Entrepreneurs, Types of Entrepreneurs and Social Responsibility PDF

Entrepreneurs, Types of Entrepreneurs and An entrepreneur is NOT any of the following: Social Responsibility ➔ He is not the person who gives or lends money to another and then sits back and Entrepreneur...

Entrepreneurs, Types of Entrepreneurs and An entrepreneur is NOT any of the following: Social Responsibility ➔ He is not the person who gives or lends money to another and then sits back and Entrepreneur relaxes until his money is returned with Someone who plans, organizes, and puts interest earnings. together all the resources required to bring a ➔ He is not the person who is hired and new enterprise into existence and to run and paid big salaries to manage business manage it on a long-term basis. full-time for its owners. ➔ He is not inventor of a product who stops Features of A Good Enrepreneur working after inventing and developing a Brain – to plan product. Hands – to do the plan ➔ He is not the person who guides or gives Mouth – to communicate and convince advice to the entrepreneur to make his Eyes – to see business more efficient and more Ears – to hear profitable Nose – to smell danger Skin – to protect TO BECOME ENTERPRISING: Heart – to love and create good relationship E – Energy Feet – to stand N – Need to achieve Spirit – to live T – Task Oriented E – Empathy ★ Entrepreneur derived from a French word: R – Resoucefulnesss Entreprendre – to undertake or to do P – Planning something R – Risk taking I – Innovation An Entrepreneur may also be defines in terms S – Skills of what he does. So, an entrepreneur is one E – Endurance who: ➔ Perceives business opportunities in the Responsibilities of the Entrepreneur environment ★ Initiating Ideas ➔ Takes risks to make use of these busines ★ Taking Risks opportunities ★ Planning ➔ Invests his own or borrows money to use ★ Controlling in the business ★ Coordinating ➔ Introduces innovations or improvements to make the business better, more Resources used by the Entrepreneur efficient, and more profitable Money — Money is necessary to obtain goods ➔ Makes plans an decisions for the and services that entrepreneurs want. A major business, and way in which money is obtained is through ➔ Generates profts for the business employment. Equipment — Useful equipment may be as simple as a small knife or a paper clip. Energy — Good health is essential to maintaining a high energy level. Adequate nutrition, rest and exercise are necessities. Time — Time is a unique resource Types of Entrepreneur Skills — Skills are developed when a person Self-Employed — These individuals perform all learns how to do a task competently the work and keep all the profit Knowledge — A real zest for life and an active Innovators — Innovators are the types of curiosity stimulate learning. entrepreneurs who come up with completely new ideas and turn them into viable 10 D’s of an Entrepreneur businesses. 1. Dream 2. Decisiveness Hustlers — These types of entrepreneurs 3. Doers focus on starting small with the goal of 4. Determination becoming bigger in the future. Hustlers are 5. Dedication motivated by their dreams and will work 6. Devotion extremely hard to achieve them. 7. Details 8. Destiny Imitators — Imitators are the types of 9. Dollars entrepreneurs who copy certain business ideas 10. Distribute and improve upon them. They are always looking for ways to make a particular product Entrepreneurs Alphabet better so as to gain an upper hand in the ★ Ability to organize resources market. ★ Bold to take calculated risk ★ Creative and innovative Copycats — These types of entrepreneurs see ★ Demanding for quality results the success of others and tries to copy them ★ Excited to compete exactly ★ Finds opportunity in crisis ★ Goal-oriented Researchers — Researcher entrepreneurs ★ Hardworking usually believe in starting a business that has ★ Inquisitively in search for improvement high chances of succeeding because they ★ Jack of all Trades have put in detailed work to understand all ★ Keen for details aspects ★ Legitimate ★ Mindful of the changes in the environment Buyers — These types of entrepreneurs have ★ Networker the money and specialize in buying promising ★ Organized and is an organizer businesses. Buyer entrepreneurs will identify a ★ Passionate business and assess its viability, proceed to ★ Questioning the status quo acquire it and find the most suitable person to ★ Resourceful run and grow it. ★ Success-oriented ★ Time conscious Acquirers — These entrepreneurs take over a ★ Undivided focus business started by somebody else and use ★ Visionary their own ideas to make it successful. ★ Winning attitude ★ Xtremely smart Buy-sell Artists — These entrepreneurs buy a ★ Yearning to learn company to improve it so that they can sell it ★ Zealously energetic again for a profit. Speculators — These entrepreneurs purchase The accomplished entrepreneur — This a commodity and resell it for a profit. Real entrepreneur has gone through all the stages estate, art, antiques and crops are typical of entrepreneurship and building a business, speculator items. and has reached success. They are now focused on scaling their business and leaving Skeptical — These entrepreneurs see the a legacy that extends beyond their lifetime. success of others and immediately starts to question it. They examine that person's Myths about Entrepreneurship business and looks for the “lucky” breaks, or Entrepreneus, like leaders, are born, not inheritance they think that successful made entrepreneur received. To be an entrepreneur, one needs money only Drone Entrepreneurs — These entrepreneurs To be an entrepreneur, a great idea is the are reluctant to change since they are very only ingredient conservative and do not want to make any Entrepreneurs are academic and socially changes in the organization. They are happy misfits with their present mode of business and do not One wants to be an entrepreneur as want to change even if they are suffering the having no boss is great fun losses. Entrepreneurship and the Philippine Economy The Money Magnet — They usually don’t have Economic Freedoms much know-how of the business world and ➔ Free competition most of the work is done by the professionals ➔ Free choice of investments appointed by them. ➔ Prices Main Determinants of Economic Growth The Solopreneur — These entrepreneurs Knowledge choose to start a business on their own with no Skills intention of ever adding staff. They are the Values chief cook and the sole person responsible for Quality of people the fate of the business. Our country was a slave of three colonial Agricultural Entrepreneur — The entrepreneurs masters who undertake agricultural pursuits are called ❖ Americans exploited our agricultural agricultural entrepreneurs. They cover a wide economy. spectrum of agricultural activities like ❖ Japan completely ruined our economy. cultivation, marketing of agricultural produce, ❖ Spanish rule introduced the tobacco irrigation, mechanization, and technology. monopoly and galleon trade for the benefits of top-ranking Spanish citizens. Franchisee — A franchisee is an individual ❖ Chinese subjugated the retail trade even who starts a business for which a widely earlier the Spanish time. known image has already been established. The franchisee owns the business and assumes its operating responsibilities subject to specifications set out by the franchisor. THE REPUBLIC:1946-1972 Middle Ages ➔ Political independence in 1946 ❖ Entrepreneur used to describe both as ➔ The import control for program of an actor and a person who managed ➔ President Carlos Garcia large production projects. ➔ US had its own of dominating the ❖ Individuals did not take any risks Philippine economy. because all the resources used to provided by the government of the THE MARTIAL LAW REGIME country, all an entrepreneur should do is OBJECTIVE: to manage it. To protect the interests of the local elite ❖ A typical entrepreneur in the middle age and foreign capitalists. was the priest. WB-IMF played a dominant role in the ❖ The person in charge of great economy architectural works used to build castles and fortifications, public buildings, THE AQUINO ADMINISTRATION abbeys, and cathedrals. Economic recovery was the first priority. The Aquino 6 - Year development plan was 17th Century based on the following principle: ❖ The connection of the risk with ➔ Respect for human rights entrepreneurship developed in the 17th ➔ Promotion of social justice century. ➔ Wiping out of poverty ❖ An entrepreneur was a person who ➔ Attainment of economic growth entered into a contract with the ➔ Market economy government to perform a service or to supply stipulated products. A Brief History of Entrepreneurship ❖ John law, a frenchman was one of the Earliest Period entrepreneur in that period. ❖ Marco polo, as a go-between was an The founder of the royal bank of Italian. France and the Mississippi ❖ He wants to trade routes to the far East Company, which had an exclusive ❖ As a go-between, He had to sign a franchise to trade between France contract with a money person to sell his and the new world. goods. In the contract merchant- Monopoly on french trade adventurer took a loan at 22.5% rate eventually led to collaspe of the including insurance. company. ❖ Capitalist was the passive risk bearer ❖ Richard Cantillion, a well-known English and merchant- adventurer took the economist at the beginning of the 17th active role in trading, bearing all century, understood Law's mistake. physical and emotional risks. He viewed the entrepreneur as a ❖ When the merchant-adventurer risk taker, observing that merchants, successfully sold the goods and farmers, craftsmen, and others sole completed the trip, the profits were proprirtors "buy at a certain price divided with the capitalist taking most of and sell at an uncertain price, them (upto 75% ) , while the therefore operating at a risk." merchant-adventurer settled for the remaining 25%.  ➔ Enhances competitive consciousness ∙ Improves quality of life 18th Century ➔ Enhance equitable distribution of ❖ In the 18th century, the person with income and wealth capital was differentiated from the one who needed capital. ❖ The entrepreneur was distinguished from the capital provider. ❖ One reason for this differentiation was the industrialization occuring throughout the world. ❖ Eli Whitney was an American inventor best known for inventing the cotton gin. This was one of the key inventions of the industrial Revolution. ❖ Thomas Edison, the inventor of many inventions. He was developing new technologies and was unable to finance his inventions himself. Edison was a capital user (an entrepreneur), not a provider (a venture capitalist). 19th and 20th Centuries Barriers to Growth of Philippine SMEs ❖ In the late 19th and early 20th centuries, Poor access to finance entrepreneurs were frequently not Obsolete technology Low productivity distinguished from managers and were Lack of skills upgrading viewed mostly from an economic Lack of information perspective. Inability to make entrepreneurial ❖ The entrepreneur organizes and transition manages an enterprise for personal Poor linkage among small, medium and gain. large industries ❖ The materials consumed in the Inappropriate location business, for the use of the land, for the Management incompetence services he employs, and for the capital Poor market access he requires. Lack of infrastructure Bureaucratic/cumbersome procedures Socio-economic Benefits From Severe global competition Entrepreneurship ➔ Promotes self- help and employment The Role of Entrepreneurship in Economy ➔ Mobilizes capital Development ➔ Provides taxes to economy 1. Entrepreneurship bids an economical and ➔ Empowers individual faster technique of distributing goods and ➔ Enhances national identity and pride ∙ services that hastens economic development. 2. Entrepreneurship is capable of generating jobs, income, goods, and services. 3. Entrepreneurship improves the quality of life. 4. Entrepreneurship contributes to more reasonable distribution of income, and therefore, comforts social unrest. 5. Entrepreneurship uses and mobilizes resources to make the country fruitful. 6. Entrepreneurship brings social benefits through the government. 7. Entrepreneurship has several definitions. Any person who takes the risks and Harrod-Domar Theory invest his resources to make something Conceptualized by Sir Harrold of England new or better is engaged in claims more products can be produced through entrepreneurship. the use of machines. 8. Economic development is a process, while economic growth is a product of economic Kaldor Theory development, both economic and Kaldor Theory, by Nicholas Kaldor, non-economic factors constitute the maintains that the key factor is technology. determinants of economic development. In less developed countries, economic Innovation Theory human conditions by reducing or Developed by Joseph Schumpeter, eliminating poverty, disease, injustice, stresses the role of innovators or illiteracy, and exploitation. entrepreneurs in economic development. 9. Development and Growth Theories. The contributions of entrepreneurship are: 1. Development of new markets 2. Discovery of new source of materials 3. Mobilization of capital resources. 4. Introduction of new technologies 5. Creation of employment. Entrepreneurial Economy This means our productive resources should be on the hands of Filipinos for their own paybacks. Ricardian Theory The government can help entrepreneurs from Theory of David Ricardo Focusing on their several assistance programs on the agriculture playing the major role in economic following: development ➔ Peace and Order ➔ Political ➔ Stability ➔ Taxes ➔ Infrastructure  ➔ Education and training ❖ Technique is credited to Albert Humphrey ➔ Public administration who led a research project at Stanford ➔ Production technology University in the 1960s and 1970s. ➔ Marketing Assistance ❖ Planning tool used to understand Strengths, ➔ Financial Assistance. Weaknesses, Opportunities, & Threats involved in a project / business. Swot Analysis ❖ Used as framework for organizing and using What is Swot Analysis? data and information gained from situation A technique that enables a group or analysis of internal and external environment. individual to move from everyday problems and traditional strategies to a Acronym fresh prospective. SWOT analysis looks at your strengths and weaknesses, and the opportunities and threats your business faces. The SWOT Analysis framework is a very important and useful tool to use in marketing Management and other business applications As a basic tool its mastery is a fundamental requirement for the marketer, entrepreneur or business person. Strengths A clear understanding of SWOT is Characteristics of the business or a team required for business majors. that give it an advantage over others in the industry. Positive tangible and intangible attributes, internal to an organization. Beneficial aspects of the organization or the capabilities of an organization, process capabilities, financial resources, products and services, customer goodwill and brand loyalty. Examples – Abundant financial resources, Well-known brand name, Economies of scale, Lower costs [raw materials or processes], Superior management talent, Better marketing skills, Good distribution skills, Committed employees. Weaknesses Characteristics that place the firm at a disadvantage relative to others. Detract the organization from its ability to attain the core goal and influence its growth.  Weaknesses are the factors which do not Product life cycle in decline, Changing meet the standards we feel they should customer needs/tastes, Rival firms adopt meet. However, weaknesses are new strategies, Increased government controllable. They must be minimized regulation, Economic downturn. and eliminated. Examples – Limited financial resources, Aim of SWOT Analysis Weak spending on R & D, Very narrow To help decision makers share and product line, Limited distribution, Higher compare ideas. costs, Out-ofdate products / technology, To bring a clearer common purpose and Weak market image, Poor marketing understanding of factors for success. skills, Limited management skills, To organize the important factors linked Undertrained employees. to success and failure in the business Opportunities world. Chances to make greater profits in the To provide linearity to the decision environment - External attractive factors making process allowing complex ideas that represent the reason for an to be presented systematically. organization to exist & develop. Arise when an organization can take benefit of conditions in its environment to plan and execute strategies that enable it to become more profitable. Organization should be careful and recognize the opportunities and grasp them whenever they arise. Examples – Rapid market growth, Rival firms are complacent, Changing customer needs/tastes, New uses for product discovered, Economic boom, Government deregulation, Sales decline for a substitute product. Threats External elements in the environment that could cause trouble for the business - External factors, beyond an organization’s control. Arise when conditions in external environment jeopardize the reliability and profitability of the organization ’s business. Compound the vulnerability when they relate to the weaknesses. Threats are uncontrollable. When a threat comes, the stability and survival can be at stake. Examples – Entry of foreign competitors, Introduction of new substitute products,