Entrep report

ENTREPRENEURSHIP & the ENTREPRENEUR

By: Wilbert C. Venzon, MBA,ip

A. Entrepreneurship as a self-employment decisionB. The concept of EntrepreneurshipC. The Entrepreneur: The individual that steers

1. Who is the Entrepreneur?2. What makes the successful entrepreneur?

D. The myths, fears and excuse of people who are not entrepreneur

E. The advantages of becoming an entrepreneur



A. ENTREPRENEURSHIP AS A SELF-EMPLOYMENT DECISION

- Basically aimed to gear someone towards self-employment

- Pertains to engage in small & medium sized business

If an individual merely desires independence or wants to go into business because he wants to be his own boss, he/she might get disappointed because a practicing entrepreneur has probably more bosses than he realizes. Here are some of them:


• The various government regulatory bodies• The suppliers who control material flow and sometimes

credit and sales policies• The financial creditors and stakeholders• The demands and cycles of the market• The demands on the entrepreneur’s personal life

• - because of that many businesses are experiencing


Entrepreneurship should not be the

economic development strategy of last resort.

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Table 1.1 Age of Business Failures

Age of Business(Years)

Failure Rate (%) Cumulative(%)

Under 1 27.6 27.6

1-2 13.8 41.4

2-3 11.2 52.6

3-4 10.1 62.7

4-5 6.4 69.1

5-10 9.3 78.4

10-20 8.7 87.1

Over 20 12.9 100

Source: A.J William, “Why small businesses FAIL”, Real Estate Journal, April 1995,pg.18.



Another study was conducted to determine the causes of business failures. ( See Table 1.2)

Table 1.2: Causes of Business Failures

%

Neglect 3.0

Fraud 1.1

Lack of Technical Expertise 8.5

Lack of Management Expertise

17.4

Lack of Experience 21.2

Incompetence 44.9

Disaster & other reasons 3.9

100

Source: A.J William, “Small Business Caught in Squeeze”, The Sun-Herald, 8 May 1997.pg.122



From the preceding tables, it is clear that most failures occurred when

the business was in its formative stage and that an incompetent

entrepreneur is most often the source of the problem.

All these point to the fact that engaging in entrepreneurship is indeed a

challenging business endeavor. An entrepreneur must possess a

combination of skills, personal characteristics and abilities that would

put to effective use of his highly developed sense of independence,

strong sense of enterprise and risk-taking temperament in his decision

to establish and operate his own business.



EXERCISES


From the given exercises , this will give you an opportunityto discover if you really want to be self-employed and to help you determine if you are ready to start your own business.


B. The concept of ENTREPRENEURSHIP

HISTORY

- Started in FRANCE after the French Revolution- It is the start of CAPITALISM and end of FEUDALISM- The word entrepreneur was coined by JEAN BAPTISTE SAY, a renowned French economist who argued that the concept of entrepreneurship is independent of the classical economics and is unable to coexist with it though closely tied with the theory of economics and society.


HISTORY

- The CLASSICAL CAPITALISM, which was propagated by Adam Smith spouses the optimization of what already exist which focuses on acquiring the most of the existing resources and establishingequilibrium or balance similar to the economic practice that wehave at present- In the early 20th century, JOSEPH SCHUMPETER, also an economist, used Say’s ideas as the groundwork of his book. The theory of Economic dynamics. He postulated that it is not optimization and equilibrium but rather the dynamic disequilibria, brought about by the innovative entrepreneur that brings a healthy economy and is the central reality for economic theory and practice.




ENTREPRENEURSHIP

In the discussion of business ventures. The word entrepreneurship, entrepreneur, entrepreneurial and entrepreneurial process will always arise. Entrepreneurship is what the entrepreneur actually does; entrepreneurial is the approach and the entrepreneurial process is where the venturers are engaged in.



ENTREPRENEURSHIP - meaning ( Webster Dictionary)

en·tre·pre·neur noun \ˌäⁿn-trə-p(r)ə-ˈnər, -ˈn(y)uG r\

: a person who starts a business and is willing to risk loss in order to make money

: one who organizes, manages, and assumes the risks of a business or enterprise



ENTREPRENEURSHIP - meaning ( Economist description)

Cantillon 1725…consist in doing things that are not generally done in the ordinaryCourse of business routine; it is essentially a phenomenon that comesUnder a wider aspect of leadership

Kuratko, et al. 1995

….is a process of innovation and new venture creation through four major dimensions - individual, organization, environment, process – and aided by collaborative networks in government, education and institution.


C. The Entrepreneur: The individual that steers

Who is the entrepreneur?

An 'entrepreneur' is a person who is in control of a commercial undertaking. The word has also come to mean a person who is 'enterprising', who is ready to engage in a bold or difficult activity.



Who can start and run an enterprise? People from all walks of life start enterprises and small businesses. You can, too, whether you're:•a young person who's just left school•a qualified tradesperson•a new graduate•an inventor or adventurer•pursuing a hobby or special interest•an author, performer or artist•recently retrenched or made redundant•a new parent with a child to look after•re-entering the workforce after a break•a public servant looking for other work options•a community worker or volunteer•a corporate manager setting up as an expert consultant•a newly arrived migrant•a person recovering from an accident or other trauma.What matters is that you have a good idea for a business, and you're determined to do everything necessary for that business to succeed.



Characteristics of entrepreneurs

An 'entrepreneurial' person is someone who is prepared to take some kind of risk in order to accomplish a task they find attractive. First and foremost, a successful entrepreneur is creative.




Entrepreneurs are also:•confident•enthusiastic•not afraid to make decisions•determined.Entrepreneurs know:•what they want•where to get the best information.Entrepreneurs can:•see opportunities that others can't see•take on a challenge rather than always opting for the safe path•plan for different possible outcomes•learn from their mistakes.




Entrepreneurs have:•a high level of energy•appropriate skills, or they know people who possess them•access to the necessary resources.




Some other skills, abilities and qualities of successful entrepreneurs are:

• the ability to see opportunities, and the confidence to seize them• the ability to identify what other people want - existing customers, potential new customers, employees, colleagues• knowing how to satisfy people's needs and wants• tenacity, persistence, determination and a willingness to work hard• self-motivation and enthusiasm• the ability to work as a member of a team• the ability to take independent action• openness to new ideas and new ways of doing things• goal-setting skills• skill in locating and mobilizing the resources needed to achieve a goal• reliable intuition - a good entrepreneur is an educated risk taker


• vision - the ability to see how products or practices might be improved, and to plan for different possible outcomes

• readiness to look at things differently, to 'think outside the box' or to take innovative action

• readiness to learn from their mistakes and those of others

• problem-solving ability, and a desire to solve problems so that all involved parties are satisfied with the outcome.



ENTREPRENEURSHIP & the ENTREPRENEUR D. The myths, fears and excuses of people who are not entrepreneurs

Myths of people who are not an entrepreneurs.

• Entrepreneurs are born• Entrepreneurs are super human• Entrepreneurs are inventors• Entrepreneur inherit business traits• Entrepreneurs possess a definite characteristic profile• The gender-difference myths (men are better entrepreneurs)• Entrepreneurs are academic and social misfits• Entrepreneurs are gamblers and risk takers• Luck and money are the only things needed to become entrepreneurs• Entrepreneurs experience a lot of failures


RISK EXCUSES

Financial Risk “ I do not have the money”

“ I do not know where to get the capital”

“ I am afraid to loose my house, car, properties, etc.

Career Risk “ I can not risk my promotion”

“ I can not afford not to have salary” What would happen to me if I don’t have a job?

Family Risk “My kids are still young”

“My spouse and I are not doing well”

Social Risk “What would my friends say?”

“What if nobody buys it”

Psychic Risk “I am too young”

“ I am too old for that”

“ I can’t handle the pressure”

D. The myths, fears and excuses of people who are not entrepreneurs


E. The advantage of becoming Entrepreneurs

• Have the opportunity to create your own destiny• Have the opportunity to be financially well-off• Have the opportunity of knowing yourself better• Have the opportunity to excel, be recognized and contribute to society


end

Entrep report

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