Entrepreneurship in Management
Entrepreneurship is a trait possessed by an entrepreneur. The spirit of enterprise makes a person an entrepreneur. Entrepreneur thus is an innovator, who carries out new combinations in ever-changing environments to initiate and accelerate the process of economics, social and technological development.
An entrepreneur is an economic agent who plays an important role in the economic development of the country. He possesses the required knowledge, skills, initiative, drive and spirit of innovation and aims to achieve goals. He identifies opportunities and grabs them for economic benefits.
Entrepreneurship is a dynamic activity which helps the entrepreneur to bring changes in the process of production, innovations in business, new ideas and usages of resources, establishing new markets, etc.
The term “Entrepreneur” is defined in the variety of ways. It varies from country to country time to time and the level of economic development. An entrepreneur in an advanced economy is an individual who introduces something new in the economy a method of production not yet tested by experience in the branch of manufacture concerned, a product with which consumers are not yet familiar, a new source of raw materials or of new markets and the life.
An entrepreneur is a high goal oriented, enthusiastic and energetic individual. A good entrepreneur should be action-oriented, highly motivated and ready to take the risk at all levels to achieve the goal. He should have unwavering determination and commitment. He should be creative and result oriented, hardworking. He should be self-confident, dedicated; self-disciplined and should accept responsibilities with enthusiasm. He should be the future vision, intelligent, imaginative and self-directed.
An entrepreneur performs all the necessary functions that are essential from the point of establishing and developing the enterprise. Like in any other activity, planning is the first step of entrepreneur. He prepares his plan of proposed project or business in very systematic way. Planning involves study of various ideas, scanning and selecting the best idea, selection of product line and location of the plant, deciding the type of business organization, preparation of the budget and identifying capital sources, studying the government rules, regulations and policies, study and selection of work force, study and selection of marketing strategies.
An entrepreneur coordinates and supervises the various tasks of organizing for optimal utilization of resources. He also take effective decisions with regard to business objectives of the enterprise, arrangement of resources and facilities like men, material, machines, money, methods, technology, development of a market for the product and maintain a good relationship with others.
An entrepreneur should be innovative in launching of new product, introduction of new technology in the production line, creation of new market, new or better source of raw material. He should undertake responsibility of risk due to unforeseen situations.
In addition to these primary functions, entrepreneur has to perform other functions and functions important for developing countries.
The other functions are diversification of production, expansion of the enterprise, maintaining cordial relations with employer and employees, attending to and resolving the labour problems and coordination with outside agencies for the well-being of the enterprise.
The functions of an entrepreneur with reference to the underdeveloped countries include a wide range of activities like management of scarce resources, dealing with public, engineering, new product development looking out for parallel opportunities, marketing management of customers and supplier relations, etc.
Entrepreneurship is a process undertaken by an entrepreneur to augment his business interests. Some authors define it as “Entrepreneurship is the indivisible process flourishes, when the interlinked dimensions of individual psychological entrepreneurship, entrepreneur traits, social encouragement, business opportunities, Government policies, availability of resources and opportunities coverage towards the common good, development of the society and economy."
Entrepreneurship lies more in the ability to minimize the use of resources and to put them to maximum advantage. Above all, entrepreneurship in today’s context is a product of teamwork and ability to create, build and work as a team.
Entrepreneurship is the process of identifying opportunities in the marketplace, arranging the resources required to pursue these opportunities and investing the resources to exploit the opportunities for better gains.
The first step in the entrepreneurial process is the identification of opportunity. This may be from his own idea or from external sources as consumers and business associates, members of distribution system, independent technical organizations, consultants, etc. Consumers are the best source of ideas for a new venture who spells out the need of a product or service. The business associates also can give ideas of a product or service.
Due to the close contact with the end user, member of distribution system also see product needs one can identify new business opportunities through discussion with a retailer, wholesalers or a trade representative.
Some Individuals are highly technical oriented and are not interested in any entrepreneurship. Such people conceptualise new business opportunities that can be given to the interested. Some government organizations and R & D centres also provide new ideas.
The opportunity identified by using either input from consumers, business associates, channel members or technical people, must be carefully screened and evaluated. This evaluation is the most critical element of the entrepreneurial process as it allows the entrepreneur to assess whether a specific product or service provides sufficient return on investment. The evaluation process involves looking at the length of opportunity, its real and perceived valve, its risks and returns, its fit with personal skills and goals of the entrepreneur and its uniqueness or differential advantage in its competitive environment.
The role of entrepreneurs in economic development involves more than just increasing the output and income; it involves in initiating and effecting a change in the structure of business or society. This change gives way to growth and higher output that lead to higher profits. Innovation plays very important role in economic growth both in developing new products or services and stimulating idea of investment in new ventures. This new investment works on both the demand and supply sides of growth. The new capital created expands the capacity for growth on supply side and the resultant new spending brings new capacity and increased output on demand side.
In spite of the importance of investment and innovation in the economic development of the area, there is little awareness of the product evolution process. This is the process through which innovation develops and commercialises through the entrepreneur’s activity which in turn results in economic growth.
Entrepreneur bridges the gap between science and the marketplace, creating new enterprises and brings new products and services into the market. Those activities of an entrepreneur significantly affect the economy of the area by building economic base and providing jobs. In some areas, entrepreneur creates new products and new employment. Thus, entrepreneur thrusts impact and plays a vital role both in overall economic development and creating employment to people.
About Rajesh Padmanabhan
My self is Rajesh Padmanabhan from Bangalore, India. I have been in this field of freelance article writing for above 5 years and i am working in one of the software firm in Bangalore.