Entrepreneurial Character, Traits, Skills, and Competencies PDF

ENTREPRENEURIAL CHARACTER, TRAITS, SKILLS, AND COMPETENCIES Mr. Arnaldo D. Bernabe ENTREPRENEURIAL CHARACTER TRAITS Ten entrepreneurial characteristics grouped into three major clusters. 1. Achievement cluster 2· Planning cluster 3. Power cluster THE ACHIEVEMENT CLUSTER The...

ENTREPRENEURIAL CHARACTER, TRAITS, SKILLS, AND COMPETENCIES Mr. Arnaldo D. Bernabe ENTREPRENEURIAL CHARACTER TRAITS Ten entrepreneurial characteristics grouped into three major clusters. 1. Achievement cluster 2· Planning cluster 3. Power cluster THE ACHIEVEMENT CLUSTER The achievement cluster consists of entrepreneurial character traits that are directly related to the entrepreneur's desire to be an achiever in the field of entrepreneurship.  OPPORTUNITY SEEKER COMMITED The person who dreams of A highly committed becoming a successful entrepreneur displays full entrepreneur must be a seeker of commitment to the work business opportunities. He/ She or endeavor that he/ she is must possess the ability to identify with great ease the most undertaking. He/She does appropriate entrepreneurial not entertain negativism opportunities. and skepticism. He/She A business opportunity-seeker is l. accepts full an entrepreneur who responsibility for what has 1. sees and acts on new business been promised to the opportunities; and customers, 2. seizes unusual opportunities to obtain financing, equipment, 2. establishes proper land, work, space, or assistance. coordination with and  PERSISTENT RISK-TAKER Trials , Sacrifices, and failures Risk is inseparable from challenge the entrepreneur to be entrepreneurship. It is inherent persistent in all entrepreneurial ventures. He/She learns to There are three type~ of risk- takers: 1.Take repeated or different actions in order to overcome the 1. An aggressive risk-taker is obstacle; not scared to take any risks in business. 2.Make personal sacrifices or exert extraordinary effort to 2. A moderate risk-taker "is complete the required task , and more calculative in taking risks. -He/She analyzes the 3.Stick to his/her own judgment in time of opposition and failures. situation before taking the leap. The term “quit” or “surrender” are not included in the vocabulary of a 3. A conservative risk-taker is successful entrepreneurs. not very eager to take any kind PLANNING CLUSTER The planning cluster is a set of characteristics of successful entrepreneurs that basically supports the character traits in the achievement cluster..  GOAL SETTER SMART principle. Goals and objectives are the guiding points that direct all actions, efforts and struggles of entrepreneurs. Being a goal setter, a successful entrepreneur sets clear, specific, and well defines short- INFORMATION SEEKER - seek a strong basis to make sound decisions. The usual constraints or limitations encountered in the gathering of information are data banks that 1. are incomplete, dated, and irrelevant; 2. are costly in maintenance; and 3. lack personnel to maintain them  SYSTEMATIC IN PLANNING AND MONITORING The term systematic implies that there is a rational and logical approach in performing the activities. Planning - simply refers to the setting of goals and. objectives. Monitoring - refers to the evaluation of the activities and adopted courses of actions whether they are carried in accordance with the plans. A successful entrepreneur adopts a systematic and coordinated planning and monitoring activities where he/ she 1. gathers all the qualitative and quantitative information before formulating the plans, 2. develops a logical step-by-step approach in the formulation of plans, 3. monitors the progress of activities and switches to alternative strategies when deemed necessary, and 4. evaluates constantly the alternatives in achieving the goals.  POWER CLUSTER - It establishes the relationships of the entrepreneurs with the suppliers of raw materials, financial institutions, customers, competitors, the government, employees, and all other stakeholders. The term power in this discussion does not connote autocratic control of the situation or having that bossy type of personality in entrepreneurial activities. An entrepreneur in the power cluster is 1. a persuasive and positive networker, and 2. self-confident  PERSUASIVE AND POSITIVE NETWORKER They rather employ or adopt a positive way of influencing others with their brilliant ideas and entrepreneurial aspirations. They are good communicators and they find it easy to sell their ideas. As a persuasive and positive networker, the successful entrepreneur usually 1. adopts specific strategies that will influence and convince others while maintaining the highest degree of respect, and 2. makes use of positive contacts in the business community in order to meet the goals and objectives of SELF CONFIDENT Successful E:ntrepreneurs are known to have a high level of self-confidence. Entrepreneurial self-confidence is actually a manifestation of the entrepreneur's strong trust or belief in himself/herself. Building self- confidence does not happen overnight. A person with low self-confidence can hardly defend his/her own idea and is easily swayed by the ideas of others. SKILLS AND CORE COMPETENCIES IN ENTREPERNEURSHIP Mr. Arnaldo D. Bernabe  ENTREPRENEURIAL SKILLS Skills are considered as the personal abilities to do things well. They come from the totality of the knowledge, practice or experience, and aptitude of a person There are 3 types of skills an entrepreneur should acquire and develop to become a successful entrepreneur. 1.Cognitive Skills 2.Technical Skills  COGNITIVE SKILLS - refer to the mental ability of the entrepreneur to learn new things, generate new ideas, and express knowledge m both oral and written forms. The cognitive skills in the practice of entrepreneurship include the a. ability to understand written materials, b. ability to learn and apply new information, c. ability to solve problems systematically, d. ability to create new ideas, arid e. ability to innovate new products and procedures or methods.  TECHNICAL SKILLS - relate to the knowledge and proficiency in a specialized field like computer technology, accounting, marketing, operation research, engineering, medical fields, or other related technical fields. The technical skills of an entrepreneur include proficiency and ability, among others, in the following areas a. information technology b. feasibility study and business plan preparation c. technical writings skill d. marketing e. management and finance  INTERPERSONAL SKILLS are basically about the relationship and interaction of the entrepreneur with the workers, suppliers, creditors, prospective customers, and other member of the business community. The interpersonal skills of an entrepreneur may include, among others, a, skills in verbal communication, b. skills in non-verbal communication, c. skills in listening d. skills in leading, and e. skills in negotiating  CORE COMPETENCIES The entrepreneurial core competency is a combination of entrepreneurial concepts and principles, entrepreneurial character traits, and entrepreneurial skills that provide and become the ultimate source of competitive advantage of the entrepreneur The competitive advantage refers to the strategic position and condition of the entrepreneurial venture that a. provides the necessary attributes to outperform competitors, b. distinguishes the venture from competitors, c. achieves superior performance in the industry, and d. produces a product or develops production  TOTAL PERSPECTIVE OF A SUCCESSFUL ENTREPRENEUR To ensure victory as a future entrepreneur, you must 1. understand fully the concepts and principles of entrepreneurship; 2. internalize and live out the character traits that are common among successful entrepreneurs; and 3. acquire, develop, sharpen,  THE ENVIRONMENT OF THE ENTREPRENEURIAL VENTURE Mr. Arnaldo D. Bernabe  TOTAL PERSPECTIVE OF A SUCCESSFUL ENTREPRENEUR Remember that the business does not operate in a test tube or a cylinder but in an environment that consists of three layers: 1· Physical environment 2. Societal THE PHYSICAL, SOCIETAL AND INDUSTRIAL ENVIRONMENT PHYSICAL ENVIRONMENT It is composed of natural elements that are inherent in the Earth. It is divided into climate, physical, resources and wildlife. CLIMATE: The entrepreneur, therefore, must consider the prevalent climatic condition of the area where he/ she intends to open the business to determine whether it can withstand or is fit to the climatic condition in the local area. PHYSICAL RESOURCES: The entrepreneur must critically assess the availability of raw materials in the locality before opening a new business. WILDLIFE: The entrepreneur must ensure that his/her business contributes to the preservation and not the destruction of the THE PHYSICAL, SOCIETAL AND INDUSTRIAL ENVIRONMENT Changes in the physical environment have a direct impact on the societal environment and the effect can be felt later in the industry environment. According to Wheelen and Hunger (2010), the changes in the physical environment have an impact on the societal environment first in terms of resource availability and costs, and later, on the industry environment in terms of growth or decline of particular industries.  SOCIETAL ENVIRONMENT The societal environment is generally composed of social, political/ cultural, economic, legal and technological forces. The critical evaluation and thorough study of the environment where the business operates is technically called ENVIRONMENTAL SCANNING. SOCIAL FORCES - are elements in society resulting from human interactions that can influence the thoughts, behavior, attitude, actions, and even the beliefs and customs of the people. POLITICAL FORCES - are the various elements usually comprising of the political parties, political systems, and other related  SOCIETAL ENVIRONMENT CULTURAL FORCES - basically refers to integrated characteristic group of people or ethnic group in a particular society. Cultural forces include the following: 1. Religion 2. Language 3. Beliefs 4. Customs 5. Education ECONOMIC FORCES – are factors which are primarily caused by changes or movements in the Philippine economy that have direct or indirect effect in the entrepreneurial venture. LEGAL FORCES - are the elements and bodies that are directly involved in the legislation and interpretation of laws and ordinances directly affecting the business. TECHNOLOGICAL FORCES - basically refer to the trends and developments in computer and information technology ENVIRONMENTAL SCANNING refers to the gathering, critical evaluation, and utilization of information on events and activities and their relationships with the physical, societal, and industry environments. INDUSTRY ENVIRONMENT The industry environment is the external environmental layer where the trends and changes are easily and immediately felt by the business. The industry forces include the following: 1. Government 2. Suppliers 3. Customers 4. Competitors INDUSTRY ENVIRONMENT GOVERNMENT- refers to the system or institution that handles the affairs of a particular country. SUPPLIERS - refer to individual persons or companies that provide the required materials, parts, or services to the business. They play a crucial role in the production of goods or services CUSTOMER – are the buyers of goods or services produced or rendered by the business. The business realizes profit from its transactions with the customers. COMPETITORS – are the forces existing in the industry environment that produce, sell or render products or services which are similar to those of the business. Competitors can be classified as direct or indirect EMPLOYEES - are the workers of the business who are highly responsible for the production of goods or delivery of services to the consumers. They help ensure the quality and quantity of products or services provided to the customers. They are the backbone of the business. CREDITORS - refer to banks, financial institutions, and financial intermediaries engaged in the lending of money to the borrower usually for a fee or charge in the form of interest. Creditors usually provide the much needed funds by extending credit to the business.  ENVIRONMENTAL SCANNING: INTERNAL ANALYSIS INTERNAL OR MICROENVIRONMENT – The internal environment in the entrepreneurial context simply refers to the environment within the business. Similar to the external environment, the different forces within the micro environment are interrelated with the other forces in the business environment. There are several forces operating within the internal environment. Some of this are the 1) business resources, 2) business culture, and 3) business structure. BUSINESS RESOURCES The business resources are assets or properties owned or controlled by the business. The resources can either be tangible or intangible.  ENVIRONMENTAL SCANNING: INTERNAL ANALYSIS BUSINESS CULTURE The business culture, otherwise known as the organizational or corporate culture, is another major force in the internal environment. It is a collection of values, beliefs, principles and expectation learned and shared by the employees, founders, stakeholders, and members of the management. BUSINESS STRUCTURE The business structure refers to the formal organization arrangement of the business in terms of hierarchy of positions, flow of communication, relationship of functional areas, and production and marketing process. A small business, therefor has very simple business structure SCANNING OF INTENAL ENVIRONMENT - The micro or internal environment of the business, including the forces operating on such environment, must be evaluated and studied. In conducting the internal environmental scanning, the following tools may be applied: 1. SWOT analysis 2. BCG analysis matrix SWOT ANALYSIS - The SWOT, or sometimes called as TOWS analysis, is pioneered by two Harvard Business School professors of business policy, George Albert Smith, Jr. and Roland Christensen. It is a popular tool to evaluate the internal environment. SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. STRENGTH - refer to the strong attributes or capabilities of the business that provide great advantage in exploiting the business opportunity. WEAKNESS - are poor attributes or deficiencies that give disadvantages to the business OPPORTUNITIES - are business situations in the form of products or services that must be exploited because of their potential in terms of profit and growth. THREATS - are possible external events in the environment that may provide harm to the business.  BCG ANALYSIS MATRIX BCG analysis matrix which was developed by the Boston Consulting Group (BCG). This environmental scanning tool is most appropriate when there are several products or services that are produced or rendered by the business. It is equally effective even when the business produces only one line of product or service. The products or services are then classified as stars, question marks, cash cows, and  BCG ANALYSIS MATRIX STARS - represent products or services that have high market share but low market growth. Products or services that are classified as stars have already matured in the market. Because of their high market share, the products or services usually provide enough cash for the business. CASH COWS - are products or services that have high market share and high market growth. The products or services provide the business with sufficient cash which are usually applied to finance products or services under the question marks. QUESTION MARKS - are products or services that are usually facing problems. These are not usually moving in terms of market share and growth and are in need of substantial capital support. The business may opt to discontinue products or services considered question marks if such move is favorable. DOGS - are products or services that have low market share and  BCG ANALYSIS MATRIX BUSINESS COMPETENCY - It has been emphasized that a successful entrepreneur possesses competency in handling the entrepreneurial venture. Competency is a combination of entrepreneurial concepts and principles, entrepreneurial skills, and entrepreneurial characteristics. Entrepreneurial competency is considered inherent in the entrepreneur and provides competitive advantage. Without the required entrepreneurial competency, the entrepreneur may find great difficulty in managing the entrepreneurial venture.  NATURE AND TYPE OF ENTREPRENEURIAL VENTURE PARTNERSHIP - A partnership is a business venture that is owned by two or more persons. The owners are usually called partners. Whatever profit or loss that results from the entrepreneurial operation is divided between or among the partners. The life of the partnership is easily dissolved compared to a corporation, particularly for the following reasons: 1.Death of one partner. 2.Admission of new partner in an existing partnership 3.Personal insolvency of one of the partners 4.Permanent withdrawal of the investment of a partner.  NATURE AND TYPE OF ENTREPRENEURIAL VENTURE CORPORATION – A corporation is an entrepreneurial venture formed by at least five but not more than fifteen persons. A corporation can either be stock or non-stock, profit or non-profit, and domestic and foreign. The person originally forming the corporation are called incorporation. A corporation is classified as a stock corporation when it is authorized to issue shares of stocks to stockholders. A non-stock corporation, on the other hand, is not authorized to issue shares of stock to the member. The owners of stock corporation are called stock holders or shareholders; while the owners of non-stock corporation are called members. The certificate of stock is an evidence of ownership of a corporation. A domestic corporation is organized under the laws of the Philippines. On the other hand, a foreign corporation is organized under the laws of foreign country but has the authority to operate in the Philippines.  NATURE AND TYPE OF ENTREPRENEURIAL VENTURE NATURE OF ENTREPRENEURIAL VENTURE - The term nature simply refers to whether the business is simply selling a product, manufacturing a product, or rendering a service to customers. The classifications of entrepreneurial venture according to its nature are as follows: 1. Merchandising 2. Service 3. Manufacturing 4. Agriculture 5. Hybrid business 6. Special corporation  NATURE AND TYPE OF ENTREPRENEURIAL VENTURE MERCHANDISING - A merchandising business is engaged in the buying and selling of products or goods. SERVICE – A service business provides services to the customers. MANUFACTURING - A manufacturing venture is a producer of goods or product, it is engaged in buying raw materials and supplies to be processed into finished products. AGRICULTURE - An agricultural entrepreneurial venture is engaged in the production of agricultural goods and animals. HYBRID BUSINESS - A hybrid entrepreneurial venture possesses the characteristics and nature of combined types of business entities. SPECIAL CORPORATION - Special types of business may  PRODUCTION SYSTEM The three important elements in the production system are: 1.Input 2.the transformation or production process; and 3. the output INPUT The input includes the following: 1. Manpower 2. Materials 3. Machine 4. Design  PRODUCTION SYSTEM PRODUCTION PROCESS The production process, also referred to as the transformation or conversion process, is the stage of production where the materials are transformed into the final product with the aid of man power and machine. It involves the following activities: l. Procurement or acquisition of raw materials and manufacturing supplies 2.Inspection of materials and supplies upon receipt at the receiving section 3.Storage of acquired materials and supplies 4.Issuance of materials and supplies to the production line 5.Inspection of damaged or broken goods and assessment of losses 6.Rework or repair of defective goods 7.Transfer or finished goods to the store room  PRODUCTION SYSTEM OUTPUT The output represents the final products from the production process and distributed to the customers. FOUR M’s OF PRODUCTION The most critical factors in the whole production system are the inputs and the transformation process. The factors involved in the input and the production process are usually referred to as the four M’s of production namely manpower, method, machine, and materials.  PRODUCTION SYSTEM 1.MANPOWER - The term manpower si1nply refers to the human workforce involved in the manufacture of products. Some of the manpower criteria that must be highly considered by the entrepreneur are as follows: 1. Educational qualifications and experience required for the job 2. Status of employment, whether permanent or temporary 3. Number of workers required for the job 4. Skills and expertise required for the job 5.Appropriate time the worker is needed 6.Conduct of background checking and issuance of requirements 7.Amount of salary or wages and other mandatory benefits 8.Availability of potential workers on the community  PRODUCTION SYSTEM 2.METHOD - or production method refers to the process or technique of converting raw Materials to finished products. The selection of the method of production is dependent on some factors, namely, l. product to produce, 2. mode of production, 3. manufacturing equipment to use, and 4. required skills to do the work. PRODUCT TO PRODUCE - The product is the physical output of the whole production process. A product can be heterogeneous or homogeneous. A heterogeneous product has dissimilar characteristics, parts, and physical appearance. On the other hand, a homogenous product has a physical appearance,  PRODUCTION SYSTEM MODE OF PRODUCTION - The mode of production refers to how the product will be produced. The following production system may be used in manufacturing the desired product:  1. Intermittent production system – is adopted when the production process is basically short and the machines are frequently changed.  2. Continuous production system – is adopted when the demands for the product is considered constant.  3. Just-in-time production system – goods are produced just in time when the market needs or demands for them. 3.MACHINE – refers to the manufacturing equipment used in the production of goods or delivery of services 4. MATERIALS – simply refers to the raw materials needed in the