Sources of Entrepreneurship Opportunities - Research Paper Example

Opportunities for Entrepreneurs (First M. Last) School or at Place or Town, Table of Contents Introduction 3 Critical Analysis and literature review 4 Sources of Entrepreneurship Opportunities 6 Conclusion 9 References 10 Bibliography 11 Opportunities for Entrepreneurs Entrepreneurship rates escalated after the mid 1970‘s when the self employment rate boomed in the modern economies of the world. (Audretsch and Thurik, 2001) illustrated that entrepreneurship became very common in 1990’s after receiving a tremendous increase in business ownership rates from the 1980’s. Nowadays the economic development authorities are focusing hard on entrepreneurship endeavors and they are being encouraged by all sorts of institutions. The most logical reason behind seeking entrepreneurship opportunities is the rate of unemployment all over the world. Entrepreneurship not only provides for one’s own self but creates jobs for a few other people as well. Entrepreneurship is connected with undertaking innovations or the introduction of new products or finance and business expertise. Entrepreneurship not only includes setting up of a business but its continuous growth and diversification. An entrepreneur keeps looking for a prospect that provides challenge. Through entrepreneurship products are converted into goods of real economic value. Entrepreneurship may involve establishment of new enterprises or could only be a revitalization of a mature organization in the result of a recent development. It’s the job of an entrepreneur to seek chances which make him capable of employing his energies in enterprising ventures. He gathers all the resources, assembles them in a nice shape and makes a product worthy of finishing. It’s the responsibility of the entrepreneur to bring improvement to existing ideas and sell them accordingly. Entrepreneurs have to lookout for market changes and create an opportunity for themselves by utilizing the shift in market demands. It is said that the most opportune moment for a moneymaker is when a nation is destroying or building itself. It is therefore from the process of change that the most occasions come from. Critical analysis and literature review Entrepreneurship is based on knowledge and is carried out after a sufficient amount of research. It caters socio-economic, psychological, technological, and legal occurrences and works in response to the swing they create in market trends. It delves deeper into marketing theories and change its strategies with the shift in events. Resources such as capital, human talent and technology are sorted and put to use in their most efficient combination at the most beneficial moments. Such arrangements are a specialty of entrepreneurs because they are moderate risk-takers. Therefore to minimize the risk factor a lot of market research is conducted when a new entrepreneurship business is started. The general concept is that entrepreneurship is about smaller businesses and therefore smaller risks. It is not true because entrepreneurship is equally applicable to larger business with larger capital. Such businesses are of course brought about after careful speculation and market analysis. Research and development departments are installed first and they measure the correct sort of business products, acumen and marketing strategies for the business according to the wide market demands and opportunities arising lately. Entrepreneurs might apply diverse techniques for marketing and production of their products but they always have some common traits for conducting their entrepreneurship endeavors. These common traits are the recipe of success because they are the guideline path for entrepreneurs of all kinds and without following it a successful venture is very improbable. These are not a set of some stray incidents; in fact these are well established fundamentals for entrepreneurship. Entrepreneurship is a complete process and even though it does not follow a strict course, its purpose and methods are well-defined. A well-constructed and conducted research and analysis of the market put the guideline for each singular enterprise. It is this philosophy which paves the path for entrepreneurship in every kind of field, be it a government policy or a particular business plan. The important thing which is to be kept in mind is that the variety provided by the individual actions in enterprises provides for the innovation in the subject of entrepreneurship. By this variety the quality of such ventures increase by the method of diversification. Every new experience and innovation adds to the literature of this subject and therefore provides new ways for the people who are about to follow this field of resource production. If these individual improvements are recorded, some advanced techniques shall become available to put in to practice. Entrepreneurship involves innovation and the capture of opportunities. Innovations are not only the grist of the entrepreneurs but political, social, regulatory and macroeconomic changes also provide the opportunity for the innovations (Schumpeter, 1961). A similar classification was observed by another researcher where he categorized entrepreneurial opportunities to exist in seven broad supplies of transformation: unexpected occurrences, incongruities, process needs, changes in industry structures or markets, demographic changes, changes in perception, and new knowledge (Drucker. 1985). Therefore we can say that opportunities reside neutrally in the formation of underused resources, and bumpy distribution of the precious asset known as knowledge. It is clear from the above mentioned that the opportunities are a part of the environment we live in (Busenitz, 1996). Utilizing these opportunities is dependent on the research researcher conducts upon his environment. A keen entrepreneur is a keen observer of his surroundings. Staying aware of the environment gives an edge over the other market as the entrepreneur anticipates the market’s change and its destiny he is in a better position to provide the market with the best fit for the upcoming trend. A slightest change in trends does not pass by him and he grabs it. The most apt decisions are taken once the opportunity is identified by the entrepreneur (Tang et al, 2012). Sources of Entrepreneurship Opportunities The sources of entrepreneur opportunities can be individual or environmental. These opportunities individually define the next steps for setting the enterprise. The possible exploitation of the opportunity is majorly dependent upon the kind of opportunity presented. Following that line of thought two ideas were presented for defining the sources of entrepreneurial occasions. Schumpeter believed that opportunities were reliant upon the people who discover or create them. His proposition believed that it was upon man to discover and produce successful innovations for the market regardless of the market stagnancy or flourishing. This type of entrepreneurship is more pandemic in its effect specifically it is more beneficial for increasing national output and job growth. The second definition and belief follows that opportunities are a product of lack of balance in the environment. The disequilibria of knowledge and means put certain entrepreneurs in a better position than others, but that does not infer that success is dependent on the resources only. Even though the resources are an important contribution to the recipe of success but they are not the most important ingredient of the dish. The important key according to this belief is to have an eye for the circumstances and the instinct to know when to strike the market with your idea. This idea due to its dependency on a change in circumstances is less beneficial to the country’s wealth. The sources for Schumpeterian opportunities are well-studied and a lot of work has been done on them and according to them. It is funny that Schumpeter does not include industrial structure as a part of sources. His list of sources contains technological changes, political or regulatory changes and socio-demographic changes. Technological changes provide source of change as the world trends towards the products that are the most recent innovation present in the market. People believe in technology and the speed it is changing with (Sheth et al, 1999).. Even with the most minor of innovation or improvement a product enhancement and development task is brought upon the shoulders of the company employees. Entrepreneurship is about innovations and not about sticking to old technologies which nobody bothers about, therefore staying up to date with every shift in technology is essential for any company. It becomes difficult for companies who have not established themselves yet because following the technological advancements requires excessive capital and machinery etc. Such infrastructure is often brought about with the partnership of several companies because at the end of the day profit is worth the pain. The political environment is often generated by the shift of power amongst government or political parties. This is important because it represents the change of choice or popular opinion amongst citizens of a country. The party that has come into power might be very opposite in its agenda than the one which was previously governing. That shall mean that the nation went for a big swap. Such revolutions accompany change of tastes, requirements and favors. Secondly the regulations imposed by the new government also account for a budge in market. Suddenly a government might levitate taxes on certain goods, increasing its prices and decreasing its sale; while it might abolish taxes on other goods believing that those are more necessary for the public. These decisions on the behalf of the public make a lot of entrepreneurship option possible or impossible. Socio-demographic environments have a major and regular affect on the entrepreneurship occasions being provided. Geography of a place has an effect on the weather, moods and festivities of a place. The most common demographic factors are nationality, religion, ethnicity age and gender. While other demographics such as income and number of people in a family are also correlated with the demand they exert on the market. Social factors as change in trends, a social revolution and religious and ethnic festivities prevailing in the area are important in terms of the entrepreneurship endeavors about to start in the area. If a company is capable of providing a value proposition which is promisingly advanced to that of the rival companies, it can also make itself capable of generating market trends rather than following them. With the exact composition of social network one might achieve the means to bring about a change in inclination for the product. A good marketing technique might do the rest. Before that enough market analysis should be carried out to know how open the target community might be towards the product and whether or not the product might be at par with the needs of the community. Obviously the selection of the target group should be dependent upon the company’s personal capacity and potential of being able to fulfill the impending demands. The cost considerations are important when it comes to taking a decision regarding an opportunity. The capacity of the company should be considered and an opportunity of a right size should be selected accordingly. Risk factors should be calculated while analyzing the complete situation and all probabilistic scenarios. A cushioning factor should always be present if the company is about to take a high risk. For example the presence of a working spouse tends to be a comforting source in case of economic failure that may arise (Evans & Leighton, 1989). Conclusion Opportunities for entrepreneurship are not only present in the environment but it is also possible to map them by engineering such occasions which are beneficial for the enterprise. With the right job function and experience variety it is possible to create opportunities. As mentioned earlier a good social network and the required connections always help the individuals who are carrying out these entrepreneurship endeavors. Moreover the cost for an opportunity should be assessed and the personal capital available to the company should be considered while making a decision in regards with capturing the opportunity. The socio-demographic, technological, and political environments can only be used as a road map for opportunities. Similar trends can be engendered by the entrepreneurial campaign itself by changing the potential circumstances in its advantage. It’s only a matter of perspective and if the company is capable of showing that perspective to its customers then a success in the venture is quite possible. So it can be concluded that environments are a great provider of opportunities and such opportunities should never be missed. On the other hand waiting for these opportunities to launch the dream products of the company is not a very intelligent decision. A company should always be capable of producing its own means of survival by manipulating the environment into creating opportunities for itself. 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