Essentials of Entrepreneurship and Small Business Management - Essay Example

Enterprise events College Enterprise, entrepreneur and entrepreneurship are terms that have many things in common. Existencefor one leads to the existence to the other. They all depend on each other in order to exist. For example, for entrepreneurship to exist, there must an entrepreneur. Also enterprises exist due to the existence of entrepreneurs. Despite the fact that these terms are common to everyday business, their definitions have given many scholars’ hard times. It has been very hard to define what entrepreneur is. This has given rise to many definitions from different scholars who are trying to discuss the real meaning entrepreneur. There are also many theories that have come up and they are trying to discuss the real meaning of an entrepreneur. Reasons that have made it difficult to discuss this time is the fact like, why are some people able to start business while others cannot. Also what’s the reason why some businesses succeed while others selling the same products cannot? These are a few of the asked questions when defining who an entrepreneur is. However, this paper will focus on describing what an enterprise is. From the point of what is an enterprise, it will also discuss the possible theories that describing the meaning who is an entrepreneur. Finally this paper will also focus on the real meaning of entrepreneurship as from different literature reviews. Many people are currently managing very big enterprises. Most of these enterprises are successful and they are gaining a lot of profit from them. The main goal of every business is to gain profit. Before we talk about how this businesses are ran, it is important to describe what an enterprise is. From business point of view, enterprise is the measures that are used to encourage people on how to be good entrepreneurs. It also involve spotting ideas and looking for the best ways in which to transform these ideas into reality (King, 2002 p. 23). Therefore, it is important for every enterprise to ensure that profits are maximized. To achieve these goals, all forces of production have to be considered. These goals are achieved through entrepreneurs’ hard work and determination. However, entrepreneurs are the ones who make enterprises run. The big question is, “who are these entrepreneurs?” To describe who really is an entrepreneur, there are some factors that have to be considered first. There some approaches that can be used to describe an entrepreneur. One of the theories that can be used to describe entrepreneurs is the trait theory. This theory describes entrepreneurs from the common identities that link all the entrepreneurs. From this approach, it is assumed that entrepreneur has some personality that makes him or her different from other people. This means that an entrepreneur will always be an entrepreneur no matter what will happen to him or her. They seemed to be fixed to this personality. This approach therefore focuses on who the entrepreneur is (his or her personality) (King, 2002 p. 24). Social development approach can also be used to describe entrepreneurs. Some of this social development factors include the risks and family influences. Family backgrounds can change personality of someone. Poor backgrounds always force some people to think of more creative ways to survive. Most of these people venture in business and they always succeed. Another approach that contrasts the trait approach is the behavioral approach. This approach focuses on what an entrepreneur does rather than who the entrepreneur is. This means that this approach is concerned with the actions that the entrepreneur is doing. This approach views an entrepreneur as an economy agent who combines all units of production in order to maximize the profits. Due to this approach, an entrepreneur is seen as the person who performs some creations that will eventually lead to creation of an organization. However, for an entrepreneur to come up with these creations, he or she must have some personal characteristics (Gartner, 1989 p.48). One of the traits that an entrepreneur must have is the ability to risk in business activities in order to quest new ventures. Although the risks are dangerous to the entire business, entrepreneurs always undertake them by ensuring that they do their best to avoid the risks that might be incurred. These risks taken should be appropriate the endeavors. Furthermore, the risks taken in the creativity should ensure that the business do not incur any loss to the organization. Financial risks are always the most dangerous risks in any business. When entrepreneurs overcome these risks, they get many rewards. If they fail, they are always required to take full responsibility of the loss. These losses can cost their savings and livelihoods. If their creativity affects the social norms of the society, the danger is that they undergo psychological problems and they might also affect the peace in their families (Gartner, 1989 p.49). Other characteristics of entrepreneurs include spontaneous creativity in the business world. Entrepreneurs are always ready to build new and tangible things. Innovations are always marketable. Therefore, it is the work of the entrepreneurs to come up with these new creations that would replace the low selling products in the market. In addition, markets are always competitive due to the many creative entrepreneurs. This requires entrepreneurs to be more competitive in their products also in order to meet the market requirements. Entrepreneurs should also have persuasive languages. This is because persuasive language will enable them to attract many customers to their ventures. When large numbers of customers are attracted, profits are always maximized. There is difference between an entrepreneur and a small business owner. Although they are both involved same businesses, their responsibilities vary. An entrepreneur is concerned with establishing and managing business and the main purpose is to gain profit and ensure continued business growth. Entrepreneurs are always creative in their work in order to ensure that their businesses meet the competitive markets’ standards. On the other hand, small business owners are responsible for managing and establishing business with their main aim is to achieve their personal goals. Small business owner always ensures that he gains personal goals. This type of business always lack creativity (Burns, 2007 p.21). Entrepreneurship involves organization creation. This creation of organization differentiates entrepreneurship from other disciplines. To ensure that entrepreneurship grows, there are factors that should be considered. This may include looking at what entrepreneurs do rather than the way they are doing. The main function of entrepreneurship is the opportunity discovery and the improvement of the economy. However, entrepreneurs are required to exploit these opportunities in order to achieve the best goals (King, 2002 p.34). There are titles in which entrepreneurship is discussed on. These titles include entrepreneurial behavior, entrepreneurial initiative, entrepreneurial function and the entrepreneurial factor. The entrepreneurial behavior involves the behavior that is responsible for risk-taking and innovation. This ensures that new opportunities are innovated. Entrepreneurial factor is considered ads the new factor in production. Entrepreneurial function involves how opportunities are discovered and exploited. It also involves the enterprise creation. All these factors are the one causing the different ways entrepreneurship can be described. There are many entrepreneurship theories that have been proposed by many thinkers. These theories are classified into three i.e. sociological, cultural and economic theories. These theories are trying to explain more on entrepreneurship from different perspectives. Some of the social theories that explain entrepreneurship include the Max Weber’s theory. The main features of this theory are the capitalism spirit and adventurer’s spirit. The adventurer’s spirit enables entrepreneurs to risk in their businesses. Another social theory is the Hagen’s theory. This theory explains the social relationship among social structure, physical environment and culture. Another feature of this theory is that it considers economic theories are not adequate. It also argues that political and social change also accelerates entrepreneurship. This means that some positive political changes that encourage many entrepreneurs to come up with more innovations. Negative political and social changes can discourage some entrepreneurs from their innovations. Therefore, social factors are essential in the entrepreneurship (Thornton, Ribeiro & Urbano, 2011 p.76). Some of the economic theories of entrepreneurship include Schumpeter’s theory of innovations. In this theory, an entrepreneur is considered to be the innovator. Entrepreneur is the one coming up with new creations in the market. These innovations may include new markets, new products, new organizations and new goods/services. Another economic theory is the HBS (Harvard business school). This theory suggests that entrepreneurship has internal and external forces. The internal forces include the character traits of and individual. These traits include knowledge, experience, intelligence and skills. All these qualities are required for innovations and creativity. The external forces are the surrounding conditions that are found around the entrepreneur. These forces are not found within the reach of the entrepreneur. They include political, cultural and economic forces. If these factors are stable, then entrepreneurship can go on without any negative influence (Thornton, Ribeiro & Urbano, 2011 p.83). There are also cultural theories that influence entrepreneurship. One of the cultural theories includes the Hoselitz theory. In this theory, cultural factors like the minority groups are governing entrepreneurship supply. One of the features of this effect is the contribution from the socio-economic classes. Some people from higher classes have succeeded in entrepreneurship due to the availability of starting resources. Also those who possess addition skills are found to benefit more on entrepreneurs who lack adequate skills (Andreas & Roy, 2010 p.36). Another cultural theory on entrepreneurship is the Peter F Ducker theory. This theory suggests that entrepreneur is the one who searches for change and uses the opportunities attained to gain the best results. The key emphasis on this theory is innovation and the available resources. However, through innovations, every entrepreneur should look for the available resources and maximize them on their use (Andreas & Roy, 2010 p.46). There are many ways in entrepreneurship can be measured. One of the scales that can be used is the belief that to achieve objectives, wide-ranging acts have to be undertaken. This means that actions taken should be done in a broad manner that will ensure that all the desired objectives are attained. Narrowing actions would prevent some objectives from being attained. Another scale that can be used to measure entrepreneurship is the use of actions that will make other organizations to respond. When new actions are initiated and other organizations respond to them, this means that entrepreneurship is growing well. The respond made by the other organizations shows that they are trying to make the same products the entrepreneurship has initialize. In order to measure an entrepreneurship, it has be the first one to introduce some products to the market. The first entrepreneurship to introduce these new products show that they are a head in innovations and soon other organizations will try to compete with it. Another scale that can be used to measure an entrepreneurship is by checking the strength of proclivity for risks. Those entrepreneurships that have weak proclivity for risks appear to be better than the rest with strong proclivity for risks. Strong proclivity for risks means that a lot of losses will be incurred I case of any damage. However, to be a good entrepreneur, it entails many things that must be attained in order to maximize the opportunities. One of the traits of a good entrepreneur is the creativity and innovation. Market is always changing every time. Things that are needed today will be considered outdated tomorrow. Therefore, to cope with this changing market, every entrepreneur has to be more creative and innovation in all activities that are undertaken. These innovations will also create room in the competitive market since there are many creative entrepreneurs. To attain all these, hard work is also required. Extra work has to be added to ensure that all goals are achieved. Persuasive language has also to be used when marketing some of the produced products. This language will attract more customer thus maximized profit. Bibliography ANDREAS FREYTAG, ROY THURIK. (2010). Entrepreneurship and Culture. Springer Berlin Heidelberg. BURNS, P. (2007). Entrepreneurship and small business. Basingstoke [England], Palgrave. GARTNER, B. (1989). “Who is an entrepreneur” “is the wrong question”. University of Baltimore. HÉBERT, R. F., & LINK, A. N. (2009). A history of entrepreneurship. London, Routledge. KING, N. (2002). Enterprise express. Oxford, Capstone. PARKER, S. C., & PARKER, S. C. (2009). The economics of entrepreneurship. Cambridge, UK, Cambridge University Press. SARASVATHY, S. D. (2008). Effectuation elements of entrepreneurial expertise. Cheltenham, UK, Edward Elgar. SMELSER, N. J., & SWEDBERG, R. (1994). The handbook of economic sociology. Princeton, Princeton University Press. THORNTON, P., RIBEIRO-SORIANO, D., & URBANO, D. (2011). Socio-cultural factors and entrepreneurial activity: An overview. International Small Business Journal. 29, 105-118. ZIMMERER, T., SCARBOROUGH, N. M., & WILSON, D. (2008). Essentials of entrepreneurship and small business management. Upper Saddle River, N.J., Pearson/Prentice Hall. Read More