Understanding Entrepreneurship: Introduction, Meaning, and Characteristics
Explore the origins of entrepreneurship, its definition, meanings from various perspectives, such as risk-bearing, organizing, and innovation, as well as the essential characteristics of an entrepreneur like hard work and a desire for high achievement.
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Presentation Transcript
Unit I 1.1: Introduction, Meaning and Characteristics
1.1 Introduction The word is from French word- Entreprendre - to undertake originally meant organiser 16 th century- persons engaged in military expeditions 17 th century-civil engineering activities included Only in the beginning of the 18 th century the word was used to refer to economic aspects Richard Cantillon was the first one to use the term in economic context
Definition A.H.Cole entrepreneurship is the purposeful activity of an individual or group of individuals, undertaken to initiate, maintain or aggrandise profit by production or distribution of economic goods and services. Entrepreneurship is the tendency of a person to organise the business of his own and to run it profitably using all the qualities of leadership, decision making and managerial skills. Entrepreneurship involves the process that leads to setting up of a business entity, expansion and development of an on going concern.
Meaning-Views on entrepreneur (i) As a risk bearer Richard Cantillon (ii)As an organiser-J.B.Say (iii)As an innovator- Schumpeter
(i) Risk bearer Entrepreneur agent Buys factors at certain price Combines them to produce Sells at an uncertain price-so risk Eg- farmers and merchants So risk bearers Prof.Knight theory of uncertainty Distinguishes between risk and uncertainty
(ii) Organiser Coordination, organisation and supervision Combines factors-Combines land of one, labour of another and capital of yet another and produce Moral qualities-work judgement, knowledge about the business Command over capital Uncertainty of profit
(iii)Innovator Dynamic changes brought by entrepreneur Introduce new products Instituting new production technology Opening of a new market Discovery of a new source of raw material Carrying out new forms of organisation
Characteristics of an Entrepreneur Apart from risk taking, organsing and innovating he should have the following charateristics (i) Hard work- willingness to work hard that distinguishes successful entrepreneur and others-tedious, sweat filled and perseverance (ii).Desire of high achievement-surmount obstacles, suppress anxieties, repair misfortune and devise expedients (iii).Highly optimistic-not disturbed by failures and problems
Cont.. (iv).Independence- not guided and influenced by others. But flexible (v).Foresight- ability to judge about future environment- changes in the markets, in consumer behaviour, technology etc. (vi)Decision making capacity-to act according (vii)Leadership- come forward to do things (viii) Managerial skills business to situation
