multilevel marketing entrepreneur may be able to own and operate a business by leveraging its
online capabilities including operating an e-commerce platform and engaging in mentoring,
training, and educational opportunities online (Blythe, 2012). Thus, a multilevel marketing
entrepreneur can now own a completely virtual business, without warehousing products, leasing
physical space, or engaging in other expensive endeavors that result in high overhead costs and
high risks. As a result, multilevel marketing organizations are able to attract new entrepreneurs
by offering several benefits including a potential for high financial reward, increased social
ENTREPRENEURIAL ENGAGEMENT 11
benefits that come from expanding a personal network, and the ability, in many cases, to
disseminate necessary products and services to places around the globe.
According to Harvard Business School’s publication entitled A Note on Direct Selling in
Developing Economies, even though direct selling models are still evolving, “modern versions of
direct selling hold the potential to improve lives across the world’s developing economies as the
range of products begins to include those that have high social value, such as medicines,
hygienic items and communications” (Chu & Segre, 2010, p. 10). In fact, the Founder of
LivingGoods, Chuck Slaughter, proved this to be true. In 2008, Slaughter signed up to become
an Avon distributor. Even though he only sold cosmetics to family members, Slaughter enrolled
in Avon to experience its business model, first-hand (Abbott, 2012). Slaughter launched
LivingGoods in 2008, adopting the Avon multilevel marketing model, and now engages 900
women who travel door-to-door as Community Health Partners who sell critical health products
like treatments for diarrhea and malaria, safe delivery kits, sustainable and health foods, water
filters, solar lights, and clean stoves. In 2015, researchers from Harvard conducted a large
independent and randomized study of the LivingGoods approach and concluded that
LivingGoods contributed to the reduction of the under-five child mortality rate in Uganda by
27% through its interventions (Björkman-Nyqvist, Guariso, Svensson, and Yanagizawa-Drott,
2015). Moreover, in a 2016 partner study, Harvard researchers Björkman-Nyqvist et al.
advocated further exploration of the multilevel marketing structure in this context citing its
impact on driving out fake and counterfeit health products in the region and leveraging its
promising business model in reaching close to 1,000 villages with a population of 1.4 million,
and continuing to scale-up. Accordingly, for these developing countries, as well as the
ENTREPRENEURIAL ENGAGEMENT 12
multilevel marketing entrepreneurs who serve them, the need to understand and address issues of
entrepreneurial engagement are critical, as the cost of failure is high.
Organizational Context and Mission
H. Enterprises, located in the United States, is a founding distributor of Vitality Global
(Vitality), with over 100,000 distributors in 50 countries. Vitality is a direct selling company,
headquartered in the United States. Vitality is committed to helping its multilevel marketing
distributors maximize their health, earn more, and live well. Vitality research focuses on finding
alternative scientific routes to achieving maximum health and wellness. With more than 30
offices around the world, Vitality’s mission is to enhance the lives of people around the world by
offering financial stability through an e-commerce platform as well as health and wellness
products based on innovative technologies. Vitality’s core products consist of a skin care line,
vitamins and antioxidants, as well as nutrition products for weight management. All products are
manufactured in the United States and ship to over 100 countries.
Organizational Performance Status
The crux of this organizational performance problem is the entrepreneurial engagement
of H. Enterprises’ distributors after their first year in business. Per Vitality’s commitment to its
distributors, it offers a dynamic online platform designed to allow its distributors to leverage
social networks and strengthen global connections in over 80 nations. During 2014, Vitality
added almost 400,000 new distributors. Vitality closed 2014 with over $400 million in sales, up
63% from 2013 annual sales of approximately $250 million. Since 2009, Vitality added over
500,000 distributors to its global platform. Of those 500,000 distributors, a majority do not
remain active in growing their Vitality distributorship.
ENTREPRENEURIAL ENGAGEMENT 13
In order to fulfill its mission and enhance the vitality of people worldwide and offer the
opportunity of financial freedom to its distributors, it is imperative that H. Enterprises remain
globally competitive in a changing international business landscape. Thus, H. Enterprises needs
entrepreneurial engagement and commitment from each of its distributors around the world.
Failure to achieve a high level of engagement can result in a loss of business revenue and
ultimately, distributor support, leading many entrepreneurs to cease operating altogether.
Accordingly, H. Enterprises needs a systematic method for training and engaging its distributors.
While several systems exist, currently there is no comprehensive system to train and measure the
engagement of distributors in H. Enterprises.
Related Literature
Direct selling is defined by the WFDSA as “a dynamic, vibrant, rapidly expanding
channel of distribution for the marketing of products and services directly to consumers”
(WFDSA, n.d., p. 1). Direct sellers, also known as independent distributors, typically
demonstrate these products or services through personal presentations. The manner in which
independent distributors are paid varies. However, the vast majority of direct sales organizations
use a compensation structure that is referred to as multilevel marketing. According to Coughlan
and Grayson (1998), multilevel marketing organizations reward their distributors for purchasing
products, selling products, and recruiting other distributors.
Multilevel marketing organizations are growing rapidly. They account for over 75% of
retail goods and services sold through direct sales organizations in the United States (Direct
Selling Association, 1999). During the past 10 years, the average annual sales growth in the
industry is approximately 7% (Sparks & Schenk, 2006). Some of the growth in the industry is
due to the variety of products and services now being distributed by multilevel marketing
ENTREPRENEURIAL ENGAGEMENT 14
organizations, which include everything from household cleaners (Amway) to cosmetics (Avon)
to cookware (Pampered Chef).
While multilevel marketing organizations enjoy accolades for rapid growth in the direct
selling industry, they are also a favorite target among global critics, particularly regarding
independent distributors’ compensation structure. According to Nga and Mun (2011), multilevel
marketing is often associated with get-rich-quick, Ponzi, and pyramid schemes. Unlike
multilevel marketing organizations, pyramid scheme investors pay to join an organization with a
promise to recruit others but have no products or services to sell (Krige, 2011). The joining
investors pass a portion of the joining fee to others in higher tiers who recruited them, sending
their money upline. Once they meet a stipulated target, the investors recoup their initial joining
fee plus bonuses based upon how many people they recruit to join the organization. Once
recruitment drops, the pyramid schemes are no longer sustainable and fail. Multilevel marketing
organizations differ from pyramid or Ponzi schemes because the emphasis is on the sale of
products or services, as opposed to promising high returns based primarily on the recruitment of
distributors (Vander Nat & Keep, 2014).
According to Kuntze, many multilevel marketing organizations are now promoting the
business venture as a foray into entrepreneurship and an equalizer in providing opportunities for
people who might otherwise be barred (2001). Everyone has an opportunity to “become an
entrepreneurial tycoon without the extreme cost in time and capital of a more traditional route to
entrepreneurship (such as starting a business from scratch, inventing a product, or buying a
franchise or existing business)” (Kuntze, 2001, p. 4). It is this same zeal which critics, like
Kuntze, claim contributes to the failure of a new independent distributorship. According to
Martinez, there are many reasons for distributorship failures, including inflated income
ENTREPRENEURIAL ENGAGEMENT 15
expectations, investments, product claims, marketing plan and network growth (2006). In order
for multilevel marketing entrepreneurs to be successful and reach a high level of income, they
have to recruit many people in order to find those who are really interested in building the
business (Martinez, 2006).
Even though multilevel marketing organizations experienced a backlash in the past
several decades, many scholars now look at multilevel marketing organizations and their
potential positive impact on developing countries. According to A Career Success of the
Distributors in Multi-Level Marketing (MLM) Company, one of the best ways to solve
unemployment in Indonesia is through entrepreneurship (Siahaan, Lumbanraja, & Chairunisa,
2014). Multilevel marketing is an attractive option among Indonesian entrepreneurs because it
does not require a huge capital outlay and is less time intensive than other ventures (Siahaan et
al., 2014). It also allows entrepreneurs to achieve financial freedom. But, the other important
aspect of multilevel marketing organizations on developing countries is the element of social
good.
In 2010, Harvard Senior Lecturer Michael Chu and Harvard MBA graduate, Joel Segre,
queried whether it was conceivable to harness the multilevel marketing distribution system in
furtherance of social goals in developing countries (Chu & Segre, 2010). Chu and Segre (2010)
concluded that if traditional multilevel marketing products were exchanged for “health products,
superior seeds or more efficient water pumps, and distribution could be accomplished on a fully
commercial basis, the potential positive impact for society [was] clear” (p. 8). In 2015, Harvard
researchers Björkman-Nyqvist, Guariso, Svensson, and Yanagizawa-Drott, confirmed Chu and
Segre’s suspicions. Their study on LivingGoods concluded that multilevel marketing
organizations not only serve a significant element of social good, but also have an impact on
ENTREPRENEURIAL ENGAGEMENT 16
child mortality rates, deliver critical benefits like health and wellness products, and offer
sustainable food, water filtration systems, and solar lights to rural villages. Accordingly, an
understanding of what has an impact on survival rates and how to increase entrepreneurial
engagement of entrepreneurs in multilevel marketing organizations is not only warranted in a
commercial as well as a communal context, but may make the difference between life and death
in areas of the world that are not as accessible, like a rural, Ugandan village.
Importance of the Organizational Innovation
The recent global economic crisis makes the problem of entrepreneurial survival
important for organizations and countries to solve. According to the Global Entrepreneurship
Monitor, entrepreneurs are motivated to start a business either out of necessity because they have
no other options or because they recognize the benefits of owning their own business (Kelly,
Singer, & Harrington, 2011). Many academics focus on the positive aspects of entrepreneurship
including employment creation, increases in productivity, advances in living standards and
economic growth (McGrath, 1999). Indeed, there are many personal as well as societal benefits
of becoming a successful entrepreneur. However, according to McGrath, failure is the flip side
of this entrepreneurial coin. Failure can lead to personal shame and, because some level of
failure is inevitable, several expensive public policies were instituted to give resources to new
ventures to help them avoid failure (McGrath, 1999). Failing is difficult not only for the
entrepreneur, but for society as well.
Due to the high cost of failure, both professionally and personally, it is critical for H.
Enterprises to implement a comprehensive method for providing support and training in order to
keep its distributors engaged. If the distributors at H. Enterprises are not engaged with the
organization, they may quit. If they quit, the entire organization, upline and downline, will be
ENTREPRENEURIAL ENGAGEMENT 17
affected. In addition, customers may take their business elsewhere. Engagement ensures that H.
Enterprises knows what support and resources its distributors need to be successful. Without a
comprehensive method for training its distributors and ensuring they remain engaged, the
organization’s high distributor turnover rate will likely continue, which has a negative impact on
the organization’s ability to achieve its mission.
Organizational Performance Goal
H. Enterprises’ goal is that by December 2018, 100% of H. Enterprises’ first-year
distributors will implement best practices in their daily activities and be actively engaged in the
Vitality business. H. Enterprises established this goal in relation to the Vitality Global strategic
goal of doubling its revenue each year. The achievement of H. Enterprises’ goal will be
measured by revenue achievements, attendance at meetings, sponsorship of additional
distributors, and overall activity of its distributors by December 2018.
Stakeholders and Stakeholders’ Performance Goals
Many stakeholder groups will be affected through this innovation study. However, for
practical purposes, this study highlights three groups but focus on one group. First, there are
seasoned distributors within H. Enterprises who are chiefly responsible for achieving the revenue
goals of the organization. Generally, the seasoned distributors assume the role of educator,
mentor, coach, and trainer for any new distributors. Second, the Operations Team in H.
Enterprises is responsible for establishing training agendas, coordinating trainings, and ensuring
corporate compliance. Finally, the first-year distributors are the new recruits who help to build
the organization. Due to the high rate of distributor turnover, the number of new first-year
distributors grows every year.
ENTREPRENEURIAL ENGAGEMENT 18
Table 1
Organizational Mission, Global Goal and Stakeholder Performance Goals
Organizational Mission
The mission of Vitality Global is to enhance the health and wellness of people globally by
offering financial stability through an internet distributorship and wellness products based on
innovative technologies.
.
Organizational Performance Goal
By December 2018, 100% of H. Enterprises’ first-year distributors will implement best
practices in their daily activities and be actively engaged in the Vitality business.
Stakeholder 1 Goal
H. Enterprises’
Seasoned Distributors

By May 2017, seasoned
distributors in H. Enterprises
will train new distributors
based upon best practices
principles in a standardized
manner.
Stakeholder 2 Goal
H. Enterprises’
Operations Team

By October 2017, H.
Enterprises will create a
mechanism for measuring the
quarterly engagement of its
distributors from the time
they are sponsored to two
years after starting their
distributorship.
Stakeholder 3 Goal
H. Enterprises’
First-Year Distributors

By March 2018, 100% of H.
Enterprises’ 2018 distributors
will use H. Enterprises’ best
practices trainings to build
their Vitality business.

Stakeholder for the Study and Stakeholder Performance Gap
Even though there is one stakeholder of focus, all stakeholders will contribute to
achieving the overall organizational goal of integrating best practices into the daily activities of
100% of H. Enterprises’ first-year distributors. However, as H. Enterprises attempts to
standardize training for its distributors who are located in over 50 countries, it is important to
consider country-specific issues like language barriers and cultural implications. Accordingly,
the stakeholders of focus for this study are seasoned distributors in H. Enterprises who achieved
critical business milestones. The stakeholders’ goal, supported by H. Enterprises, is that by May
2017, seasoned distributors will train new distributors based upon best practices principles in a
ENTREPRENEURIAL ENGAGEMENT 19
standardized manner. The majority of new distributors quit within their first year because they
do not know how to build and grow their distributorship. Scanning interviews reveal that first-
year distributors have not implemented best practices in their daily activities because no
standardized practices currently exist. By December 2018, 100% of H. Enterprises’ first-year
distributors will implement best practices in their daily activities and be actively engaged in the
Vitality business. The gap in performance, therefore, is 100%.
Purpose of the Project and Questions
The purpose of this innovation study was to conduct a three-pronged needs analysis. The
analysis evaluated what knowledge and skills, motivation, and organizational resources are
required by the stakeholders to achieve the organizational performance goal. The analysis
commenced by generating a list of possible needs and subsequently, moved to examine those
needs in order to hone in on actual or validated needs. For practical purposes, this innovation
study primarily considered the needs of the group of seasoned distributors from H. Enterprises.
Two key inquiry questions served to guide the study:
1. What are the knowledge and skills, motivation, and organizational needs necessary for
seasoned distributors in H. Enterprises to train new distributors based upon best practices
principles in a standardized manner?
2. What are the recommended knowledge and skills, motivation, and organizational
solutions to those needs?
Methodological Framework
This study utilized the gap analysis by Clark and Estes (2008). Specifically, the gap
analysis is an analytical framework that measures the difference between an organization’s actual
performance level and the preferred performance level. First, a list of assumed needs for the
ENTREPRENEURIAL ENGAGEMENT 20
performance gap was generated through personal knowledge and related literature. These needs
were then validated through interviews, literature review, and content analysis. Finally, research-
based solutions were recommended along with a plan for implementation and evaluation.
Definitions
Best Practices: A business method that results in superior achievements that is used to
benchmark future performance (Best Practices, n.d.).
Developing Countries: Even though there is no uniform definition of this term, generally
countries with a low GNP per capita or low human development index are listed as developing
countries.
Direct Seller: A career-minded entrepreneur, building a part-time or full-time business, who is
engaged in selling products or services absent a fixed retail location (WFDSA, 2015).
Downline: The sponsored distributors. As independent distributors sponsor other distributors,
they typically earn a percentage of their sponsors’ sales. These sponsored distributors are called
the downline distributors.
Entrepreneurial Engagement: An attitude and commitment to the multilevel marketing
organization.
Microenterprise: A business with few, if any employees, that operates on a small scale. The
criteria for being considered a microenterprise varies by country (IFC, 2013).
Microentrepreneurs: Owners of microenterprises.
Multilevel Marketing: According to Vander Nat & Keep (2014), a method of compensation used
in direct selling organizations. Independent distributors earn commission for personal sales as
well as the sales commission of their sponsored distributors (downline).
ENTREPRENEURIAL ENGAGEMENT 21
Network Marketing: A business model wherein a direct selling distributor recruits other
distributors to become a member of the organization. Over 90% of organizations that engage in
network marketing also utilize the multilevel marketing compensation model (Network
Marketing, n.d.).
Preferred Customers: Multilevel marketing customers who receive a discount off retail price in
exchange for a commitment to purchase a specific number of products or services.
Seasoned Distributors: Veteran distributors in H. Enterprises who achieved a particular rank
within the organization. These distributors are responsible for training new distributors and
sharing best practices for achieving sustainability and growth.
Upline: Sponsoring distributors. Independent distributors who are recruited into a multilevel
marketing organization have a sponsor. The sponsor, along with independent distributors who
are in levels above the new independent distributor, are considered upline.
Organization of the Study
There are five chapters in this study. This chapter provided an overview of key concepts
and terminology commonly found in a discussion about multilevel marketing organizations and
entrepreneurship. In addition, this chapter introduced the reader to the organization’s mission,
goals and stakeholders as well as initial concepts regarding gap analysis. Chapter Two provides a
review of current literature surrounding the scope of this innovation study along with topics of
global entrepreneurship and factors associated with owning and operating a business. Moreover,
assumed needs for this study are also addressed. Chapter Three explains the methodology
guiding this study along with the rationale for selecting study participants, methods of data
collection as well as data analysis. In Chapter Four, the data and results are assessed and
analyzed. Finally, Chapter Five sets forth a comprehensive education and training solution to
ENTREPRENEURIAL ENGAGEMENT 22
address entrepreneurial engagement and persistence, which is based upon research, data and
literature, and includes recommendations for an implementation and evaluation plan.

ENTREPRENEURIAL ENGAGEMENT 23
CHAPTER TWO: REVIEW OF THE LITERATURE
The global financial crisis in 2008 made many people reexamine their employment
choices. When there were few jobs, people started to explore alternative careers and
entrepreneurial paths (Fairlie, 2013). Many people investigated traditional entrepreneurial
opportunities, like owning a franchise, but also began to explore careers in the direct selling
industry. In fact, the direct selling industry proved recession-proof with a 17% industry growth
rate (Wood, 2012). Even though the global economy appears to be bouncing back from its 2008
decline, entrepreneurs are not trading their direct selling lifestyle for a desk job (DSA, 2015).
Notwithstanding, many multilevel marketing entrepreneurs are still failing, with some companies
turning over 100% of their distributors annually. Thus, innovative education and training
strategies that enable multilevel marketing entrepreneurs to meet new business challenges are
critical to explore.
This chapter provides a brief history of the multilevel marketing industry, explores the
relationship between multilevel marketing organizations and entrepreneurship, illuminates
factors that have an impact on the success and failure of multilevel marketing organizations and
discusses the training resources available to independent distributors. Additional research on
entrepreneurial competencies is also presented. Finally, this chapter concludes with an overview
of the gap analysis framework as well as its application to independent distributor knowledge
and skills, motivation, and organizational factors that have an impact on the entrepreneurial
engagement of new multilevel marketing distributors.
Multilevel Marketing Organizations
In its simplest form, direct selling is face-to-face selling that occurs away from a fixed
retail establishment (Peterson & Wortruba, 1996). According to the WFDSA, in 2014,
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approximately $182 billion retail dollars in direct sales products and services was moved
globally (WFDSA, 2014). Significantly, the largest portion of revenue comes from the United
States with 19% market share, followed by China (17%), Japan (9%), Korea (9%), Brazil (7%),
Germany (5%), Mexico (4%), France (3%), Malaysia (3%), United Kingdom (3%), and Other
(22%). There are approximately 100 million independent distributors engaged in direct selling
worldwide (WFDSA, 2015).
The WFDSA defines a direct seller as a career-minded entrepreneur who is building his
or her own business or a part-time entrepreneur who is engaged in direct selling to make
supplemental income. Notably, almost 95% of all direct sellers are compensated through a
multilevel marketing structure (DSA, 2010). Multilevel Marketing, also referred to as network
marketing, is a method of direct selling in which independent distributors earn income from
personal sales and from sales by the distributors they sponsor and recruit, directly and indirectly
(Vander Nat & Keep, 2014).
Due to the complex nature of multilevel marketing compensation structures, it is difficult
to discern the average income of these independent distributors. However, according to a study
conducted by the Direct Selling Association (2014), the profiles of direct sellers in the United
States of America appear to be better than the average American. For example, with an
approximate cost of $106.40 to become an entrepreneur, 58% of entrepreneurs have a household
income over $50,000 as compared to the 52% average among all Americans (DSA, 2014). In
addition, entrepreneurs have higher educational attainment: 99% earned a high school degree
(versus the national average of 85%) and 52% are college graduates as compared to the 28% rate
nationwide (DSA, 2014).
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Multilevel marketing, is best understood as a type of compensation structure in the direct
selling industry. While all distributors engaged with multilevel marketing organizations are
direct sellers, what differentiates the groups is the requirement of multilevel marketing
distributors to create their own team. Multilevel marketing distributors earn commission on their
own sales revenue as well as the revenue generated by their team (downline).
History of Multilevel Marketing Organizations
Many scholars credit the evolution of multilevel marketing to Dr. Carl Rehnborg, who in
1939 founded the California vitamin company, which eventually became Nutrilite. According to
multiple sources, Dr. Rehnborg and two of his national distributors, Lee Mytinger and William
Casselberry, created a business structure where distributors in Nutrilite would purchase products
at a discount of 35% off retail price (Vander Nat & Keep, 2013). Distributors were then tasked
with selling these products at retail and recruiting additional independent distributors.
Under this new business strategy, performance-based compensation was used to drive the
recruiting distributors’ efforts. Mytinger and Casselberry performed well under this
compensation structure and Nutrilite sales increased to $500,000 per month. In 1948, the Food
and Drug Administration began to investigate Nutrilite for exaggerated product claims (Vander
Nat & Keep, 2013). Later, the Federal Trade Commission launched an investigation into
distributor contracts, when former Nutrilite distributors, Richard DeVos and Jay Van Andel,
used the same multilevel marketing structure to sell non-competing products for Amway
Corporation (Vander Nat & Keep, 2013). Even though Nutrilite experienced early legal troubles,
the multilevel marketing structure devised by Rehnborg survived and proved successful.
As multilevel marketing organizations gained traction, so too did the flurry of unpopular
press activity, government investigations, and negative academic research. Critics began linking
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multilevel marketing organizations to pyramid schemes. According to Vander Nat and Keep
(2013), a pyramid scheme is like a chain letter: “The original recruit moves up a compensation
pyramid as they bring in new recruits that, in turn, bring in recruits until the original recruit
reaches the top of the pyramid and maximum compensation” (p. 346).
Over the last few decades, several multilevel marketing organizations were adjudged to
be illegal pyramid schemes. According to Vander Nat and Keep (2013), Glenn W. Turner,
known for his “Dare to Be Great” motivational seminars and Koscot Interplanetary cosmetics
organizations, was one of the first to be prosecuted. The Koscot case produced the legal criteria
for differentiating between a legal and illegal organization. The Federal Trade Commission held,
In the Matter of Koscot Interplanetary, Inc., that illegal entrepreneurial chains require
participants to pay the organization for “(1) the right to sell a product and (2) the right to receive
in return for recruiting other participants into the program rewards which are unrelated to sale of
the product to ultimate users” (p. 1180). Since the Koscot case, subsequent government
investigations focused on ethical and legal questions regarding the operational aspects of
multilevel marketing organizations (Koehn, 2001).
Since multilevel marketing organizations rely on recruiting new distributors, distributors
in multilevel marketing organizations can turn to unethical, fraudulent, and ill-conceived
recruitment-centered tactics that morph the organization into a pyramid scheme (Koehn, 2001).
In order maintain its legitimacy, according to case law, multilevel marketing organizations must
do four things: (1) ensure distributor focus is on retail sales; (2) establish buy-back policies so
distributors are not stuck with excess product; (3) charge low up-front fees for the right to
become a distributor; and (4) make all sales-training-related purchases voluntary (Koehn, 2001).
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The political tide against direct selling organizations seems to be changing. Now,
researchers are looking to direct selling companies, and specifically, multilevel marketing
organizations, for guidance on how to expand to international markets. As Wood proclaims,
with billions of dollars in sales annually, this industry is not only significant because of its size,
but what it has been able to do in international markets (Wood, 2012). Unfortunately, however,
there are still organizations who engage in illegal practices and thus, the negative stigma
associated with the multilevel marketing industry remains.
Multi-Layered Entrepreneurship
As the multilevel marketing industry continues to evolve, its relationship to the many
facets of entrepreneurship becomes increasingly more important. Many people are attracted to
the idea of multilevel marketing. It requires no formal training, no prior experience, very little
start-up capital, and is a viable alternative when there are few employment options (Cahn, 2008).
In addition, multilevel marketing organizations tend to appeal to people with an entrepreneurial,
and perhaps, even an anti-corporate mindset. Moreover, in the face of shrinking economies, there
seems to be a place for multilevel marketing organizations in countries where people “seek to
alter their status” (Cahn, 2008, p. 446). Notably, there are several multilevel marketing
organizations that have over 1 million independent distributors, who are spread out all over the
world. These independent distributorships are individually owned companies and while they
may be legally restricted on certain branding and marketing fronts, they are often unrestricted in
how they legally conduct and grow their businesses.
According to Di-Masi, with the Global Development Research Center, there are many
definitions of entrepreneurship that can be found in the literature. However, the earliest
definition of entrepreneurship dates back to the 1700s and was used as an economic term to
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define the process of accepting the risk of buying goods at certain prices and selling at uncertain
prices (Di-Masi, n.d.). As times changed, the definition of entrepreneurship evolved to include
aspects of innovation in products, process, markets, and organizations. Current definitions of
entrepreneurship have come to mean the creation of new enterprises (Di-Masi, n.d.). As defined
by the online Business Dictionary, entrepreneurship is the “capacity and willingness to develop,
organize and manage a business venture along with any of its risks in order to make a profit. The
most obvious example of entrepreneurship is the starting of new businesses” (Entrepreneurship,
n.d., p. 1). Entrepreneurs play three significant roles: they diversify a country’s economy by
adding new businesses, they provide employment opportunities, and they increase national
output per capita (Just Jobs Network, 2014). All direct sellers are defined as full-time or part-
time entrepreneurs (WFDSA, 2014).
Notably, not all entrepreneurs generate significant revenue. In fact, global
entrepreneurship is on the rise through a new trend referred to as a microenterprise. According
to Frenkel, Schmidt, Neugebauer and Vogel (2015), microenterprises have the following
attributes: they are run primarily by one owner, the business generates a small revenue, the
owner and any employees live close to or below the poverty line, and the investment capital of
the business is less than $20,000. There are approximately 70 to 90 million formal
microenterprises worldwide, with the majority located in developing economies (International
Finance Corporation, 2013).
Multilevel marketing organizations are beginning to play a significant role in the
development of microenterprises worldwide. In Lipstick Evangelism: Avon trading circles and
gender empowerment in South Africa (2009), scholars Dolan and Scott examine the burgeoning
relationships between multilevel marketing organizations and women in developing countries.
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According to Dolan and Scott, the investment in women is the most direct path toward
improving a country’s health and wellness, both fiscally as well as socially.
Through their interviews with several female, South African, Avon entrepreneurs, Dolan
and Scott learned that most entrepreneurs made sales commissions of approximately $76.59 per
month. While this amount could not alleviate household poverty, the female entrepreneurs
explained that it did provide an additional financial cushion for their families. Moreover, for
these female entrepreneurs, the benefits of joining the multilevel marketing industry went
beyond the financial rewards. According to the South African women, Avon provided them with
a professional identity, helped to enhance their appearances, and facilitated the development of
vital entrepreneurial skills they can transfer to future employment or other business ventures.
The advantages of forging the relationship between a sustainable, international multilevel
marketing organization, like Avon, and women in developing economies includes enhanced
social benefits for women, immediate performance-based compensation and other financial
rewards (Dolan & Scott, 2009). Finally, the ability to leverage a platform, like Avon’s, allows
“women [to] capitalise on a sphere that is largely outside the purview and control of men [and]
may provide a promising, if modest, model for gender equitable poverty reduction in developing
countries” (p. 215). Accordingly, it appears that although microenterprises do not generate much
income, they are a significant part of the entrepreneurial landscape. Moreover, with additional
support and training, research studies show more business ventures can survive start-up
entrepreneurial hurdles.
Entrepreneurial Motivation in a Multilevel Marketing Organization
For the past several decades, scholars explored the reasons compelling people to become
entrepreneurs. In The Career Reasons of Nascent Entrepreneurs researchers Carter, Gartner,
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Shaver and Gatewood (2003) trace the historical underpinnings of entrepreneurship and highlight
the myriad of research efforts undertaken to try and explain entrepreneurial desires. The scholars
distilled the research into six categories: (1) innovation and novelty; (2) personal independence;
(3) status and recognition; (4) role models; (5) financial achievements; and (6) goal-centered
pursuits (Carter et al., 2003). While Carter’s list explains many entrepreneurial desires,
according to research, the list is not all-inclusive with respect to multilevel marketing
organizations.
In examining what attracts multilevel marketing distributors to join the industry, the
WFDSA (2015) distilled multilevel marketing distributors into seven categories of sellers:
wholesale/discount buyer, short-term salesperson, quality of life, careerist, social contacts,
recognition, and product beliefs. According to the WFDSA, the categories to which an
independent distributor can belong are not static; they can belong to more than one and can move
among categories.
Even though independent distributors in multilevel marketing organizations join as
salespeople with the intention of building a business, several distributors simply want to buy the
company products at a discount. These wholesale/discount buyer salespeople do not recruit
others to join their team and they do not sell the products. In fact, according to the WFDSA,
multilevel marketing organizations are beginning to recognize this category of salesperson and
are now changing their sales structures accordingly by including a category for preferred
customers.
The second category of salesperson recognized by the WFDSA is the short-term
salesperson who has specific goals. The short-term salesperson joins the organization to earn
supplemental income to meet a specific financial goal. For example, there are spikes of
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distributor enrollments a month or two before the holidays. The goal for these distributors is to
make enough supplemental income to pay for holiday gifts for friends and families.
The third category of salesperson, quality of life improvement, includes people who make
insufficient income to support their desired lifestyle. Often, one member of the family will work
with the multilevel marketing organization a few additional hours per week in order to make
supplemental income. These quality of life entrepreneurs work part-time in building their
multilevel marketing business venture.
The careerists occupy the fourth category of salespeople identified by the WFDSA.
Careerists include people who work in the multilevel marketing organization on a full-time basis.
According to the WFDSA, they are microentrepreneurs who partner with the organization to
build a small business. On a global level, less than 10% of independent distributors fall in this
category.
Social contacts, is the fifth category of salesperson, identified by the WFDSA.
Many multilevel marketing organizations now have global operations. In many countries,
women are often isolated, and as a result, join multilevel marketing organizations to increase
their network and develop additional social contacts.
The second to last category, recognition, exists to identify salespeople, usually women, in
multilevel marketing organizations who join the organizations for respect and acknowledgement
of their efforts. According to the WFDSA, this category is notable because in multilevel
marketing organizations, women earn the same amount as men and there are no restrictions on
what a woman can achieve. According to several scholars, multilevel marketing organizations,
in particular, encourage female participation and even serve as an “opportunistic response” to the
gender-fractured structure of post-industrial society (Busher, Bremner, & Muljono, 2009).
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Through flexible working hours and an increased ability to balance economic desires with family
obligations, multilevel marketing organizations create environments in which women can thrive.
The final category, product beliefs, includes salespeople with a strong belief in the
product benefits. These salespeople often join multilevel marketing organizations in order to
share the products with family and friends.
Even though the WFDSA groups all independent distributors into the category of
entrepreneurs, the motivation of independent distributors to join the multilevel marketing
organization dictates whether or not they can overcome start-up business challenges.
Accordingly, the impact of additional training and support is, therefore, unknown.
Specifically, the first two categories identified by the WFDSA, wholesale/discount buyer
and short-term salesperson, include salespeople who do not intend to build a long, sustainable
business venture. Thus, additional support, in the form of education and training, is likely
inconsequential. However, the other five categories of salespeople may benefit from additional
training and support.
In the context of a technology-driven, largely virtual global industry, the discussion of
entrepreneurial motivation is critical. Multilevel marketing organizations offer distributors
simplicity, independence, and low start-up costs, which make it an accessible business and career
opportunity for people who might otherwise be excluded (Cahn, 2008). Thus, the barrier to
entering the multilevel marketing industry is low. As a result, motivation becomes a key driver
in multilevel marketing distributor success. In order to succeed, distributors must learn from
experienced multilevel marketing distributors, engage with their sponsoring distributors, spend at
least a month training and educating their downline team members, utilize technology and
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follow-up with prospective clients and distributors, hire financial and accounting professionals,
and remain employed until they stabilize their distributor income (Smith, 2005).
Entrepreneurship Challenges
As countries around the globe began to examine the impact of the global economic crisis,
it became incumbent upon governments to develop creative ways for citizens to prosper
regardless of the economy. In Indonesia, for example, in 2012, the total unemployment reached
over 7.2 million people, representing 6.1% of the total labor force (World Bank, 2015). In
examining what to do, the Indonesian government decided that a suitable alternative was to
encourage entrepreneurial activity through the National Entrepreneurship Movement which
provided more access to funds and support for women entrepreneurs (Gentile, 2014). According
to Siahaan et al. (2014) multilevel marketing ventures served as a strong entrepreneurial
alternative in Indonesia because they require a low up-front investment and do not have a time-
constraint.
Even though the Indonesian government serves as an example of government support of
new entrepreneurial activity, the raw reality is that most new businesses fail within 5 years (U.S.
Department of Labor, 2010). Even if a new business manages to survive the five-year hurdle, it
may be unable to achieve a profit. Thus, while multilevel marketing is a viable alternative for
new entrepreneurs, it is critical to examine why these new entrepreneurs fail.
Richard Osborne, in Why Entrepreneurs Fail highlights as a key reason for
entrepreneurial failure the unrealistic belief that the entrepreneur can overcome fundamental
limitations of the business venture. In a footnote, Osborne acknowledges other significant
reasons for entrepreneurial failure, including competitor retaliation, an unstable industry, loss of
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a vital customer, closing distribution channels, technology swings, market fluctuations,
undercapitalization, over-dependence on current management, and family challenges (p. 4).
There are many additional reasons why entrepreneurs in multilevel marketing
organizations fail. Just like any business venture, being an entrepreneur takes time and effort.
Moreover, many multilevel marketing entrepreneurs are recruited into the venture with unlikely
income expectations, exaggerated product claims, unrealistic marketing and network growth
plans, and an inflated ability to sponsor numerous distributors (Martinez, 2006). In addition,
given the structure of a multilevel marketing organization, the training of new distributors falls
squarely on the shoulders of the recruiting distributor. Thus, given the numbers of independent
distributors in a multilevel marketing organization, “ensuring that adequate standards are
maintained across every encounter with a new distributor is likely to be problematic” (Msweli &
Sargent, 2001, p. 510). The ability to adequately train new distributors has a significant impact
on distributor retention as well as the ability of distributors to maintain strong relationships with
their customers.
Entrepreneurial Competencies and Education
While many scholars focus on the reasons for entrepreneurial failure, recent scholars note
that too much attention was paid to the relationship between inadequate financial resources and
entrepreneurial failures. Inyang and Enuoh (2009), contend greater focus should be paid to
entrepreneurial competencies as the impairment to successful entrepreneurship. In looking at
what is required of an entrepreneur, it is important to consider the concept of competencies.
Simply, competencies constitute the combination of skills, knowledge, and attitudes that a person
uses to “produce outstanding performance in any given area of responsibility” (Inyang & Enuoh,
2009, p. 65).
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In the context of entrepreneurs, such competencies include the combination of
knowledge, skills, and attitudes an entrepreneur acquires through training and development that
enable the entrepreneur to produce outstanding performance while maximizing profit during the
management of a business venture (Inyang & Enuoh, 2009). Notably, high productivity can be
obtained in a small enterprise, like multilevel marketing distributorships, through alternative
approaches that explore motivation, organizational communication, and training and
development (Inyang & Enuoh, 2009). Thus, a renewed emphasis and exploration of
entrepreneurial competencies can help multilevel marketing entrepreneurs achieve success.
There is a growing debate among scholars with respect to whether entrepreneurs are born
or made (Henry, Hill & Leitch, 2005). This, of course, has an impact on whether or not
entrepreneurship education and training can have a positive impact on the business outcomes of
new entrepreneurs. According to scholars Hisrich and Peters (as cited in Henry et al., 2005),
entrepreneurs must have technical, business management, and entrepreneurial skills. Technical
skills include communication, oral and written, as well as organizational skills. Business
management skills encompass strategic operational skills required to run a successful business.
Finally, personal entrepreneurial skills harness a person’s risk-taking and innovation skills.
Even though entrepreneurship education and training is receiving recent scholarly
attention, in 1984, Ian Jamieson suggested there should be three categories of education devoted
to entrepreneurs including education about enterprise, education for enterprise, and education in
enterprise (as cited in Henry et al., 2005). According to Jamieson, education about enterprise
encompasses “awareness creation” and should be designed to teach entrepreneurs about the
operational aspects of running a business. Education for enterprise deals with preparing
entrepreneurs for the challenges of self-employment. The final category, education in enterprise,
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handles management training, marketing courses, and all of the personal skills required by
entrepreneurs to overcome business challenges and plan for growth (as cited in Henry et al.,
2005). After tracing various historical perspectives about entrepreneurship education and
training, through their research, Henry, Hill and Leitch (2005) concluded that although there is
wide discrepancy with respect to what is taught in entrepreneurship education, the science of
entrepreneurship, like business and operational skills, can be taught much more easily than the
creative facets, like the skills to innovate, that encompass the art of entrepreneurship.
In order to be successful, distributors in multilevel marketing organizations must develop
the necessary entrepreneurial competencies required to succeed and run a profitable business.
Multilevel marketing distributors must also be mindful of the negative stigma associated with the
industry and have high levels of motivation to overcome various entrepreneurial challenges.
While much is required of multilevel marketing entrepreneurs, the role of multilevel marketing
organizations should not be minimized. Multilevel marketing organizations must provide
effective training to their distributors that incorporates the organization’s compensation plan,
sales training, product training, and how to obtain and retain customers (Aggarwal & Kumar,
2014). Without the support of multilevel marketing organizations, many independent
distributors will fail. The next section explores an analytical framework for how to address
entrepreneurial engagement in the context of knowledge and skills, motivation, and
organizational factors.
Methodological Framework
In the context of this innovation study, the Clark and Estes (2008) gap analysis
framework was used to assess the gap between the current and desired organizational
performance level. This framework is particularly useful for analyzing organizational needs
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through the lens of three assets: knowledge and skills, motivation, and organizational
competencies. Through this study, the gap analysis revealed knowledge and skills, motivation
and organizational needs that have an impact on the entrepreneurial engagement of multilevel
marketing distributors.
Notably, while the Clark and Estes (2008) gap analysis was primarily developed to
analyze the deficits in performance within organizations, many industries adopted this
framework and used it to identify performance gaps in education, government functions, and
volunteer organizations. The analysis begins with setting measurable organizational
performance goals. Once the organizational goal is set and in place, it is important to ensure
stakeholder alignment.
The second step in the Clark and Estes analytical process is to analyze the gap between
the organizational performance goal and the desired performance level. This gap is expressed in
a numerical format. With respect to innovation studies, like this one, the gap is expressed as a
100% deficit because the organizational goal identified what does not yet exist and the desired
performance is the implementation of the innovation.
The third step in the process is to identify the cause for the gaps in organizational
performance. What makes this process unique is its deliberate and research-based approach to
analyzing the root causes for the performance gaps, before identifying and implementing
possible solutions. Based upon their research, Clark and Estes (2008) identify three main causes
for performance deficits which stem from gaps in knowledge and motivation as well as
organizational barriers. In the context of this innovation study, these three potential causes are
referred to as needs.
ENTREPRENEURIAL ENGAGEMENT 38
With respect to the knowledge component of the study, an organization must identify
whether people have the information sufficient to achieve the organizational goal (Clark & Estes,
2008). If the employees do not have the information or skills necessary to achieve the
organizational goal, it simply cannot be achieved.
Unlike the knowledge analysis, the motivational analysis can be convoluted because it is
based on a psychological process, which is, of course, internal (Clark & Estes, 2008).
Motivation, in this case, looks at whether employees choose to work toward a goal, the process it
takes for them to continue working toward the goal, and the requisite mental effort put forth to
achieve the goal (Clark & Estes, 2008). Put more simply, motivation is essentially whether
employees choose to do something, continue doing it until it’s done, and how much mental effort
they expend to get it done. According to Clark and Estes, a gap in motivation is often the root
cause for gaps in organizational performance (2008).
The third root cause for performance gaps are barriers within an organization. These
barriers typically refer to inadequate organizational processes or resources. In considering
organizational barriers, it is also critical to look at and develop the “cultural profile” of the
organization (Clark & Estes, 2008). A supportive organizational culture is critical to the
achievement of organizational goals. For example, in a primarily virtual organization, like this
one, trust is a key aspect of the virtual culture, and as such, any virtual team will require
coordinated support efforts to achieve organizational goals (Clark & Estes, 2008). The gap
analysis framework is depicted in Figure 1.
ENTREPRENEURIAL ENGAGEMENT 39

Figure 1. The gap analysis framework adapted from Clark and Estes (2008)
Assumed Performance Needs
According to Clark and Estes (2008), gap analysis “diagnoses the human causes behind
performance gaps” (p. 21). In many cases, people assume, without conducting the appropriate
analysis, the needs required to solve a particular performance problem. In order to avoid this, a
complete analysis of a performance problem should include the following: (a) scanning
interviews with key stakeholders; (b) an analysis of learning, motivation, and
organization/culture theory; and (c) a detailed review of related literature on entrepreneurial
engagement. The following section addresses the assumed needs related to knowledge and
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skills, motivation, and organizational resources with respect to entrepreneurial engagement at H.
Enterprises.
Preliminary Scanning Data
Knowledge and skills. An entrepreneurial pursuit can be daunting. Today, it is
becoming increasingly more important for entrepreneurs, in particular, to acquire the knowledge
and skills necessary to compete in the global economy (Jusoh, Ziyae, Asimiran, & Kadir, 2011).
At H. Enterprises, many independent distributors do not have the foundational business
knowledge required to own and operate a business. For example, many independent distributors
do not have a thorough understanding of the sales process, client retention techniques, customer
service, accounting, operations, and recruitment. In order to be successful, the independent
distributors at H. Enterprises must understand these entrepreneurial concepts. In addition, in
order to operate their own distributorship, the independent distributors must have sufficient
knowledge of their country-specific legal issues as well as the company products.
According to Jusoh et al. (2008), in order to compete on a global scale, entrepreneurs
need to enhance their skills and knowledge, which will, ultimately, have an impact on their
ability to thrive. In H. Enterprises, scanning interviews reveal a lack of entrepreneurial and
leadership training. Entrepreneurial training could mean the difference between a successful or
unsuccessful business venture (Jusoh et al., 2008).
Motivation. Entrepreneurs need knowledge and skills to achieve success. However,
entrepreneurs also need a combination of the right attitude, which will enable them to continue
learning and evolving in the business space, along with the ability to take appropriate risks in
conducting their entrepreneurial activities (Jusoh et al., 2008). In this case, scanning interviews
reveal that independent distributors become overwhelmed with the operational aspects of the
ENTREPRENEURIAL ENGAGEMENT 41
business. Moreover, independent distributors also face a lot of rejection from clients as well as
business partners and as a result, three out of four distributors end up quitting the business.
While many distributors attend corporate and regional trainings, once they return to their
business routine, they do not implement what they learned because it is difficult and requires
effort.
Organization. Due to the global nature of H. Enterprises, several independent
distributors have goals that do not necessarily align with the corporate organization, and thus,
deviate from corporate policies and procedures. For example, several distributors create
independent trainings to teach their downlines about operating a successful distributorship. The
diversity of training methods creates several challenges. First, based upon a review of the
available trainings, it does not appear there is enough of an emphasis placed on the relationship
between these trainings and business performance (Walker, Redmond, Webster & Le Clus,
2007). In order for the distributor to utilize what they learned from the training, its relevance to
business performance and daily operations should be emphasized (Walker et al., 2007).
Moreover, it appears the focus of independent distributor trainings is not necessarily
aligned with the trainings delivered by corporate headquarters. Corporate trainings generally
provide an overview of products and company policies. However, independent distributor
trainings focus on recruitment, sales, compensation plans, and country expansion, among others.
Based upon informal interviews, new distributors tend to focus on one training group. Thus, if
they get plugged in to the corporate trainings, they do not view the trainings delivered by their
uplines. As a result, many distributors participate in ad hoc training, delivered in multiple styles
and languages, throughout the world. Moreover, even though Vitality Global adds several new
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distributors each month, there is a high rate of independent distributor turnover, and as a result, it
is difficult to achieve any level of organizational cohesion.
Learning and Motivation Theory
In order to achieve an organizational performance goal, it is important to have a solid
understanding of learning, motivation, and organizational issues that can have an impact on
desired performance. With respect to learning, in this case, it is critical to identify what
independent distributors should know, analyze how they learn most effectively, and understand
the methods that are most valuable to help them learn (Rueda, 2011). But, in order to achieve
this, the independent distributors must also have the requisite motivation to achieve the
performance goal, in particular, the active choice, persistence, and mental effort. Moreover, in
the context of organizational performance, even when independent distributors have the
knowledge and motivation to achieve learning goals, the structures and policies of organizations
can be an impediment to achieving those goals (Rueda, 2011). Accordingly, in the context of this
innovation study, in order to achieve organizational performance goals, it is important to analyze
the knowledge and skills, motivation and organizational needs of seasoned distributors, which
are addressed in the sections below.
Knowledge and skills. Knowledge can be divided into four categories: factual
knowledge, conceptual knowledge, procedural knowledge, and metacognitive knowledge
(Anderson & Krathwohl, 2001). Factual knowledge encompasses knowledge of details and
elements whereas conceptual knowledge focuses on knowledge of theories and principles.
Procedural knowledge, on the other hand, delves into subject-specific techniques and skills.
Finally, metacognitive knowledge hones in on knowledge of one’s cognitive processes, or self-
knowledge. In this study, each category of knowledge plays a role in whether the performance
ENTREPRENEURIAL ENGAGEMENT 43
goals of the organization can be achieved. Specifically, seasoned distributors need the factual,
conceptual, procedural, and metacognitive knowledge to train new distributors based upon best
practices principles in a standardized manner.
As entrepreneurs, independent distributors in multilevel marketing organizations must not
only have the requisite product knowledge but also hard and soft skills to be more customer-
focused (Nga & Mun, 2011). Thus, while factual knowledge encompasses what seasoned
distributors know with respect to new distributor entrepreneurial engagement and product
knowledge, there are also conceptual, procedural, and metacognitive knowledge needs.
Conceptually, it is important for seasoned distributors to be able to distinguish among new
distributors who need support. Scholars advocate sharing among multilevel marketing
distributors to enhance tacit knowledge, how to handle rejections, and practical awareness (Nga
& Mun, 2011). On a procedural level, seasoned distributors need to know what steps they must
take in order to differentiate among new distributors in order to provide maximum support. The
ability of seasoned distributors to support new distributors has a positive impact on motivation
which results in a positive effect on multilevel marketing organizational outcomes (Nga & Mun,
2011). Finally, on a metacognitive level, seasoned distributors need to know how to reflect on
their own effectiveness as trainers for new distributors.
Knowledge needs are a critical driver in multilevel marketing organizational
performance. In fact, according to Nga and Mun (2011), the ability of distributors to
communicate critical information has an impact on the success or failure of distributors, and
should therefore, be formally taught in graduate business schools or offered in a professional
certification course for multilevel marketing distributors.
ENTREPRENEURIAL ENGAGEMENT 44
Motivation. According to Schunk, Pintrich, and Meece (2009) there are three common
threads to organizational performance problems involving motivation: active choice, persistence,
and mental effort. Active choice is characterized by a person actively pursuing a goal.
Persistence is the continual movement toward the goal. Finally, mental effort is the hard work
that must accompany choice and persistence in achieving the goal.
Motivational needs in the context of multilevel marketing organizations are particularly
complex due to the business structure of a multilevel marketing organization. In a multilevel
marketing organization, there exists no true “hierarchal leader-subordinate” structure (Sparks &
Schenk, 2001). In fact, a distributor who sponsors a new distributor is at the same time both a
sponsor and a recruit, since the sponsoring distributor was previously introduced to the
organization through another distributor (Sparks & Schenk, 2001). As such, seasoned
distributors cannot “promote, discipline, or dismiss recruits; they cannot alter recruits’
compensation; they cannot direct recruits’ daily work activities” (Sparks & Schenk, 2001, p.
851). Seasoned distributors are limited, therefore, in the type of leadership style they must
employ in order to ensure the maximum level of entrepreneurial engagement of the distributors
they sponsor. Thus, it is critical to understand the motivational needs of seasoned distributors as
they train new distributors.
According to the literature, seasoned distributors train new distributors for two main
reasons: seasoned distributors receive significant financial incentives for recruiting new
distributors and many distributors associate their multilevel marketing participation with a
“higher order value” that extends beyond pecuniary gains (Sparks & Schenk, 2001). Such higher
order values may include a strong belief in product benefits, strengthening of family cohesion
ENTREPRENEURIAL ENGAGEMENT 45
since most distributors work from home, and on a global level, the benefits to women of owning
their own business and becoming an entrepreneur.
Seasoned distributors need to see the utility value in developing training for new
distributors, set goals related to developing the training, have a high level of interest in training
new distributors, and they need to develop self-efficacy with respect to developing,
implementing, and conducting training for new distributors. Understanding what motivates
seasoned distributors to train new distributors at H. Enterprises would inform business practices
and strategies for organizational growth.
Organization. Even if the knowledge and motivation are adequate to achieve the desired
performance goal, the organizational factors must also support the achievement of the goal.
Organizations are characterized by cultural models and cultural settings. Cultural models
represent the “normative understandings” of how organizations perform or should perform
(Rueda, 2011). Cultural settings, on the other hand, are the social constructs in which the
organization operates (i.e., where specific behavior is enacted). With respect to the cultural
model, seasoned distributors need to be open-minded to learning new training-related skills.
Moreover, seasoned distributors also need to value the development of trainings in order to
achieve the performance goal of training new distributors based upon best practices principles in
a standardized manner. It is equally important to address the cultural setting in this context.
Seasoned distributors need to set aside time from running their own businesses to train new
distributors. In addition, seasoned distributors also need role models within the organization
who prioritized training new distributors to have a positive impact on their entrepreneurial
engagement and knowledge of company products.

ENTREPRENEURIAL ENGAGEMENT 46
Conclusion
The global financial crisis provided countries and their citizens with an unprecedented
opportunity to explore other employment alternatives. Even though the multilevel marketing
industry suffered through a period of high profile legal entanglements, negative community
perceptions, and government investigations, it emerged in the economic downturn as a viable,
recession-proof, entrepreneurial business opportunity. In fact, recent research reveals the variety
of benefits brought to the world stage via multilevel marketing: societal benefits of supplying
developing countries with necessary products and services, financial benefits of supplemental or
full-time income opportunities to aspiring entrepreneurs and the countries in which they operate,
and personal benefits to the independent distributors who are expanding their global networks as
they embark on a flexible, female-friendly, global business opportunity.
The relevant literature uncovers the significant opportunities that exist to support budding
multilevel marketing entrepreneurs, in particular, the training and education they need to
overcome start-up business challenges. Only the future will reveal whether such training and
education can have a positive impact on the high turnover rates experienced by multilevel
marketing organizations during a distributor’s first year in business. The Clark and Estes (2008)
gap analysis model was used, in this study, to identify independent distributor needs with respect
to knowledge and skills, motivation and organizational resources, in order to develop a
comprehensive training and education solution to address this issue of entrepreneurial
engagement. Chapter Three describes the methodology used in this innovation study. Chapter
Four shares the data and analyzes the results. Finally, Chapter Five identifies a comprehensive
training and education solution and proposes a recommendation for implementation and
evaluation.
ENTREPRENEURIAL ENGAGEMENT 47
CHAPTER THREE: METHODOLOGY
The purpose of this innovation study was to conduct a needs analysis in the areas of
knowledge and skills, motivation, and organizational resources that have an impact on the
organizational performance of seasoned distributors in H. Enterprises. The questions that serve
as the guide for this study are as follows:
1. What are the knowledge and skills, motivation, and organizational needs necessary for
seasoned distributors in H. Enterprises to train new distributors based upon best practices
principles in a standardized manner?
2. What are the recommended knowledge and skills, motivation, and organizational
solutions to those needs?
Participating Stakeholders
Since the aim of this innovation study was to examine the needs required for seasoned
distributors in H. Enterprises to train new distributors based upon best practices principles in a
standardized manner, the unit of analysis is the seasoned distributors. However, due to the
enormity of H. Enterprises, with several hundred thousand distributors throughout the world, the
sample for this study includes distributors who achieved the corporate ranking of Bronze and
above.
In H. Enterprises, there are more than a dozen ranks of distributors. Once a distributor is
sponsored and purchases a mandatory starter kit, the distributor receives the title and rank of
New Member. As a New Member, the compensation plan is limited. The second level is
Associate Member. The only requirements to achieve the rank of an Associate Member include
purchasing a mandatory starter kit and conducting a minimal level of personal volume, which is
ENTREPRENEURIAL ENGAGEMENT 48
less than $200. An Associate Member may achieve the personal volume requirement by
purchasing products or acquiring clients.
The third level, Full Member, requires a distributor to personally enroll two distributors
(one on each leg) who purchase approximately $200 within the first month. This volume is
typically achieved when the distributor enrolls in an auto-shipment of monthly product. Since
Vitality has a binary compensation structure, it has two legs. As distributors are sponsored, the
sponsoring distributor must build up each leg in order to advance to the next rank. As a Full
Member, the sponsoring distributor begins to earn team commissions from the volume achieved
by their downline. Each time a distributor’s legs produce a certain level of revenue, the system
automatically triggers a commission check. One leg must produce a minimum of 1/3 of the total
volume in the month to trigger the commission. Thus, each distributor leg must remain active in
order to earn team commissions. The fourth level, Professional, requires a distributor to
personally enroll four Full Members (minimum of one in each leg) or eight distributors
(minimum of three in each leg). At this level, a distributor begins to earn a bonus on its first
level distributors. For example, if Hal sponsors Mary who sponsors Trent, Hal’s first level is
Mary. Hal’s second level is Trent. As a Professional, Hal may now earn a matching bonus of
20% on Mary’s efforts. Thus, if Mary makes $100 in commission from selling Vitality products,
Hal will also receive a check for $20. The binary compensation structure in a multilevel
marketing organization is depicted in Figure 2.
ENTREPRENEURIAL ENGAGEMENT 49

Figure 2. Binary Compensation Structure in A Multilevel Marketing Organization
The fifth level, Full Professional, requires eight personally enrolled Full Members
(minimum of two per leg) or 12 Associate Members (minimum of three per leg). At this level, a
distributor may continue to earn team commissions, the first level bonus of 20% and a second
level bonus of 10% on downline distributor efforts. The sixth level, Executive, requires the
distributor to personally enroll 12 Full Members (minimum of three per leg). As an Executive,
distributors may now earn a 10% bonus on third level distributor efforts. The seventh level,
Executive Plus, requires the distributor to have at least one Executive-ranked distributor on a leg
and a high level of team commissions in the preceding month. In team commissions alone, this
means the Executive Plus distributor would receive significant compensation, not including the
matching bonuses of first, second, and third level commissions on downline distributor efforts.
This ranking receives special recognition at corporate events.
The eighth level, Bronze, requires a distributor to have two Executive Plus legs and
double the team commissions of the Executive Plus level in the preceding month. Bronze
distributors receive a 5% match on fourth level distributor efforts. If a distributor achieves a
Bronze ranking, it means they surpassed significant revenue goals, are leading a global
organization, and are actively engaged in the growth of the business.
ENTREPRENEURIAL ENGAGEMENT 50
The current, highest ranking distributor in the corporate organization is a Double
Platinum Director. From Bronze, a distributor must achieve the ranking of Silver, Gold, and
Platinum before achieving the Double Platinum ranking. As a Double Platinum, the distributor
must have four different Gold legs, millions of commissionable volume in one calendar month,
and maintain the rank for two consecutive months with no more than 25 percent coming from
any line of sponsorship. The distributor must also have over 10,000 sponsored distributors on
successful auto-shipments. As a Double Platinum, the distributor earns team commissions,
seven levels of matching bonuses, a six-figure bonus as well as a share of company profits.
Figure 3 depicts distributor levels in H. Enterprises.

Figure 3. Distributor levels in H. Enterprises
In this study, any distributor ranked Bronze and above (Bronze Plus) is the focus of the
study for the following reasons: (1) the Bronze Plus are considered part of the senior leadership
in H. Enterprises; (2) the Bronze Plus are a large enough group, which ensures anonymity; (3)
the Bronze Plus are largely responsible for delivering and coordinating training for distributors;
Double Platinum
Platinum
Gold
Silver
Bronze
Executive Plus
Executive
Full Professional
Professional
Full Member
Associate Member
New Member
ENTREPRENEURIAL ENGAGEMENT 51
and (4) the Bronze Plus are responsible for mentoring and coaching distributors and therefore,
they are in the best position to ensure the best practices solutions and recommendations are
implemented in the field with new distributors.
To ensure anonymity, any identifying information regarding the corporate entity, the
distributors, and proprietary organizational processes were altered. All names are pseudonyms
and many details were redacted to protect the privacy rights of the organization and participants.
The seasoned distributors, and in this case, the Bronze Plus of H. Enterprises were selected as the
core population because the founder of H. Enterprises mentors, coaches, and educates, on a daily
basis, the top-producing distributors in her organization throughout the world. Thus, with the
frequency of contact, this population provided the best access to the researcher. There are
several hundred distributors in the category of Bronze Plus. Accordingly, in order to gain a
global perspective, the researcher relied on the founding distributor for guidance and access to
the interview participants.
Data Collection
Prior to commencing the data collection for this study, permission from the Institutional
Review Board at the University of Southern California was obtained. In order to validate
assumptions related to knowledge and skills, motivation, and organizational needs, in-person
interviews were conducted. Since this is a novel study, the existing literature served as a guide
in collecting data, but to better assess the current needs, all instruments, protocols, and questions
used to guide the data collection were unique. Indeed, confidentiality of the participants was
paramount. Therefore, all participants were given pseudonyms to ensure maximum privacy and
confidentiality. The interview method of data collection is discussed in detail in the following
section.
ENTREPRENEURIAL ENGAGEMENT 52
Interviews
The interview participants live all over the world, and thus, all interviews were conducted
via Skype. Approximately 15 participants were reached, and 12 participants agreed to be
interviewed. Each interview consisted of approximately 20 questions and lasted one hour. Each
interview was conducted in English. However, since English was a second language for some of
the participants, each interview varied in length, and some interviews required a translator. Each
interview commenced with an interview protocol that informed the participants of the interview
procedure and obtained participant permission to record the interview for future transcription and
coding. All interview participants orally agreed to proceed with their interview after the
procedure and protocol were read. Please refer to Appendix B for the interview protocol.
All interview participants were selected based upon longevity and rank in the
organization. In order to be interviewed, each seasoned distributor must be with H. Enterprises
for at least one year. It was the goal of this study to determine the knowledge and skills,
motivation, and organizational needs of seasoned distributors and thus, longevity in the
organization was a critical component. In addition, only the seasoned distributors ranked Bronze
or above were considered for an interview. To achieve the rank of Bronze, the seasoned
distributor must meet a financial threshold and as such, the seasoned distributor had a significant
downline. Since this number changes every month, it is difficult to estimate the size of this
participant pool. Even so, estimates suggest there are several hundred participants in this
category. Thus, there was a sufficient number of qualified participants for the interviews. An
informal request was sent to the founder to seek her guidance and support in connecting the
researcher to interview participants in order to achieve a global sample. Only those who
indicated a willingness to participate were considered.
ENTREPRENEURIAL ENGAGEMENT 53
Other Data Collection Methods Considered
During the preliminary phase of this study, several additional data collection methods
were considered including document analysis, observation, and focus groups. After careful
consideration, and upon discussions with the co-founder, the researcher concluded that document
analysis would be difficult due to the foreseeable language barriers and proprietary nature of the
documents. Moreover, the co-founder also discouraged observation as a method of data
collection due to the compacted, and often erratic schedules of the seasoned distributors. Finally,
focus groups were similarly discarded as a potential method of data collection due to scheduling
challenges and foreseeable language and cultural barriers.
Validation of the Performance Needs
In the remaining sections of Chapter Three, the strategies for validating assumed needs
are described. Specifically, the analysis includes: knowledge and skills, motivation and
organizational needs of seasoned distributors in H. Enterprises to train new distributors based
upon best practices principles in a standardized manner.
Validation of Performance Needs: Knowledge
Factual, conceptual, procedural and metacognitive knowledge needs validation. In
order to assess all knowledge needs, 12 seasoned distributors were asked interview questions.
The first set of interview questions assessed factual knowledge about entrepreneurial
engagement and company products. Next, the interview questions addressed conceptual
knowledge about how seasoned distributors differentiate between new distributors who need
help and those who do not need assistance. Finally, the interview questions assessed procedural
knowledge regarding how seasoned distributors evaluate the knowledge of new distributors, and
ENTREPRENEURIAL ENGAGEMENT 54
subsequently, metacognitive knowledge with respect to how seasoned distributors monitor and
evaluate their own effectiveness as trainers for new distributors.
Validation of Performance Needs: Motivation
Motivation needs validation. In order to validate several aspects of motivation, 12
seasoned distributors were asked several interview questions. The focus of the interview
questions honed in on needs regarding value, goals, affect, and self-efficacy.
Validation of Performance Needs: Organization/Culture/Context
Organizational needs validation. The assumed organizational needs for the
performance gap at H. Enterprises included an examination of culture and setting. In this case,
seasoned distributors at H. Enterprises need to remain open-minded to change, value training for
new distributors, ensure they set aside the appropriate amount of time to conduct trainings for
new distributors, establish role models within the organization, develop a communication plan
regarding new distributor training, and foster a culture of mutual trust. In order to validate these
needs, 12 seasoned distributors were asked several interview questions.
For ease and reference, Table 2 depicts the ways in which assumed needs were generated,
paying particular attention to preliminary scanning data, learning and motivation theory, and
related literature.
Table 2
Summary of Assumed Needs and Sources
Sources Knowledge Motivation Organization
Preliminary
Scanning Data
(informal knowledge
about the
organization)
 Need the
foundational
business knowledge
required to own and
operate a business.
 Need a thorough
understanding of the
 Need to value
strategies they learn
at training and
apply them in their
practice.
 Need to be resilient
in the face of
 Need goals to align
with the corporate
organization.
 Need the focus of
trainings to align
with corporate
trainings.
ENTREPRENEURIAL ENGAGEMENT 55
sales process, client
retention techniques,
customer service,
accounting,
operations, and
recruitment.
 Need sufficient
knowledge of
country-specific
legal issues as well
as company
products.
rejection from
clients and business
partners.

 Need organizational
cohesion to remain
engaged.

Learning and
Motivation Theory

 Need to know what
the new/incoming
distributors know
about entrepreneurial
engagement. (F)
 Need to know what
the new/incoming
distributors know
about company
products. (F)
 Need to distinguish
levels of assistance
required by new
distributors. (C)
 Need the procedural
knowledge required
to perform the new
distributor training.
(P)
 Need to know how
to reflect on their
own effectiveness as
trainers for new
distributors. (M)

 Need to see value
in developing,
implementing, and
conducting training
for new/incoming
distributors.
 Need to set goals
related to
developing,
implementing, and
conducting training
for new distributors
in entrepreneurial
engagement and
company products.
 Need to have a high
level of interest in
training new
distributors.
 Need to know they
are capable of
developing,
implementing, and
conducting training
for new
distributors.
 Need to be
adaptable and open-
minded to learning
new skills in order
to maximize
performance.
 Need to value the
development of
trainings which will
increase
entrepreneurial
engagement.
 Need to set aside
time from running
their own
businesses to train
new distributors.
 Need to have role
models within the
organization who
have prioritized the
training of new
distributors.
 Need to develop a
communication
plan regarding the
standardized
training of new
distributors.
 Need to foster a
culture of mutual
trust where
distributors feel
valued.

Related Literature

 Need to enhance
skills and knowledge
in order to survive
 Need to have a high
interest in
continuing to learn
 Need to emphasize
the relationship
between trainings
ENTREPRENEURIAL ENGAGEMENT 56
(F) Factual Knowledge; (C) Conceptual Knowledge; (P) Procedural Knowledge; (M) Metacognitive Knowledge

In summary, the components of knowledge and skills, motivation, and organizational
needs were thoroughly examined to discern the needs of seasoned distributors to train new
distributors based upon best practices principles in a standardized manner. Each aspect of the
study was validated using qualitative data as depicted in Table 3.
Table 3
Summary of Assumed Needs and Validation Method
Assumed Needs

Interviews
Knowledge Needs X
Motivation Needs X
Organizational Needs X

Data Analysis
The stakeholders of focus in this study were the seasoned distributors in H. Enterprises.
Through qualitative methodology, in particular, interviews with key stakeholders, the assumed
needs were examined. Specifically, after the interviews were conducted, they were transcribed
and coded, paying particular attention to the themes that arose out of the knowledge and skills,
motivation, and organizational needs of seasoned distributors at H. Enterprises. If the needs
related to knowledge and skills, subcategories were used to represent the four categories of
knowledge including factual, conceptual, procedural, and metacognitive knowledge. If
motivational needs arose, they were also subcategorized into themes reflecting issues of utility
business challenges.
 Need entrepreneurial
and leadership
training in order to
compete globally.
and evolve in the
business space.
 Need to be
confident and see
value in taking
appropriate risks in
conducting
entrepreneurial
activities.
and business
performance.

ENTREPRENEURIAL ENGAGEMENT 57
value, intrinsic value, goal-setting, and self-efficacy. If the needs appeared to be organizational,
cultural setting and cultural model issues were further examined to discern whether the needs
stemmed from lack of open-mindedness, perception of training value, time management issues,
lack of role models, communication challenges, and issues regarding mutual trust. The data
collected through interviews was used to guide the proposed solutions for this study.
Trustworthiness of Data
In this study, the trustworthiness of the data collected was a paramount concern. To
guard against any issues, key steps were taken, including the assurance of confidentiality of all
interview participants. In addition, it was equally critical for all interview participants to
participate voluntarily. Thus, at several points, prior to commencing the interviews, all
participants were given the opportunity to decline to be interviewed.
Role of Investigator
I am a new independent distributor with H. Enterprises. I became a distributor with H.
Enterprises after being introduced to the organization and its founding distributor and learning
about the organization’s impact on developing economies. My role as principal investigator was
to conduct a gap analysis of the needs related to knowledge and skills, motivation, and
organizational resources as it relates to training new distributors based upon best practices
principles in a standardized manner. With the ability to have distributors in over 100 countries, it
is important for H. Enterprises to develop standardized trainings to ensure high entrepreneurial
engagement throughout the organization and thorough knowledge of company products and
procedures.
For this project, seasoned distributors were cognizant of my role as principal investigator.
As part of the interview protocol, seasoned distributors were informed that the sole purpose of
ENTREPRENEURIAL ENGAGEMENT 58
this study was to analyze information about the organizational performance needs in order to
improve the organization. Moreover, seasoned distributors were assured that all information
obtained during this study was anonymous and used only for that purpose. Seasoned distributors
were further informed that all participation was voluntary and confidential. Moreover, seasoned
distributors were made aware that I am a doctoral candidate with the University of Southern
California and any findings related to H. Enterprises would be shared with its leadership.
Finally, seasoned distributors were informed that it was up to the leadership of H. Enterprises to
decide what to do with the findings of this study.
Limitations
There are some limitations in this study that need to be addressed. First, since this study
relied on the interview responses of 12 seasoned distributors, there are issues inherent in this
self-reported data, including selective memory, telescoping, attribution, and exaggeration.
Second, this study required access to seasoned distributors throughout the world and as such,
both availability and language barriers posed a challenge to the collection of data. Finally, as
seasoned distributors required an English translator, they sought the assistance of family
members and/or friends, and thus, no professional translating services were utilized.
Delimitations
The focus of this innovation study was to conduct an analysis of the performance needs
of a particular stakeholder in a specific organization. As such, the primary delimitation of the
study is that it is specific to the needs of H. Enterprises. Accordingly, this delimitation may
hinder the ability to make generalizations about other organizations with different compensation
and organizational leadership structures.
ENTREPRENEURIAL ENGAGEMENT 59
This study also considered the experience of one stakeholder group and as a result, it may
not be entirely representative of the needs of the other stakeholders in the organization. Even
though several stakeholders were identified in Chapter One, in-depth examination of those
stakeholder experiences and needs is outside the scope of this study.

ENTREPRENEURIAL ENGAGEMENT 60
CHAPTER FOUR: RESULTS AND FINDINGS
The focus of this innovation study was to determine (1) what knowledge and skills,
motivation and organizational needs are necessary to train new distributors based upon best
practices principles in a standardized manner; and (2) what are the recommended solutions to
those needs. The gap analysis by Clark and Estes (2008) was used as the framework to validate
assumed needs that were generated and discussed in detail in Chapter Three. The validity of the
assumed needs was performed through an analysis of qualitative data. Specifically, 12
interviews were conducted over a two-month period, with high-ranking distributors at H.
Enterprises residing in Hong Kong, the United States of America, Indonesia, Australia,
Singapore, and Malaysia. This chapter presents the results and findings from those interviews
with respect to knowledge and skills, motivation, and organizational needs. The conclusion to
this chapter summarizes key findings and provide a framework for a discussion of recommended
solutions set forth in Chapter Five.
Results and Findings for Knowledge Needs
There are four categories of knowledge: factual knowledge, conceptual knowledge,
procedural knowledge, and metacognitive knowledge (Anderson & Krathwohl, 2001). In this
innovation study, each category of knowledge plays a role in whether H. Enterprises can achieve
its performance goals. Specifically, seasoned distributors need factual, conceptual, procedural,
and metacognitive knowledge to train new distributors based upon best practices principles in a
standardized manner. The results and findings for each category of knowledge are summarized
in Table 4. It is important to note that, since this is an innovation study, with an assumed 100%
gap, if a category is “Not Validated” it means the assumed need is currently being addressed by
the organization or it is not a “need” at all. If a category is “Validated in Part” it means part of
ENTREPRENEURIAL ENGAGEMENT 61
the assumed need is already being addressed by H. Enterprises, but there remains a gap that
needs to be addressed. If a category is “Validated” it means the assumed need is confirmed, and
there is, indeed, a 100% gap that was appropriately identified that needs to be addressed.
Table 4
Summary of Results for Knowledge Needs
Assumed Knowledge Need

Category Result
Seasoned distributors need to know what new distributors
know about company products
Factual Not Validated
Seasoned distributors need to know what new distributors
know about entrepreneurial engagement
Factual Not Validated
Seasoned distributors need to know what new distributors
know about the sales process, client retention techniques,
customer service, accounting, operations and recruitment
Factual Not Validated
Seasoned distributors need to know what new distributors
know the foundational business knowledge required to
run a business
Factual Not Validated
Seasoned distributors need to know what new distributors
know about country-specific legal issues
Factual Not Validated
Seasoned distributors need to be able to distinguish levels
of assistance required by new distributors
Conceptual Not Validated
Seasoned distributors need to know how to enhance skills
and knowledge in order to survive business challenges
Procedural Not Validated
Seasoned distributors need to know how to convey
entrepreneurial and leadership training in order to
compete globally
Procedural Validated in part
Seasoned distributors need to know how to conduct
effective new distributor trainings
Procedural Validated in part
Seasoned distributors need to be able to know how to
reflect on their own effectiveness as trainers for new
distributors
Metacognitive Validated in part

The results and findings for each category of knowledge are discussed in detail below.
Insufficient Factual Knowledge that Does Not Alter Performance
Many scholars stress the importance of factual knowledge as a critical driver in
multilevel marketing organizational performance (Nga & Mun, 2011). Specifically, factual
ENTREPRENEURIAL ENGAGEMENT 62
knowledge encompasses knowledge of details and elements (Anderson & Krathwohl, 2001). It
is the basic information an individual needs to know in order to adequately perform a function or
role. In this case, several factual needs were assumed and identified in Appendix A.

Figure 4. Assumed Factual Knowledge Needs of Seasoned Distributors Regarding What New
Distributors Know About the Operation of a New Distributorship
In order for seasoned distributors to develop a standardized training process for new
distributors based upon best practices it was assumed that new distributors needed to come into
the organization with a basic factual business foundation. However, the results from the
interviews with seasoned distributors did not support these assumed factual knowledge needs. In
fact, despite an extensive literature review and preliminary observations conducted at H.
Enterprises, the opposite was true. The seasoned distributors in H. Enterprises did not express
interest in new distributors’ factual knowledge regarding how to own and operate a business,
country-specific legal issues, company products, or entrepreneurial engagement. Notably,
Assumed
Factual
Knowledge
Needs
Seasoned distributors
need to know what
new distributors know
about company
products
Seasoned distributors
need to know what
new distributors know
about entrepreneurial
engagement
Seasoned distributors
need to know what new
distributors know about
sales process, client
retention techniques,
customer service,
accounting, operations
and recruitment
Seasoned distributors
need to know what
new distributors know
about the
foundational business
knowledge required
to run a business
Seasoned
distributors need to
know what new
distributors know
about country-
specific legal issues
ENTREPRENEURIAL ENGAGEMENT 63
seasoned distributors confirmed that they do not even screen for specific foundational knowledge
early in their recruitment process. In fact, seasoned distributors recruit new distributors based
upon their desire to simply own and operate a business. Thus, this category of factual knowledge
needs was not validated.
To elicit key factual knowledge information, the interview participants were asked how
they select, identify, and recruit new distributors. Notably, the seasoned distributors were
aligned on one important component of their process of recruitment: they never prejudge. One
seasoned distributor, Yolanda, shared, “[I]nitially you don’t want to be choosy...when you first
join the business, you talk to anybody.” Another seasoned distributor, Harry, explained his
recruitment and selection process a similar way: “We never judge them…who will do, who like
to do, who can do, who cannot do . . . we just share information…as like a gold rush, we are
trying to find the gold from the bunch of sand.” Similarly, Sharon, shared her recruitment and
selection process. She explained that she does not select people she wants to work with, she
simply shares information with them over coffee. Through this informal interaction, Sharon
learns about their goals in life and what might be missing: “For example, they need a way out
from work or want to have a better quality of time with family…So, I didn’t do any selection at
all. And through that sharing…I see my business expanded to many countries.” Indeed, the
theme of the recruitment and selection process was “don’t prejudge, share information, and talk
to anybody.” Thus, seasoned distributors are aligned around the concept of “no prejudgment.”
As a result, they do not seek to understand prospective distributors’ factual knowledge about
owning and operating a business. Instead, seasoned distributors share information and talk with
anyone interested in the business opportunity.

ENTREPRENEURIAL ENGAGEMENT 64
Sufficient Conceptual Knowledge Regarding Assisting New Distributors
Each interview participant was asked three questions to validate assumed conceptual
knowledge needs. Conceptual knowledge focuses on knowledge of theories and principles
(Anderson & Krathwohl, 2001). The seasoned distributors who participated in the interview
process shared that their organizations consist of between 20,000-50,000 members worldwide in
their downlines. Table 5 provides an overview of each interview participant’s organization
including the number of members and countries in which they have operations.
Table 5
Summary of Distributor Membership, Countries, Headquarters, and Concentrations
Distributor
Name
Estimated
Number of
Distributors
Estimated
Number of
Countries
Headquarters Concentrations
Yolanda 50,000 40 United States Malaysia, Singapore, Taiwan,
China, Hong Kong, United States
Sharon 25,000 33 Malaysia South Africa, Hong Kong,
Singapore, Malaysia
Harry 40,000 31 Hong Kong Asia and Europe
Julie 40,000 40 Malaysia Malaysia
Steve 40,000 40 Indonesia Malaysia, China, Philippines,
Netherlands, Hong Kong,
Australia
Stacey 20,000 25 Hong Kong Malaysia, Indonesia, China,
Hong Kong
Jennifer 30,000 20 Indonesia Indonesia
Sam 50,000 50 United States Indonesia, Malaysia, China,
France, Germany, Chile,
Philippines, Netherlands, Hong
Kong, Australia, United States
Hugh 30,000 50 United States United States, China, Taiwan,
Hong Kong, Malaysia,
Singapore, Japan, Korea,
Philippines, Canada, Mexico,
Europe, Spain
Iris 40,000 40 Malaysia Malaysia, Europe, Asia
Margaret 20,000 15 Singapore United States, Europe, Asia
Justine 20,000 20 Australia Singapore and Australia

ENTREPRENEURIAL ENGAGEMENT 65
Due to the global nature of H. Enterprises, it is incumbent upon seasoned distributors to
be able to distinguish levels of assistance required by new distributors.

Figure 5. Assumed Conceptual Knowledge Need of Seasoned Distributors
The seasoned distributors shared similar reasons in needing to be able to distinguish
between new distributors who need assistance. For one seasoned distributor in Indonesia, Sam,
while many of his distributors reside in Indonesia, his business expanded to Malaysia, China,
Germany, France, Chile, Philippines, Netherlands, Hong Kong and Australia. Another seasoned
distributor, Hugh, operates in over 50 countries. A third seasoned distributor, Stacey, shared that
her operations include 20,000 distributors in 25 countries. Yet another seasoned distributor,
Harry, indicated that he has 40,000 distributors in 31 countries. Thus, an ability to distinguish
between distributors who need assistance and those who do not, is critical to the seasoned
distributors in being able to build and grow a global, sustainable organization. Harry explained
that once you help a distributor, they can help others. It was best explained by Harry this way:
Assumed
Conceptual
Knowledge
Need
Seasoned
distributors need to
be able to
distinguish levels of
assistance required
by new distributors
ENTREPRENEURIAL ENGAGEMENT 66
In everybody seven levels human relationship, there must be Platinum prospects. So,
maybe in the first level human relationship we cannot find it and then we dig deeper. At
the second level, we find out people, more at the third level, fourth level, seven people
even 10th level, 20th level, 30th level we find the right persons. As soon as we find the
person in our deeper levels they would encourage people to their above levels people, to
peoples above that. As like as a flame, when you start a flame, the flame always goes up,
always the flame goes up. We are trying to find the people at the lower level to help those
people.
As Harry explained, it is critical for him to be able to distinguish among his distributors who
need assistance because once he helps the distributors who are encountering challenges, they can
then help the distributors in their levels. As the challenges are resolved, the distributors begin
gaining momentum and send the flames of encouragement, productivity, and excitement upline.
According to Harry, this is the manner in which many successful distributors expand throughout
the world. Harry believes that once the challenges are resolved, there is no stopping the
expansion of his business.
Another seasoned distributor, Margaret, also shared that you can “feel” right away the
new distributors who need your support. She further explained that a seasoned distributor will
also connect with certain members of his or her own team more than other members. She
emphasized that each distributor has the free will to run the business and do it his or her own
way. However, she added, those distributors who do not follow their upline, usually end up
failing.
Accordingly, based upon the interviews with the seasoned distributors, there was
sufficient conceptual knowledge regarding the importance of being able to distinguish among
ENTREPRENEURIAL ENGAGEMENT 67
distributors who need help. Each seasoned distributor understood that assisting new distributors,
and finding distributors who could light a flame upline, was a critical driver to the growth,
cohesion, and expansion of their business.
Mixed-Results in Procedural Knowledge
Procedural knowledge encompasses subject-specific techniques and skills. According to
scholars, as entrepreneurs in a multilevel marketing organization, each independent distributor
must have product knowledge and soft skills to be customer-focused (Nga & Mun, 2011). On a
procedural level, seasoned distributors need to know what steps they must take in order to
enhance skills and knowledge to overcome business challenges, how to perform effective new
distributor trainings and finally, how to convey the entrepreneurial and leadership training in
order to compete globally.

Figure 6. Assumed Procedural Knowledge Needs Regarding the Operation of a Distributorship
Assumed
Procedural
Knowledge
Needs
Seasoned distributors
need to know how to
enhance skills and
knowledge in order to
survive business
challenges
Seasoned distributors
need to know how to
convey entrepreneurial
and leadership training
in order to compete
globally
Seasoned distributors
need to know how to
conduct effective new
distributor trainings
ENTREPRENEURIAL ENGAGEMENT 68
The findings from the interviews confirmed there was sufficient procedural knowledge in
how to conduct effective personal growth trainings and in leveraging the company training
philosophy. However, there was insufficient procedural knowledge in how to conduct leadership
trainings for emerging leaders in H. Enterprises.
Sufficient Procedural Knowledge in How to Conduct Personal Growth Trainings and
Leveraging Company Training Philosophy
Since seasoned distributors do not recruit new distributors based upon their foundational
knowledge with respect to how to run a business, seasoned distributors need to know how to
conduct effective trainings for new distributors to help them overcome new business challenges.
The interviews with seasoned distributors did not validate the assumed procedural need of
knowing how to enhance new distributor skills and knowledge. According to the seasoned
distributor interviews, there is a global training platform that all distributors in H. Enterprises
follow and each seasoned distributor is aligned with how to best leverage it for new distributors.
In order to develop a productive, high-performing global team, seasoned distributors need
the procedural knowledge required to perform new distributor training. Through interviews with
the 12 seasoned distributors, they emphasized the importance of being able to conduct key initial
trainings that provide new distributors with an anchor that allows them to weather future
business storms. Each seasoned distributor explained the importance of being able to conduct
these initial trainings by referring to the trainings as “the importance of knowing your why.”
According to one seasoned distributor, Sam, once a new distributor knows what he or she wants,
and can form an emotional attachment to it, it is concretized. He explains further: “Especially in
network marketing, it’s not the how to step… one, two, three, four, five, how to do the business,
most people chase the how to, but more importantly is the mindset of why they do the business”
ENTREPRENEURIAL ENGAGEMENT 69
(emphasis added). According to the seasoned distributors, these early trainings and discussions
help solidify the foundation for new distributors.
Another seasoned distributor, Iris explained the initial training of new distributors in a
similar way. She explained that seasoned distributors provide new distributors with a YouTube
link to watch a video that discusses their “why” as well as the need for a growth mindset. After
new distributors watch the first video, they are asked to check back in with the sponsoring
distributor. During that initial conversation, Iris explained that she reiterates the importance of
mindset and “why” they enrolled as a new distributor. For some new distributors, they are
seeking financial freedom, for other new distributors they would like the flexibility and time
freedom that accompanies becoming an entrepreneur.
Even though there is no manual of trainings, for example, one seasoned distributor,
Stacey, explained that there is indeed a system called One System. This System exists entirely
online in a series of YouTube videos that were filmed during live events and trainings. Some
YouTube trainings range from 30 minutes to several hours and explore many different topics,
including how to get started in the business, open mindset, reflections on a beginner’s
experience, how to operate the back office of the business platform, the art of recruiting, and
what to expect as a new distributor. The seasoned distributors direct the new distributors to a
particular video or series in order to best enhance their knowledge and skills in a particular area.
According to Stacey, this One System is a secret to the success of the global team:
What we do is follow the system and follow what it’s teaching us, and then we duplicate
with our partners and let them follow the system…So, it is simple and can be duplicate
for success in the business.
ENTREPRENEURIAL ENGAGEMENT 70
Each seasoned distributor stressed the importance of the initial training on growth
mindset. However, one seasoned distributor, Jennifer, explained that in order to enhance the
skills and knowledge of the members of her team, she leverages technology and does a weekly
call with her English-speaking team as well as her Mandarin-speaking team. During these calls,
the members of her team pick different topics they think will enhance their skill sets. Even
though there is a structure around her trainings, Jennifer stresses the importance of learning on
the job: “Equipping them with skills to do their job better, not content and not theories, but
hands-on experience for them to go out there and have the confidence to just go try and make
mistakes.”
Through each interview, the seasoned distributors shared the importance of “plugging
into the system.” For them, the system is the One System. The One System provides
foundational knowledge to get new distributors started in their business. However, what they
need to help them grow, individually, varies. As a result, a lot of the education and training takes
place between seasoned distributors and new distributors during one-on-one conversations. In
fact, one seasoned distributor, Yolanda, who left her corporate job to join H. Enterprises,
explained that when she joined she wished they had a training manual and a standard of
procedures to lead their teams. But, she explained further that H. Enterprises is a feel business
for which there is no manual: “After walking through the journey myself, it is indeed a feel
business, anything can happen at any time. So, it is about the leader in the trenches to really see
and feel, to watch and then make a diagnosis.”
The interviews with seasoned distributors did not validate the assumed procedural need
of knowing how to enhance new distributor skills and knowledge. The seasoned distributors
confirmed that there is a system, One System that all distributors in H. Enterprises follow.
ENTREPRENEURIAL ENGAGEMENT 71
Moreover, each seasoned distributor is in alignment with the new distributor training philosophy
of starting with “why” and growth mindset trainings as well as leveraging the YouTube platform.
Insufficient Procedural Knowledge in Leadership Trainings for Distributors
Over the course of the 12 interviews, it became clear that there is a system for new
distributor trainings. However, once distributors climb the ranks and grow their teams, education
and training procedures are less defined. Thus, while it is important for seasoned distributors to
be able to convey entrepreneurial and leadership trainings to their distributors in order to
compete globally, there is no systematic method for providing leadership trainings to distributors
to ensure they are able to lead their own global teams. Thus, this procedural category is partially
validated. The following table provides illustrative quotes from the 12 distributor interviews
with respect to a lack of systematic procedures and highlights different approaches taken by each
seasoned distributor.
Table 6
Summary of Interview Responses from Seasoned Distributors Highlighting Different Approaches
to Developing Leaders
Different Approaches to Developing Leaders
Yolanda No manual, teach all leaders differently through different approaches
Sharon Find out who is ready to grow their business
Harry Build solid relationships with leaders, develop close communication, remind
leaders how to become better in business
Julie Deal with core leaders only, core leaders are responsible for their own teams
Steve Monitor the back office and business numbers, the system sorts out leaders
Stacey Daily conversations are critical to know everything about teams
Jennifer Find different ways to empower global teams, there is no method to ensure
anything with respect to leaders being able to lead their teams
ENTREPRENEURIAL ENGAGEMENT 72
Table 6, continued
Sam Conduct a lot of one-on-one trainings, fine-tune leaders through
consultations, leaders learn through doing
Hugh Plop them into the One System, let our main leader train them, use our experiences
to change them from consumer to entrepreneur
Iris Let the downline handle issues on their own to become more independent
Margaret Find someone who can provide a protective and warm environment for members
of their team, chat with the team regularly using WhatsApp, VChat and Skype
Justine Meet with prospects and leaders together, direct them to the videos, meet them
one-on-one

Partially Sufficient Metacognitive Knowledge Regarding Training New Distributors
Metacognitive knowledge encompasses knowledge, understanding, and awareness of
one’s cognitive processes and the ability to self-reflect (Anderson & Krathwohl, 2001). On a
metacognitive level, in order to be more effective for their global, distributed teams, seasoned
distributors need to know how to reflect on their own effectiveness as trainers for new
distributors. Based upon the interview responses, it became readily apparent that the seasoned
distributors did not agree on the importance of education and training to their global teams.
Thus, this metacognitive knowledge category is validated in part.
ENTREPRENEURIAL ENGAGEMENT 73

Figure 7. Assumed Metacognitive Knowledge Need of Seasoned Distributors
To validate the metacognitive knowledge need, seasoned distributors were asked what
impact education and training has on the success of their global teams. The interview findings
validated in part the assumed need that seasoned distributors are able to assess their own
effectiveness in training new distributors. Specifically, seasoned distributors did not explain the
importance of education and training with their global teams and instead emphasized the
importance of new distributors’ passion and mindset as the most critical driver in business
growth.
For one seasoned distributor, Jennifer, education and training is the life line of her
business. But, Jennifer explains that the education and training in her business is not content-
driven, like it is in formal education: “I have business partners who have trouble having a
conversation with people. They can’t even tell their own story. So, the training, that’s going to
make the most impact on people in this business, is on the mindset.” Jennifer explained that she
Assumed
Metacognitive
Knowledge
Need
Seasoned distributors
need to be able to know
how to reflect on their
own effectiveness as
trainers for new
distributors
ENTREPRENEURIAL ENGAGEMENT 74
spends most of her time training her team on how to be more confident. This, Jennifer
explained, helps her distributors become more successful.
For other distributors like Harry and Julie, they acknowledge that education and training
is important but more importantly, a new distributor must have passion in order to be successful.
As Julie explains, “They have to have passion in order to upgrade themselves. Otherwise,
education and training without passion to do that and commitment is not useful.” As Steve
explains, “Education and training is the foundation to prepare for great things ahead, also
disappointment. It’s not just a skill training but also a mindset training that is the foundation for
our business.” Yet another seasoned distributor, Stacey, explained that education and training is
the culture of her business and a way of duplication, which is the key to growth. However,
formal education is not required in order to be successful.
Other seasoned distributors, Margaret and Jan, however, expressed that education and
training is not as important to the growth of their global teams. Jan explained it this way:
Training is not the most important point to be successful. It’s attitude…willing to
change, learn from mistake, how well she adapts to the current trend and use it in the
business, and the importance of practicing action
Accordingly, based upon the varied responses from the seasoned distributors, regarding the
importance of education and training to their global teams, the metacognitive knowledge
category can only be validated in part.
Summary of Results and Findings for Knowledge Needs
The results and findings from the interviews confirm there are knowledge gaps that exist
for seasoned distributors. Table 7 explains the results from each knowledge category along with
a brief explanation, which summarizes the discussion below.
ENTREPRENEURIAL ENGAGEMENT 75
Table 7
Summary of Results and Explanation for Knowledge Needs
Assumed Knowledge Need Category Result Explanation
Seasoned distributors need to
know what new distributors
know about company products
Factual Not
Validated
Seasoned distributors do not
recruit based upon
foundational knowledge, as
they do not prejudge.
Seasoned distributors need to
know what new distributors
know about entrepreneurial
engagement
Factual Not
Validated
Seasoned distributors do not
recruit based upon
foundational knowledge, as
they do not prejudge.
Seasoned distributors need to
know what new distributors
know about the sales process,
client retention techniques,
customer service, accounting,
operations and recruitment
Factual Not
Validated
Seasoned distributors do not
recruit based upon
foundational knowledge, as
they do not prejudge.
Seasoned distributors need to
know what new distributors
know the foundational
business knowledge required
to run a business
Factual Not
Validated
Seasoned distributors do not
recruit based upon
foundational knowledge, as
they do not prejudge.
Seasoned distributors need to
know what new distributors
know about country-specific
legal issues
Factual Not
Validated
Seasoned distributors do not
recruit based upon
foundational knowledge, as
they do not prejudge.
Seasoned distributors need to
be able to distinguish levels of
assistance required by new
distributors
Conceptual Not
Validated
Seasoned distributors
emphasized the importance of
being able to discern which
distributors need assistance as
a key to building a global
business.
Seasoned distributors need to
know how to enhance skills
and knowledge in order to
survive business challenges
Procedural Not
Validated
Seasoned distributors plug in
new distributors to a global
platform, which offers basic
education and training.
Seasoned distributors need to
know how to convey
entrepreneurial and leadership
training in order to compete
globally
Procedural Validated
in part
Seasoned distributors engage
in different strategies to
convey one-on-one leadership
trainings to core leaders.

ENTREPRENEURIAL ENGAGEMENT 76
Table 7, continued
Assumed Knowledge Need Category Result Explanation
Seasoned distributors need to
know how to conduct effective
new distributor trainings
Procedural Validated
in part
Seasoned distributors rely on
the global platform for new
distributor training and
conduct one-on-one leadership
development trainings in
different ways.
Seasoned distributors need to
be able to know how to reflect
on their own effectiveness as
trainers for new distributors
Metacognitive Validated
in part
Seasoned distributors did not
agree on the importance of
education and training for their
global teams.

While seasoned distributors explained they do not have a standardized recruiting method,
they further explained that they do not intend to change the way they sponsor new distributors
since it is a system that works well for them. Thus, the factual knowledge category was not
validated. Moreover, seasoned distributors possess sufficient conceptual knowledge to be able to
distinguish among new distributors who require assistance, even though the assistance they
provide is not standardized in any way. Thus, the conceptual knowledge category was not
validated.
With respect to procedural knowledge, seasoned distributors explained that there is a
system for training new distributors called the One System and it is highly leveraged within H.
Enterprises. Thus, they possess sufficient procedural knowledge with respect to training new
distributors and following the company training philosophy. However, a procedural knowledge
gap exists with respect to how seasoned distributors help new distributors lead their own global
teams. According to the seasoned distributors, there is no systematic method for training new
distributors on how to lead a global team and each seasoned distributor does it differently. Thus,
the procedural knowledge category was validated in part. Finally, seasoned distributors do not
agree on the importance of global education and training. For some distributors, it is the life line
of their business. For other seasoned distributors, there are far more important factors to
ENTREPRENEURIAL ENGAGEMENT 77
consider with respect to their success, specifically, the passion, focus, and commitment of their
global team members. Thus, the metacognitive knowledge category was also validated in part.
Results and Findings for Motivation Needs
Organizational problems involving motivation stem from three areas: active choice,
persistence and mental effort (Schunk et al., 2009). A person must actively choose to pursue a
goal, persist toward the goal, and exert the mental effort required to achieve the goal. In the
context of multilevel marketing organizations, motivational challenges become more complex to
solve. Since there exists no hierarchical relationship among distributors, seasoned distributors
must employ a variety of leadership styles to ensure maximum level of distributor engagement
among their global teams (Sparks & Schenk, 2001). It is, therefore, critical to examine the
motivational needs of seasoned distributors as they train new distributors.
Prior to conducting the 12 seasoned distributor interviews, several assumed motivational
needs were identified. Specifically, seasoned distributors need to see the utility value in
developing training for new distributors, set goals related to developing the training, have a high
level of interest in training new distributors, and they need to develop self-efficacy with respect
to preparing, implementing, and conducting training for new distributors.
ENTREPRENEURIAL ENGAGEMENT 78

Figure 8. Assumed Motivation Knowledge Needs of Seasoned Distributors
The results and findings from the interviews confirm there are motivation needs that exist
for seasoned distributors. First, while seasoned distributors explained they see the utility value in
training new distributors, there is a critical issue with respect to “inactive” distributors who
simply sponsor new distributors but provide no training for them. Thus, there is an issue
regarding utility value among inactive seasoned distributors. Second, the 12 seasoned
distributors shared their high level of personal interest in training new distributors, but also
disclosed several challenges and frustrations in conducting the trainings. Thus, there is again, an
issue with respect to intrinsic value as it relates to training new distributors.
With respect to goal-setting and self-efficacy, those motivation categories were not
validated. It appears the focus of all distributor trainings revolve around the goal-setting process
for new distributors. However, even though seasoned distributors expressed a high level of self-
efficacy related to conducting these new distributor trainings, there is a gap with respect to the
Assumed
Motivation
Needs
Seasoned Distributors
need to see value in
developing,
implementing, and
conducting training
for new distributors
Seasoned Distributors
need to have a high
level of interest in
training new
distributors
Seasoned Distributors
need to set goals related to
developing, implementing,
and conducting training for
new distributors in
entrepreneurial
engagement and company
products
Seasoned Distributors
need to know they are
capable of developing,
implementing, and
conducting training for
new distributors
ENTREPRENEURIAL ENGAGEMENT 79
self-efficacy of new distributors who receive the training. The results of each motivation
category are summarized in Table 8. The results and findings for each category of motivation
are discussed in detail below.
Table 8
Summary of Results for Motivation Needs
Assumed Motivation Need Category Result
Seasoned distributors need to see value in
developing, implementing, and conducting
training for new distributors
Utility Value Validated in part
Seasoned distributors need to have a high
level of interest in training new distributors
Intrinsic Value Validated in part
Seasoned distributors need to set goals
related to developing, implementing, and
conducting training for new distributors in
entrepreneurial engagement and company
products
Goal-setting Not Validated
Seasoned distributors need to know they are
capable of developing, implementing, and
conducting training for new distributors
Self-efficacy Not Validated

Task Value
Current motivational theories explore the relationship between belief, values, and goals.
For the purposes of this innovation study, this motivation section focuses on the impetus for
seasoned distributors to train new distributors based upon best principles practices in a
standardized manner. A renowned scholar in the field of motivation research, Eccles, along with
her colleagues, concluded that people make choices about tasks based upon their negative and
positive characteristics (Eccles & Wigfield, 2002). Moreover, once people make choices
regarding a particular task, they eliminate other options and thus, each option carries with it a
specific cost. This is referred to as task value. Indeed, even if people are certain they can
perform a task, they need a compelling reason to engage in and complete it. In exploring the
reasons for engagement, Eccles et al. (1983) identified four components of task value: attainment
ENTREPRENEURIAL ENGAGEMENT 80
value, intrinsic value, utility value and cost. In this context, utility value and intrinsic value were
identified as motivational needs. Thus, they are explored in detail below.
“Active” seasoned distributors see the utility value in developing, implementing and
conducting training for new distributors. According to Eccles and Wigfield (2002), utility
value is determined through an analysis of how well a particular task relates to current and future
goals. A task, for example, may have a positive value because it is relevant and useful to a
person’s future goals, even if the person does not particularly enjoy it. In this innovation study,
it is important to discern whether the seasoned distributors see the utility value (usefulness and
importance) in developing, implementing, and conducting training for new distributors.
For most successful, seasoned distributors, they place a high utility value on developing,
implementing, and conducting training for new distributors. However, not all distributors who
sponsor new distributors are considered “active.” This may be one of the biggest challenges for
the industry. According to one seasoned distributor, Sam, when you first sign up, in order to be
very successful you must have a sponsor who has “your best interest at heart” and “knows the
business from A to Z.” Your sponsor must also be “willing to help you from A to Z” and in
return you must “trust pretty much 100% of what they tell you and what to do.” Sam
acknowledged that distributor activity is an issue in the business and at times, there are simply
sponsors who do not train their downlines what to do and how to be successful. According to
Sam, however, it is important for the new distributor who wants to be trained to look upline until
they find someone who is “active.” If all else fails, Sam suggests the new distributor ask one of
the seasoned distributors for help identifying the active upline who are willing to train new
distributors.
ENTREPRENEURIAL ENGAGEMENT 81
Iris, another seasoned distributor, explained that seasoned distributors place a high value
on training new distributors. However, the training is not always formal training. Iris explained
that through the One System, there are scheduled global meetings, recorded trainings, and
presentations. Each of those trainings is developed and hosted by a seasoned distributor. Iris
further explained that she does not want her team members plugged into the system for more
than five hours per week because she feels the on-field training is most important: “I normally
spend my time to join field with my people specifically those who are new. I let them become
the bridge. They just sit beside us and listen to the whole presentation and how to handle
objections. I think that is more practical.” Iris, therefore, sees the utility value of training new
distributors, but distinguishes between formal and informal training opportunities. For Iris, the
informal training opportunity, in-field, is most important for the development of her global team.
Thus, while there is a high utility value among “active” seasoned distributors with respect
to developing, implementing and conducting training for new distributors, many new distributors
are sponsored by “inactive” seasoned distributors. This is problematic because distributors are
compensated on moving products as well as sponsoring new members. Thus, an “inactive”
distributor may be an excellent recruiter and an “absent” trainer. For that reason, this motivation
category is validated in part.
Seasoned distributors express interest in training new distributors but acknowledge
concomitant frustrations and challenges. Intrinsic value is defined as the enjoyment a person
gets from performing a particular activity or a person’s interest in the subject (Eccles &
Wigfield, 2002). In order to effectively develop a standardized training for new distributors
based upon best practices, seasoned distributors need to have a high level of individual interest in
performing activities related to developing the training.
ENTREPRENEURIAL ENGAGEMENT 82
According to the seasoned distributors, there are several aspects to training that are
important in the multilevel marketing industry. The initial trainings on products, mindset, how
to get started in the business, and how to share the platform with prospects are critical to getting
started in the business. However, subsequently, the trainings take many forms. There continue
to be formalized trainings through One System and informal training opportunities which include
one-on-one trainings with distributors in the field. One seasoned distributor, Harry, who has a
team in 31 countries, develops and conducts trainings based on what his distributors need and
“what they want to know and then after that he will do more motivational speaking to keep them
engaged.” Harry spends “40% of his time on new distributor” trainings because he has a high
level of interest in training his global team and ensuring they’re successful.
According to another seasoned distributor, Jennifer, she also has a high level of personal
interest on training new distributors and acknowledges how critical it is for her train others on
her team to be successful. Since her business is dependent on her ability to duplicate successes
all over the world, Jennifer contends that if people engage in the business for only money “they
will lose sight with the real vision of helping people,” “cannot work with the team sincerely” and
“cannot really lead the people.” Thus, without a high level of personal interest in training team
members, seasoned distributors will not see the rapid duplication of their business and “the team
will be stopped.”
Margaret, another seasoned distributor, however, expressed frustration with aspects of
training new distributors. Even though she knows it’s important, and expressed a certain level of
individual interest in new distributor training, she explained that she’s learned a lot about human
behavior through this business. Specifically, Margaret shared that a lot of new distributors
express desire and intentions to be successful in the business. They claim to have a growth
ENTREPRENEURIAL ENGAGEMENT 83
mindset. However, these new distributors do not follow through with the training and do not do
what is required of them to be successful. Instead of working hard, Margaret believes that a lot
of new distributors simply want to make more money and she therefore, wonders whether they
are “willing to do whatever it takes to make more money.” Margaret contends “you can easily
waste your time” training distributors and jokes, “I can write a book with a whole list of excuses.
So many…I’ve never heard so many excuses as since I’m in this business.”
While it appears that the seasoned distributors expressed a high level of individual
interest in training new distributors, they acknowledge the inherent challenges and frustrations in
training new distributors as well. Since multilevel marketing organizations are renowned for the
ability to make a tremendous income, many organizations attract new distributors who simply
want to make a lot of money but who are not willing to work hard and develop their businesses.
For the seasoned distributors in H. Enterprises, this seems to be a key frustration that has an
impact on their interest and desire to train new distributors. They simply do not want to waste
their time.
Goals
Goals are defined as “what the individual is consciously trying to do” (Lunenberg, 2011).
According to Dr. Edwin Locke, individuals who are given specific and challenging but attainable
goals outperform their peers who are given easier, nonspecific goals (Lunenberg, 2011).
Goals have a measurable impact on performance outcomes because they specify the
requirements for success (Zimmerman, Bandura, & Martinez-Pons, 1992). In addition, in order
to achieve the specified goal, a person must engage in self-monitoring and self-judgement in the
course of performance (Zimmerman et al., 1992).
ENTREPRENEURIAL ENGAGEMENT 84
Seasoned distributors established goal-setting trainings that have an impact on the
culture of the organization. All of the seasoned distributors expressed alignment with how
they would like to have an impact on new distributors. One seasoned distributor, Hugh, who
currently has 30,000 people in his downline expressed it best when he discussed how the founder
of H. Enterprises helps her teams set goals for themselves. This goal-setting process is shared
through formal and informal trainings.
The very first training, which trains new distributors on the importance of knowing your
“why” and the growth mindset, helps distributors develop the strength to face future obstacles
and business challenges. A new distributor’s “why” is the reason the individual joined the
organization. For many new distributors, they join the organization because they want to achieve
financial freedom, time freedom, a healthy lifestyle, or simply, a better life. From the “why”
training, new distributors learn to set measurable goals. They can elect to set a goal to make a
specific income, share the opportunity with a certain number of people by a specific date, or
achieve a certain rank in a specific amount of time. Usually, the new distributor’s sponsor works
with the new distributor to set the goal.
Goal-setting in H. Enterprises, however, does not stop with new distributor training. As
Hugh explains, once new distributors achieve financial freedom, time freedom, and a healthy
lifestyle, they need to raise their “life value.” This is the second chapter of the goal training
series for new distributors, and even distributors who have been in business for a little while.
According to Hugh, through the training, distributors learn to “setup a new goal for [their] life.”
But, the biggest inspiration for Hugh came from what the founder said in a recent global
announcement: “Now, I’m Platinum. I got my financial freedom. I got my health. I’m getting
younger and now I can’t stop. I do need to help more people, my followers to realize their
ENTREPRENEURIAL ENGAGEMENT 85
dreams, to have what they want through the e-commerce platform.” The founder then
announced that her next goal is to help 100 people become Platinum, to be millionaires in
Vitality. For Hugh, this shows him that the founder has “a heart of love, to like to help people.”
Through her example, Hugh expects his leaders to do the same and train new distributors and
others to help them achieve their goals: “if the leaders, team leaders, group leaders got a very
good vision, got a very good heart, and you express your love, work hard, express your action to
help the people, people will follow you, people will follow the system, follow the team, follow
the leader.”
Self-Efficacy
Researchers have long held that efficacy beliefs contribute significantly to goal
performance (Bandura & Locke, 2003). The self-efficacy theory was introduced by Albert
Bandura (1977) in “Self-efficacy: Toward a unifying theory of behavioral change.” Bandura
defined self-efficacy as an individual’s beliefs in his or her ability to perform a task necessary to
achieve a valued goal. Bandura explained that self-efficacy beliefs are a critical driver in human
behavior and changes to that behavior (Maddux & Gosselin, 2015). Bandura proposed that self-
efficacy beliefs influence a person’s decision to attempt a behavior and whether a person chooses
to persist in the face of challenges (Maddux & Gosselin, 2015).
Seasoned distributors have high self-efficacy in training development but new
distributors struggle with following trainings. Seasoned distributors understand that they
must train new distributors in order to be successful. Each seasoned distributor acknowledged
the importance of new distributor training and their competence as it relates to such training.
One seasoned distributor, Margaret, shared that she can only earn her rank “through helping my
team.” Another seasoned distributor, Steve, explained that with 40,000 people in his downline
ENTREPRENEURIAL ENGAGEMENT 86
there’s no way he can communicate with them one by one, and there is no way he can know
them one by one. Thus, seasoned distributors must have high confidence in their ability to train
key leaders on their teams and those leaders must train others in their downline in order to gain
global traction.
Steve explained further that what they do in Vitality is not “rocket science” and “five
years in college” is not required to become a leader in the industry. But, “you just need to follow
the proven system.” Steve emphasized that the One System will sort out the leaders and
determine who makes it to the top and who does not. Thus, even though the seasoned
distributors have high self-efficacy as it relates to training the key leaders on their teams, they do
not have time or ability to train each new distributor and must instead, “leverage the system” and
find ways to “duplicate themselves.”
One seasoned distributor, Sam, explained his challenge in reaching new distributors this
way: “The deeper you can reach into an organization, the stronger it is, the faster it is. And it’s
worth it.” Sam further explains, “Nowadays there’s no way for me to reach hundreds of
thousands of people in my organization. But, the more that I can again help the right people, the
key people, they can reach out more than I cannot.” For Sam, it is critical for him to leverage the
system: “So, it’s all about leveraging all that and that’s how we build our organization. So we
build the right people they can carry it forward.”
According to several seasoned distributors, however, the challenge arises when new
distributors begin to question the training methods or proven ways of leveraging the system.
Since many of the seasoned distributors have organizations throughout the world, it is difficult
when a new distributor says “no” or “I can’t.” Iris explains, “Sometimes I just need them to say
yes to me. When they say yes, then I’ll go ahead. When they say no, even though I have my
ENTREPRENEURIAL ENGAGEMENT 87
own perception, I just stop.” Due to the nature of the business, multilevel marketing distributors
are independent entrepreneurs. Thus, they have the ability to run their businesses in a manner of
their choosing.
Even though seasoned distributors ask new distributors if they have an open mind, many
say they are open to learning new things, but really do not have an open mind. Margaret
explains, “the majority actually is not as open as they think, not at all.” Without an open mind,
new distributors cannot be trained on how to best leverage the platform. Thus, the majority of
leaders rely not only on leveraging the One System training platform, but also building their
teams through sharing stories. Margaret explained that Vitality is not a high science or technical
business. In fact, she explains “it’s a people business, as people as you can get.” Moreover,
Margaret shares “it’s about people sharing their personal growth, their stories, what they were,
and what they become through this business, and how their life has transformed.” Thus, even
though the seasoned distributors have high self-efficacy as it relates to developing and
conducting trainings for new distributors, new distributors must mirror this high self-efficacy in a
manner which allows them to receive the trainings and implement them.
Summary of Results and Findings for Motivation Needs
Through the 12 seasoned distributor interviews, it became apparent that there are
motivation needs that exist for seasoned distributors and new distributors, as it relates to new
distributor training. Table 9 shares the results from each motivation need along with a brief
explanation, which summarizes the discussion above.

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Table 9
Summary of Results and Explanation for Motivation Needs
Assumed Motivation Need Category Result Explanation
Seasoned distributors need
to see value in developing,
implementing, and
conducting training for new
distributors
Utility
Value
Validated in
part
Inactive seasoned distributors
need to see the utility value of
training the new distributors
they sponsor, or they need to
assist the new distributors in
identifying an active upline.

Seasoned distributors need
to have a high level of
interest in training new
distributors
Intrinsic
Value
Validated in
part
Seasoned distributors need a
better way to handle training
objections from new
distributors so that it does not
affect their personal desire to
train their downlines.
Seasoned distributors need
to set goals related to
developing, implementing,
and conducting training for
new distributors in
entrepreneurial engagement
and company products
Goal-setting Not Validated Seasoned distributors have a
well-established goal-setting
process that is in effect from
Day One as a new distributor.
Seasoned distributors need
to know they are capable of
developing, implementing,
and conducting training for
new distributors
Self-
efficacy
Not Validated Seasoned distributors need to
identify additional ways in
which to help new distributors
become more “open” to
receiving training.

Results and Findings for Organizational Needs
In order to achieve the organizational performance goal, knowledge, motivation, and
organizational needs must be met. In examining the needs of an organization, special emphasis
should be paid to cultural processes. According to Rueda (2011) cultural processes are difficult
to standardize in organizations because they are not always “visible,” are often “automated,” and
involve relative values. With respect to the organizational leg of the “KMO” triad, an analysis of
both cultural models and cultural settings is warranted. Cultural models are dynamic and help
form the structure of an organization, including its practices, incentives, and policies (Rueda,
ENTREPRENEURIAL ENGAGEMENT 89
2011). Cultural settings, on the other hand, are the social constructs in which the organization
operates where specific behavior is enacted.
With respect to H. Enterprises’ cultural model, seasoned distributors need to be open-
minded in learning new training-related skills. In addition, they need to foster a culture of
mutual trust where distributors feel valued. Moreover, they also need to value the development
of trainings to achieve the performance goal of training new distributors based upon best
practices principles in a standardized manner. Since cultural models and settings are interrelated,
it is equally important to address the cultural settings in this context. In this study, seasoned
distributors need to set aside time to train new distributors. In addition, seasoned distributors
need role models within the organization who prioritize training new distributors to have a
positive impact on their entrepreneurial engagement and knowledge of company products.
Finally, seasoned distributors need to develop a communication plan to inform new distributors
of training and education opportunities within the organization.
ENTREPRENEURIAL ENGAGEMENT 90

Figure 9. Assumed Organizational Needs of Seasoned Distributors
The results and findings from the interviews confirm there are organizational needs that exist for
seasoned distributors. First, even though seasoned distributors are open-minded and adaptable to
learning new skills and acknowledge the importance of fostering a culture of mutual trust, they
do not value the development of new trainings that emphasize entrepreneurial engagement.
Moreover, when seasoned distributors do set aside time to train new distributors they emphasize
the importance of understanding how to share the business opportunity with new prospects at big
events and opportunity meetings, instead of traditional training. In addition, the role models in
the organization tend to be high-ranking distributors with a large followership and not
necessarily a seasoned distributor who prioritized new distributor training. Finally, until
seasoned distributors develop training outside of the One System, there does not appear to be a
present need for a communication plan regarding standardized training opportunities for new
Assumed
Organizational
Needs
Seasoned Distributors
need to be adaptable
and open-minded to
learning new skills in
order to maximize
performance
Seasoned Distributors
need to foster a
culture of mutual
trust where
distributors feel
valued
Seasoned Distributors
need to value the
development of
trainings which will
increase
entrepreneurial
engagement
Seasoned Distributors
need to set aside time
from running their
own businesses to
train new distributors
Seasoned Distributors
need to have role
models within the
organization who
have prioritized the
training of new
distributors
Seasoned Distributors
need to develop a
communication plan
regarding the
standardized training
of new distributors
ENTREPRENEURIAL ENGAGEMENT 91
distributors. The results of each organizational category are summarized in Table 10. The
results and findings for each category of organization are discussed in detail below.
Table 10
Summary of Results for Organization Needs
Assumed Organization Need

Category Result
Seasoned distributors need to be adaptable
and open-minded to learning new skills in
order to maximize performance
Cultural Model Not Validated
Seasoned distributors need to foster a culture
of mutual trust where distributors feel valued
Cultural Model Not Validated
Seasoned distributors need to value the
development of trainings which will increase
entrepreneurial engagement
Cultural Model Validated
Seasoned distributors need to set aside time
from running their own businesses to train
new distributors
Cultural Setting Validated
Seasoned distributors need to have role
models within the organization who have
prioritized the training of new distributors
Cultural Setting Validated
Seasoned distributors need to develop a
communication plan regarding the
standardized training of new distributors
Cultural Setting Validated in part

Cultural Models
For the purposes of this innovation study, this section focuses on the cultural models of
H. Enterprises and what organizational needs are necessary for seasoned distributors to train new
distributors based upon best principles practices in a standardized manner. Prior to the
interviews with 12 seasoned distributors several cultural models were identified as needs
including the need for seasoned distributors to be adaptable and open-minded to learning new
skills, the need for seasoned distributors to foster a culture of mutual trust, and the need of
seasoned distributors to value the development of trainings which will increase the
ENTREPRENEURIAL ENGAGEMENT 92
entrepreneurial engagement of distributors in the organization. The three cultural models
identified above are explored in detail below.
Seasoned distributors are adaptable, open-minded, and even vulnerable when
learning new skills. For most successful, seasoned distributors, they emphasize the importance
of a growth mindset and the need to be “open” to learning new things. According to Margaret, it
is critical to have an open mind when you start with H. Enterprises: “when you are coming from
traditional business into network marketing business, [you] have to go through a mindset change
and that change of mindset is where the personal growth comes in.” Margaret explained further
that she had to set her ego aside while she was building her business and assisting her team. She
had to be open-minded to help her team build their businesses “because everybody builds their
business differently.”
Steve, another seasoned distributor, had to witness the success of different people in H.
Enterprises before becoming convinced that the platform works. Steve explains, “I witnessed
with my own eyes housewife, employee, people with high education, people with no experience
in business or not experienced in business, they do well in the business, that’s why I can do too.”
Thus, Steve was slower to become adaptable and open-minded toward education and training.
Through the interview with Steve, it became apparent how significant the opportunity can be and
how important education and training is to the success of distributors. He explains,
So training and education is, what we say, what we call is the key of the game. For
example, even a low job in Indonesia, salary may only maybe 3 million Rupiah is around
$300 in Indonesia, but they need education and training before entering the job for the
first three months. And here we are, want to be successful people, want to become US
millionaire, want to become Platinum, surely training and education is the foundation for
ENTREPRENEURIAL ENGAGEMENT 93
people to prepare them to great things ahead. So it’s not just a skill training, but also a
mindset training.
For another seasoned distributor, Jennifer, she remains open-minded and adaptable to
training and educating distributors. She further explained that she expresses her adaptability by
being vulnerable with her team and explaining to them that she does not know all of the answers,
but will learn with them: “I am willing to fail. I am willing to admit that I don’t have all the
answers.” She further explains that her team is helped by her expressions of vulnerability:
“helping my team to see that it is okay to be human especially the leaders, it’s very important
because it helps them to then rediscover what’s important to them and have them be the best at
that role.”
Based upon the interviews with seasoned distributors, it appears they started their
businesses as new distributors with open-minds, they continued growing their businesses by
being adaptable, and began leading their teams by expressing their vulnerabilities. For these
reasons, this organization need is not validated.
Seasoned distributors know the importance of fostering a culture of mutual trust
where distributors feel valued. Each seasoned distributor emphasized the importance of
fostering a culture of mutual trust among their organizations. Since the distributors operate in a
global, virtual environment, it is critical to be able to unconditionally rely on business partners
for advice and guidance. This concept of the importance of building “mutual trust” was likely
the most critical finding throughout these interviews. Table 11 was created to illustrate the depth
and importance of this issue.

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Table 11
Summary of Distributor Comments Regarding Mutual Trust
Seasoned
Distributor
Importance of Fostering a Culture of Mutual Trust
Iris Trust and belief is the most important thing in this industry, especially in our
organization. If you do not trust our leaders, Sam and Yolanda, if you do not
believe them, we go nowhere.
Margaret Mutual trust is important. This is why a positive environment is really easy.
A new distributor who wants to grow will need that, and she will receive it
first from the sponsor.
Harry Mutual trust is very important. We promote not only the business, not only the
product, also we promote the general human value that means love. We’ve
got the love, thankful, and gratitude. That’s our culture.
Steve Mutual trust is not built in a day. It’s through constant communication and
working together and believe we are in the same direction. We as leader, we
want to help people who are willing to be helped.
Sam If people know you have their best interest at heart, then they start to trust you.
We only do business with people we know, we like, and we trust.
Justine Mutual trust is critical and the most important ingredient of a relationship that
is powerful and mutually nurturing. I tell my team: I cannot promise you that I
will solve all of your problems, but I promise you that you won’t be alone to
face them.
Hugh Mutual trust is important and is built when all people are willing to help each
other and to care about each other.
Sharon Mutual trust is important in this business because this is a human business.
Without trust we won’t be able to go further and the trust builds the teamwork.
Julie Mutual trust is very important in the entire team, be it Malaysia or
international. They have to work together and believe in each other.
Jennifer Mutual trust is built from constant communication and relationships. It’s a
mutual benefit and there’s duplication of what we say and they do.
Stacey Mutual trust is very important. Staying connected to the team is the key.
When we keep a good relationship with the core leaders in those countries,
they will bring the message down to their partners.
Yolanda Mutual trust is important. People also value the integrity of the organization
and the culture. We walk the talk.

For the seasoned distributors, mutual trust is the foundation of their business. Without
mutual trust, the business does not grow. Seasoned distributors express mutual trust through
regular communication, guiding their teams, and “walking their talk.” As seasoned distributors
foster mutual trust among their teams, core leaders will send the message down to their partners.
ENTREPRENEURIAL ENGAGEMENT 95
Mutual trust builds teamwork. Without mutual trust, seasoned distributors firmly believe that
their business will go “nowhere.” It appears that this concept of mutual trust is what allowed
these leaders to build global teams of 50,000 people spread out among 50 different countries.
Without mutual trust, and a belief in each other, their teams cannot expand in this explosive way.
Seasoned distributors value initial One System trainings but do not develop their
distributors through trainings focused on entrepreneurial engagement. From an
organizational standpoint, H. Enterprises excels at providing low budget initial trainings for its
new distributors that focus on product benefits, growth mindset, the first 90 days of running a
distributorship, and how to share success stories with potential business partners to encourage
them to join the organization. Few trainings, if any, focus on entrepreneurial engagement or how
to stay connected to the organization. Moreover, as mentioned in the prior knowledge and
motivation sections, seasoned distributors do not have a uniform approach to training their
business leaders and developing trainings that have an impact on entrepreneurial engagement.
As teams in H. Enterprises expand to 40,000 or 50,000 distributors all over the world, it
becomes increasingly difficult for seasoned distributors like Harry, Iris, or Sam to engage all of
their distributors. Throughout the interviews with the 12 seasoned distributors, it became clear
that duplication was the key to each of the distributor’s success. In order to duplicate
themselves, the seasoned distributors find core leaders in each of their teams who established an
interest in being successful in the organization. For example, even though Harry spends 40% of
his time with his new distributors, he finds out who is most engaged with his organization by
“checking reports” from the back office of each country and from that report he knows which
country is active just from its sales volume. Thus, for Harry, entrepreneurial engagement
equates to a monetary value. Once Harry learns which country has a high sales volume, he then
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observes who is active in his WhatsApp chat groups. Subsequently, Harry observes through the
back office who has a team that is growing and remains connected with those specific leaders.
Once Harry identifies the core leaders he is able to discern what they need to move their teams
forward and develops trainings for them accordingly. Thus, for Harry entrepreneurial
engagement is a result and not a process that he encourages from the initial trainings. Harry’s
trainings further develop those distributors who are already engaged and not those who might be
struggling.
For another seasoned distributor, Sharon, she observes which of her distributors follow
the One System. It is important for her to see whether her distributors are following what they
are being taught. If they do not follow the trainings and teachings, those are not the leaders she
wants to develop. Sharon emphasized again, the importance of being able to duplicate herself.
In order for her to be successful in 33 countries with 50,000 distributors, she needs to make sure
that her leaders can run by themselves. She also monitors her leaders through WeChat and other
group chats. Since a lot of her leaders are concentrated in Malaysia, she flies there to conduct
special trainings with her leaders. Again, however, for Sharon, entrepreneurial engagement is
the impetus for her to develop further trainings. She does not do anything to ensure that her
distributors are otherwise engaged. She lets the system sort out her leaders and develops her
leaders accordingly.
Another seasoned distributor, Margaret, expressed significant frustration with all of the
excuses she receives from new distributors claiming they want to be successful. While she
acknowledges the importance of education and training, she claims to never have heard so many
excuses about why a distributor cannot do something. Thus, she turned her attention from
training new distributors and “babysitting” to helping distributors who show effort by “calling a
ENTREPRENEURIAL ENGAGEMENT 97
lot, asking a lot of questions, sending text messages and communicating.” For Margaret, the key
is helping people who are already engaged.
There is little question that the seasoned distributors agree that helping new distributors is
important to them as well as to the success of their global business. However, with respect to
developing trainings that focus on entrepreneurial engagement, this does not appear to be a key
priority or concern. In fact, the seasoned distributors shared that they end up developing new
trainings for emerging leaders in a one-on-one format that are personalized for those leaders’
specific needs. Moreover, they do not have time to spend with all of their distributors. As a
result, they spend time with distributors who show through their actions that they are already
engaged and want to build their business.
Cultural Settings
This section focuses on the cultural settings in H. Enterprises and what organizational
needs are necessary for seasoned distributors to train new distributors based upon best principles
practices in a standardized manner. Prior to the distributor interviews, several cultural settings
were identified as needs including the need for seasoned distributors to set aside time from
running their own businesses to train new distributors, the need to have role models within the
organization who prioritized the training of new distributors, and the need to develop a
communication plan regarding the standardized training of new distributors. The three cultural
settings are explored in detail below.
Seasoned distributors focus their limited time on allowing new distributors to watch
how they share the business opportunity with new distributor prospects. Throughout the 12
seasoned distributor interviews, it became apparent that seasoned distributors set aside time to
train new distributors, but they focus their limited attention on the ones who are active in
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building their businesses. New distributors show they are “active” by “plugging” into the One
System, implementing the lessons from the trainings, engaging in the group chats, as well as
through their sales volume and sponsorship of new distributors.
One seasoned distributor, Hugh, explained that the way seasoned distributors train new
distributors, outside of plugging them into the One System, is by training them to share the
opportunity. Once the new distributor piques the interest of a prospect, Hugh trains them to say,
“I’m not professional. I’m not expert. I’d like to introduce you to those people and to the
meetings. You can listen to them. See what they think, what they’re doing, what business they
do. If you’re interested, just learn from them, just follow them. It’s easy.” Hugh further
explained that in each country, seasoned distributors host what is called an “business
development meeting.” In these meetings, they gather prospects in a room who then listen to the
success stories of seasoned distributors. The seasoned distributors break down into steps what it
takes to be successful in the business. If the prospect is interested, the sponsoring distributor
then introduces the prospect to the seasoned distributor, who is usually a Platinum and making
millions of dollars per year. Hugh explained that this “sharing process” is akin to telling family
or friends about a great movie you just saw at the theater. Thus, for Hugh, once the new
distributor is trained by plugging into the One System, they begin to attend these business
development meetings with their own prospects. At this stage, there does not seem to be much
additional training beyond what is given through One. The focus is on new distributors building
their teams.
Another seasoned distributor, Yolanda, explained that several of her core leaders think
the bulk of her training is focused on business development meetings and big audience
presentations: “People think our business is about speaking on stage, and actually there’s only a
ENTREPRENEURIAL ENGAGEMENT 99
very small portion because when you do an event with 200-2,000 people, there’s only one
message coming from one direction.” Yolanda further explained that her work occurs after the
big meeting, in one-on-one meetings, explaining the business opportunity to potential
distributors. Again, for Yolanda, she carves out time to train new distributors, but this “training”
is really shadowing Yolanda as she explains the business opportunity to the prospect of the new
distributor.
While it appears seasoned distributors carve out time to train new distributors, the
training is passive. It entails the new distributor simply sharing the opportunity with prospects
and introducing the prospects to the seasoned distributors who “close” them. This is problematic
because in order to get assistance from the seasoned distributors, new distributors must show
they are “active” in the business. They do this through sales and individual activity and
communication. Without evidence of their engagement, the seasoned distributors might not
spend any time training new distributors.
Seasoned distributors look to distributors who achieved a high rank and large
followership but not necessarily those who prioritize training. In speaking with the 12
seasoned distributors, many look to the founder for guidance on how to run and build their
businesses. As the highest ranking distributor in her organization, the founder is the one who is
also responsible for developing the One System and helping each of the seasoned distributors
achieve their own ranks. While the founder encourages education and training among her
downline (the entire organization), she can also only spend a limited amount of time with core
leaders. The founder’s core leaders are also high-ranking distributors who have the largest
teams. Thus, seasoned distributors seek role models who achieved a high rank in the
organization, not necessarily those who prioritized training and development for their teams.
ENTREPRENEURIAL ENGAGEMENT 100
While all seasoned distributors acknowledge the importance of education and training to the
development of their global teams, they seem to default to the training new distributors receive
through One System or the one-on-one training they offer to their high-performing leaders.
One seasoned distributor emphasized the need for role models in the multilevel marketing
industry, but not as it related to the development of trainings for new distributors. Yolanda
explained, “We start from scratch. If you go to Amway, Market America, they have a beautiful
manual. They have beautiful training courses, but the people who make it are way less. So
sometimes the manual might actually restrict people.” For Yolanda, it is important to have role
models in the organization who know how to share the opportunity with other people. She
explained that even if 10 people are talking about the opportunity, they will share it 10 different
ways so that it almost feels like 10 different companies. She emphasized how important this was
to the expansion of the business because one of the 10 stories will inspire a new prospect to join
the organization.
For another seasoned distributor, Sam, it is critical to focus on his existing business rather
than find new ways to train new distributors. He explained, “At the beginning, you have to sort
through everybody. It’s like a stack of cards, you’ve gotta go through the whole stack to find
four aces. Six years afterwards, now that I’m doing very well, I need to be choosy.” He
explained further that it takes a lot of time to train new distributors on how to start an
organization so “most of [his] time is helping the existing organization.” Sam is a Platinum. In
helping his organization grow, Sam emphasizes the importance of the “attitude of gratitude” so
that “people will pay it forward.” Sam explained that training and education is important for the
“foundation of the whole organization” but it is the culture that carries it forward because it
“leads people to certain actions.” Thus, Sam does not necessarily seek role models who
ENTREPRENEURIAL ENGAGEMENT 101
prioritize training for new distributors, but rather role models who will perform “the right actions
to keep moving the business forward and give the opportunity to people around the world.”
The leaders in H. Enterprises rely on leveraging the One System training platform as well
as building their teams through sharing stories. Thus, even though the seasoned distributors
emphasize the importance of education and training, the training new distributors receive is
largely “set.” New distributors receive additional training through their attendance at business
development meetings, and once their business is booming, they receive one-on-one training
with high-performing distributors in the organization. Accordingly, H. Enterprises does not
emphasize the need for role models who prioritize training of new distributors, but rather role
models who are engaged in the business and actively making it grow.
Seasoned distributors communicate daily with their teams and also regularly share
dates of business development meetings. All of the seasoned distributors use electronic means
of communicating with their teams. They use Facebook, WeChat, WhatsApp, LinkedIn, and
email, among others. This is one way seasoned distributors measure who on their teams is
“active.” But, they also use these platforms to share information with each other, including the
dates of upcoming business development meetings and events. According to Sam, it is so
important to “watch rather than hear” in order to learn how to be successful in the business.
Thus, for them, the business development meetings are a way for new distributors to learn the
essence of the business, which is sharing the business opportunity. Sam explained it further: “If
you’re in it, you learn a lot faster than just by reading it, or listening to somebody teach you.”
Sam then quoted Confucius: “Once you do it, then you understand it.” Thus, while it may not
appear to be a traditional training, the business development meetings, according to Sam are
critical to the growth of the business.
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There does not appear to be a communication plan regarding the standardized training of
new distributors, primarily because the initial training is composed of getting plugged in to the
One System. Since these trainings exist online, in a YouTube channel, there is little need to
share these trainings on a daily basis, via a communication plan. The 12 distributors did not
express an interest in developing additional trainings for new distributors, beyond what exists in
the One System. They emphasized, instead, the need to leverage the One System, and train core
leaders in a one-on-one format. However, if, in the future, seasoned distributors develop
leadership training for their core leaders, the need to develop a communication plan regarding
standardized training opportunities may be more pressing.
Summary of Results and Findings for Organization Needs
Through the 12 seasoned distributor interviews, it became apparent that there are
organization needs that exist for seasoned distributors and new distributors. Table 12 shares the
results from each organization need along with a brief explanation, which summarizes the
discussion above.

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Table 12
Summary of Results and Explanation for Organization Needs

Assumed
Organization Need
Category Result Explanation
Need to be adaptable
and open-minded to
learning new skills in
order to maximize
performance
Cultural Model Not Validated Seasoned distributors are open-
minded and adapt and learn new
skills as they grow their business
and expand globally.
Need to foster a culture
of mutual trust where
distributors feel valued
Cultural Model Not Validated Each seasoned distributor
expressed how critical mutual
trust is to the foundation of their
global, virtual organization.
Need to value the
development of
trainings which will
increase
entrepreneurial
engagement
Cultural Model Validated Seasoned distributors identify
new distributors who are active
and train them, instead of
providing training for struggling
distributors who are not engaged.
Need to set aside time
from running their own
businesses to train new
distributors
Cultural Setting Validated With their limited time, seasoned
distributors show new, active
distributors how to share the
business opportunity.
Need to have role
models within the
organization who have
prioritized the training
of new distributors
Cultural Setting Validated Distributors seek role models
who have achieved a high rank
and have a significant
followership. Training is not a
key concern.
Need to develop a
communication plan
regarding the
standardized training
of new distributors
Cultural Setting Validated in
part
Seasoned distributors
communicate regularly and share
dates for events and opportunity
meetings. They rely on the One
System to train new distributors.
ENTREPRENEURIAL ENGAGEMENT 104
CHAPTER FIVE: SOLUTIONS AND IMPLEMENTATION
This chapter is designed to offer an evidence-based solution to address the needs
identified for H. Enterprises in the areas of knowledge and skills, motivation, and organization.
Specifically, Chapter Five addresses the second research question in this two-part series:
1. What are the knowledge and skills, motivation, and organizational needs necessary for
seasoned distributors in H. Enterprises to train new distributors based upon best practices
principles in a standardized manner?
2. What are the recommended knowledge and skills, motivation, and organizational
solutions to those needs?
This chapter is divided into four distinct sections. The first section addresses validated needs and
a rationale for developing a solution for those needs. The second section explores relevant
research and offers a solution to address the needs identified through the interviews conducted
with senior leaders from H. Enterprises. The third section sets forth an implementation plan of a
key solution that aims to address high priority needs in the categories of knowledge and skills,
motivation, and organization. Finally, the fourth section presents an evaluation plan, which is
designed to guide implementation of the proposed solution and assess progress accordingly.
Selection of Validated Needs and Rationale
In Chapter Four, knowledge and skills, motivation, and organizational needs were
analyzed and either validated, validated in part, or not validated. A summary of the needs that
address, specifically, the knowledge and skills, motivation and organizational needs necessary
for seasoned distributors in H. Enterprises to train new distributors based upon best practices
principles in a standardized manner are shown in Table 13.
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Table 13
Summary of Assumed Needs and Results
Assumed Need KMO Area Category Result
Seasoned distributors need to know what
new distributors know about company
products
Knowledge Factual Not Validated
Seasoned distributors need to know what
new distributors know about entrepreneurial
engagement
Knowledge Factual Not Validated
Seasoned distributors need to know what
new distributors know about the sales
process, client retention techniques, customer
service, accounting, operations and
recruitment
Knowledge Factual Not Validated
Seasoned distributors need to know what
new distributors know about foundational
business knowledge required to run a
business
Knowledge Factual Not Validated
Seasoned distributors need to know what
new distributors know about country-specific
legal issues
Knowledge Factual Not Validated
Seasoned distributors need to be able to
distinguish levels of assistance required by
new distributors
Knowledge Conceptual Not Validated
Seasoned distributors need to know how to
enhance skills and knowledge in order to
survive business challenges
Knowledge Procedural Not Validated
Seasoned distributors need to know how to
convey entrepreneurial and leadership
training in order to compete globally
Knowledge Procedural Validated in
part
Seasoned distributors need to know how to
conduct effective new distributor trainings
Knowledge Procedural Validated in
part
Seasoned distributors need to be able to
know how to reflect on their own
effectiveness as trainers for new distributors
Knowledge Metacognitive Validated in
part
Seasoned distributors need to see value in
developing, implementing, and conducting
training for new distributors
Motivation Utility Value Validated in
part
Seasoned distributors need to have a high
level of interest in training new distributors
Motivation Intrinsic Value Validated in
part

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Table 13, continued
Assumed Need KMO Area Category Result
Seasoned distributors need to set goals
related to developing, implementing, and
conducting training for new distributors in
entrepreneurial engagement and company
products
Motivation Goal-setting Not Validated
Seasoned distributors need to know they are
capable of developing, implementing, and
conducting training for new distributors
Motivation Self-efficacy Not Validated
Seasoned distributors need to be adaptable
and open-minded to learning new skills in
order to maximize performance
Organization Cultural Model Not Validated
Seasoned distributors need to foster a culture
of mutual trust where distributors feel valued
Organization Cultural Model Not Validated
Seasoned distributors need to value the
development of trainings which will increase
entrepreneurial engagement
Organization Cultural Model Validated
Seasoned distributors need to set aside time
from running their own businesses to train
new distributors
Organization Cultural
Setting
Validated
Seasoned distributors need to have role
models within the organization who have
prioritized the training of new distributors
Organization Cultural
Setting
Validated
Seasoned distributors need to develop a
communication plan regarding the
standardized training of new distributors
Organization Cultural
Setting
Validated in
part

As Table 13 demonstrates, there are needs that exist in each category of knowledge and
skills, motivation, and organization. However, in the past year, Vitality more than doubled its
sales revenue to become a $1B company. Vitality’s growth is unprecedented as it continues to
add hundreds of thousands of distributors per year. As one of its Vitality’s biggest distributors,
H. Enterprises is helping Vitality break sales records, expand into other countries and regions of
the world, and function as one of Vitality’s critical distributor legs. Without H. Enterprises,
Vitality would not achieve these milestones. Like many organizations, H. Enterprises faces a
conundrum. There are identified gaps in knowledge and skills, motivation, and organizational
ENTREPRENEURIAL ENGAGEMENT 107
resources. However, despite these gaps, H. Enterprises currently outperforms the market and is
growing exponentially. Thus, H. Enterprises is forced to consider whether it should even address
the organizational gaps. If H. Enterprises chooses to address the gaps, it must next identify what
initiatives will have an impact on organizational performance, and finally, how much the
initiatives will cost to implement and evaluate.
The Cost of Doing Nothing
In 2013, Gallup, pursuant to its ongoing study of employee engagement, published “The
State of the Global Workplace: Employee Engagement Insights for Business Leaders
Worldwide,” which revealed that only 13% of workers worldwide are engaged. Gallup defines
engagement as a worker who is “emotionally invested” and focused on creating daily value for
the organization (Gallup, 2013). Since the 1990s, Gallup has administered its Q12 survey to
over 25 million workers, in 195 countries, in 70 languages. In its Q12 survey, Gallup measures
four stages of engagement, and asks workers to consider the following: (1) what do I get from
this role; (2) how do I contribute; (3) do I belong; and (4) how can I make improvements,
innovations, or contributions. In its latest study, Gallup administered the Q12 survey to an
additional 230,000 workers in 142 countries. Gallup then grouped workers’ responses into three
categories: (1) engaged; (2) not engaged; and (3) actively disengaged. After analyzing the
results, Gallup made several key findings about engagement and the cost of disengagement,
including (1) disengagement drains world economies, (2) engagement varies widely from region
to region, (3) engagement leads to the perception of job growth, (4) poor management practices
hinder organizational performance and engagement levels, (5) engagement leads to feelings of
positivity and living better, and (6) education is often associated with higher engagement levels.
Gallup concluded, through its findings, that engagement is critical to an organization’s
ENTREPRENEURIAL ENGAGEMENT 108
productivity, profitability, and customer satisfaction, which are ultimately the key to its longevity
and financial success.
Fiscal Impact of Engagement
After analyzing the data, Gallup found that organizations who rank in the top 25% for
engagement, report higher productivity, more profitability, better customer ratings, and less
turnover and absenteeism. Gallup also discovered that organizations in its database that have an
average of 9.3 engaged employees for every actively disengaged employee yielded 147% higher
earnings per share (EPS) as compared to their competition. By contrast, organizations with an
average of 2.6 engaged employees for every actively disengaged employee experienced 2%
lower EPS compared with their competition.

Figure 10. Earnings Per Share Comparison Emphasizing Impact of Engagement
While organizations experience the fiscal impact of engagement, Gallup contends that
engagement is actually a much bigger issue, and has worldwide economic implications. In its
latest study, Gallup reduced disengagement to a monetary value and made a multi-country
2.6 engaged
employees for every
1 actively disengaged
employee = 2% lower
EPS
9.3 engaged
employees for every
1 actively disengaged
employee = 147%
higher EPS
ENTREPRENEURIAL ENGAGEMENT 109
comparison. Gallup estimates that active disengagement in the United States, for example, costs
approximately $450 billion to $550 billion per year. Active disengagement in Germany costs
approximately €112 billion to €138 billion per year (US$151 billion to $186 billion). In the
United Kingdom, active disengagement costs approximately £52 billion and £70 billion (US$83
billion and $112 billion) per year. After making this multi-country comparison, Gallup urged
business leaders to do what it takes to engage their workers. Accordingly, if organizations, like
H. Enterprises engaged more of their workers, they would have a dramatic impact not only their
bottom line but also on the countries where they conduct business.
Impact of Engagement on Social Good
Even though the fiscal impact of engagement provides compelling reasons for any
organization to implement initiatives to address concerns of worker engagement, in the context
of this study, the element of social good should not be overlooked. Chapters One and Two of
this study provided examples of multilevel marketing organizations that have a positive impact
on developing countries. From lipstick to treatments for malaria, these multilevel marketing
organizations afforded entrepreneurs in developing countries an ability to become more
financially independent, increase their social networks, gain access to critical health and wellness
products, empower women, and aid in decreasing the gender disparity in many regions. Thus, if
organizations like H. Enterprises develop initiatives to address entrepreneurial engagement, the
ability for entrepreneurs to reach places of the world that are not as accessible increases along
with its many benefits.
The High Cost of Doing Nothing
For many organizations, like H. Enterprises, it is tempting to overlook organizational
gaps during periods of economic growth. However, according to scholars, doing nothing is not a
ENTREPRENEURIAL ENGAGEMENT 110
good option. Engagement has a fiscal impact on an organization’s productivity, profitability, and
customer satisfaction, as well as the global economy. Moreover, engagement satisfies an
element of social good by providing more opportunities to developing countries and their
citizens. As a result, for H. Enterprises, who operates in countries around the globe, doing
nothing about entrepreneurial engagement comes with a very high cost.
According to Gallup (2013), the best way to address issues of worker engagement include
engaging leadership teams to champion the organizational philosophy of engagement, hold
managers accountable, align engagement communication efforts, and have a well-defined and
comprehensive leader and manager development program. Due to the unique structure of H.
Enterprises, unlike traditional workers, if entrepreneurs encounter an issue, they cannot choose to
leave their uplines and join another upline. If the issue they encounter is insurmountable, the
entrepreneur’s only choice is to transition to a consumer or quit. Thus, it may be even more
critical for H. Enterprises to address issues of entrepreneurial engagement at its core leadership
level to ensure leadership alignment with the organizational philosophy, hold its leaders
accountable, align communication efforts, and develop a comprehensive program for its leaders
to empower them to be able to lead their own global teams (Gallup, 2013).
An analysis of the needs of H. Enterprises as well as the current literature reveal that
while there may be multiple solutions that can be proposed for each validated or partially
validated need, in this context, one comprehensive solution exists to address the most significant
needs of H. Enterprises. Notably, H. Enterprises lacks a hierarchical structure and its distributors
operate in an incredibly diverse environment with respect to cultures and languages. Moreover,
all distributors operate their businesses using an e-commerce platform. Thus, any proposed
solution must address the global, diverse needs of the organization as well as how distributors
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most effectively communicate. The solution proposed, a lead-the-leader training solution is
based upon evidence from the 12 distributor interviews, as well as an analysis of current
literature, learning and motivation theories, and organizational performance. The lead-the-leader
training solution is summarized below along with an implementation plan that demonstrates the
ease of integration into the current organizational structure. Finally, this chapter addresses a
method to evaluate the effectiveness of the solution.
Proposed comprehensive solution to address needs in all categories develop lead-the-
leader training program. The interviews with Bronze Plus distributors revealed that they each
approach the leadership development of their team members quite differently. While it is
important for seasoned distributors to be able to convey entrepreneurial and leadership trainings
to their distributors in order to compete globally, it was confirmed through the interviews that
there is no systematic method for providing leadership trainings to distributors to ensure they are
able to lead their own global teams. Most seasoned distributors rely on one-on-one trainings to
develop key leaders. This approach is problematic once a team grows to thousands of members
and is spread out among multiple countries. It is further complicated by cultural and language
barriers. Moreover, the inability of H. Enterprises to effectively and efficiently develop its
leaders has a negative impact on its profitability and growth. Thus, it is important to develop a
lead-the-leader training program to help high-ranking distributors convey critical information to
their teams and empower them with the skills they need to train their global teams. Research and
practice suggest several key dimensions of lead-the-leader training programs to consider in
designing the program for H. Enterprises. These details regarding the lead-the-leader training
program are discussed below.
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Factors that impact success of lead-the-leader training programs leadership
curriculum for business. Before designing a lead-the-leader program, H. Enterprises should
have a deep understanding of existing leadership curriculum and factors that impede the
development of leadership curriculum. In exploring existing leadership development curriculum,
H. Enterprises can survey potentially cost-effective, efficient, and productive curriculum
alternatives. Notably, since H. Enterprises has a complex business structure, it needs be
intentional with respect to how it designs its lead-the-leader program.
Many scholars agree that leadership curriculum is difficult to design. Allen, Miguel and
Martin (2014) contend there are four main reasons preventing the design and implementation of
effective leadership curriculum: (1) there is a lack of empirical and theoretical research on
designing effective leadership curriculum; (2) there is a lack of transferable leadership skills
from student to manager and leader; (3) there is no well-developed leadership development
theory; and (4) faculty do not use existing research or evidence-based teaching in delivering their
leadership courses. In examining the challenges that exist in leadership development curriculum,
Allen et al. (2014) identify and propose a model for developing curriculum called the Know, See,
Plan, Do Model. Even though Allen et al. (2014) contend the KSPD model was designed for use
in higher education settings, they acknowledge that their model can also be used in
organizational environments.
Allen et al. (2014) explain their model through each of its core components, know, see,
plan and do. With respect to know, Allen et al. explain that at the beginning of every leadership
development curriculum, students should be well steeped in leadership theory, concepts and
literature. According to the authors, students may learn about women in leadership, power and
leadership, authenticity, transformational leadership, and ethics, among many other key concepts
ENTREPRENEURIAL ENGAGEMENT 113
and theories. Through this foundation, students are then able to ascend to the next wrung of the
leadership development curriculum ladder.
In See, Allen et al. (2014) expect students to integrate new leadership information into
existing mental schema. In this See Phase, students begin to practice the leadership concepts
they obtained in the Know Phase. The authors suggest that in practicing these concepts, the
students may elect to keep a daily diary of leadership events that occur, students may watch
videos to examine what types of leadership styles are being expressed, or in an online setting,
students might blog about specific leadership concepts they observed. The See Phase takes time
for students to practice what they learned.
Since the goal of leadership development curriculum is to move students from novices to
experts, they must synthesize the information they’ve learned and understand how to properly
analyze a problem before they can solve it. According to Allen et al. (2014) since leaders are
often confronted by unique problems, they must be adept at problem-solving skills. Leaders
must be able to define the problem, generate solutions, and develop the best plan to solve it. In
the Plan Phase, students are tasked with developing skillful interventions. The Plan component
requires students to be able to forecast potential outcomes and evaluate options available for
taking action. The authors suggest that students can practice this skill by examining a past
failure and serving as class consultants to each other. This type of practice allows students to
critically reflect on and analyze the past failure and generate alternative solutions.
In the Do Phase of the development of leadership curriculum, Allen et al. (2014)
emphasize the importance of applying knowledge from different perspectives and then taking the
appropriate action. In this phase, the authors highlight the importance of experiential learning,
which enables students to acquire knowledge in four phases: Experience, Reflect, Think and Act.
ENTREPRENEURIAL ENGAGEMENT 114
The goal, in the Do Phase, is to provide students with an opportunity to implement a plan. Allen
et al. (2014) suggest that to test this component, instructors should provide students with the
opportunity to complete a larger project and give as examples breaking a Guinness world record,
assisting a non-profit, or planning an event.
H. Enterprises does not have a bevy of leadership development curriculum to analyze and
guide it in developing its own program. However, the Know, See, Plan, Do model proposed by
Allen et al. (2014) can provide H. Enterprises with significant guidance. Each component of the
KSPD model provides H. Enterprises with a framework to consider as it designs and moves
forward with the lead-the-leader training program.
Adult Learner Issues
In the context of this innovation study, it is important to note that the distributors who
join H. Enterprises are adults. Thus, it is critical to understand, when considering the
implementation of an online learning platform how a new initiative like the lead-the-leader
training program should be designed for the largest impact on H. Enterprises’ adult learners. In
describing the approaches to take in designing curriculum for adult learners, a discussion of
andragogy is important.
According to Knowles, Holton and Swanson (2011) andragogy encompasses the methods
and approaches taken in designing curriculum for adult students. Knowles et al. (2011) illustrate
several aspects of adult learners that make them different from traditional learners. First, adult
learners do not excel in a rigid, uncompromising and authoritative environment. Moreover, in
many adult classes, the teacher and the student have equal authority, and at times, it is difficult to
discern who benefits from the class more–the adult learner or the teacher. Finally, adult learners
are typically intrinsically motivated and they can only meet their goals, needs, and interests
ENTREPRENEURIAL ENGAGEMENT 115
through furthering their education. Indeed, adult learners need to know why it is important to
learn something (Fidishun, 2000). As a result, in designing effective adult online curriculum, the
point of inquiry for teachers really needs to begin with student needs and interests. Moreover,
according to Stilborne and Williams (1996) adult learners learn only what they need to learn,
learn by comparing past experiences with new ones, need immediate feedback regarding their
progress, want to engage in practical learning experiences, try to avoid failure, and adults do not
learn in the same way as younger peers.
Since adults learn in different ways, the online curriculum designer and instructor must
consider various learning strategies before designing online curriculum and instruction for adults.
While there are many learning strategies that could be considered, four particular strategies are
important in this context, including contextual, experiential, self-directed and transformational.
First, contextual learning engages the adult learner in tasks featuring real-world scenarios with
which they can relate using their prior experience, culture and profession (Bransford, Brown, &
Cocking, 1999). Since adults like to relate new experiences with prior experiences, contextual
learning can provide adults with a rich and fulfilling learning experience.
Experiential learning, on the other hand, is the result of making meaningful connections
between what the adult learner already knows and new concepts that are introduced.
Experiential learning involves action, reflection, abstraction and application (Itin, 1999). To
have a successful experiential learning experience, the instructor must make clear the new
knowledge, help the adult learner connect the new knowledge to prior knowledge, and assist the
adult learner in an analysis of the learning experience.
Self-directed learning is also proven to be a successful strategy in engaging adult online
learners. However, to be successful, self-directed learning requires the adult learner to be
ENTREPRENEURIAL ENGAGEMENT 116
intrinsically motivated and goal-oriented (Merriam, 2001). Self-directed learning is often the
best learning strategy to employ in learning environments that require a high level of
independence from adult learners.
Finally, transformational learning uses critical reflection as its foundation.
Transformational learning can occur gradually or suddenly and changes the way learners see the
world and themselves (Baumgartner, 2001). Adult learners, through critical analysis, reflect on
unique scenarios that force them to engage in their own learning experiences by using their own
goals and reference points.
While it is important to consider various learning strategies when designing online
curriculum for the lead-the leader program, it is also critical for designers and instructors to
know whether their adult students are comfortable navigating the technology required to learn in
the online space. Many adults do not yet have the technological prowess to engage in the online
learning process. Thus, adult learners need to first master the technological skills required to
engage in online learning (Fidishun, 2000). Even though seasoned distributors already leverage
several methods of communicating electronically, it is important, when designing this lead-the-
leader platform to provide collaborative learning spaces, online access to resources in multiple
formats, and multiple ways to express key ideas to engage differentiated learners (Stilborne &
Williams, 1996).
Types of Trainings
In developing its lead-the-leader training program, H. Enterprises must consider the
various modes of program delivery including asynchronous and synchronous online formats, on-
demand training possibilities, and on-the-job training elements. In analyzing the various modes
of delivery, H. Enterprises must remain mindful of its organizational structure as well as other
ENTREPRENEURIAL ENGAGEMENT 117
factors that might prevent successful implementation, including language barriers, cultural
barriers, and challenges for women entrepreneurs. An overview of each mode of training
delivery follows.
Asynchronous versus synchronous online learning environments. Asynchronous
online learning environments are flexible and self-paced. Learners can access the prerecorded
coursework with a variety of tools and learning management systems. Notably, asynchronous
learning is unique as it does not require a set time or date for accessing the materials. Through
research, scholars determined that courses offered in certain asynchronous formats provided
students with a sense of community, an ability to reflect on material and form a proper response,
and increased collaboration among classmates (Knapcyzk, Frey & Wall-Marencik, 2005).
As courses began to transition online, many educators tried to use synchronous formats to
mimic traditional on campus courses. In synchronous classes, the instructor and students are
logged in at the same time and communicate with each other directly (Shi & Morrow, 2006).
Online formats include webinars, live lectures, video conferencing and chat rooms. Synchronous
courses are highly interactive and involve real-time sharing of information. The challenge,
however, is that synchronous courses require all participants to be online at the same time.
Several studies found that the most successful synchronous courses have a high level of
participant interaction, which allows students to understand and retain the information thereby
increasing their course achievements (Offir, Lev, & Bezalel, 2008). To achieve high
interactivity throughout the course, the instructor, must therefore be well-versed in the technical
aspects of course delivery (Reushle & Loch, 2008).
Even though asynchronous and synchronous learning environments are widely used,
many scholars debate the effectiveness of each delivery and format as well as the impact it has
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on student learning. In her study, Skyler (2009) used both asynchronous and synchronous
elements in an online course and subsequently measured student learning, student satisfaction,
and student confidence regarding use of technology. The results of her study found that both
methods of online delivery were effective. However, almost three-fourths of the students
surveyed stated that they would rather take a course with synchronous lectures versus a course
with asynchronous text-based learning elements. Finally, Skylar’s study demonstrated that
students enrolled in an online course perceived an increase in their technological skills as a result
of the course.
Even though scholars contend that asynchronous and synchronous online delivery
formats do not have an impact on the level of retention and performance, many students prefer
synchronous elements. Thus, in developing its lead-the-leader training program, H. Enterprises
should consider incorporating synchronous elements into its program to maximize distributor
engagement and satisfaction. Moreover, H. Enterprises must also build into its lead-the-leader
training program significant resources to assist trainers with the technological aspects of the
training delivery.
On-demand training. On-demand training allows a student to access digital learning
opportunities when the student needs them (Davenport, 2005). On-demand learning usually
consists of modules that are delivered in a variety of ways, including web-based, face-to-face or
hybrid formats. On-demand training can also be delivered with low-tech tools or high-tech
systems (Paradise, 2008).
According to many scholars, IBM led the market on the implementation of on-demand
learning for the organization. According to employees at IBM, on-demand education and
training offers employees a way to integrate learning with work in order to enhance their
ENTREPRENEURIAL ENGAGEMENT 119
performance (Davenport, 2005). In addition, on-demand learning opportunities can be
personalized and relate to a worker’s role, goals, and activity.
On-demand learners are typically adults who value learning, prefer to control how it is
accomplished, and want to exercise power over when it is scheduled and when they can use it
(Hartley, 2000). Successful on-demand learners share the following characteristics: they take
initiative, desire information, are flexible, and are oriented around goals, careers, and results.
With respect to leadership curriculum, in particular, even though some scholars contend that
managerial skills and leadership training are not as effective in an on-demand format, many
practitioners believe it is a good substitute when traditional training methods are unavailable or
cannot meet the needs of the organization in a timely manner (Comacchio & Scapolan, 2004).
On-demand trainings offer many benefits to participants. On-demand training caters to
independent, adult learners who can choose when to engage and access the training. For many
distributors, this type of training is ideal. Moreover, even though scholars criticize the use of on-
demand training for leadership skills, with distributors all over the world, traditional training
methods are not always feasible. Thus, H. Enterprises should consider incorporating on-demand
training material in part of its lead-the-leader training program.
On-the-job training and development. In traditional on-the-job training, trainees
experience work as a primary observer. As a result, the training is unstructured and follows the
flow of the work being done by the trainer (Sisson, 2000). Generally, an on-the-job trainer is a
skilled worker who may even be an expert in his or her job. However, the trainer is not a trained
instructor. Sisson (2000) contends that on-the-job training is not an effective method since it is
not standardized, relies heavily on the trainer to convey the information in a show-and-tell
format, and as a result, produces inconsistent results. Despite criticisms of using on-the-job
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training, Sisson (2000) shares four reasons it is still the dominant training method: (1) it is a
hands-on training; (2) includes real-world practice; (3) is a simple approach; and (4) requires no
corporate formalities and relies heavily on informal interactions among workers.
In his book, Sisson (2000) advocates using a hands-on training approach instead of a
traditional on-the-job training approach. To be effective, hands-on training requires six steps: (1)
prepare for the training; (2) open the training session; (3) present the training subject; (4) practice
the training skills; (5) evaluate trainee performance; and (6) review the training subject.
According to Sisson (2000) in preparing for the training, the trainer needs to have the
materials ready to distribute, set up the training area, and simply get ready. In opening the
session with the trainee, the trainer should determine the trainee’s skill level, explain the
objective of the training, and share reasons why the training is important. In presenting the
subject, the trainer should start a two-way demonstration by going step-by-step. The trainer
should conclude this step by demonstrating twice and setting the trainee up to practice the skill.
In order to practice the skill, the trainer should set up something realistic. After the trainee
attempts the skill, the trainer must evaluate his or her performance. In evaluating the
performance, the trainer should observe critically, offer words of encouragement, provide
coaching, stress the importance of quality over expeditiousness, and ask the trainee a lot of
questions. Finally, in reviewing the training subject, the trainer should review the trainee’s
performance, set up additional practice opportunities, offer guidance, follow-up with the trainee
frequently, and encourage the trainee to ask the trainer questions as the trainee masters the skill.
According to Sisson (2000) the HOT POPPER training method is best accomplished
individually or in small groups. To that end, the biggest limitation to the hands-on training
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approach is the inability of a trainer to address large groups since many participants will not be
able to view the live demonstrations or participate fully.
Instead of on-the-job training, H. Enterprises should consider incorporating elements of
the hands-on training approach outlined by Sisson (2000). However, in doing so, H. Enterprises
must be mindful of the hands-on training limitations. For example, the hands-on training
methods are best geared toward small audiences. Accordingly, H. Enterprises should reserve this
mode of training delivery for practicing elements of the lead-the-leader training program and not
delivering detailed content.
Elements of a Successful Lead-the-Leader Training Program
It is critical for seasoned distributors to be able to convey entrepreneurial and leadership
trainings to their downline distributors, but it should not be done on a one-on-one basis. This
approach is unwieldy as a team grows to thousands of distributors in multiple countries. Through
research as well as a deep understanding of the practice of seasoned distributors, elements of a
proposed lead-the-leader training program are outlined and discussed in detail below.
Define problem or identify issues training is meant to address. As entrepreneurs,
seasoned distributors have little time to engage in anything other than the operation of their
businesses. Thus, for the lead-the-leader training to be successful, it will be important for the
trainers to share with the adult training participants what the training attempts to solve and the
impact it has on their global businesses’ success (Knowles et al., 2011).
Establish alignment with core leaders. The multilevel marketing environment is
unique because there is no management hierarchy. Since the lead-the-leader training program is
a latitudinal initiative, there must be alignment with core leaders since they rely on their
ENTREPRENEURIAL ENGAGEMENT 122
influence to change the behaviors of their downlines. Thus, all core leaders must be in alignment
with the purpose of the training as well as the organizational objectives it attempts to achieve.
Identify stakeholder needs. It is critical for trainers to identify key internal and external
stakeholder needs. Once the trainers have an understanding of stakeholder needs, the training
can be tailored to meet those needs. If stakeholder needs are properly identified and addressed,
the training participants will complete the training with a renewed motivation to transfer the
skills they learned to their global businesses. In this regard, it is important for the trainers to be
familiar with the multilevel marketing environment as well as the culture of H. Enterprises and
its empowerment capabilities.
Create course objectives. With the help of an expert consultant, course objectives
should be created. In creating these objectives, the consultant should define the roles of key
individuals in the training program, define the characteristics of a successful trainer, and identify
the importance and significance of the training. Course objectives will allow the trainers to
measure the effectiveness of the lead-the-leader training to determine whether to modify any key
areas.
Goal-setting. A core group of leaders needs to engage in goal-setting for the lead-the-
leader training program. In this regard, it is important to establish the significance of planning as
well as the importance of creating lesson plans. The goals established for the lead-the-leader
training program will have a measurable impact on performance outcomes because they will
specify the requirements for a successful program (Zimmerman et al., 1992). Goal-setting will
also require training participants to engage in self-monitoring and self-judgement in the course of
performance (Zimmerman et al., 1992).
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Define learning environment and mode of delivery. Scholars advocate the use of
multi-sensory methods to teach new material. Moreover, to keep trainers organized, a consultant
should establish and implement a training checklist. The checklist should include a line item for
trainers to ensure the learning environment is safe and comfortable for the training participants.
Presentation skills. Presentation skills encompass not only delivery of training material
but also the appearance of trainers. Thus, a consultant should establish appropriate guidelines of
appearance for trainers. Moreover, the consultant should also lead a presentation skills training
for trainers so they know how to lead a training. For example, trainers should ask questions
during the trainings and establish ways for training participants to practice many times.
Course content. With the help of an expert, H. Enterprises should create training
exercises and simulations to achieve course objectives. Content should be developed after
stakeholder needs are identified and with significant input from seasoned distributors. Notably,
this lead-the-leader training will not necessarily address specific and individual distributor
concerns. The lead-the-leader training program is being designed as an umbrella training to help
seasoned distributors develop their own effective trainings that are geared specifically to the
issues they must resolve in their global businesses.
Course evaluation. H. Enterprises must establish a method for determining whether the
performance outcomes of the lead-the-leader training program were met. This will require
evaluations at multiple intervals with participants and trainers. Moreover, it will also include
surveys and interviews with all participants. The goal of the course evaluation is to determine
whether there was a measurable skills improvement.
This section of Chapter Five explored relevant research and offered a lead-the-leader
training solution to address high priority needs of seasoned distributors in H. Enterprises. The
ENTREPRENEURIAL ENGAGEMENT 124
next section sets forth an implementation plan of the lead-the-leader training program. The
implementation plan explores key elements of the environment in which distributors operate as
well as specific action steps to take in implementing this training initiative.
Implementation Plan
The comprehensive solution for H. Enterprises is to develop a lead-the-leader training
program, which offers e-learning opportunities as well as live training components. To do this
successfully, H. Enterprises must remain cognizant of the environment in which it intends to
implement this policy initiative. Specifically, H. Enterprises must consider language barriers,
cultural barriers as well as challenges encountered by women entrepreneurs. These
environmental factors are addressed in detail below, followed by the specific actions that should
be taken to implement the lead-the-leader training program.
Language Barriers
In this context, H. Enterprises operates in a cross-border, cross-cultural, highly virtual,
global environment. Thus, the consideration of language is highly appropriate in the context of
developing a new training and education initiative for the organization. Many scholars noted
that globalization is requiring organizations to examine language more closely. According to
Charles (2007) “only language can enable individuals and companies to communicate” (p. 261).
Many scholars explored the impact on organizations that adopted a common corporate language
(Louhiala-Salminen, Charles, & Kankaanranta, 2005, 2012).
Scholars Louhiala-Salminen et al. (2012) recognize the use of language as a corporate
asset and claim that the “true cost of the language barrier cannot be measured in terms of
translating and interpreting but in damaged relationships” (p. 264). Since language is a key to
building cultural knowledge, enhancing trust, and building rapport, H. Enterprises must develop
ENTREPRENEURIAL ENGAGEMENT 125
a strategic plan regarding its use of language in various settings, both internal and external to the
organization. Otherwise, H. Enterprises, as a diverse international organization may
unintentionally cause an imbalance of power and inequality among its distributors. It may also
inhibit knowledge sharing that is critical to successful operations and the achievement of H.
Enterprises’ organizational goals.
Cultural Barriers
Since most successful seasoned distributors lead teams of 40,000-50,000 distributors in
40 to 50 countries, it is important to consider the multicultural dimensions of a new education
and training initiative. For H. Enterprises, cultural barriers are potentially systemic. As a result,
in designing online curriculum for global distributors, H. Enterprises must consider the potential
cultural roadblocks that exist to prevent successful implementation.
To avoid dire unintended consequences, online curriculum designers and instructors must
identify ways to engage students and deliver culturally sensitive and appropriate learning
experiences (Gaudelli, 2006). Studies show that students who engage in an environment that
optimizes their learning preferences tend to score higher on learning assessments as well as
learning attitude scores versus students who learn in an unsuitable environment (Shih, Lui, &
Sanchez, 2013). Moreover, an organization whose aim it is to develop online curriculum must
also remember that the orientation of adult learners is “life-centeredness” (Alalshaikh, 2015).
The consideration of cultural issues is particularly important for H. Enterprises. Since H.
Enterprises operates in many countries, with many cultures and languages, a one-size-fits-all
solution will not work. Thus, in developing this lead-the-leader training program, H. Enterprises
will likely have to start with a pilot program and then make modifications to its training program
as it implements the program in different countries, with different cultural considerations.
ENTREPRENEURIAL ENGAGEMENT 126
Factors Affecting Women Entrepreneurs
H. Enterprises is unique. Its founder is a minority and a woman. Notably, the majority
of distributors in H. Enterprises are women, many of whom operate a distributorship in emerging
economies. Accordingly, in the context of this innovation study, there is a significant
opportunity for H. Enterprises to develop its women entrepreneurs and thus, the factors that
could impede the performance of women entrepreneurs are important to understand.
According to many scholars, women entrepreneurs harness the power to transform many
of the world’s economies. Notably, female entrepreneurs explore untapped market niches and as
a result, emerged as key players in a difficult world economy (Apergis & Pekka-Economou,
2010). However, there are many barriers to the success of women entrepreneurs, including lack
of education, finances, training, environment, and mentorship (Terjesen & Elam, 2012). For
rural women, these challenges are compounded and include lack of education, lack of
experience, lack of professional skills, lack of desire to accept entrepreneurial risk, lack of skills
in modern business contexts, and lack of quality control systems, among others (Lassithiotaki,
2011).
Studies show that training can be a pivotal factor in motivating women to become
entrepreneurs but may only meet the needs of some women (Bauer, 2011; Bhardwaj, 2013).
In his article, Bhardwaj (2013) highlights the results of several studies that demonstrate business
education has a positive effect on women entrepreneurs’ income potential. Moreover, training
builds their confidence, and, with flexible training programs and interest based skills training,
women are more apt to engage in entrepreneurial endeavors (Bhardwaj 2013).
A large majority of distributors in H. Enterprises are women, and, for many of them, H.
Enterprises is their first foray into the business world. Accordingly, it is critical for H.
ENTREPRENEURIAL ENGAGEMENT 127
Enterprises to acknowledge potential issues facing its women entrepreneurs and provide
education and training to help them combat gender-oriented business challenges. In doing so, H.
Enterprises will pave the way for them to become successful business leaders.
Implementing the Lead-the-Leader Program
In developing its training, H. Enterprises must first analyze the factors that have an
impact on the success of its leadership training program. Next, H. Enterprises must identify
action steps that will be used to implement the leadership training program. Concurrently, H.
Enterprises will evaluate its current resources, including its human asset capabilities and
organizational capacity. Subsequently, H. Enterprises will identify additional key components
that will have an impact on its implementation of the leadership training program, including
stakeholder involvement and financial constraints. Finally, H. Enterprises will develop a
timeframe in which to implement the leadership training program.
Action steps and analysis of organizational resources. The proposed lead-the-leader
training solution will be delivered by the senior leaders of H. Enterprises with the guidance and
support from outside training consultants who are familiar with the multilevel marketing
environment. The objective of the program is to ensure all leaders who are Bronze-level and
above have the knowledge and skills as well as motivation to help their global distributors
effectively and productively lead their own teams. In order to move this solution forward, a
number of actions must be taken including, for example, developing the curriculum, identifying
the mode in which to conduct the training and the resources necessary and available, all logistical
concerns, and determining the effectiveness of the trainings. These will be discussed briefly
below and outlined in Figure 11.
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Figure 11. Action Steps to Develop, Conduct, and Implement Lead-the-Leader Training Program
Due to the nature of the organization and the solution proposed, Figure 12 below depicts
the human resources required to implement the solution along with their relationship to each
other in the context of the proposed solution.

Determine
specific
training needs
Determine
mode of
training
Identify
available
funding
Identify
culutral and
language
barriers
Determine
best location
to conduct
training
Identify
leaders to
conduct
training
Develop
pilot
modules
Develop and
conduct pre-
training
assessment
Conduct
training
Develop and
conduct post-
training
assessment
Develop and
distribute
supplemental
material
Analyze
results of pilot
training and
determine
next steps
ENTREPRENEURIAL ENGAGEMENT 129

Figure 12. Human Resources Required to Implement Lead-the-Leader Training Program
As Figure 12 depicts, the co-founder of H. Enterprises is a critical driver in the
implementation of this education and training initiative. Each human resource asset relies on her
in some capacity, even though there is no hierarchical organizational structure. Two Platinum
Distributors are directly beneath the co-founder because they are most closely aligned with the
co-founder’s organizational goals and can help move the solution forward. The two Platinum
Distributors will direct the efforts of the educational consultant who will be hired to create a
comprehensive solution for the organization. Finally, the Bronze Plus distributors comprise the
senior leadership of the organization and while they may not make final decisions, they will have
significant influence on the direction of the education and training initiative. Moreover, it is the
Bronze Plus distributors who will implement the lead-the-leader program with their teams.
Hire a consultant. A first step in Phase I of implementing the lead-the-leader program is
hiring an educational consultant. Even though the Bronze Plus senior leaders know the issues
Co-founder
Two Platinum
Distributors
Educational
Consultant
Platinum
Distributors
Bronze Plus
Distributors
ENTREPRENEURIAL ENGAGEMENT 130
they encounter in the field along with what challenges they face in developing their own leaders,
it will be important for H. Enterprises to hire an educational expert to help the senior leadership
team develop the most effective trainings. Two Platinum Distributors should lead the efforts
with the educational expert consultant to ensure the consultant is aligned with their goals and
desires as an organization. H. Enterprises should hire a consultant who is adept at curriculum
development in both live and e-learning formats. The consultant should also have expertise in
developing pre-training benchmark assessments so that the training is developed to align with the
goals of the organization. Finally, the consultant should be familiar with, or have worked in, a
multilevel marketing organization.
Determine training needs. Next, in order to develop an effective lead-the-leader
training program for the Bronze Plus senior leaders, it is important to determine specific needs
and wants of the organizational leaders. Through the interviews, it became apparent that 12
senior leaders in H. Enterprises approached developing their global leaders differently.
Moreover, most of the trainings conducted by the senior leaders were time-consuming, and done
through one-on-one interactions. As a result, in order to maximize the effectiveness of these
trainings and capitalize on the experience of the senior leaders, a global lead-the-leader training
is being proposed.
Determine mode of training. There are many considerations with regard to how to
deliver the lead-the-leader training program. Significantly, many distributors almost exclusively
conduct business via the online platform and communicate with their teams using electronic
tools and applications. Thus, a majority of the lead-the-leader training program should be
accomplished via an e-learning platform. However, some elements of the training program
could be delivered live to allow the senior leaders an opportunity to practice their skills and
ENTREPRENEURIAL ENGAGEMENT 131
move from novices to experts. A proposed plan for training delivery modes is highlighted as a
column in Table 14.
Identify available funding. Since the trainings and events for leadership in H.
Enterprises are largely financed through its senior leader, it is most appropriate for its co-founder
to make the decision regarding the mode of training, and whether the trainings are best
conducted live, through an e-learning platform, or both. In conducting the cost feasibility
analysis, the co-founder can rely on the expertise of the hired consultant to provide advice with
respect to focusing the training on areas that will result in the biggest, most immediate impact.
Notably, even though the need for a lead-the-leader program is evident across multiple countries,
in multiple distributor legs, a more sophisticated analysis should be conducted to determine the
most cost-effective, targeted solution that can be adapted to other regions and countries. In
addition, if the co-founder intends to seek monetary contributions from the Bronze Plus senior
leaders, she may wish to conduct another survey among her team members to determine their
willingness to contribute financially to this endeavor.
Identify cultural and language barriers. One of the challenges that may arise in
developing the global, lead-the-leader training is the various countries in which H. Enterprises
operates. Due to the global distributor model, H. Enterprises operates in over 50 countries, in
multiple languages. Thus, as the two Platinum Distributors conduct the survey of topics and
pulse the willingness of Bronze Plus leaders to financially contribute, they should also start
compiling a list of all of the countries in which H. Enterprises operates along with the top 10
languages spoken by H. Enterprises senior leadership.
Determine best location for pilot. Prior to rolling out a global, lead-the-leader training
program, the Platinum Distributors in H. Enterprises should identify an appropriate place in
ENTREPRENEURIAL ENGAGEMENT 132
which to conduct a pilot training. Even though Vitality Global has field offices throughout the
world, H. Enterprises conducts a lot of its business in Indonesia where many of its Platinum
Distributors are located. Thus, H. Enterprises should consider conducting a pilot of its lead-the-
leader training program in Indonesia since it would be cost-effective and provide ample space for
hosting the team and recording the training.
Identify leaders to provide training. In order to best leverage the strengths of H.
Enterprises’ key senior leaders, the Platinum Distributors should conduct a survey to determine
what trainings, if any, Bronze Plus leaders are qualified to conduct. In order to maximize the
effectiveness of the trainings, minimize the costs of the training, and conduct the most productive
and meaningful trainings, the senior leaders in H. Enterprises who encountered the issues that
confront all global leaders should be leading the trainings. However, through the interviews, it
became clear that many leaders are not comfortable speaking in public. Thus, only those leaders
who are comfortable speaking in public should be leading the trainings. Through the survey,
Bronze Plus senior leaders will identify the top three trainings they are voluntarily willing to
conduct for the global team. Notably, this step completes Phase I of the implementation plan
which lasts approximately six months.
Develop pilot modules. The first step in Phase II of the implementation plan is to begin
developing the content for the training program. In order to develop the topics for these
trainings, two Platinum Distributors with the most seniority with the organization, along with a
hired consultant, will survey the Bronze Plus senior leaders. After the consultant compiles the
results and performs a preliminary analysis, s/he and the two Platinum Distributors will present
the information to the organization’s co-founder, who will make the final decision regarding the
ENTREPRENEURIAL ENGAGEMENT 133
trainings. Since most of the communication in H. Enterprises is conducted electronically, it is
most appropriate to conduct a survey in this manner as well.
Develop and conduct pre-training assessment. Through the interviews the senior
leaders expressed the different ways in which they train leaders to lead their global teams. A
consultant, therefore, is the appropriate resource to develop and conduct pre-training assessments
to ensure the trainings are most effective for the diverse community of distributors. Notably, this
step completes Phase II of the implementation plan which lasts approximately six months.
Conduct training. In Phase III of the implementation plan, Platinum Distributors with
the guidance and support of the educational consultant will begin conducting the training. Phase
III lasts approximately four months. While many organizations would consider using a
consultant to conduct the training, in the multilevel marketing environment, trust is critical.
Therefore, the training will be most effective if the two Platinum Distributors take a lead role in
conducting it.
Develop and conduct post-training assessment. In Phase IV of the implementation
plan, the consultant will develop and distribute a post-training assessment. Importantly, the
educational consultant should identify key areas from the pre-training assessment and develop
survey questions that inquire about the participants’ experience with those issues, among others.
The goal of the post-assessment survey is to determine the overall effectiveness of the training.
This step will take approximately three months.
Develop supplemental materials. From the questions that arise during the training
along with the post-assessment survey results, the consultant should also develop supplemental
materials to distribute to the global team to help solidify the knowledge acquired through the
training. The consultant, in developing supplemental materials, should also consider the results
ENTREPRENEURIAL ENGAGEMENT 134
of the initial survey as well as the pre-training assessments as they could provide insight into any
of the distributors learning gaps. This step marks Phase V of the implementation plan and last
approximately five months.
Analyze pilot results and make critical changes and recommendations. Finally, the
consultant and two Platinum Distributors should analyze the results of the pilot and determine
what needs to be changed and where, how, and when to expand the training to other locations.
Since this step analyzes the same assessments and results from the training, this phase of the
implementation plan, Phase VI, will take place concurrently with Phase V but will take
approximately eight months to complete.
Summary Implementation Plan
A summary of the action steps, format, human resource roles and responsibilities, and
time frame for each training step is outlined in Table 14 below.
Table 14
Implementation Plan for Lead-the-Leader Solution: Key Action Steps, Format, Human Resource
Needs, and Time Frame
Action Steps Format Human Resource
Roles/Responsibilities/Capacity
Time Frame
Hire a consultant to
assist with surveys,
assessments, analysis
and development of
training
N/A Consultant will be managed by two
Platinum Ranked Distributors
Phase I: 01/17-06/17
Determine specific
training needs/wants
and who will receive
training
Online
Survey
Consultant and two Platinum
Distributors will survey Bronze Plus
leaders to determine their training
needs/wants
Phase I: 01/17-06/17

ENTREPRENEURIAL ENGAGEMENT 135
Table 14, continued
Action Steps Format Human Resource
Roles/Responsibilities/Capacity
Time Frame
Determine mode of
training–e-learning or
live (or both)
N/A Consultant will make
recommendation but co-founder
should make decision regarding
mode of training since she is likely
paying for the biggest portion
Phase I: 01/17-06/17
Identify available
funding and source(s)
of funding (senior
leadership or
Corporate)
Online
Survey
Consultant will survey Bronze Plus
leaders to determine their
willingness to financially contribute
to lead-the-leader training
Phase I: 01/17-06/17
Identify cultural and
language barriers to
training
N/A Ask two Platinum Distributors to
make a list of all countries and
languages in which Bronze Plus
leaders operate teams to determine
the scope of the trainings
Phase I: 01/17-06/17
Determine best
location to conduct
pilot
Online
Survey
Through a survey, highest ranking
distributors should determine where
to host pilot–consider Indonesia
because there is a field office and
videotaping could be conducted
Phase I: 01/17-06/17
Identify leaders to
provide training
N/A The hired consultant and Platinum
Distributors will analyze the survey
results and compile a list of trainings
that should be developed along with
a list of potential trainers to conduct
them
Phase I: 01/17-06/17
Develop pilot e-
learning modules (first
three) and live modules
(first three)
E-learning
and Live
Formats
Consultant will develop trainings for
both live and e-learning modules
(managed by two Platinum
Distributors)
Phase II: 07/17-12/17
Develop and conduct a
pre-training benchmark
assessment
In-person
and Online
Surveys
Consultant will create an assessment
for pre- and post-training results and
conduct a pre-training benchmark
assessment (managed by two
Platinum Distributors)
Phase II: 07/17-12/17
Conduct training Live Consultant will oversee trainings for
best results (managed by two
Platinum Distributors)
Phase III: 01/18-04/18
ENTREPRENEURIAL ENGAGEMENT 136
Table 14, continued
Develop and conduct
post-training
assessment
In-person
and Online
Surveys
Consultant will develop assessments
and conduct a post-training
assessment (managed by two
Platinum Distributors)
Phase IV: 05/18-07/18
Develop and distribute
supplemental materials
based on pre- and post-
training assessments
Distribute
Electronic
ally
Consultant will develop
supplemental materials (managed by
two Platinum Distributors)
Phase V: 08/18-12/18
Analyze results of pilot
and determine what
needs to be changed,
and where, how, and
when to expand the
training to other
locations
N/A Consultant will analyze results
(managed by two Platinum
Distributors) and present findings to
co-founder
Phase VI: 08/18-
03/19

Evaluation Plan for Lead-the-Leader Training Solution
The evaluation of outcomes, according to Clark and Estes (2008), is the final step in the
gap analysis framework. In order to discern whether the lead-the-leader comprehensive training
program is an appropriate solution for H. Enterprises, it must be evaluated. In evaluating
training solutions, many scholars rely on Kirkpatrick’s (2006) four levels of assessment (Clark &
Estes, 2008; Rueda 2011). The Kirkpatrick (2006) four levels of assessment are Reaction,
Impact, Transfer, and Results.
Reaction
According to Rueda (2011) the first level, Reaction, is really a measure of motivation
(i.e., will the distributors in H. Enterprises choose to engage with the lead-the-leader training
program, will they persist, and will they exert enough effort). Notably, if there are challenges at
Level 1 (Reaction), there is a high likelihood the proposed solution will fail (Rueda, 2011).
According to Kirkpatrick (2006), the primary goal in evaluating Level 1 Reactions for training
solutions is to measure the participant’s learning experience with respect to the course, content,
ENTREPRENEURIAL ENGAGEMENT 137
instructor, and job relevance. Thus, in evaluating the distributors’ experience with the lead-the-
leader training solution, H. Enterprises should consider using a ten-question survey with a five-
point Likert scale where 5 is “strongly agree” and 1 is “strongly disagree.” The proposed
questions for the Level 1 Reaction survey are included in Table 15. below.
Table 15
Evaluation Plan for Lead-the-Leader Training Solution: Proposed Questions, Instrument, and
Assessment Level
Proposed Question Assessed
by:
Reaction Impact Transfer Results
Prior to the start of the lead-the-
leader training program, I
understood the course objectives.
Five-point
Likert
Scale
Survey


The lead-the-leader training
program met the course objectives.
Five-point
Likert
Scale
Survey


The training facility and
environment met all course needs.
Five-point
Likert
Scale
Survey


The course materials and resources
were easy to understand.
Five-point
Likert
Scale
Survey


The course materials and resources
enhanced my learning experience.
Five-point
Likert
Scale
Survey


The instructor exhibited the
knowledge and skills necessary to
effectively lead the course.
Five-point
Likert
Scale
Survey


The instructor’s presentation skills
were excellent.
Five-point
Likert
Scale
Survey


ENTREPRENEURIAL ENGAGEMENT 138
Table 15, continued
Proposed Question Assessed
by:
Reaction Impact Transfer Results
The course was appropriate in time
and length to meet the course
objectives.
Five-point
Likert
Scale
Survey


I learned valuable lessons that I
will immediately apply to my
business.
Five-point
Likert
Scale
Survey


I would highly recommend the
lead-the-leader training program to
my colleagues.
Five-point
Likert
Scale
Survey


Learning
The second step in the evaluation plan is to assess whether learning took place
(Kirkpatrick, 2006). It is critical to measure the learning taking place as a result of the training
program, because without learning, there can be no change in behavior (Kirkpatrick, 2006).
Learning, according to Kirkpatrick (2006), takes place if one or more of the following objectives
is achieved: the attitudes of the participants change, the knowledge of participants improves as a
result of attending the program, and/or the participants’ skills increase.
With respect to the gap analysis framework (Rueda, 2011), in particular, the Level 2
assessment answers the following question: Did the lead-the-leader training solution result in
changes to the learning (knowledge and skills), motivational, and organizational needs that were
identified for H. Enterprises? In this case, the lead-the-leader training program is focused on
increasing distributor leadership and training skills. As a result, learning is best assessed during
the lead-the-leader training program by asking participants to first, apply what they learned, and
next, ask them to explain why they do it (Clark & Estes, 2008). To measure Level 2 Learning
with respect to an increase in skills, therefore, H. Enterprises should implement a series of
ENTREPRENEURIAL ENGAGEMENT 139
practice exercises. While distributors are performing the exercises, a trained observer can score
the distributors using a checklist to assess distributor proficiency (Clark & Estes, 2008). A
Proposed Level 2 Learning Observation Checklist is included in Table 16 below.
Table 16
Lead-the-Leader Level 2 Learning Observation Checklist
LEAD-THE-LEADER
Level 2 Learning Observation Checklist

Instructor: Date:
Exercise: Observer:

Class Structure
Needs
Improvement Satisfactory Outstanding
Not
Observed*
Gives overview of course content

Summarizes content covered

Directs participant preparation for next class

*Please explain any Not Observed elements in Comments
Comments:

Methods
Needs
Improvement Satisfactory Outstanding
Not
Observed*
Provides easy-to-understand materials (if applicable)

Uses non-lecture learning activities

Delivers well-planned exercises

*Please explain any Not Observed elements in Comments
Comments:

Trainer-Participant Interaction
Needs
Improvement Satisfactory Outstanding
Not
Observed*
Invites participant input

Involves a variety of training participants

Demonstrates understanding of participant learning
needs

*Please explain any Not Observed elements in Comments
Comments:

ENTREPRENEURIAL ENGAGEMENT 140
Table 16, continued
Content
Needs
Improvement Satisfactory Outstanding
Not
Observed*
Demonstrates appropriate knowledge

Explains concepts clearly

Relates concepts to job relevance

*Please explain any Not Observed elements in Comments
Comments:

Other Comments (attach additional sheet if necessary):

Transfer
After assessing the reactions of the participants (Level 1) and measuring the changes to
participant learning (Level 2), the proposed lead-the-leader solution must next be assessed with
respect to Transfer (Level 3), i.e. whether the lead-the-leader program is implemented by
distributors in its most relevant contexts and whether the distributors continue to apply what they
learned over time (Rueda, 2011). It is critical to assess Level 3 Transfer because without a
transfer of skills or change in behavior, no positive final results can be expected (Kirkpatrick,
2006).
In the context of H. Enterprises, this Level 3 Transfer assessment can be difficult for
three primary reasons: (1) distributors must have the opportunity to apply what they learned; (2)
it is difficult to predict the timing of a change in distributor behavior; and (3) the distributor may
apply what he or she learned and conclude it is not as good as the prior solution and/or the
distributor’s upline does not support the new solution (Kirkpatrick, 2006). Accordingly, H.
Enterprises should begin to develop the Level 3 Transfer assessment by first answering three
primary questions: when should Level 3 Transfer be assessed, how often should Level 3 Transfer
be assessed, and how should Level 3 Transfer be assessed (Kirkpatrick, 2006).
ENTREPRENEURIAL ENGAGEMENT 141
Since H. Enterprises is a global, virtual organization with independent distributors, it
needs to allow some time for the change in behavior to occur as a result of attending the
program. Notably, the distributor participants are senior level leaders who run multi-million
dollar global businesses. Thus, in an effort for H. Enterprises to be sensitive to both distributor
seniority and time constraints, the most effective and productive Level 3 Transfer assessment
could be a post-training survey that is given approximately two-months after the completion of
the training program to both the training participants as well as a randomly selected group of the
participant’s downline distributors (Kirkpatrick, 2006). For more comprehensive results, the
Level 3 Transfer Post-Training Survey should be repeated quarterly for the first-year and then in
six-month intervals. A Proposed Level 3 Transfer Post-Training Survey is included in Table 17.
below.

ENTREPRENEURIAL ENGAGEMENT 142
Table 17
Lead-the-Leader Level 3 Transfer Post-Training Survey
LEAD-THE-LEADER TRAINING PROGRAM
TRANSFER OF SKILLS SURVEY
Have you applied what you
learned?
We want our trainings to be the best in the industry, and to do that, we seek your input and support. This survey
solicits your feedback on how the leader has applied what he or she has learned after the completion of the training
program. If you are the leader who attended the program, please only answer the left-hand column “Impact of
Actions” questions along with all narrative questions. If you are in the downline of the leader, please only answer
the right-hand column “Impact of Actions” questions along with all narrative questions. Please let us know if you
have any questions.

Application (to be answered by both the leader and downline)
1. What is the leader doing differently as a result of attending the Lead-the-Leader Training Program?

Impact of Actions – Participant Answers Impact of Actions – Downline Answers
Have these actions improved your effectiveness
as a leader?

□ Absolutely
□ No
□ I’m not sure
How would you rate the training participant with
respect to leader effectiveness after the training:
□ Consistent high quality
□ Generally good
□ Quality varies daily
□ Poor quality
I consider my team to be more effective now, as a
result of my attendance at the training.
□ Absolutely
□ No
□ I’m not sure
How would you rate your team’s effectiveness
post-training:
□ Consistent high quality
□ Generally good
□ Quality varies daily
□ Poor quality
I consider my organization’s performance to be
markedly improved as a result of my attendance at
the training.
□ Absolutely
□ No
□ I’m not sure
How would you rate your organization’s
performance post-training?
□ High Performing
□ Better than it was before
□ Average
□ Under Performing

ENTREPRENEURIAL ENGAGEMENT 143
Table 17, continued
Impact of Actions – Participant Answers Impact of Actions – Downline Answers
My actions have improved effectiveness in the
following areas:
□ Distributor engagement
□ Leadership Communications
□ Team Collaboration
□ Team Financial Performance
□ Other:___________________________
□ Areas to Improve:__________________
How would you rate the following with “3” as
outstanding, “2” as average, and “1” as needs
improvement.
□ Distributor Engagement 1 2 3
□ Leadership Communications 1 2 3
□ Team Collaboration 1 2 3
□ Financial Performance 1 2 3
□ Other:__________________________
□ Areas to Improve:_________________
Survey: 2M Q1 Q2 Q3 Q4 6M
(circle one)

We read every comment. Thank you!

Additional Comments:

Survey Participant Information (optional)
Name

Address

Phone

Email

Thank you for your participation!
Results
The final level of the evaluation plan, Level 4, measures the results of the solution. In
this innovation study, a Level 4, Results, assessment answers the following question: Did the
lead-the-leader solution contribute to meeting the organizational goals of H. Enterprises (Rueda
2011)? According to Clark and Estes (2008), Level 4 is the most challenging level to assess
since it is often expensive and difficult to conduct. Notably, the most critical aspect of a Level 4
Results assessment is to determine what can be measured to demonstrate the organizational goals
have, or have not, been achieved (Kirkpatrick, 2006).
ENTREPRENEURIAL ENGAGEMENT 144
In this case, the lead-the-leader solution is a comprehensive training solution, which aims
to prepare global leaders to lead their own teams in order to increase entrepreneurial
engagement. Entrepreneurial engagement, at H. Enterprises, can be measured in various ways,
including distributor retention, revenue, attendance at trainings, and the number of distributors
on autoship. In order to assess the results of the lead-the-leader training solution, H. Enterprises
should measure entrepreneurial engagement by (1) using a control group; (2) allowing time for
results to manifest; (3) measuring entrepreneurial engagement before and after the training
solution is implemented; (4) repeating the results measurement in appropriate intervals; (5)
conducting a cost/benefit analysis; and (6) understanding that proof is not always possible, and
therefore evidence of the impact may be all that is available (Kirkpatrick, 2006). Figure 13
depicts various elements that have an impact on entrepreneurial engagement at H. Enterprises.

Figure 13. Elements of Entrepreneurial Engagement at H. Enterprises That can be Assessed to
Determine Effectiveness of Lead-the-Leader Training Program
Entrepreneurial
Engagement
Distributor
Retention
Revenue
Attendance
at Trainings
Distributors
on Autoship
ENTREPRENEURIAL ENGAGEMENT 145
In measuring entrepreneurial engagement, a simple spreadsheet can be used to track the
results of the lead-the-leader training solution. Table 18 depicts an example of what can be used
to track the lead-the-leader Level 4 Results.
Table 18
Lead-the-Leader Level 4 Results Assessment that Measures Entrepreneurial Engagement at H.
Enterprises
Lead-the-Leader Level 4 Results Assessment
Control Group:________________________________________________________________
Date of Assessment:____________________________________________________________
Person Conducting Assessment:__________________________________________________
Element Before Training After Training % Change Date for next
Assessment
# Of Distributors
On Team

Average Length
of Time With
Team In Months

Revenue in $
# Of Trainings
Attended by
Team Members

# Of Distributors
On Autoship

# Of Distributors
Not On Autoship

# Of Distributors
Who Joined
Team

# Of Distributors
Who Quit

ENTREPRENEURIAL ENGAGEMENT 146
Strengths and Weaknesses
The gap analysis framework provides a strong approach to analyzing needs in the areas of
knowledge and skills, motivation, and organizational resources. However, it is challenging to
perform, in this context, given the dynamics of this particular organization. H. Enterprises is a
highly global, virtual, diverse organization that lacks a hierarchical structure and formal
processes. Each distributor is independent, may speak a different language, and also adhere to
different cultural values. As a result, processes in the organization can change daily, and thus,
needs in the categories of knowledge and skills, motivation, and organizational resources are
fluid. Accordingly, a robust analysis of current data must be rapid in order to make any
meaningful changes due to the multiple variables that can have an impact on entrepreneurial
engagement.
There are many benefits to adhering to the gap analysis framework, even in this context.
By adhering to the gap analysis framework and performing significant research and analysis, the
lead-the-leader comprehensive solution was developed, and appears to be able to address the
needs of most, if not all, of the distributors in the areas they identified with respect to knowledge
and skills, motivation, and organizational resources. However, the process is not a short one, and
requires financial resources, time, and organizational support to properly analyze organizational
goals and needs. Thus, for organizations that need to experience rapid changes or respond
quickly to market forces, this framework may not be the best suited to help them achieve their
goals.
Limitations
The primary limitation of this innovation study was the selection of distributors who were
available to be interviewed. The founder of H. Enterprises contacted several high-performing
ENTREPRENEURIAL ENGAGEMENT 147
distributors to seek their participation in the study. From the available participants, 15
distributors agreed to participate, but three could not be reached. Moreover, after the interviews
began, it became apparent that the interview participants had three things in common: (1) they
were strategically aligned with the founder, (2) they had reached the top tiers in the
organization’s financial rankings, and (3) they had been in business with the founder for many
years. Thus, even though each agreed to speak openly about the organizational environment,
education and training processes, the level of transparency may have been skewed.
Questions for Future Research
This innovation study sought to address an age-old question in a highly stigmatized
industry: why people leave. Notably, in this multilevel marketing environment, there are a
myriad of factors that have an impact on an independent distributor’s desire to stay in business,
become a consumer instead of a business owner, or simply quit. While this study made
significant strides in answering the question of how to increase entrepreneurial engagement in a
global, virtual multilevel marketing organization, several questions remain unanswered,
including (1) To what extent are distributors recruited to become entrepreneurs and ignored
because they do not produce significant enough revenue? (2) Should training focus on
motivating independent distributors who seem to be flailing or should it focus on highly
motivated entrepreneurs? (3) At what point does training and education impact entrepreneurial
engagement? (4) Should organizations focus training on the distributors who show the most
financial promise?
Conclusion
In the last several decades, scholars began to recognize the benefits of the multilevel
marketing compensation and organizational structure, especially for budding entrepreneurs in
ENTREPRENEURIAL ENGAGEMENT 148
developing countries, women entrepreneurs, and adults who lack formal education and training.
If multilevel marketing organizations, like H. Enterprises, invest the time and resources in to
identifying the ways in which they can have an impact on the entrepreneurial engagement of
their independent distributors, they can help their distributors create, and sustain, a profitable
entrepreneurial enterprise. Creating and sustaining a profitable entrepreneurial enterprise is not
only a benefit to the multilevel marketing organizations that invest the time and effort to helping
their entrepreneurs succeed, but also has the potential to significantly improve the livelihoods of
the entrepreneurs, their families, and the communities in which they operate and reside.
Multilevel marketing organizations can, through education and training, quite possibly change
the world.

ENTREPRENEURIAL ENGAGEMENT 149
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attainment: The role of self-efficacy beliefs and personal goal setting. American
Educational Research Journal, 29(3), 663-676. doi:10.2307/1163261

ENTREPRENEURIAL ENGAGEMENT 160
Appendix A
Summary of Assumed Needs for Knowledge and Skills, Motivation, and Organizational
Challenges

(F) Factual Knowledge; (C) Conceptual Knowledge; (P) Procedural Knowledge; (M) Metacognitive Knowledge
Sources Knowledge Motivation Organization
Preliminary
Scanning Data
(informal
knowledge
about the
organization)
 Need the foundational
business knowledge
required to own and operate
a business.
 Need a thorough
understanding of the sales
process, client retention
techniques, customer
service, accounting,
operations, and recruitment.
 Need sufficient knowledge
of country-specific legal
issues as well as company
products.

 Need to value strategies they
learn at training and apply
them in practice.
 Need to be resilient in the
face of rejection from clients
and business partners.

 Need goals to align with
the corporate organization.
 Need the focus of
trainings to align with
corporate trainings.
 Need organizational
cohesion to remain
engaged.

Learning and
Motivation
Theory

 Need to know what the
new/incoming distributors
know about entrepreneurial
engagement. (F)
 Need to know what the
new/incoming distributors
know about company
products. (F)
 Need to distinguish levels
of assistance required by
new distributors. (C)
 Need the procedural
knowledge required to
perform the new distributor
training. (P)
 Need to know how to
reflect on their own
effectiveness as trainers for
new distributors. (M)

 Need to see value in
developing, implementing,
and conducting training for
new/incoming distributors.
 Need to set goals related to
developing, implementing,
and conducting training for
new distributors in
entrepreneurial engagement
and company products.
 Need to have a high level of
interest in training new
distributors.
 Need to know they are
capable of developing,
implementing, and
conducting training for new
distributors.
 Need to be adaptable and
open-minded to learning
new skills in order to
maximize performance.
 Need to value the
development of trainings
which will increase
entrepreneurial
engagement.
 Need to set aside time
from running their own
businesses to train new
distributors.
 Need to have role models
within the organization
who have prioritized the
training of new
distributors.
 Need to develop a
communication plan
regarding the standardized
training of new
distributors.
 Need to foster a culture of
mutual trust where
distributors feel valued.
Related
Literature

 Need to enhance skills and
knowledge in order to
survive business
challenges.
 Need entrepreneurial and
leadership training in order
to compete globally.
 Need to have a high interest
in continuing to learn and
evolve in the business space.
 Need to be confident and see
value in taking appropriate
risks in conducting
entrepreneurial activities.
 Need to emphasize the
relationship between
trainings and business
performance.

ENTREPRENEURIAL ENGAGEMENT 161
Appendix B
Interview Protocol - Email

Dear ___________:

My name is Alexandra McDermott Wilcox. I am a doctoral candidate in the Global Executive
Doctor of Education Program at the Rossier School of Education at University of Southern
California. I am conducting research to examine entrepreneurial engagement in multilevel
marketing organizations. My research study has been approved.

You are cordially invited to participate in this study.

If you agree, you are invited to:

- Participate in an interview. The interview is completely voluntary and confidential.
As such, you can ask to skip any questions you do not wish to answer. Every effort will
be made to conduct the interview in-person. Each interview will last approximately one
hour and will be conducted in English. The interview will be recorded, unless you
request otherwise, and handwritten notes will be taken.

Participation in this study is voluntary. Your identity as a participant will remain
confidential at all times during and after the study.

If you would like to volunteer as a participant to be interviewed, please respond to this email at
amwilcox@usc.edu or via telephone at 949-933-8426.

Thank you in advance for your participation.

Alexandra McDermott Wilcox
Doctoral Candidate - Rossier School of Education
University of Southern California

ENTREPRENEURIAL ENGAGEMENT 162
INTERVIEW PROTOCOL

Respondent (Name): ____________________________________________________________

Location of Interview: ___________________________________________________________

Time in / Time Out: _____________________________________________________________

Introduction

Thank you for meeting with me today. I am conducting this interview as part of my dissertation
research at USC, exploring entrepreneurial engagement in multilevel marketing organizations. I
expect the interview to last approximately one hour and have questions that explore the concepts
of knowledge and skills, motivation, and organizational needs in your organization.

Your participation in this interview is completely voluntary. We can skip any question, upon
your request, at any time, and you may also stop the interview at any time. Any identifiable
information obtained in connection with this study will remain confidential. Your responses will
be coded with a false name (pseudonym) and maintained separately from your answers.

If you are comfortable with it I would like to record our conversation. The recording will be
destroyed after it is transcribed. Are you comfortable if I record the conversation?

Do you have any questions?

Great, let’s get started.

Knowledge

What methods do you use to determine what your new distributors know about how to run
their organizations?

How often do you check in with your new distributors to determine whether they have the
information to succeed (operations, company products, country-specific rules and regulations)?

What methods do you use to determine what trainings you need to conduct with your new
distributors?

Can you please explain your methods for differentiating between distributors who need
help and those who don’t need your help?

How do you know whether a new distributor is engaged in your organization?

How do you know when new distributors need your help?

How do you determine when a new distributor has an issue with product knowledge?
ENTREPRENEURIAL ENGAGEMENT 163

How do you evaluate the knowledge level of your new distributors with respect to company
products?

How do you evaluate the knowledge level of your new distributors with respect to how to
run their own business?

How do you conduct trainings for your new distributors (in-person, skype, video, etc.)?

Do you conduct any pre-training assessments to determine what your new distributors know
about the topic of the training?

After the training is over, do you assess what your new distributors learned?

How do you know when a new distributor is confused by a particular concept? What do you do
when this happens?

Do you follow-up with your new distributors?

How do you know whether your training is effective for new distributors?

In what ways?

Can you describe a time you changed a training based upon your beliefs as opposed to the
feedback you received from someone else?

Motivation

Does the development of trainings for new distributors help you achieve your future goals?

Please discuss some of your reasons for developing trainings for new distributors.

As a seasoned distributor, is it important to train new distributors? Why?

Please describe your goal-setting process with respect to training new distributors.

What are your goals?

How do you develop your training goals?

What methods do you use to keep track of your training goals?

How often do you measure your performance in the context of your training goals?

Do you ever revisit your training goals?

ENTREPRENEURIAL ENGAGEMENT 164
How do you prioritize the training of new distributors in the context of what you do every
day?
After conducting a training for new distributors, what is your emotional reaction (how do you
feel afterwards?)?

What is your level of confidence with respect to training new distributors on how to run a
successful business?

Can you rank it on a scale of 1 to 10 with 1 being low and 10 being a high level of confidence?

What factors impact your belief in your ability to train new distributors in how to run a
successful business?

Let’s discuss the various aspects of training–specifically, creating the training, implementing the
training, and then conducting the training.

With respect to creating the training, is there anything that would make you feel more confident
in your abilities to create the training?

With respect to implementing the training, is there anything that would make you feel more
confident in your abilities to create the training?

With respect to conducting the training, is there anything that would make you feel more
confident in your abilities to create the training?

Organization

How and by whom are important decisions made in this organization?

How does the organization communicate the value of training for new distributors?

What aspects of the organization do people value most?

Does the organization do anything to incentivize you with respect to helping new
distributors?

Who is the best trainer in your organization for new distributors?

What actions do they take with respect to new distributor training that makes them
successful?

How and when do seasoned distributors get performance feedback with respect to new
distributor training?

ENTREPRENEURIAL ENGAGEMENT 165
What actions do you take to increase new distributor retention?

What actions does the organization take to assist with these efforts?

Are new distributors valued in the organization?
Are there any actions you take to communicate the value of new distributors to the new
distributors themselves?

In thinking about the concept of trust, do you think the seasoned distributors in your
organization trust each other?

How would you define trust in this context?

Please provide examples of ways in which seasoned distributors communicate mutual trust.

Abstract (if available)

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Asset Metadata

Creator Wilcox, Alexandra McDermott (author)

Core Title Increasing entrepreneurial engagement and persistence through education and training in a virtual organization with global operations: an innovation study

School Rossier School of Education

Degree Doctor of Education

Degree Program Global Executive

Publication Date 08/03/2016

Defense Date 05/26/2016

Publisher University of Southern California (original), University of Southern California. Libraries (digital)

Tag entrepreneurial engagement,lead-the-leader training program,multilevel marketing,OAI-PMH Harvest,persistence,Training,virtual organization,women's leadership

Format application/pdf (imt)

Language English

Contributor Electronically uploaded by the author (provenance)

Advisor Picus, Lawrence O. (committee chair), Bentis, Nadine (committee member), Filback, Robert A. (committee member)

Creator Email alexmcderm@yahoo.com,amwilcox@usc.edu

Permanent Link (DOI) https://doi.org/10.25549/usctheses-c40-294992

Unique identifier UC11280436

Identifier etd-WilcoxAlex-4733.pdf (filename),usctheses-c40-294992 (legacy record id)

Legacy Identifier etd-WilcoxAlex-4733.pdf

Dmrecord 294992

Document Type Dissertation

Format application/pdf (imt)

Rights Wilcox, Alexandra McDermott

Type texts

Source University of Southern California (contributing entity), University of Southern California Dissertations and Theses (collection)

Access Conditions The author retains rights to his/her dissertation, thesis or other graduate work according to U.S. copyright law. Electronic access is being provided by the USC Libraries in agreement with the a...

Repository Name University of Southern California Digital Library

Repository Location USC Digital Library, University of Southern California, University Park Campus MC 2810, 3434 South Grand Avenue, 2nd Floor, Los Angeles, California 90089-2810, USA