Principles of entrepreneurship - Essay Example

Finally, the paper looks at how entrepreneurs can recognize opportunities and generate business ideas. Introduction An entrepreneur is an individual who establishes a new organization without the benefit of corporate sponsorship. Entrepreneurs venture into new business opportunities with the aim of having growth and high profitability as their primary objectives. Several myths have been developed concerning entrepreneurs. Most people believe that entrepreneurs can start new businesses, they are gamblers, they always want to own business and be completely independent, entrepreneurs work longer and harder than managers in big companies, they experience a great deal of stress and pay a high price and they are always solely motivated by the quest for the almighty dollar.

In addition to this, entrepreneurs seek power and control over others and they are talented and have good ideas (Acs Z. and Audretsch, 2010). Most entrepreneurs venture into businesses for various reasons such as to gain better quality lives, to increase their profit potentials, as well as desire for independence. Most entrepreneurs possess certain elements like innovation and creativity, management skills, social networks, and effective communication (Ramoglou, 2013). . The following figure summarizes the characteristics of entrepreneurs.

Literature Review Value proposition is creating utility of a product or a service to the customers thi is according to (Bovert and Martha, 2000). On the other hand, (Best, 2007) defines value proposition as all key elements included I a situation and the benefits the target customer is searching for while purchasing a product or a service. However, Sheehy, Bracey and Frazier, 1996) defines value proposition as the bundle of value that an organization delivers to its customers and this does not only include the price, selection, service, but also the intangibles like brand image and equity.

The authors believe that value proposition is not only purchasing the product or the service but what the customer is thinking about while purchasing the product. The following diagram shows the components of value proposition. From the diagram above it is evident that value proposition contains components such as value expectations on one side and a partners role and relative competitive position on the side of the organization. From the diagram above, value proposition entails various factors such as the market value of the proposition being created.

The customer’s experiences with the value are also considered while the product and service offered is also put into consideration. Entrepreneurs then look at the benefits that will be derived from the product and services and look at alternatives that the market provides for its products and services. Finally, the entrepreneur must think about substantiate evidence that the proposition is offering. After this, the entrepreneurs are expected to review the benefits, costs, and value that the organization is offering to the customers, prospective customers both within and outside the organization.

In summary, the value proposition is a promise of value to be delivered and a belief from the customer that value will be experienced. There is the need for entrepreneurs to understand that there are those customers who are slow to adapt to the value proposi