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MG305 Lecture March 10, 2010 Understanding the Entrepreneurial Perspective in individuals

USP, School of Management, 2010 MG305, 2009
USP, School of Management, 2010
MG305, 2009

The Entrepreneurial Perspective

How do we get information on entrepreneurs? Use the information for what? Usefulness of information!!! Now?

The Entrepreneurial Perspective How do we get information on entrepreneurs? Use the information for what? Usefulness

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Sources of research on entrepreneurs

1. Technical and professional journals that encompass in-depth research on current business concepts.

These are well designed and structured. Examples include the—Journal of Business Venturing, Journal of Small Business Management and Entrepreneurship, etc.

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2. Textbooks on entrepreneurship —These are books that typically discusses the operation of small firms/nonprofit organizations.

Examples : New venture Creation, Effective Small Business Management, and Entrepreneurial Strategy, etc.

2. Textbooks on entrepreneurship —These are books that typically d iscusses the operation of small firms/nonprofit

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3. Books about entrepreneurship — These books are written from the practitioners’ perspective-- ‘how to’ guides.

A variety deal with the problems facing the individual who commences a business, and others deal with a particular aspect of the subject. Examples — In the Owner’s Chair, The Business Planning Guide, etc.

3. Books about entrepreneurship — These books are written from the practitioners’ perspective-- ‘how to’ guides.

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4. Biographies or autobiographies of entrepreneurs, such as “Business at the speed of Thought”.

4. Biographies or autobiographies — of entrepreneurs, such as “Business at the speed of Thought”. USP,

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5.Compendiums about entrepreneurs — These are pieces that associate with different picked individuals, submit statistical information and/or overviews of perceived general trends.

In other words these are collection of facts, drawings and photographs on a particular subject, especially in a book.

Examples include The Entrepreneurs and the Enterprising Americans.

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6. News and periodicals — These news periodicals present stories on entrepreneurs on a timely basis.

Examples: Business Week, Forbes, and The Wall Street Journal, etc ..

6. News and periodicals — These news periodicals present stories on entrepreneurs on a timely basis.
6. News and periodicals — These news periodicals present stories on entrepreneurs on a timely basis.
6. News and periodicals — These news periodicals present stories on entrepreneurs on a timely basis.
6. News and periodicals — These news periodicals present stories on entrepreneurs on a timely basis.
6. News and periodicals — These news periodicals present stories on entrepreneurs on a timely basis.
6. News and periodicals — These news periodicals present stories on entrepreneurs on a timely basis.
6. News and periodicals — These news periodicals present stories on entrepreneurs on a timely basis.

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7. Venture periodicals —An increasing growing number of new magazines are involved particularly with new business

7. Venture periodicals —An increasing growing number of new magazines are involved particularly with new business ventures.

Examples: Entrepreneur and Inc, etc.

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8. Newsletters — There are a number of newsletters devoted exclusively to entrepreneurship. The “Liaison” is an example

8. Newsletters — There are a number of newsletters devoted exclusively to entrepreneurship. The “Liaison” is

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9. Proceedings of conferences These are publications relating to annual or periodic conferences that deal in part with entrepreneurship. Examples include Proceedings of the Academy of Management and Frontiers in Entrepreneurship Research.

9. Proceedings of conferences — These are publications relating to annual or periodic conferences that deal
9. Proceedings of conferences — These are publications relating to annual or periodic conferences that deal
9. Proceedings of conferences — These are publications relating to annual or periodic conferences that deal
9. Proceedings of conferences — These are publications relating to annual or periodic conferences that deal

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10. Government Publications — The United States government publishes a wealth of information on small business

10. Government Publications — The United States government publishes a wealth of information on small business operations.

In case of Fiji the Fiji Bureau of Statistics

Examples: pamphlets from the Small Business Administration or the Fiji Bureau of Statistics, etc.

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Additional Sources of information about entrepreneurial characteristics

Additional Sources of information about entrepreneurial characteristics 1. By direct observation of practising entrepreneurs, it can

1. By direct observation of practising entrepreneurs, it can provide insights into their traits and characteristics, and provide a profile. Some common methods include interviews, surveys and case studies.

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2. The final source on entrepreneurial information is speeches and presentations by practicing entrepreneurs.

2. The final source on entrepreneurial information is speeches and presentations by practicing entrepreneurs. USP, School

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Characteristics of entrepreneurs

1. Commitment, determination, and perseverance —more than any other factor, total dedication to success---as an entrepreneur can overcome obstacles and setbacks. It can also compensate for personal shortcomings.

Characteristics of entrepreneurs 1. Commitment, determination, and perseverance —more than any other factor, total dedication to

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2. Drive to achieve — Entrepreneurs are self-starters who appear to others to be internally driven by a strong desire to compete, to excel against self-imposed standards, and to pursue and attain challenging goals.

2. Drive to achieve — Entrepreneurs are self-starters who appear to others to be internally driven

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3. Opportunity orientation — one clear pattern among successful growth-minded entrepreneurs is their focus on opportunity rather than on resources, structure, or strategy. Their goal orientation helps them with measures of how they are performing.

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4. Initiative and responsibility entrepreneurs are willing to put themselves in situations where they are personally responsible for the success or failure of the operations.

4. Initiative and responsibility — entrepreneurs are willing to put themselves in situations where they are

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5. Persistent problem solving Entrepreneurs are not intimated by difficult situations. Simple problems bore them, unsolvable ones do not warrant their time.

5. Persistent problem solving — Entrepreneurs are not intimated by difficult situations. Simple problems bore them,

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6. Seeking feedback — Effective entrepreneurs are often described as quick learners.

Entrepreneurs actively seek feedback. This strong desire might improve their performance.

6. Seeking feedback — Effective entrepreneurs are often described as quick learners. Entrepreneurs actively seek feedback

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7. Internal locus of control — Successful entrepreneurs believe in themselves.

They believe that their accomplishments and setbacks are within their own control and influence and that they can affect the outcome of their actions.

7. Internal locus of control — Successful entrepreneurs believe in themselves . They believe that their

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8. Tolerance for ambiguity — Successful entrepreneurs flourish on the fluidity and exhilaration of such an ambiguous existence.

8. Tolerance for ambiguity — Successful entrepreneurs flourish on the fluidity and exhilaration of such an

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9. Calculated risk taking — Successful entrepreneurs are not gamblers. When they decide to participate in venture, they do so in a very calculated and careful manner.

9. Calculated risk taking — Successful entrepreneurs are not gamblers . When they decide to participate

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10.Integrity and reliability Integrity and reliability build and sustain trust and confidence.

Since word of mouth is a valuable tool, a successful small-business owner must be respected in the community (c.f. Fiji & Taiwan, Fiji & Japan, etc)

10.Integrity and reliability — Integrity and reliability build and sustain trust and confidence. Since word of

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11. Tolerance for failure — Entrepreneurs use failure as a learning experience. The most effective entrepreneurs are realistic enough to expect such difficulties.

11. Tolerance for failure — Entrepreneurs use failure as a learning experience. The most effective entrepreneurs
11. Tolerance for failure — Entrepreneurs use failure as a learning experience. The most effective entrepreneurs
11. Tolerance for failure — Entrepreneurs use failure as a learning experience. The most effective entrepreneurs

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12. High energy level — Many entrepreneurs fine tune their energy levels by carefully monitoring what they eat and drink, establishing exercise routines, and knowing when to get away for relaxation.

12. High energy level — Many entrepreneurs fine tune their energy levels by carefully monitoring what

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13. Creativity and innovativeness — An expanding school of thought believes that

creativity can be learned

13. Creativity and innovativeness — An expanding school of thought believes that creativity can be learned

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14. Vision — Not all entrepreneurs have predetermined vision for their firm.

In many cases, this vision develops over time as the individual begins to realize what the firm is and what it can become.

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14. Vision — Not all entrepreneurs have predetermined vision for their firm. In many cases, this

15. Self-confidence and optimism —

Although entrepreneurs often face major obstacles, their belief in their ability seldom waivers.

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16. Independence — The desire for independence is a driving force behind contemporary entrepreneurs.

16. Independence — The desire for independence is a driving force behind contemporary entrepreneurs. USP, School

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17. Team building — The desire for independence and autonomy does not preclude the entrepreneur’s desire to build a strong entrepreneurial team.

Most successful entrepreneurs have highly qualified, well-motivated teams that help handle the growth and development of the venture.

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There is a ‘dark side’ of entrepreneurship.

What is meant by this statement?

There is a ‘dark side’ of entrepreneurship. What is meant by this statement? USP, School of

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The dark side of entrepreneurship is detrimental source that exists within the energetic drive of a thriving entrepreneur.

There are three major traits that are affiliated with the dark side of small businesses:

  • [A] Risk
    [B] Stress

  • [C] Entrepreneurial ego.

The dark side of entrepreneurship is detrimental source that exists within the energetic drive of a

Potential entrepreneurs need to be cognizant that the dark side of entrepreneurship prevails.

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The Dark Side of Entrepreneurship

A. The Entrepreneurs Confrontation with Risk

1. Financial risk — In many ventures the individual puts an enormous part of their savings or other resources at stake.

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The Dark Side of Entrepreneurship [c’d]

2. Career risk — A question frequently by ‘would be entrepreneurs’ is whether they will be able to find a job or go back to their jobs if their venture should fail.

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The Dark Side of Entrepreneurship [c’d]

3. Family and social risk — Entrepreneurs expose their families to the risk of an incomplete family experience and the possibility of permanent emotional scars.

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The Dark Side of Entrepreneurship [c’d]

4. Psychic risk — The greatest risk may be to the well-being of the entrepreneur.

The Dark Side of Entrepreneurship [c’d] 4. Psychic risk — The greatest risk may be to

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B. Stress and the Entrepreneur 1. What is entrepreneurial stress? 2. Sources of stress

B. Stress and the Entrepreneur 1. What is entrepreneurial stress? 2. Sources of stress a. Loneliness--Entrepreneurs

a. Loneliness--Entrepreneurs are isolated from persons in whom they can confide. They tend not to participate in social activities unless there is some business benefit.

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b. Immersion in the business — Most entrepreneurs are married to their “business”. They have long work hours, leaving them with little or no room for civic recreation

b. Immersion in the business — Most entrepreneurs are married to their “business”. They have long
b. Immersion in the business — Most entrepreneurs are married to their “business”. They have long

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c. People problems — Most entrepreneurs experience frustration, disappointment, and aggravation in their experience with people.

c. People problems — Most entrepreneurs experience frustration, disappointment, and aggravation in their experience with people.

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d. Need to achieve--Achievement brings satisfaction.

However, many entrepreneurs are never satisfied with their work no matter how well it was done.

d. Need to achieve--Achievement brings satisfaction. However, many entrepreneurs are never satisfied with their work no

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Dealing with Stress

a. Networking --One way to relieve the loneliness of running a business is to share experiences by networking with other business owners

Dealing with Stress a. Networking --One way to relieve the loneliness of running a business is

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3. Dealing with Stress [c’d]

b. Getting away from it all--The best antidote could be a well-planned vacation.

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3. Dealing with Stress [c’d]

c. Communicating with subordinates-- Entrepreneurs are in close contact with subordinates and can readily assess the concerns of their staff.

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3. Dealing with Stress [c’d]

3. Dealing with Stress [c’d] d. Finding satisfaction outside-- Entrepreneurs need to get away from the

d. Finding satisfaction outside-- Entrepreneurs need to get away from the business occasionally and become more passionate about life itself; they need to gain some new perspectives.

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3. Dealing with Stress [c’d]

e. Delegating — Entrepreneurs find delegation difficult because they think they have to be at the business all of the time and be involved in all aspects of their operation.

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Next (dark side cont’d) C. The Entrepreneurial Ego

[ego: 1. Your sense of your own value and 2 (psychology) the part of the mind that is responsible for your sense of who you are (= your identity) [Oxford Dictionary]

1. Why the need for control--The entrepreneurs are driven by a strong desire to control both their venture and their destiny

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2. Sense of distrust--Because entrepreneurs are continually scanning the environment, it could cause them to lose sight of reality, distort reasoning and logic, and take destructive action.

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3. Overriding desire for success--This can be dangerous because there exists the chance that the individual will become important than the venture itself

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4. Unrealistic optimism--When external optimism is taken to its extreme, it could lead to a fantasy approach to the business.

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Entrepreneurial Motivationwhat is it?

This refers to the willingness of an entrepreneur to sustain his/her entrepreneurial behaviour.

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