Vous êtes sur la page 1sur 27

Entrepreneurship

Nature & Importance of


Entrepreneurs

Learning Objectives
To introduce the concept of entrepreneurship
and its historical development.
To explain the entrepreneurial decision
process.
To identify the basic types of start-up
ventures.
To explain the role of entrepreneurship in
economic development.
To discuss the ethics & social responsibility of
entrepreneurs.

Entrepreneur - origin
Comes from French word
meaning
between-taker or gobetween

Entrepreneur 17th Century

A person bearing risks of profit (loss) in


a fixed-price contract with government

Entrepreneur 1725
Richard Cantillon (1680s May 1734)
was an Irish-French
economist and author
of Essai sur la Nature
du Commerce en
Gnral (Essay on the
Nature of Trade in
General).
A person bearing risks
is different from one
supplying capital.

Entrepreneur - 1803
Jean Baptiste Say January 1767
November 1832) was a
French economist and
businessman. He had
classically liberal views
and argued in favor of
competition, free trade,
and lifting restraints on
business.
Separated profits of
Entrepreneur from profits
of capital.

Entrepreneur - 1876
Francis Amasa Walker
(July 2, 1840 January 5,
1897) was an American
economist,
statistician,
journalist,
educator,
academic administrator.

He
distinguished
between
those
who
supplied
funds
and
received interests and
those
who
received
profits from managerial
capabilities.

Entrepreneur - 1934
Joseph Schumpeter
(February 8, 1883
January 8, 1950) was
an economist from
Austria and a giant in
the history of economic
thought.
Entrepreneur is an
innovator and develops
untried technology.

Entrepreneur - 1961
David
Clarence
McClelland (May 20, 1917
March 27, 1998) was an
American
psychological
theorist, noted for his work
on Need Theory, publishing
a number of works in the
1950s-1990s. McClelland is
credited with developing
the Achievement Motivation
Theory commonly referred
to as need achievement or
n-achievement theory.

Entrepreneur - 1964
Peter Ferdinand Drucker
November
19,
1909
November 11, 2005) was an
Austrian-born
American
management
consultant,
educator, and author, whose
writings contributed to the
philosophical and practical
foundations of the modern
business corporation. He was
also
a
leader
in
the
development of management
education, and he invented
the
concept
known
as
management by objectives.

Entrepreneur - 1975
Albert Shapero
(1925 1986)
Entrepreneur takes
initiative, organizes
some social and
economic
mechanisms, and
accepts risks of
failure.

Entrepreneur - 1980
Karl H. Vesper is a
professor of Business
Administration at the
University of Washington
in Seattle. He is a
nationally
recognized
chronicler of the growth
of
entrepreneurship
education in U.S. higher
education and a national
expert on
entrepreneurship
programs.

Entrepreneur - 1983
Gifford Pinchot
(August 11, 1865
October 4, 1946)
was an American
forester and
politician.
Intrapreneur is an
Entrepreneur
within an already
established
organization.

Entrepreneur - 1985
Robert Hisrich
Entrepreneurship is
the process of
creating something
different with value
by devoting the
necessary time &
effort, assuming
the accompanying
risks and receiving
the resulting
rewards.

Entrepreneurship
The Process of creating something
new with value by devoting the
necessary time and effort, assuming
the accompanying financial,
psychological, & social risks, and
receiving the resulting rewards of
monetary and personal satisfaction
and independence.

Development of Entrepreneurship
Theory
17th Century Person bearing risks of profit (loss) in
a fixed-price contract with government.
1725 Richard Cantillon person bearing risks is
different from one supplying capital.
1803 Jean Baptiste Say separated profits of
entrepreneur from profits of capital.
1876 Francis Walker distinguished between those
who supplied funds and received interest and those
who received profit from managerial capabilities.
1934 Joseph Schumpeter entrepreneur is an
innovator and develops untried technology.

Development of Entrepreneurship
Theory

1961 David McClelland entrepreneur is an energetic,


moderate risk taker.
1964 Peter Drucker entrepreneur maximizes
opportunities.
1975 Albert Shapero entrepreneur takes initiative,
organizes some social & economic mechanisms, and
accepts risk of failure.
1980 Karl Vesper entrepreneur seen differently by
economists, psychologists, businesspersons, and
politicians.
1983 Gifford Pinchot intrapreneur is an entrepreneur
within an already established organization.
1985 Robert Hisrich Entrepreneurship is the process of
creating something different with value by devoting the
necessary time & effort; assuming the accompanying
financial; psychological, and social risks; and receiving the
resulting rewards of monetary and personal satisfaction.

The Entrepreneurial Decision


Process
Deciding to become an entrepreneur
by leaving present activity.
Major decision involves changing
from present lifestyle to forming a
new enterprise.
A change in work environment takes
place.
Disruption in present lifestyle.

Desirability of a New Venture


Formation
Aspects of a situation that make it
desirable to start a new company.
Usually involves the following:
Cultural
Sub cultural
Family
Teachers
Peers

Enablers New Venture


Formation

Factors making it possible to create a new venture


include:
Government (Provides infrastructure & economic
stability).
Background (Formal education & previous business
experience.)
Marketing (Existence of market & marketing knowhow to arrive at a best package of product, price,
distribution & promotion needed for successful
product launch.)
Financing (Resources available from personal
savings, credit, friends & relatives, & risk capital.)
Role Models can have powerful influences and
provide ample motivation.

Types of Start Ups


Lifestyle firm: A small venture that supports
the owners and usually does not grow.
Foundation Company: A type of company
formed from Research & Development that
usually does not go public.
High Potential Venture: A venture that has
high growth potential and therefore receives
great investor interest. They are also called
Gazelles (very high growth ventures).

Role of Entrepreneurship in Economic


Development
Improvement in Per Capita output & income +
Initiating and constituting change in the structure
of business and society.
Understanding of the Product Evolution Process.
Five phase process comprising of: - Recognition
of social need - Institution of Technological
Innovation - Iterative synthesis leading to
invention (Intersection of
knowledge & social
need.) - Development phase - Industrial phase
Government as an Innovator Assists in
commercializing the results of the synthesis of
social need and technology (technology transfer).
Intrapreneurship.
Entrepreneurship.

Intrapreneurship &
Entrepreneurship
Intrapreneurship Entrepreneurship within
an existing organization is called
Intrapreneurship.
Entrepreneurship The Process of creating
something new with value by devoting the
necessary time and effort, assuming the
accompanying financial, psychological, &
social risks, and receiving the resulting
rewards of monetary and personal
satisfaction and independence.

Skill Requirements Entrepreneurship


Technical Skills
Writing, Oral
Communication, Monitoring Environment,
Technical Business Management, Technology,
Interpersonal, Listening, Organizing, Network
building, Coaching
Business Management Skills
Planning &
Goal Setting, Decision making, Human
Relations, Marketing, Finance, Accounting,
Management, Control, Negotiation, Venture
launching, managing growth
Personal Entrepreneurial Skills
Inner
Control/ disciplined, Risk taker, Innovative,
Change oriented, Persistent, Visionary leader,
Ability to manage change.

Ethics and Social Responsibility of


Entrepreneurs

Risk taking with capital is inevitable.


Corporate responsibility practiced by Managers
depends upon the organizational climate
whether supportive of laws and professional
codes.
Entrepreneurs with relatively new companies
usually develop internal ethical code and depend
more on their personal value system than that of
other Managers.
Ethics refers to the study of whatever is right and
good for humans, while Business Ethics concerns
itself with the investigation of business practices
in light of human values.
Four broad areas of Business Ethics include: 1) An
inquiry into theory and empirical studies, 2)
Theory building without empirical testing, 3)

The Future of
Entrepreneurship
Different perceptions of Entrepreneurship.
Common aspects include Risk taking, Creativity,
Independence, and Rewards.
Gradual increase in the number of new
Entrepreneurship related courses being offered at
Universities.
Government encouragement for innovation &
Entrepreneurial processes and organizations.
Societys support for Entrepreneurship is gradually
increasing.
Large companies continue to explore
Intrapreneurship within their organizations.