GEENTX01: The Entrepreneurial Mind PDF

GEENTX01: The Entrepreneurial Mind Topic 1: The Revolutionary Impact of Entrepreneurship Today’s Entrepreneurs Entrepreneurs have to take a lot of things into account Climate change contributes to increased frequency of...

GEENTX01: The Entrepreneurial Mind Topic 1: The Revolutionary Impact of Entrepreneurship Today’s Entrepreneurs Entrepreneurs have to take a lot of things into account Climate change contributes to increased frequency of natural disasters, rise in flows Entrepreneurs have never wasted a good of refugees, and global conflict over food crisis. and water. Over half of the Fortune 500 were created Existential risks - events that can cripple during a recession or bear market. civilization or even cause the extinction of the human race. A "bear market" is a term used in the financial markets to describe a prolonged Anthropogenic – human-caused events that period of declining prices for a particular threaten the survival of life on earth asset, such as stocks, bonds, or What any of this has to do with entrepreneurs? commodities. - Industrial revolution Entrepreneurship is a wellspring of - Carbon Emissions economic growth, social renewal and personal development. Entrepreneurs are part of the problem but also the greatest hope for the solutions. Entrepreneur’s ideas, savings, investment and innovation that lead to development. Since the Industrial Revolution in the late eighteenth and early nineteenth centuries, They are the ones who can alleviate poverty many business entrepreneurs around the by contributing to economic growth and job world have simply plundered and exploited creation the environment in ignorance, without any Are you a Business or Social Entrepreneur? thought for sustainability. There are many kinds of entrepreneurs. The word Early entrepreneurs were the first to see the ‘entrepreneur’ is very flexible in the English possibility that 56325632 language. coal and gas could fuel industry as well as power our dreams and innovations. enterprising human being have changed the world’s climate and entrepreneurs must share some of the blame. most of the technologies we need to Business entrepreneurs - are driven by the profit improve the situation already exist, motive. They seek growth and profits within the developed by entrepreneurs and inventors business world. in the last quarter century. Social entrepreneurs have many of the same personality characteristics as business entrepreneurs, but they are driven by a mission and seek to find innovative ways to solve problems that are not being or cannot be addressed by either the market or the public sector.  GEENTX01: The Entrepreneurial Mind Muhammad Yunus: Founder of the The characteristics of seizing opportunities, Grameen Bank and a pioneer of embracing risks, and persistently realizing microfinance, Yunus is known for his ideas. efforts to provide financial services to the It is this mind-set that has revolutionized poor. He introduced the concept of the way business and social ventures are microcredit, which has empowered millions conducted at every level and in every of people to lift themselves out of poverty. country. Blake Mycoskie: Founder of TOMS Shoes, Enterprise (or enterprising) is still used as a company that popularized the "One for an ‘attitude to life, an attitude of exploring, One" business model. For every pair of of developing, of leading and of taking shoes sold, TOMS donates a pair to a child initiatives. in need. This model has expanded to include eyewear and other products. Enterprising individual – is the process of identifying, developing and bringing a Tony Meloto: Founder of Gawad Kalinga vision to life, be it an innovative idea or (GK), a community development simply a better way of doing something organization that aims to end poverty and build sustainable communities. GK focuses Entrepreneurial means ‘willing to take on housing, education, and livelihood risks in order to create value’ programs to uplift marginalized communities. It mean that a person is the sole proprietor of the rest of their life, of their own destiny Illac Diaz: Founder of Liter of Light, an organization that provides solar bottle bulbs to communities without electricity. These The word entrepreneur is derived from the French low-cost solar lights use recycled plastic entreprendre, meaning ‘to take in between’, or ‘to bottles filled with water to refract sunlight undertake’. and illuminate homes. The entrepreneur is someone who undertakes to Small-business owners may once have captured organize, manage and assume the risks of a an opportunity like an entrepreneur but then do not business. continue to have the attributes that make it entrepreneurial. In Malay, usahawan means someone who does a commercial activity at some financial risk. The difference is that small-business owners would rather exploit existing equilibrium opportunities In the Thai language, the word for entrepreneur is and optimize supply and demand in established pupagongan, which means literally ‘someone who markets. Entrepreneurs, on the other hand, aim to assembles other people together’. exploit innovative venture opportunities and create In Indonesian, wiraswasta has the signification of new markets at home and abroad. ‘courageous private sector’. Many small business owners often like stable sales, Characteristics of Entrepreneurs profits and modest growth and want to keep the business at a size they can personally manage and Ability to consolidate resources control. These are not entrepreneurs but small- Management skills business managers. A desire for autonomy Entrepreneurial Mind-set (Some people are born Risk takers with it, but can be developed) Competitiveness Goal-oriented behavior  GEENTX01: The Entrepreneurial Mind Confidence Opportunity-driven - an entrepreneur who opts to start a business because they have spotted an Opportunistic behavior available opportunity, and is prepared for and Intuitiveness has the resources to carry it out Pragmatism Necessity-driven - an entrepreneur who starts The ability to learn from mistakes a business because they see an opportunity. The ability to employ human relations Self-efficacy - Self-assessed conviction or skills. confidence about personal abilities to muster the motivation, perform the cognitive tasks and Entrepreneurial Economy conduct the actions needed to successfully Entrepreneurs are the pioneers of today’s business execute a specific task within a given context. successes. Entrepreneurial Cognition (entrepreneurs Their sense of opportunity, their drive to innovate actually think differently from other people) and their capacity for accomplishment have Cognition encompasses mental processes like become the standard by which free enterprise is attention, memory, language, problem-solving, now measured. decision-making, and information processing. Summary Description of Entrepreneurship It involves applying knowledge and adapting preferences. Entrepreneurship (Robert C. Ronstadt) Social cognition theory looks at situation- The dynamic process of creating incremental based mental models (cognitions) that optimize wealth personal effectiveness. This wealth is created by individuals who assume Entrepreneurial cognition as the knowledge major risks in terms of equity, time, and/or career structures that people use to make assessments, commitment of providing value for a product or judgements, or decisions involving opportunity service evaluation, venture creation, and growth. The product or service itself may or may not be a Entrepreneurship Theory new or unique but the entrepreneur must somehow infuse value by securing and allocating the Entrepreneurship = f (entrepreneur) necessary skills and resources This simple formula states that entrepreneurship is Topic 2: Fundamentals of the Entrepreneurial a function of the entrepreneur, a real individual Mind with passions, experiences and knowledge living in a particular culture and time period Entrepreneurial Mindset – describe the most common characteristics associated with Influences for Entrepreneurs successful entrepreneurs as well as the elements associated with the “dark side” of entrepreneurship Entrepreneurial Leadership – the capacity to lead and the capacity to risk pursuing innovative opportunities Publications Who are the Entrepreneurs? Technical and professional journals Independent individuals, intensely committed and determined to persevere who work very Textbooks on entrepreneurship hard.  GEENTX01: The Entrepreneurial Mind Books about entrepreneurship Internal Locus of Control - They believe their accomplishments and setbacks are within their Biographies or autobiographies of own control and influence. entrepreneurs Tolerance for Ambiguity - successful Compendiums about entrepreneurs entrepreneurs thrive on the fluidity and News periodicals excitement of such an ambiguous existence Venture periodicals Calculated Risk Taking - if they decide to participate in a venture, they do so in a very Newsletters calculated, carefully thought-out manner Proceedings of conferences Tolerance for Failure - Entrepreneurs use The Internet failure as a learning experience Direct Observation of Practicing Entrepreneurs High Energy Level - The extraordinary workloads and the stressful demands faced by Interviews entrepreneurs place a premium on energy. Surveys Creativity and Innovativeness - cultures Case studies differ very much in terms of creativity and innovation Speeches, Seminars, and Presentations by Practicing Entrepreneurs Vision - Entrepreneurs know where they want to go Profile dimensions That Characterize Entrepreneurs Passion - a fundamental emotional experience for entrepreneurs Determination & Perseverance - total dedication to success and focus on advantage; Team-building - Successful entrepreneurs unwavering commitment to succeed need to have highly qualified, well-motivated teams that help handle the venture’s growth and Drive to Achieve - Internally driven by a strong development. desire to compete, to excel against self-imposed standards and to pursue and attain challenging The Dark Side of Entrepreneurship goals. There are certain negative factors that may Need to Achieve - examine a situation, surround entrepreneurs and dominate their determine how to increase the odds of winning behavior. and then push ahead. Failed Entrepreneurs – error of judgement Opportunity orientation is the constant Opportunist entrepreneurs awareness of the opportunities that exist in everyday life. Empire-builders who grow too quickly and lose control Persistent Problem Solving - relentless attack on a problem or an obstacle that is impeding Entrepreneurs who attract controversy business operations. Dishonest entrepreneurs Seeking feedback - Strong desire to know how The Entrepreneur’s Confrontation with Risk well they are doing and how they might improve their performance. Financial Risk New ventures involve risking personal savings and resources.  GEENTX01: The Entrepreneurial Mind Failure may lead to financial loss. individuals gravitate towards heavy workloads and find themselves completely Entrepreneurs may personally guarantee immersed in their business demands. company obligations. Type A Personalities: Risk of personal bankruptcy is a concern. Chronic and severe sense of time urgency. Reluctance to risk savings, property, and income for new business. Constant involvement in multiple projects subject to deadlines Career Risk Neglect of all aspects of life except work Will entrepreneurs find a job if venture fails? A tendency to take on excessive responsibility Returning to old job after venture failure? Explosiveness of speech and a tendency to Career risk worries for secure managers speak faster than most people with high salary and benefits Dealing with Stress Family & Social Risk How can entrepreneurs improve the quality of their New ventures demand entrepreneur's business and personal lives? energy and time. Networking - One way to relieve the Other commitments may suffer. loneliness of running a business is to share Increased family and social risks. experiences by networking with other business owners. The objectivity gained Friendship impact due to missed social from hearing about the triumphs and errors events. of others is itself therapeutic. Psychic Risk Getting away from it all - The best antidote Money, possessions, relationships can to immersion in business, report many recover. entrepreneurs, is a holiday. If vacation days or weeks are limited by valid business Psychological impact can be severe and constraints, short breaks still may be lasting. possible. Such interludes allow a measure Some entrepreneurs can't immediately of self-renewal. bounce back from financial losses. Communicating with employees - Psychic impact can have long-lasting Entrepreneurs are in close contact with effects. employees and can readily assess the concerns of their staffs. The personal Stress and The Entrepreneur touches often unavailable in large Entrepreneurial stress can be viewed as a corporations – such as company-wide function of discrepancies between a outings, flexible hours and small loans to person’s expectations and ability to meet tide demands, as well as discrepancies between Finding satisfaction - Outside the company, the individual’s expectations and countering the obsessive need to achieve personality. can be difficult, because the entrepreneur’s Type A behavior, this personality structure personality is inextricably woven into the describes people who are impatient, company fabric. Entrepreneurs need to get demanding and over-strung. These away from the business occasionally and  GEENTX01: The Entrepreneurial Mind become more passionate about life itself; Overriding Desire for Success they need to gain some new perspectives. Entrepreneur's ego tied to desire for Delegating - Implementation of coping success. mechanisms requires implementation time. Despite challenges, strong drive to succeed To gain this time, the entrepreneur has to persists. delegate tasks. Entrepreneurs find delegation difficult, because they think they Entrepreneur becomes defiant, creative to have to be at the business all of the time and counter insignificance. be involved in every aspect of the operation. But if time is to be used for Pride in success, but potential for alleviation of stress, appropriate delegates destructiveness. must be found and trained. Monumental achievements can Exercising rigorously - Research by overshadow venture's importance. Goldsby and colleagues looked at two types Danger of losing perspective, becoming of exercise – running and weightlifting – more important than the venture. and what impact they had with sales volume, extrinsic rewards, and intrinsic Unrealistic Optimism rewards. The results indicated that running Entrepreneurial optimism vital for success. is positively related to all three outcome variables, and weightlifting is positively High enthusiasm creates external optimism, related to extrinsic and intrinsic rewards. inspires trust during challenges. The Entrepreneurial Ego Extreme optimism can lead to unrealistic, fantasy-based approaches. An Overbearing need for control Self-deception ignores trends, facts, and Entrepreneurs driven by internal locus of reports. control. May result in inability to handle business Strong desire for autonomy and control. reality. Prefer to create their own structures. The Entrepreneurial Journey May perceive others as threats to their Entrepreneurs create ventures much as an artist creates control. a painting Balancing control is crucial for successful Formed by the lived experience of venture creation entrepreneurship Experiential Nature of Creating a Sustainable Sense of Distrust Enterprise Entrepreneurs scan environment for Emergence of Opportunity competition, customers, regulations. Emergence of the Venture Anticipate and act ahead of others. Emergence of the entrepreneur Excessive vigilance can lead to fixation on trivial matters. You don’t just produce a venture; it comes out of you with pain and excitement. You don’t somehow May distort reasoning, logic, and take pre-exist as an entrepreneur; you emerge as a result harmful actions. of your own unique, novel, idiosyncratic and Distrust has dual-edged nature. experiential nature of creating a venture. Venture  GEENTX01: The Entrepreneurial Mind creation is a lived experience that, as it unfolds, applied in the corporate sector. forms you. Intrapreneurship = entrepreneurship inside an organisation Creating a sustainable enterprise involves three parallel things: the opportunity arises out of the  Continuous innovation which allows for shadows; the venture emerges out of your creativity pathways to accelerate their pace and cope and diligence; you yourself then emerge as with competition in the world markets. entrepreneur. None are predetermined or fixed – they define and are defined by one another Corporate Innovation Philosophy Important practices for establishing an innovation- Pathway to Entrepreneurial Career driven organization: Entrepreneurial career means finding the pathways toward creating ventures that are Set explicit innovation goals right for you. Create a system of feedback and positive reinforcement The nature of entrepreneurial capabilities vary across the different stages of Emphasize individual responsibility entrepreneurial activity, can be compared with the entrepreneurial characteristics that Provide rewards based on results are needed for success. Do not punish failures Assessing Support for Corporate Innovation Does the firm encourage entrepreneurial thinking? Does the firm provide ways for innovators to stay with their ideas? There are various pathways that can help build personal qualities and start the entrepreneurial Are people permitted to do the job in their career, such as finding or creating an opportunity, own way, or are they constantly stopping to becoming involved in the family business, working explain their actions and ask for with an employer to commence a new venture permission? activity, seeking a franchise or buying an existing Has the firm evolved quick and informal business to turn around or grow. ways to access the resources to try new Topic 3: Corporate Entrepreneurial Mindset ideas? The Entrepreneurial Mindset in Organizations Has the firm developed ways to manage many small and experimental innovations? Response to rapid, discontinuous, and significant changes in companies external and internal Is the system set up to encourage risk taking environments in a global economy: and to tolerate mistakes?  Restructure of operations in fundamental Are people in the firm more concerned with and meaningful ways new ideas or with defending their turf?  Introduction of corporate entrepreneurship How easy is it to form functionally or intrapreneurship – dynamic, flexible complete, autonomous teams in the firm’s entities prepared to take advantage of new corporate environment? business opportunities when they arise Rules for an Innovative Environment Entrepreneurship is often viewed as a small- 1. Encourage action. business phenomenon, but increasingly it is being  GEENTX01: The Entrepreneurial Mind 2. Use informal meetings whenever possible. The Need for Corporate Entrepreneurship 3. Tolerate failure, and use it as a learning Rapid growth in the number of new and experience. sophisticated competitors 4. Persist in getting an idea to market. Sense of distrust in the traditional methods of corporate management 5. Reward innovation for innovation’s sake An exodus of some of the best and brightest 6. Plan the physical layout of the enterprise to people from corporations to become small encourage informal communication. business entrepreneurs 7. Expect clever bootlegging of ideas— International competition secretly working on new ideas on company time as well as personal time. Downsizing of major corporations 8. Put people on small teams for future- An overall desire to improve efficiency and oriented projects. productivity 9. Encourage personnel to circumvent rigid procedures and bureaucratic red tape. 10. Reward and promote innovative personnel Concept of Corporate Entrepreneurship and Innovation Corporate Entrepreneurship A process whereby an individual or a group of individuals, in association with an existing organization, creates a new organization or instigates renewal or innovation within the organization. Successful Innovative Companies Corporate Entrepreneurship Strategy Factors in large corporations that are successful A vision-directed, organization-wide reliance on innovators: entrepreneurial behavior that purposefully and Atmosphere and vision continuously rejuvenates the organization and Orientation to the market shapes the scope of its operations through the recognition and exploitation of entrepreneurial Small, flat organizations opportunity. Multiple approaches Interactive learning Skunk Works (small groups) Types of Innovation Radical Innovation The launching of inaugural breakthroughs. These innovations take experimentation and determined vision, which  GEENTX01: The Entrepreneurial Mind are not necessarily division gets too big, perhaps reaching $250 million to $300 million in sales, it is split up. managed but must be  Motivate the champions: When a 3M employee recognized and nurtured. has a product idea, they recruit an action team to develop it. Salaries and promotions are tied Incremental Innovation to the product’s progress. The champion has a The systematic evolution of a product or chance to some day run their own product service into newer or larger markets. group or division.  Stay close to the customer: Researchers, Many times the incremental marketers and managers visit customers and innovation will take over after a routinely invite them to help brainstorm product ideas. radical innovation introduces a  Share the wealth: Technology, wherever it is breakthrough developed, belongs to everyone Developing & Supporting Radical and Structuring The Work Environment Incremental Innovation Reestablishing the drive to innovate: Invest heavily in entrepreneurial activities that allow new ideas to flourish in an innovative environment. Provide nurturing and information-sharing activities. Employee perception of an innovative environment is critical Corporate Venturing: 3M, a renowned innovation-driven company. Institutionalizing the process of embracing  "15% Rule" or the "15 Percent Time." This rule the goal of growth through development of encourages employees to spend 15% of their innovative products, processes, and work time on projects outside of their primary technologies with an emphasis on long-term responsibilities prosperity  Don’t kill a project: If an idea can’t find a home in one of 3M’s divisions, an employee can Preparing for Failure devote 15 percent of their time to prove it is “Learning from Failure” workable. For those who need seed money, as many as 90 Genesis grants of $50 000 are Recognizing the importance of managing the awarded each year. grief process that occurs from project failure.  Tolerate failure: Encouraging plenty of Understanding how organizational routines and experimentation and risk-taking allows more rituals are likely to influence the grief recovery. chances for a new product hit. The goal: divisions must derive 25 per cent of Ensuring that the organization’s social support sales from products introduced in the past five system can encourage greater learning, foster years. The target may be boosted to 30 per cent motivational outcomes, and increase coping in some cases. self-efficacy in affected individuals.  Keep divisions small: Division managers must know each employee’s first name. When a  GEENTX01: The Entrepreneurial Mind Facilitating Corporate Entrepreneurial The definition of social entrepreneurship has been Behavior in constant evolution since it first appeared in the 1990s. As for today, it is seen as doing business for Organizations foster entrepreneurial behavior by: a social cause by putting the general interest of Encouraging—not mandating—innovative society on top of economic performance. In this activity way, in social entrepreneurship, profit is no longer the ultimate goal of business but a means to achieve Human resource policies for “selected rotation” broader goals connected to improving society and Committing to projects long enough for the environment. momentum to occur. By nature, social enterprises are managed Bet on people, not on analysis. following the principles of corporate social responsibility (CSR) and Sustainable Rewarding Entrepreneuring: Development. Allow inventor to take charge of the new The people running these social businesses are venture called social entrepreneurs. And as we’ve been Grant discretionary time to work on future discussing, their measure of success isn’t about projects profit. Instead, they feel successful when their business has somehow improved the world. Make intracapital available for future research ideas Developing Innovative (I) Teams Innovative (I) Team A semi-autonomous self-directing, self- managing, high-performing group of two or more people who formally create and share the ownership of a new organization. The leader is called a “innovation champion” or Social Entrepreneurship a “corporate entrepreneur. A new form of entrepreneurship applies to social Collective Entrepreneurship problem solving traditional, private-sector Individual skills are integrated into a group; entrepreneurship’s focus on innovation, risk- this collective capacity to innovate becomes taking, and large-scale transformation. something greater than the sum of its parts. Social entrepreneurship refers to the practice of Strategic Entrepreneurship Roles using entrepreneurial skills and principles to address social, environmental, or community issues and create positive social change. Social Entrepreneurship Process  Recognition of a perceived social opportunity  Translation of the social opportunity into an enterprise concept Topic 4: The social and ethical perspectives of  Identification and acquisition of resources entrepreneurship required to execute the enterprise’s goals.  GEENTX01: The Entrepreneurial Mind Social Entrepreneur Ecopreneurs  A person or small group of individuals who  Sustainable business for organizations founds and/or leads an organization or initiative means not only providing products and engaged in social entrepreneurship. services that satisfy the customer, and doing so without jeopardizing the environment,  Also referred to as “public entrepreneurs,” but also operating in a socially responsible “civic entrepreneurs,” or “social innovators. manner. Characteristics of Social Entrepreneurs as  An ecopreneur combines the unrelenting Change Agents drive and imagination of the entrepreneur  Adoption of a mission to create and sustain with the stewardship of a conservator rather social value (beyond personal value) than the devastation of an exploiter.  Recognition and relentless pursuit of The old definition of sustainability used to mean opportunities for social value simply surviving or maintaining a business’ viability against its competitors.  Engagement in continuous innovation and learning Nowadays the term sustainability means a real commitment to the environment and climate  Action beyond the limited resources at hand change mitigation/ adaptation as well as a  Heightened sense of accountability revamping of the entire business model to its core. Social Enterprise Environmental Awareness  The three traditional sectors – public  Ecovision (government), private (business) and social A leadership style that encourages open and (non-profit) flexible structures that encompass the employees,  This can be seen everywhere, from civic and the organization, and the environment, with municipal enterprises, community attention to evolving social demands. development financial institutions, faith-based "Ecovision" is a term that can refer to various enterprises, blended value organizations, social concepts and initiatives related to environmental economy enterprises, social venturing, sustainability and vision for a more eco-friendly sustainable businesses or social enterprises. future. The Social enterprise challenge Key Steps in an Environmental Strategy  Social Obligation - Firms that simply react to 1. Eliminate the Concept of Waste - The goal is social issues through obedience to the laws. to minimize waste generation by designing  Social Responsibility - Firm that respond more products and processes that create little to no actively to social issues; accepting waste, thus reducing environmental impacts responsibility for various programs. and conserving resources.  Social Responsiveness - Firms that are highly 2. Restore Accountability - holding individuals, proactive and are even willing to be evaluated organizations, and governments responsible for by the public for various activities. their actions and decisions that impact the environment. Environmental responsibility 3. Make Prices Reflect Costs - the need to  Actions being done. Example unilever internalize the external costs associated with sustainable sourcing, reducing plastic, environmental degradation. It suggests that community engagement prices for goods and services should include the  GEENTX01: The Entrepreneurial Mind true costs of their production, including advocating for more gender equality, while environmental and social costs others resist these changes based on traditional mores. 4. Promote Diversity - refers to biodiversity, which encompasses the variety of life on Earth, Shifting Societal Norms: Societal norms are including species, ecosystems, and genetic the accepted standards of behavior within a diversity given society. For example, debates about environmental sustainability have led to 5. Make Conservation Profitable: - finding conflicts between those who prioritize ways to incentivize and reward actions that ecological concerns and those who prioritize protect and conserve natural resources and economic growth, reflecting different societal ecosystems. norms and values. 6. Insist on Accountability of Nations: This Reliance on fixed principles may prevent principle emphasizes the need for nations to be individuals or organizations from adapting to accountable for their environmental and new information or changing dynamics, sustainability commitments at the international leading to conflicts when others believe that an level. evolving ethical process should be followed. The Ethical Side of Entrepreneurship Ethics and Laws  Ethics Managerial Rationalizations A set of principles prescribing a behavioral code Justifications in defense of unethical acts are that explains what is good and right or bad and believing that an activity: wrong; ethics may outline moral duty and obligations. 1. Is not “really” illegal or immoral. Provide the basic rules or parameters for 2. Is in the individual’s or the corporation’s best conducting any activity in an “acceptable” manner. interest. 3. Will never be found out.  Reasons for Ethical Conflicts 4. That helps the company will be condoned by the company. The many interests that confront business enterprises both inside and outside the organization The unethical act you're describing involves a company tolerating or even endorsing unethical Changes in values, mores, and societal norms behavior if it benefits the company in some way. Reliance on fixed ethical principles rather than an This type of situation is often referred to as "turning ethical process a blind eye" or "looking the other way" when it comes to unethical conduct. Value: For example, changes in attitudes towards LGBTQ+ rights have led to ethical conflicts between individuals who uphold conservative, traditional values and those advocating for LGBTQ+ inclusion and equality. Evolution of Mores: Mores are societal customs and conventions that dictate acceptable behavior within a culture. For instance, issues related to gender roles and The Matter of Morality expectations have evolved, with some  GEENTX01: The Entrepreneurial Mind Ethical conduct may reach beyond the limits of the  Survival (bottom-line thinking) law.  Reliance on other social institutions to convey  The requirements of law may overlap at times and reinforce ethics. but do not duplicate the moral standards of Establishing a Strategy for Ethical Enterprise society. Ethical Practices and Codes of Conduct  Legal requirements tend to be negative (forbidding acts), whereas morality tends to be  A code of conduct is a statement of ethical positive (encouraging acts). practices or guidelines to which an enterprise adheres.  Legal requirements usually lag behind the acceptable moral standards of society.  Codes of conduct are becoming more prevalent in industry.  Inherent problems arise when people believe laws represent morality. just because something is legal does not necessarily mean it is morally right, and conversely, not everything that is morally right is necessarily reflected in the law. Legal Perspective: In some countries or states, the recreational use of certain drugs, such as marijuana, may be legal under specific conditions or regulations. Moral Perspective: From a moral perspective, some Ethical Consciousness: It involves recognizing people or societal groups may view recreational and understanding the distinction between right drug use as morally wrong or harmful, even if it is and wrong legally permitted. Ethical process and structure refer to the systematic  Negative Emphasis: Legal requirements approach and organizational framework that guide primarily focus on prohibiting or restricting ethical decision-making. Ex policy, rules, process certain behaviors or actions. Positive Institutionalization in the context of ethics refers to Emphasis: Morality, in contrast, is often the integration of ethical values, principles, and concerned with encouraging virtuous or ethical practices into the core fabric and operations of an behaviors. entity.  suggests that societal morals and values often Ethical Leadership by entrepreneurs evolve more rapidly than the laws that govern a society. The Opportunity for Ethical Leadership by Entrepreneurs  Societies are characterized by diverse moral perspectives influenced by culture, religion,  An owner has the unique opportunity to display philosophy, and personal beliefs. Laws, on the honesty, integrity, and ethics in all key other hand, are enacted through a political and decisions. legal process that may not fully capture or  The owner’s actions serve as a model for other accommodate this diversity. employees to follow. Reasons for unethical behavior  An owner’s value system is a critical  Greed component of the ethical considerations that surround a business decision  Distinctions between activities at work and activities at home Topic 5: CREATIVITY AND INNOVATION  A lack of a foundation in ethics  GEENTX01: The Entrepreneurial Mind IDEAS AND THE SEARCH FOR Process needs OPPORTUNITY  Process gaps or bottlenecks - Identifying and shaping opportunity is central  The entrepreneur must recognize an innovation to the domain of entrepreneurship. solution, or ‘painkiller’. - opportunity identification process is one of the primary preoccupations of Industry and market changes entrepreneurship  Continual shifts in the marketplace occur, - Innovation refers to newness, but not because caused by developments such as consumer something is new that it will automatically attitudes, advancements in technology, industry create value or be perceived as inherently growth and the like. positive and good. - Entrepreneur’s challenge is to innovate a new  Innovation is the creation of solutions to product, service, process, market or business incongruities. concept that they foresee will create future value. Demographics SOURCES OF INNOVATIVE IDEAS  These arise from trend changes in population, education, income changes, age, occupations, Trends geographic locations and similar factors.  Trends signal shifts in the current paradigm Perceptual changes (or thinking) of the major population.  These changes occur in people’s interpretation  Societal trends: ageing of facts and concepts. They are intangible yet demographics, health and fitness meaningful. growth, senior living, social media Knowledge-based concepts  Technology trends: smart phone technology, e-commerce, Internet  Inventions are knowledge-based; they are the advances, drones, miniaturization product of new thinking, new methods and new knowledge.  Economic trends: higher disposable income, dual wage-earner families,  Such innovations often require the longest time performance pressures, rising fuel costs period between initiation and market implementation because of the need for testing  Political trends: increased regulations, and modification. terrorism, sovereign debt, military alliances, free trade agreements NATURE OF CREATIVE PROCESS  Environmental trends: global warming,  One’s creative potential is drought, increased severity of storms, something that can be developed and increases frequency of bushfires, pollution. improved.  Some individuals have a greater aptitude Unexpected occurrences for creativity than others.  Some people have been raised and  These are successes or failures that, educated in an environment that because they were unanticipated or unplanned, encouraged them to develop their often end up proving to be a major innovative creativity. surprise to the business.  The creative process involves seeing Incongruities relationships among things others have not seen  These occur whenever a difference exists expectations and reality.  GEENTX01: The Entrepreneurial Mind DEVELOPING CREATIVITY Lateral Thinking ARENAS OF CREATIVITY  Concerned with the generation of Idea Creativity new ideas. It is also concerned with  Thinking up a new idea or concept, such as ‘breaking out of the concept prisons of old an idea for a new product or service or a ideas’. way to solve a problem  Lateral thinking is not a substitute for Material Creativity vertical thinking  Inventing and building a tangible object  Lateral thinking is generative, vertical such as a product, an advertisement, a thinking is selective. report or a photograph. Organization Creativity  Organizing people or projects and coming up with a new organizational form or approach to structuring things. Relationship Creativity Thinking Outside the Box  An innovative approach to achieving  To leave your psychological comfort zone collaboration, cooperation and win-win and explore ‘solutions in the unknown relationships with others. world on the outside requires large Event Creativity measures of mental agility, boldness and  Producing an event such as an awards creativity ceremony, team outing or annual meeting Recognizing Relationships Inner Creativity  Many inventions and innovations are a  Changing one’s inner self; being open to result of the inventor seeing new and new approaches to how one does things different relationships among objects, and thinking about oneself in different processes, materials, technologies and ways. people Spontaneous Creativity Using your Brains  Acting in a spontaneous or spur-of-the-  The right brain hemisphere helps an moment manner individual understand analogies, imagine INNOVATION AND THE ENTREPRENEUR things and synthesize information.  The left brain hemisphere helps the person  Innovation is the process by which analyze, verbalize and use rational entrepreneurs convert opportunities (ideas) approaches to problem solving. into marketable solutions.  he creative process involves logical and  Innovation process begins with the analysis analytical thinking in the knowledge of the sources of new opportunities accumulation, evaluation and implementation stages.  Most successful innovations are simple and  To become more creative it is necessary to focused. They are directed towards a practice and develop both right- and left- specific, clear and carefully designed hemisphere skills application. TYPES OF INNOVATION Invention  The creation of a new product, service or process, often one that is novel or untried; such concepts tend to be revolutionary  GEENTX01: The Entrepreneurial Mind Extension  Reward heroic activity  the expansion of a product, service or  Work, work, work process already in existence; such concepts make a different application of a current idea Duplication  the replication of an already existing product, service or process.  however, is not simply copying but adding the entrepreneur’s own creative touch to enhance or improve the concept to beat the competition Synthesis  the combination of existing concepts and factors into a new formulation; this involves taking ideas or items already invented and finding a way so together they form a new application. PRINCIPLES OF INNOVATION  Be action oriented  Make the product, process or service simple and understandable  Make the product, process or service customer-based  Start small  Aim high  Try/test/revise  Learn from failures  Follow a milestone schedule