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Entrepreneurship Introduction to Entrepreneurship and Small firms

Entrepreneurship

Introduction to Entrepreneurship and Small firms

Topics

Introduction of Entrepreneurship History of Entrepreneurship Importance of Entrepreneurship Definitions of Entrepreneurship Characteristics of Entrepreneurship

Defining small firms why these firms are different?

Learning objectives

  • To give the introduction of Entrepreneurship.

  • To understand the term Entrepreneurship through definitions.

  • To explain the history of Entrepreneurship.

  • To give brief importance of Entrepreneurship.

  • To explain the different characteristics of successful Entrepreneurs.

  • To give overview of small firms and why small firms are different.

Ask your self

  • Who are they?

  • Are they born or made?

  • What is their link to the process of innovation?

  • Can entrepreneurs manage large firms or do they have to change as business grows

  • Are entrepreneurs any different than managers?

  • Are they any different from owner manager?

  • Can entrepreneurship be engendered in large companies or other sorts of organizations

Entrepreneurship
Entrepreneurship

“Most of what you hear about entrepreneurship is all

wrong. It’s not magic; it’s not mysterious; and it has nothing to do with genes. It’s a discipline and, like

any discipline, it can be learned.”

Peter F. Drucker

Introduction Of Entrepreneur

  • The Entrepreneur is one who is willing to bear the risk of a new venture if there is a significant chance for profit.

  • An Entrepreneur is being called so when he initiates, conceptualize and materialize a business process which is entirely unique.

  • An Entrepreneur is someone who starts a business from a fresh idea and makes it work.

History of Entrepreneurship

The word Entrepreneurship is derived from the French verb “ENTERPRENDRE”- to undertake .

The French men who organized and led military expeditions in

the early 16th Century were referred to as Entrepreneurs.

  • 17 th Century

    • Developed in 17 th century

    • Being a person who entered into contractual arrangement with the

Government to perform a service or

stipulated products

to supply

  • Contract prices was fixed, any resulting profits or losses were entrepreneur’s

  • 18 th Century

    • Person with capital was differentiated from who needed capital

    • Industrialization occurring throughout the world

    • Eg. Thomas Edison (Electronics)

19 th and 20 th Century

  • In late 19 th & early 20 th centuries entrepreneurs were frequently not distinguished from managers and were reviewed mostly from an economic perspective

  • Entrepreneur organizes and operates an enterprise for personal gain

  • He pays current price for the material consumed in the business

  • He contributes his own initiative, skills and ingenuity in planning, organizing and administering the enterprise

  • He also assumes the chances of loss and gain consequent to unforeseen and uncontrollable circumstances

Importance of Entrepreneur

Entrepreneur role as a innovator who market his

Innovation.

Entrepreneurs are those individuals who takes the risks

and start something new. Entrepreneur develop new

goods or processes that the market demands are not

currently being supplied.

Definitions of

Entrepreneurship

Entrepreneurship is an individual that organize, operates and takes on the risks of business.

OR

Process of creating something new value by devoting the

necessary time assuming the accompanying financial psychic and social risks and receiving the resulting rewards of monetary and personal satisfaction and independence.

Entrepreneurs

Entrepreneurs use innovation to exploit or create change and

opportunity for the purpose of making profit. They do this by shifting economic resources from an area of lower productivity into an area of higher productivity and greater yield, accepting

a high degree of risk and uncertainty in doing so.

Entrepreneur ,owner manager and

manager

  • Entrepreneur who starts the business from scratch. for example, initiating the plan , materializing and implementing and also creating brand for his products and services. in simple words entrepreneur who run the business in a unique form

  • Owner-manager who follow up the market trying to capture the existing customers by doing some additional or value added services in the existing products and services category.

  • Managers of firms do not own or control the firm they are employed by. The firm is controlled by its larger, parent company.

  • Managers are different people from owner-managers, but both can be entrepreneurs.

  • Figure below shows these relationships. Managers are different people from owner-managers, but both can be entrepreneurs

Owner-

 

managers

Managers

   

Entrepreneurs

 

Characteristics of successful

Entrepreneur

  • Mental Ability Entrepreneur must have creative thinking and must be able to analyze problems and situations. He should be able to anticipate changes.

  • Business Secrecy He should guard his business secrets from his competitors.

  • Clear Objectives He must have clear objectives as to the exact nature of business or the nature of goods to be produced.

  • Human Relations He must maintain good relation with his customers, employees, etc. To maintain good relationship he should have emotional stability, personal relations, tactfulness and consideration.

  • Communication Ability He should have good communication skills means both the sender and the receiver should understand each others message.

  • Technical Knowledge He should have sufficient technical knowledge.

Cont….

  • Long term involvement An entrepreneur must be committed to the project.

  • Motivator

  • Moderate risk taker

  • Initiative

  • High energy level He should be able to work for long hours, for which his energy level should be high.

  • Goal setter

  • Self confidence

Entrepreneurial Enterprises

  • Many entrepreneur want to start and run their own enterprise, make it successful and stick with it for life. Other want to become a serial entrepreneur-those are the people who understand that their forte is starting businesses.

Types of Entrepreneurs

  • Serial Entrepreneurs

  • Opportunity Entrepreneurs

  • Necessity Entrepreneurs

  • Social Entrepreneurs

Intrapreneur

A person within a large corporation who takes direct responsibility for turning an idea into a profitable finished product through assertive risk taking and innovation. Intrapreneurs have entrepreneurial skills blended with managerial skills but operate within the confines of an organization.

Intrepreneur

One who sets up, maintains and assumes the financial risks of an

Internet business venture not to be confused with intrapreneur or the more traditional entrepreneur.

What keeps most people away

from becoming entrepreneurs?

  • Funding

  • Manpower

  • Strong backing

  • Branding/Marketing

  • Fear

Failures of Entrepreneurial

Ventures

Multiple factors involved in the failure of

ventures:

  • Bad Management

  • Technical difficulty/ failure

  • Insufficient fund

  • Too much competition

  • Research gap

entrepreneurial

A small firms is not just about size, its in simple statistical terms. These firms have some important characteristics: ( Less than 500 employees)

  • Market influence

  • Independence

  • Personal influence

The rise of Small Firms

  • People expect companies to address their particular needs.

  • People want to control their own destinies

  • Market niches are becoming slimmer and markets more competitive.

Important Statistics

  • In Italy 79% of employment in generated by small firms

  • In France 63%

  • In UK 62%

  • In Germany 60%

  • Over all in the EU they generate 66% of employment.

Why small firms are different.

The small firms are distinguish between two categories:

Life style firms Growth firms

Eight reasons why many small businesses fail
Eight reasons why many small businesses fail
Eight reasons why many small businesses fail 26

How to become a Successful

Entrepreneurship

  • Find a simple solution to a big problem

  • Take your hobby as a business

  • Always find a cheaper way to do something

  • Have a personal blog to bran yourself and your business.

SESSION: 1 Definition Importance History 16 th century 17 th century 18th century 19 th &
SESSION: 1
Definition
Importance
History
16 th century
17 th century
18th century
19 th & 20 th
century
Introduction to
Entrepreneurship
Entrepreneur
Owner Manager
Manager
Characteristi
cs of
Entrepreneur
s
Mental
Business
Clear
Human
Communicat
Technical
Ability
Secrecy
Objectives
Relations
ion Ability
Knowledge
Long term
Moderate risk
High energy
Motivator
Initiative
Goal setter
involvement
taker
level
How to Become Successful
Entrepreneur