entrepreneurship 1

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Page 1: Entrepreneurship 1
Page 2: Entrepreneurship 1

WHO IS AN ENTREPRENEUR

An entrepreneuris a person who has possession of an enterprise, or venture, and assumes significant accountability for the inherent risks and the outcome.

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CONCEPTUAL MODEI OF ENTREPRENEURSHIP

ENTREPRENEURSHIP

THE PERSON

THEORGANIZATION

THE ENVIRONMENT

THEORGANIZATION

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THE ANALYTICAL FRAMEWORK OF ENTREPRENEURSHIP

The person: Personality , Skills ,Experience, Motives and

Psychological Preferences. The Task: Perceiving

opportunity, marshalling resources, providing leadership.

The Environment: Availability of Resources, infrastructure, competitive pressures, social values, rules and regulations, state of technology, etc

The Organization: structure, policies, rules, culture, human resources systems, communication systems.

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SCHUMPETER’S VIEWS ON ENTERPRENEURSHIP

Creative and innovative activity.

Distinction between an innovator and an inventor.

Both wide and narrow.

Entrepreneur is a large scale businessman who creates something new.

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WALKER’S VIEWS ON ENTREPRENEURSHIP

Organizer and coordinator.

Different degrees of organizational skill and coordinating capacity.

True entrepreneurs are limited.

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DRUCKER’S VIEWS ON ENTREPRENEURSHIP

Entrepreneur is one who always searches for change, responds to it and exploits it as an opportunity.

Purposeful and systematic innovation.

Behavior rather than personality trait.

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ENTREPRENEURSHIP

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Entrepreneurship

Mainstream Economic

Factors Land

Labor

Capital

Entrepreneurship

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Enterprise

An enterprise may be defined as an undertaking or adventure involving uncertainty and risk and requiring innovation and also to the ability to think out and start new business.

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Your own new enterprise serves your interest in significant ways

Salary.

Security

Assets builder

Perks.

Independence

Fulfillment

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Entrepreneurs...Traits

Self-confident and optimistic

Able to take calculated risk

Respond positively to changes

Flexible and able to adapt

Knowledgeable of markets

Able to get along well with others

Independent minded

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Entrepreneurs...Traits II

Energetic and diligent

Creative, need to achieve

Dynamic Leader

Responsive to suggestions

Take initiatives

Resourceful and persevering

Perceptive with foresight

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Entrepreneurship

Joseph Schumpeter...20th century talks about “creative destruction” whereby established ways of doing things are destroyed by the creation of new and better ways of getting things done

Described it as a process and entrepreneurs as innovators who use process to shatter the status quo through new methods...

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Entrepreneurship

Is a dynamic process of creating incremental wealth. This wealth is created by individuals who assume the major risks in terms of equity, time and career commitment of providing value for some product or service

The entrepreneur must somehow infuse value to the product or service...

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The Creative Process

Idea Germination

Preparation

Incubation

Illumination

Verification

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The difference between invention and innovation is:

Invention - is the creation of new products, processes, and technologies not previously known to exist.

Innovation - is the transformation of creative ideas into useful applications by combining resources in new or unusual ways to provide value to society for or improved products, technology, or services.

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Organizing entrepreneurship: Does the entrepreneur need a firm?

Entrepreneurship as management : firm is the assets the entrepreneur arranges (not owns).

Entrepreneurship as imagination, creativity : firm can contract for entrepreneurship.

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Entrepreneurship as innovation : entrepreneurship is sui generis, independent of the firm.

Entrepreneurship as alertness or discovery : entrepreneur owns no capital (could be an employee or independent contractor).

Entrepreneurship as charismatic leadership : firm is the entrepreneur plus the employees who follow him.

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Advantages of entrepreneurship

Enormous personal financial gain

Self-employment, offering more job satisfaction and flexibility of the work force

Employment for others, often in better jobs

Development of more industries, especially in rural areas or regions disadvantaged by economic changes, for example due to globalization effects

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Advantages…

Encouragement of the processing of local materials into finished goods for domestic consumption as well as for export

Income generation and increased economic growth

Healthy competition thus encourages higher quality products

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Advantages…

More goods and services available

Development of new markets

Promotion of the use of modern technology in small-scale manufacturing to enhance higher productivity

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Advantages…

Encouragement of more researches/ studies and development of modern machines and equipment for domestic consumption

Freedom from the dependency on the jobs offered by others

The ability to have great accomplishments

Serious tax advantages

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