Chap1 ENTREPRENUERSHIP

8/11/2019 Chap1 ENTREPRENUERSHIP

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chapter 7-source of

capital


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Concept of Entrepreneur &

Entrepreneurship

Entrepreneur- Word of entrepreneur derived from French word

entrepredre means to undertake orto try.- Entrepreneur is person who organizes, manages and

assumes the risk of business.(Kuratko and Hodgetts, 2001)

- Entrepreneur refer to individual who establishes a

business and manages it to obtain profit and to besuccesfull. (Carland, 1984)

- It also define as who accept risks and opportunities ofcreating, operating and growing a new business.


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- Entrepreneur is a person who sets up a

business or businesses, taking on financial

risks in the hope of profit.

- It also a businessman who takes risks to

combine factor of production such as

capital,labour andraw materialand acceptsrewards through profit made by market value

of his product.

- An entrepreneur is always alert about

business opportunities that have not beenseen by others.

- They will have imaginative, creative and

innovative.


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Entrepreneurship

- is a process of seeking businesses opportunities

under conditions of risk.

- also refers to the process of creating something

new value by devoting the necessary time and

effort, assuming the accompanying financial,physical and social risks and receiving the

resulting monetary rewards, personal

satisfaction and independence.

- The study of entrepreneurship is concerned withthe entrepreneurial behavior and dynamics of

business set up, expansion and development.


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The success of a business venture depends on several aspects which are

required by an entrepreneur that encompass attitude, skills and knowledge;

ATTITUDE SKILLS KNOWLEDGE

Motivation Decision making Law

Confidence Problem solving Management

Initiative Negotiation Economics

Responsibility Communication Accounting

Risk Taker Creativity Values

Diligence Team Work Business

Mental and Physical fitness Management Culture

Information seeker Technical Project management


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Difference between Businessman

and EntrepreneursCHARACTERISTICS ENTREPRENEUR SMALL BUSINESSMAN

Time Unlimited Limited

Nature of job Flexible Rigid in adapting to change

Decision making Makes own decisions Follows decisions made by

others

Effort and commitment Continuous Low

Risk taking Moderate Low

Goal Maximizes self-potential by

utilizing available opportunities

Solely for profit maximization


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SOCIAL RESPONSIBILITIES OF

ENTREPRENEURS

Social responsibilities means beingconcerned about people and society as a

whole.

Entrepreneurs are entrusted withresponsibility of improving the quality of

human life.

Social responsibilities is seen as a keydriver for engaging the wider community in

business activities.


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Country

Competitors

Staff

Suppliers

Society/

Community

Customers

SocialResponsibilities


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Customers- Monitors complaints from customers regarding the quality of the product or

treatment received from employees. Follow-up on the matter then identify

the necessary corrective action to be taken.

- Gather information feedback via customer questionnaires regarding the

product or services which recently been purchased by customers.

Society / Community- Produce, create and improve products.

- Create choices through innovative and creative production.

- Produce products of high quality.

- Always be sensitive to the needs of customers.

- Fulfill the needs and want of customers.

- Create more job opportunities.

- Improve the lifestyles of society.


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Suppliers- Nurture good relationship with suppliers.

- Pay any dues to suppliers at the agreed stipulated time.- Share opinions and experiences to create new ideas related to the

business.

Staffs- Always take care of the staff welfare.

- Give adequate wage to the workers.

- Do not restrain and always provide guidance to staff.

- Conduct courses and training to update staff with the latest information.

- Rewarded staff with bonuses, allowances and other perks such as extra

holidays.

- Appreciate and recognize dedicated and highly ethical staff.


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Competitors

- Practice healthy competition with competitors.- Share ideas and opinions on way to prepare and provide the best services

to customers.

- Work together to produce and create products that can give the most

benefit to the customers and make improvements to the product to attract

more customers.

- Healthy competition among entrepreneurs will lead to more jobopportunities for the community.

Country- Create job opportunities.

- Assist in improving the lifestyle of the society.

- Create more infrastructure facilities for the society.

- Improve socio-economical aspects and increase national income.

- Diversify the national economy so not to depend solely on one sector of the

economy.


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PERSONAL TRAITS/BEHAVIORS ASSOCIATED WITH

SUCCESSFUL ENTREPRENEUR PERFORMANCE

Entrepreneurial competencies refers to keys

characteristics possessed by successful

entrepreneurial functions effectively.

Entrepreneurial competencies can be observed

from the entrepreneurs attitude, internal life

value or his insistence to perform with

excellence.


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There have 13 entrepreneurial competencies possessed

by successful entrepreneurial, which are;

- Personal initiative

- Seize opportunity

- Endurance

- Information seekers

- High work quality- Commitment towards work agreements

- Efficiency

- Systematic planning

- Creative problem solving

- Self-Confidence- Assertion

- Persuasion

- Power and authority


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Personal initiative- A successful entrepreneurs takes the initiative and will always do

something without receiving instructions from anyone.- They has proactive and diligent attitude in making his business

successful.

- It helps the entrepreneurs in seeking opportunities and exploring his

field of interest.

- An entrepreneurs who has strong personal initiative is able to actimmediately on available opportunities and chooses the best

strategy when they face problem.

- Initiative allows an entrepreneurs to be alert and proactive.

- They likes to take initiative in solving problems in situations where

no leadership exists.


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Seized Opportunities- A successful entrepreneur grabs or seizes opportunities

continuously to make sure that his business sustains for a long timein the industry.

- They focuses, identifies and exploits new business opportunities,

and seizes unusual chances to obtain financing, equipment, land,

work space or assistance.

- The entrepreneurs maximizes his thinking capacity by findingsolutions to problems faced by the community.

- In identify current human needs, they will take action to develop,

modify, adapt or adopt the existing products to fulfill market demand.

- Entrepreneurs increase knowledge by getting ideas from

employees, customers and competitors, reading on related matters,and identifying his skills, capabilities and self-potential.


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Endurance

- Entrepreneurs has to face various barriers and problems before

achieving success,

- They needs to have great strength and courage within him. A

successful entrepreneurs is strong enough to face problems and

barriers courageously.- A successful entrepreneurs will be brave to express his opinions

and ideas.

- They would never give up accomplishing his vision and tries hard to

deal with barriers that block his path to achieving success.

- A successful entrepreneurs will also be courageous even though hehas been declared unsuccessful.


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Information Seekers

- A successful entrepreneurs is able to seek information by doingresearch to obtain the information that he needs and by receiving

feedback from customers in order to provide a good product or

service that can gain customers satisfaction and acceptance.

- They consults experts and experienced persons, uses contact or

information network, and personally undertakes market research,analysis or investigation to obtain useful information.

- Importance for entrepreneurs to make analysis on his market and

business progress.

- A successful entrepreneurs should have up-to-date and accurate

information.- Information obtained will help him enhance his experience and

improve his achievement and business performance.


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High Work Quality

- A successful entrepreneurs places care on quality and can be seenas having the urge to sell or produce products of high quality.

- They states a desire to produce or sell a top quality product orservice.

- Always makes comparison of his work quality with those of others to

make sure his product always better.- Not only doing a job but also doing it in the best way possible to

produce products of the best quality.

- High quality products ensure customer satisfaction andsimultaneously increase market share.

-

Product of high quality will bring profitable returns to anentrepreneurs as it ensures the faith of customers towards theproducts.

- Therefore, a successful entrepreneur should make an effort todevelop high quality products or services in order to maintaincustomers loyalty, commitment and satisfaction.


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Commitment towards work agreements

- A successful entrepreneur devotes total commitment to the venture.

- This commitment helps entrepreneurs rectify mistakes and

overcome obstacles which threaten business operations.

- A successful entrepreneurs who has high level of commitment

towards work agreements can be seen in ;

o Willingness to sacrifice his personal interest in order to make themarket successful;

o Taking full responsibilities in completing a task;

o Willingness to help his own staff to performed the job and provide

satisfaction to customers, and

o Showing an attitude of care to satisfy customers, suppliers, andother parties as agreed.

- This good attitude will gain the trust of others and help to improved

the entrepreneurs image which is key to his success.


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Efficient

- A successful entrepreneur is oriented towards efficiency

and is always finding ways to produce product at lower

cost or within a shorter time period.

- When new idea emerges, the entrepreneurs alwaystakes into consideration the calculation of cost and profit.

- Uses business information and management methods to

improve his efficiency in business, which would help

decrease wastage and costs.


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Systematic planning

- Planning is the most important aspect for an entrepreneur in

arranging business strategies to achieve business goal.

- A successful entrepreneurs practices time management in

performing systematic planning of his business.

- Systematic planning will lead to an increase in performance and

achieving business targets.- This type of entrepreneurs usually move towards;

o Making plans, taking forwards steps, and dividing big task into

simpler and smaller task;

o Making plans to overcome anticipated obstacles;

o Making evaluations and choosing the best alternative for a specificproblem, and

o Using a systematic and logical approach to achieve business goals.


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Creative Problem Solving

- A successful entrepreneurs has the capability of solving problems in

terms of searching for smart step to solve those problems as well as

looking and thinking of innovative new ideas or creative problem-

solving methods.

- Every entrepreneurs faces many uncertainties that might cause

problems to the business. The problems must be solved creatively.

- Action taken must solve the problem as well as enhance employee

loyalty towards the company.


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Self Confidence

- A successful entrepreneurs who has confidence in himself;o Believe in his skills and capabilities to achieve what they desired. They tends to be

optimistic about his chance of success;

o Express their feeling of confidence towards his capability in solving certain tasks and

challenges. He will be able to stand firm and overcome the problem of low self-

esteem when confronted with competition;

o Is able to make decision without hesitation or responds to challenges;

o Reads a lot and gathered experience in subjects outside his specialization, and

o Does not have fear of failure.


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Assertion

- A successful entrepreneurs will be assertive in his

actions.

- They brave to give ideas or opinion to people and take

action even when he has face defiance from others.


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Persuasion

- Successful entrepreneurs able to persuade his

customers to buy his products or services.

- They will be obtrusive in his own skills.

- In order to ensure that business deals aresmooth, he has to persuade many people who

have an impact on his business such as staff,

customers, suppliers and financial institutions.


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Power and authority- A successful entrepreneurs is also a leader, as a leader he will able

to influence his staff and industry that he involved in to make sure heachieves his vision.

- 5 aspects influence that should take into consideration;

o Influence based on total control;

o Influence based on the power to impose penalty;

o Influence based on the power to give rewards;o Influence based on the power of expertise, and

o Influence based on the power to show good examples.

Chap1 ENTREPRENUERSHIP

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