The Reason Why Some Entrepreneurs Such as Elon Musk Stand out from the Rest - Research Paper Example

Entrepreneurship Introduction to Entrepreneurship For a long, there have been many definitions and explanations on who an entrepreneur is and what he does. For instance, according to the oxford dictionary, an entrepreneur is a person who attempts to make profits by indulging in risk taking initiatives. According to this definition, it becomes evident that for one to become a successful entrepreneur, then it is a mandatory requirement that he or she is daring enough to take risks some of which are extreme that could result to loss of a large sum of money. According to Longenecker et al. (2003), entrepreneurs normally watch out market needs before launching new firms aimed at meeting those needs. The essay will relay information on entrepreneurship and using Elon Musk, it will describe the basics that one requires in order to become a successful entrepreneur in addition to strengths and weaknesses that one ought to observe in the field of business. The main reason behind the risk-taking attitude among entrepreneurs is normally to provide an impetus for innovation and economic change. One entrepreneur that started from a humble beginning to become a reputable brand in the field of business is Elon Musk. Musk, a 42 year old African born, has gone down records for coming up with some of the most outstanding innovations the world is yet to fully comprehend. Some of the famous innovations that Elon has personally designed include PayPal, an online money transfer system and space rockets, which made him receive contracts from companies such as NASA (Hull & May, 2014). One reason why Elon successfully managed to become one of the most recognized entrepreneurs of all times is the fact that he was willing to take risks. Some of the risks Elon took include investing huge sums of money in Telsa motors invention, which he was not aware of the outcome. It is because of his risk taking that Elon’s investment rapidly rose to the extent that he currently manages more than 6,000 employees (Musk, 2006). Some of the things that make most entrepreneurs succeed is the fact that they already know the goals they wish to achieve. Some of the most common ambitions in the mind of an entrepreneur include making profits, creating wealth and leaving a positive mark in the society (Dana, 2011, P. 419). Entrepreneurs are normally in three categories; change agent, intrapreneur and classic entrepreneur. A change agent is normally an innovative thinker that normally makes numerous efforts in revitalizing an organization or firm in a move to make it competitive in the market (Burns, 2001, p. 48). According to Burns (2001), a change agent normally works independently and normally comes up with some of the strangest but accurate ways of solving problems. The second category is the intrapreneur, a person who comes up with innovations that meet specific societal needs (Burns 60). The final category is the classical entrepreneur, unlike the intrapreneur, the main objective of a classical entrepreneur is normally looks around for possible opportunities and once he spots one, he or she normally does research to identify possible solutions for the problem (Burns, 2001, p.11). The reason why Elon is an outstanding entrepreneur is the fact that he has the ability to spot a business niche when he sees one. For instance, when Elon realized that people were having difficulties in sending money abroad and doing their shopping online, he spotted a niche. After intensive research, he came up with PayPal, an online system where one can not only send and receive money but is also able to do online shopping while at home hence solving the issue of driving all the way to shopping centers in order to purchase something. Apart from being a risk taker, other characteristics of an entrepreneur include having self-confidence, a desire to accomplish in life being extremely creative since through creativity, one is able to come up with new ideas (Talloo, 2007, P. 18). Initiating a New Venture Before diving into any form of business, it is normally a good idea if one come up with a business plan. This is a statement that describes the type of business one wishes to start, its objectives and ways the entrepreneur will use to achieve these goals (McKeever, 2012, P.8). A business plan plays a huge role in the evaluation of business ideas. Through a business plan, entrepreneurs are not only in a position to come up with outstanding business ideas but are also in a position to balance their enthusiasm in business with facts in addition to recognizing their limitations and ways to overcome them (Covello & Hazelgren, 2006, p. 7). Apart from stating future objectives, the business plan also incorporates financial aspects where it states the amount of money one would require in staring or expanding the business. Just like any entrepreneur, Elon Musk had a business plan for his companies. For instance, while drafting Telsa motor’s business plan. According to Musk (2006), Telsa motor’s long-term goal was to design a wide range of car models affordable by both the upper and middle level persons. The objective of Telsa motors was to create a vehicle that was unique compared to others. It is because of this plan that the company came up with an electronic car, making it stand out from the other vehicles that ran on gasoline (Musk, 2006). One thing that made the electric cars unique is the fact that the disposed batteries were neither toxic to human beings nor the environment. According to McKeever (34), a business plan ought to provide descriptive and detailed information on what the entrepreneur will include and what he or she will exclude. The choices made by the entrepreneur need to be well researched and thought of, this is because a wrong choice of decisions could result to massive loss of capital. Conversely, a good business plan enables one to approximate the amount of capital one will need to start the business in addition to the amount of revenue one is to expect (McKeever, 2012, P. 34). Role of Entrepreneurship in the Society Entrepreneurs normally play a major role in any society they establish themselves. Research shows that entrepreneurship in any society normally results to increase in employment opportunities in addition to growth of the economy’s GDP (Lyons, 2013, p. 64). Many people have benefited from Elon’s companies such as Telsa motors and Space X. For instance, space X has employed thousands of workers from not only in the US but also globally. Most of these employees work have various professions such as software and hardware engineers, mechanical and structural engineers whose role is producing rockets capable of flying thousands of miles in space and back while ensuring the safety of the crew (“Space X”). Just like Space X, Telsa motors currently manage over 6,000 employees in various fields within the company (Musk, 2006). Entrepreneurship normally plays a big role in improving the economic level of a nation. This is because, by introducing new products and building new industries, a nation receives economic boost due to the revenues received from trading of the created products (Lynos, 2013, p. 99). Growth and Development of the venture For one to come up with a good business idea, it requires intensive thinking and research. Apart from ensuring that the business idea satisfying the needs of prospective customers, the entrepreneur should also ensure that the idea in question has an added advantage in order for it to compete with other similar business ventures already in the market (Leach & Melicher, 2012, p. 46). The entrepreneur should also ensure that the business idea has a good marketing profile in addition to an attractive investment returns, which will enable the business remain in business for a long period. It is because of creative and well-researched ideas that Elon Musk has managed to remain in the field of business for a long period. Elon has never run short of ideas, this is because he is knows how to manage his time and normally comes up with a new idea when it is needed most. For instance, Elon stated that he is in the process of designing a unique type of plane. Unlike other plane, his new invention shall be an electronic plane that has the capacity to land and take off vertically (Alden). Elon further stated that this idea came up after the Concordia incident that that went up in flames moments after takeoff resulting to a massive loss of innocent lives. it is because of the Concordia incident that prompted Elon to come up with the idea of designing such a plane in order to reduce the rate of plane related accidents since electric planes would be able to land anywhere once a fault is detected and will not be required to seek for an airport (Alden). The new plane invention will one of the many outstanding innovations produced by Elon Musk and it is because of this that he still one of the most prominent entrepreneurs not only in the US but globally. Some of the reasons why he is still in control in the world of business is the fact that he is in full knowledge of all the attributes one requires to excel. For instance, apart from being motivated to excel in any business idea he comes up with, Elon also a risk taker whereby he is able to tolerate risks, ambiguity and uncertainty all at once. One other reason that Elon’s business ideas are normally stunning is the fact that he has clear knowledge of his competitors and it is because of this that most of his products receive more recognition. Managing Growth Just the way a company rises up to become a giant in the field of business, the same company can be brought down to its knees if proper management is not adhered to. For any business venture to be successful in any economy, the entrepreneurial ventures ought to be in a position to create employment and economic growth (Nieman, Pretorius & Dyer, 2004, p. 4). For a business to continue growing, one ought to have enough resources in terms of capital, machinery and information for proper decision-making. These entire requirements are usually classified as investments since through them a business venture will gradually grow to higher business ranks. Elon Musk invests a lot of capital in his company and it is because of this that he is still a prominent figure in the field of business. After inventing PayPal, an online money transaction system and selling it for $ 1.5 billion dollars, he invested the money in his two companies; Space X and Telsa motors. After purchasing the required apparatus and hiring the right people, he came up with an electric car and this boosted Telsa Motors even further to the extent that it began competing with other vehicle manufacturing companies such as Ford (“Outside Club”). Elon eventually launched Space X in 2002 and due to Elon’s outstanding record; the company signed an agreement with NASA. Entrepreneurial Business Models Even in the availability of market, adequate resources and outstanding entrepreneurs, some businesses usually fail to thrive. One reason behind collapsing of businesses is the model a business is using. Though little attention is given to business models, it is one of the driving forces in any business (Morris, Schindehutte & Allen, 2003, p. 726). A business model plays a huge role in the building of value chain concepts in addition to extended value systems. For proper business models in any business venture, an entrepreneur ought to be developing good relations with not only his or her customers but also his partners and suppliers (Morris, Schindehutte & Allen, 2003). Elon Musk knows clearly the importance of a business model in any organization and it is because of this that he is at the forefront in ensuring that all his customers are not only treated fairly but are given the required services. For instance, Telsa motors ensure that all the manufactured cars go through an intensive checking to ensure that customers that purchase the vehicles do not experience any mechanical problems. By ensuring that customers are satisfied, this boosts the company’s sales since the satisfied customers market the company to other people hence more sales (Musk, 2012). Developing Entrepreneurship in Large Organizations Just like an entrepreneur, entrepreneurial firms apart from being risk takers they are also innovative. For large organizations and corporations to be at par with other companies, they ought to be a step ahead in terms of innovation. It is only through outstanding innovations and decision-making strategies that a company can remain competitive in the market (Elfring, 2005, p. 24). Telsa Motors and Space X are some of most innovative companies in the US. This is because both companies have specialized in the production of machines and this requires a lot of research and dedication. For such innovation to perfect it requires professional skills and Elon is one such person since apart from being a qualified business person he is also a professional engineer. Elon Musk had a degree in economics from the University of Pennsylvania; he later got his second degree in physics from the same university before finally going back for his PhD in physics at Stanford University. It is because of this that all of Elon’s innovations are outstanding (“Biography”). Intrapreneurship, Creativity and Innovation An intrapreneur is usually a person that uses organizational resources to push an innovative idea to be accepted by an organization. It is therefore evident that an entrepreneur launches new ideas in an organization or established business (Desouza, 2011, p. 25). These people normally have certain characters. For instance, apart from being bright, they are also love challenges. Intrapreneurs also have the ability to generate ideas quickly. Elon Musk is one great intrapreneur not only because of his outstanding innovations but since he had entrepreneurial skills right when he was a kid. This is because when Elon was 12 years old, he designed a space a space game code, which he sold for $ 500 (“Forbes”). Elon’s the creativity has seen him create some of the most complex machines and it is because of this that he landed a contract with NASA, the world’s biggest space shuttle company (Hull & May, 2014). The electric cars are also another evidence of Elon Musk’s prowess when it comes to Intrapreneurship, creativity and innovation. The Challenges of Getting into Business Starting a business venture is normally a difficult task but maintaining it is even more difficult than the former. In many occasions, businesses normally collapse just moments after their inception. According to research, the most common effects of collapsing business ventures is normally because it reaches a point when the entrepreneur realizes that he or she is not happy with the business idea he made (Barringer & Ireland, 2004). Misuse of funds could also result to the collapse of a business venture whereby finds meant for the business are spent inappropriately to the extent that some cannot be accounted for (Parker, 2009, p. 253). Although Intrapreneurship is the backbone of any business venture or organization, it can also be hazardous. For instance, overreliance on a single project could be disastrous if it fails. Although Telsa and Space X are recognized globally for the outstanding innovations, they have also had their own share of challenges and misfortunes. For instance, the first three space crafts designed by Space X Crash –and- Burn Videos, whereby they were not clear as required by astronauts (Davies, 2013). In 2008, Telsa motors was hit by a financial crisis but the issue was settled after Musk’s decision to bankrupt himself whereby he gave up the money he had acquired after selling PayPal. In the same Year, one of Tesla motor’s vehicles featured on “Top Gear”, a show that analyses top vehicles, it was discovered that the vehicle ran out of power even before attaining its promised range hence greatly tampering with the company’s market (Davies, 2013). Ethical and Social Responsibility Challenges for Entrepreneurs. In social entrepreneurship, apart from focusing on large-scale transformation it also involves itself in innovation and risk taking processes. The process of social entrepreneurship involves the identification of perceived social opportunities and converting them into enterprise concepts (Ashoka, n.d). A social entrepreneur involves that is capable of providing lasting solutions to a society’s needs. This is normally achieved when the entrepreneur not only presents user-friendly ideas but also ensures that these ideas are ethical in order for citizens to have trust in them and believe that the ideas are the solution to their problems (Ashoka, n.d ). Some characteristics of social entrepreneurs include high sense of accountability, urge to come up with ideas to solve human needs, passion for learning and continuous innovation (Ashton, 2011, p. 255). Through ethics, one is able to pursue his or her activities in an acceptable manner. In order to avoid social and ethical challenges in one’s business enterprise, the entrepreneur ought to ensure that instead of setting rules he should set standards that govern members on their daily activities (Sims, 2003, p. 144). The entrepreneur should also ensure that he hires the right people for the business to thrive. The entrepreneur should also be at the forefront in displaying ethics, honesty and integrity in all areas of the business venture and it is by doing so that all the members will be prompted to follow his path (Spence & Painter- Morland, 2011, p. 127). Elon Musk has all the necessary ideas and knows all the requirements of becoming a social entrepreneur. Elon’s companies have been successful for a long period and this is attributed to Elon’s knowledge and ability to choose the right people for his production companies. Elon also portrays good leadership skills whereby he leads by example and it is because of this that all employees of Telsa motor and Space X are not only known for their discipline but gentleness as well in addition to dedication to their work (Seemuth, 2013). Globalization and Entrepreneurship It is normally a good move when entrepreneurs decide to expand their boundaries. Although the move is sometimes risky but taking risks is one of entrepreneurs’ characteristics. Some of the reasons why entrepreneurs opt for globalization of their ventures is usually due to the desire to excel and become international leaders. Internationalization normally comes because the entrepreneur has seen business opportunities and wishes to make use of them by coming up with a solution. One of the reasons why companies cross borders and establishes companies in other regions are due to defense of the company (Isenberg, 2008). By being defensive, companies cross boundaries in order to gain more trust and loyalty from international clients, Similarly, companies expand boundaries Elon Musk’s Telsa motors is an international company, this is because the company produces vehicles that are sold in many nations globally. Therefore, Telsa motors has smaller companies in nations such as Britain and France, which deal with all vehicles exported to these nations. Apart from crating more income for Telsa motors, the company also solves the problem of unemployment since by establishing companies in various nations, Telsa motors offers people from these nations a chance to work for them. Going global normally has a number of benefits, for instance, it promotes the building of the company’s brand in other nations hence increase in loyalty by clients. Globalization also results increase in potential investors in addition to capitalization of tax (Global Entrepreneurship Institute, n.d). Conclusion Good Entrepreneurs are ever on the lookout for market needs and once they spot a niche, they search for ideas before finally coming up with solutions for the societal needs. The reason why some entrepreneurs such as Elon musk stand out from the rest is that they are aware of the goals they wish to achieve. The main objectives of any entrepreneur are normally to make profits, create wealth in addition to leaving a positive mark in the society. Before diving into any form of business, entrepreneurs ought to come up with good business plans. These statements describe the type of business one wishes to dive in. The main objective of a business plan is ensuring entrepreneurs achieve their goals (McKeever, 2012, P.8). A business plan plays a huge role in the evaluation of business ideas. Through a business plan, entrepreneurs are able to come up with good business ideas in addition to properly balance their enthusiasm in business with facts in addition to recognizing their limitations and ways to overcome them. References Alden, William. (2013). “Elon Musk’s Next Blue-Sky Idea.”New York Times. [Online]. Available at < http://dealbook.nytimes.com/2013/11/12/elon-musks-next-blue-sky-idea/?_php=true&_type=blogs&_r=0> [Accessed 19 April 2014] Ashoka. (n.d). Ashoka Innovators for the Public. [Online]. Available at < https://www.ashoka.org/social_entrepreneur> [Accessed 19 April 2014] Ashton, R. (2011). How to be a social entrepreneur make money and change the world. Hoboken, John Wiley & Sons. Barringer, B. R., & Ireland, R. D. (2004). Entrepreneurship: successfully launching new ventures. Harlow, Pearson Education Limited. Biography. (2014). Elon Musk Biography. [Online]. Available at [Accessed 19 April 2014] Burns, P. (2001). Entrepreneurship and Small Business. Basingstoke: Palgrave Macmillan Limited Covello, J. A., & Hazelgren, B. J. (2006). The complete book of business plans simple steps to writing powerful business plans. Naperville, Ill, Sourcebooks. http://www.lib.sfu.ca/cgi-bin/validate/books24x7.cgi?bookid=15352. Dana, L. P. (2011). World Encyclopedia of Entrepreneurship. Cheltenham, Edward Elgar Pub. Davies, A. (2013). “How Elon Musk Is Revolutionizing Two Major Industries At The Same Time.” Business Insyder. [Online]. Available at < http://www.businessinsider.com/how-elon-musk-overcomes-challenges-2013-3> [Accesses 19 April 2014] Desouza, K. C. (2011). Intrapreneurship: managing ideas within your organization. Toronto, University of Toronto Press. Elfring, T. (2005). Corporate entrepreneurship and venturing. New York, NY, Springer. Forbes. Elon Musk. [Online]. Available at < http://www.forbes.com/profile/elon-musk/> [Accessed at 19 April 2014] Global Entrepreneurship Institute. (n.d). Global Entrepreneur. [Online]. Available at http://blog.gcase.org/global-entrepreneur/ [Accessed 19 April 2014] Hull, D. & May. P. (2014). Rocket Man: The otherworldly ambitions of Elon Musk. [Online]. Available at http://www.mercurynews.com/business/ci_25541126/rocket-man-otherworldy-ambitions-elon-musk [Accessed 17 April 2014] Isenberg, J. D. (2008). “The Global Entrepreneur.” Harvard Business Review. [Online]. Available at http://hbr.org/2008/12/the-global-entrepreneur/ar/1 [Accessed 19 April 2014] Leach, J. C., & Melicher, R. W. (2012). Entrepreneurial finance. Australia, South-Western Cengage Learning. Longenecker, J.G., Moore, C.W. and Petty, J.W. (2003). Small Business Management: An Entrepreneurial Emphasis, 12th Edition. Ohio: South Western Lyons, T. S. (2013). Social entrepreneurship: how businesses can transform society. Santa Barbara, Calif, Praeger. Mckeever, M. P. (2012). How to write a business plan. Berkeley, CA, Nolo. Morris, M., Schindehutte, M. & Allen, J. (2003). The Entrepreneur’s Business Model: Towards a Unified Perspective. [Online]. Available at < http://www.entrepreneur.dk/DTU%20Master%20Spring%202014/Documents/The%20Entrepreneurs%20business%20model.pdf > [Accessed 19 April 2014] Musk, E. (2012). “The Tesla Approach to Distributing and Servicing Cars.” Telsa motors. [Online]. Available at http://www.teslamotors.com/blog/tesla-approach-distributing-and-servicing-cars [Accessed 19 April 2014] Musk,E. (2006). The Secret Tesla Motors Master Plan (just between you and me). [Online]. Available at [Accessed 17 April 2014] Nieman, G., Pretorius, M., & Dyer, T. (2004). Managing growth: a guide for entrepreneurs. Cape Town, Juta Academic. Outsider Club. (2012). Elon Musk Investment Strategies. [Online]. Available at < http://www.outsiderclub.com/report/elon-musk-investment-strategies/978> [Accessed 19 April 2014] Parker, S. C., & Parker, S. C. (2009). The economics of entrepreneurship. Cambridge, UK, Cambridge University Press. Seemuth, M. (2013). “From the Corner Office - Elon Musk.” Success. [Online]. Available at http://www.success.com/article/from-the-corner-office-elon-musk [accessed 19 April 2014] Sims, R. R. (2003). Ethics and corporate social responsibility: why giants fall. Westport, Conn. [u.a.], Praeger. SPACE X. (2014). Careers. [Online]. Available at < http://www.spacex.com/careers> [Accessed 19 April 2014] Spence, L. J., & Painter-Morland, M. (2011). Ethics in small and medium sized enterprises a global commentary. Dordrecht, Springer. http://public.eblib.com/EBLPublic/PublicView.do?ptiID=645874. Talloo. (2007). Business Organisation & Management (For B.Com Couese Of Delhi University).new York: McGraw Hill. Read More