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OBJECTIVES
By the end of this course, you should be able to; Identify why entrepreneurship is important Develop a vision to become an entrepreneur Identify entrepreneurial opportunity and transform it into a basic business plan Making decision to become a young entrepreneur for a better future life
Entrepreneur! Why..?
Employed - self employed Financial and time freedom Health, wealth and legacy High - low no risk business High low less capital business Stock no stock business Work hard - work smart principle
CHAPTER 1
INTRODUCTION TO ENTREPRENEURSHIP
Adam Smith (1776) an entrepreneur is a person who acts as agents in transforming demand into supply Jean Babtiste Say (1803) an entrepreneur is a person who shifts resources from an area of low productivity to high productivity John Stuart Mill (1848) an entrepreneur is a prime mover in the private enterprise. The entrepreneur is the fourth factor of production after land, labor and capital
Carl Menger (1871) the entrepreneur acts as an economic agent who transforms resources into products and services. The entrepreneur transforms and give added value. Joseph Aloysius Schumpeter (1934) an entrepreneur is an innovator
Alfred Marshall (1936) the process of entrepreneurship of business development is incremental or evolutionary. It evolves from sole proprietorship to a public company Ibnu Khaldun (Abdul Rahman Mohamed Khaldun) the entrepreneur is seen as a knowledgeable individual and is instrumental in the development of a city state where enterprise will emerge
David McClelland, the entrepreneur is a person with high need for achievement, this need for achievement is directly related to the process of entrepreneurship In Malaysia the term usahawan is used for entrepreneur
Definition of
Scarborough and Zimmer (1998) is a person who creates a new business in the face of uncertainty for the purpose of achieving profit and growth by identifying opportunities and assembling the necessary resources to capitalise on them
Kuratko and Hodgetts (2004) one who undertakes to organise, manage and assume the risks of a business a catalyst for economic changes who uses purposeful searching, careful planning and sound judgement when carrying out the entrepreneurial process
Definitions of Entrepreneurship
Histrich and Peter (1998) is the dynamic process of creating incremental wealth Kuratko and Hodgetts (2004) is a dynamic process of vision, change and creation. It requires an application of energy and passion towards the creation and implementation of new ideas and creative solutions
Myths of Entrepreneurship
1. 2. 3. 4. 5. 6. 7. 8. Entrepreneurs are doers not thinkers Entrepreneurs are born not made Entrepreneurs are always inventors Entrepreneurs are academic and social misfits Entrepreneurs must fit the profile All entrepreneurs need is money All entrepreneurs need is luck Entrepreneurs seeks success but experience high failure rates 9. Entrepreneurs are extreme risk takers (gamblers)
1. Seeking feedback 2. High level of energy 3. Team building 4. Ability to set vision 5. Tolerance for failure 6. Drive to achieve (self starter) 7. Skilled at organising 8. Creative and innovative 9. Independent 10.Opportunity orientation 11.High degree of commitment 12.Initiative and responsibility
Characteristics of Entrepreneurs
Differences between..
Businessman Engages in business activities for the purpose of profit to support his living and family Low risk taker Follows others and invests only in tested and proven markets
Manager Very conscious of rules and taboos in an organisation Sensitive to the future and willing to postpone rewards Has a powerful need for acceptance Able to identify problems in any course of action Make detailed plans
Entrepreneur Starts the venture, assumes leadership and expands the venture to fulfill personal goals and attain self accomplishment Starting from moderate risk taker Take calculated risks Views rules only as guidelines Concept of the future based on personal goals. Low threshold for frustration Prone to action and seems impulsive
CHAPTER 2
DEVELOPING ENTREPRENEURIAL CREATIVITY AND INNOVATION
What is Creativity?
Creativity involves the development of uniques and novel responses to problems and opportunities the abilities to produce work that is novel, high in quality and appropriate-Sternberg, Kaufman and Pretz(2002)
Barriers to Creativity
Personal Beliefs Fear Of Criticism
Over Management
Stress
Barriers to Creativity
1. Personal beliefs We belief that we are not creative
2. Fear of criticism Some are afraid that people will say that their ideas are crazy, foolish and impractical
3. Over management workers burdened with assignments, schedules and demands for quick production have hampered workers from thinking creatively
4. Stress Not only a distraction that drains ones energy that could be used creatively but it is also bad for the health
DO IT
3. DO IT D - define problem O - open minded and apply creative technique I - identify best solution T - transform
4. Mind mapping This technique allows one to use pictures and/or word phrases to organise and develop thoughts in a non-linear fashion. It helps people to see a problem and its solution 5. Nominal group The use of the groups is to generate ideas and evaluate solutions face to face in non threatening group.
Innovation
Creativity is a pre condition to innovation Is believed to the key to sustainable success for many organisation Kinicki and Williams (2003), finding ways to deliver new or better goods or services Chell (2001), innovation is deemed as the creation of something new in the marketplace that alters the supply demand equation
Types of Innovation
1. Invention The act of creating a new product, service and process that is totally novel or untried 2. Extension The extension or addition to existing product lines, services and processes 3. Duplication Process of replication of existing product, service or process. It does not mean simply copying, but adding new features or improving competitiveness of the product, service or process.
Sources of Innovation
Unexpected Event New Knowledge Concept
Changes Of Demographics
Process Needs
Sources of Innovation
1. Unexpected events Entrepreneur frequently notice that they get ideas from something that is out of their expectations 2. New knowledge concept It can be obtained through reading, attending seminars or conferences or discussions among the professionals
3. Changes of demographics Changes of demographic characteristics in age, educational levels, income and types of employment have been a main source of innovation for entrepreneurs 4. Process needs Process needs exist within the process of business, an industry or a service. It perfects a process which already exists, replaces a link that is weak, redesigns an existing process and so on.
Barriers to Innovation
Organisation does not encourage innovation Insufficient resources Traditional behaviour management Fear of trying Fear of change Improper motivation Fear of failure Self image block
The Importance
1. To ensure an organisations survival The future business depends on the ability of the organisation to create new products or services 2.To explore new markets A creative and innovative entrepreneur will always think of conquering a new market by introducing new products or services
3. To exploit natural resources Entrepreneurs should ensure that they can get these benefits by exploiting the wealth of resources without causing harm to the environment