Concept Of Entrepreneurship

Q1.

Discuss and define the concept of �entrepreneurship’.

The entrepreneur is our visionary, the creator in each of us. We're born with that quality and it defines our lives as we respond to what we see, hear, feel, and experience. It is developed, nurtured, and given space to flourish or is squelched, thwarted, without air or stimulation, and dies.

Michael Gerber

The term 'entrepreneur' has been around since the seventeenth-century, it originates from France, where the phrase “entreprendre” was first used when a Frenchmen вЂ?entered and took charge’ of royal contracts. It was used widely to describe a person who lead a project which would deliver valuable benefits and bring it to completion, a person who can manage uncertainty and bring success in the face of challenges that would destroy a less well managed venture.

In this early 19th century this description was altered by the French economist J. B. Say who instead focused on the business process rather than the practitioner. He said that an entrepreneur shifts economic resources out of an area of lower productivity and into one of higher productivity and greater yield. 200 years later confusion still remains over the definitions of �entrepreneur’ and �entrepreneurship' with no single definition existing.

Further examples back up this point. In 'Advanced Entrepreneurship' by H. Rwigema and R. Venter the term is described as “... a process of conceptualising, organising, launching and вЂ" through innovation вЂ" nurturing a business opportunity into a potentially high growth venture in a complex, unstable environment”.

Meanwhile Scott Shane in 'General Theory of Entrepreneurship' believes "Entrepreneurship is an activity that involves the discovery, evaluation and exploitation of opportunities to introduce new goods and services, ways of organising, markets, processes, and raw materials through organising efforts that previously not existed." (Shane, S. 2003)

In fact, the variations are almost endless: "Entrepreneurship is the act of forming a new organisation of value" (Bateman& Snell 1996), "... the creation of new enterprise" (Bartol & Martin 1998) or "...the process of creating something new with value by devoting the necessary time and effort, assuming the accompanying financial, and receiving the resulting rewards of monetary and personal satisfaction and independence." (Hisrich & Peters 1998)

Consequently, we can say with certainty that entrepreneurship is at best ambiguous and at worst a wildly theoretical concept but we believe the best definition comes from Peter Kilby вЂ" as noted by Wickham (1998). He says the entrepreneur has a lot in common with the 'Heffalump', a fictional animal in A. A. Milne’s Winnie the Pooh.

"[The Heffalump] is a rather large and important animal. He has been hunted by many individuals using various trapping devices, but no one so far has succeeded in capturing him. All who claim to have caught sight of him report that he is enormous but disagree on his particulars." (Wickham 1998)

Unlike the others, Kilby accepts the mystic of the entrepreneur as primary to its definition and that its value is actually found in this ambiguity because it enables each individual to find meaning and inspiration to match their expectations.

Definitions aside, to better understand the nature of entrepreneurship itself however we must now look at some of developmental theory and examine the different schools of entrepreneurial thought.

THE MACRO VIEW OF ENTREPRENEURSHIP вЂ" is a view which presents a broad selection of factors relating to success or failure in existing entrepreneurial businesses in the external locus of control. It also includes external processes that are beyond the control of the individual entrepreneur and can be broken down into three subcategories:

The Environmental School of Thought вЂ" This school deals with external factors that affect the lifestyle of a potential entrepreneur. These could be positive or negative forces in the modelling of entrepreneurial desires. The school focuses on institutions, values and influence of the society that put together, form a socio-political environmental framework that affects the development of an entrepreneur. For example strong support from family and friends may influence the desire to become an entrepreneur. In the case of Richard Branson this would refer to the major influence of his mother.

The Financial/ Capital School of Thought вЂ" The foundations of this school are based on the capital-seeking process. The search for start-up and growth capital is the complete focus because securing venture capital is vital to an entrepreneur’s development. In this case, the entire entrepreneurial venture is viewed from a financial management viewpoint and decisions involving finance occur at every major point.

The Displacement School of Thought вЂ" This thought process concentrates on the negative side of the existence of group, where someone can feel out of place or be displaced from the group. It argues that a group can slow a person’s development, either bringing it to a halt or removing specific factors vital to the individual for them to advance. As a result the frustrated individual is motivated to succeed which can be projected into an entrepreneurial pursuit. There are three major types of displacement that demonstrate this school of thought:

-Political displacement. Government regulations and policies that can limit/ redirect certain industries or reject free enterprise.

-Cultural displacement. Social groups excluded from professional fields e.g. Ethnic background, sex race, religion.

-Economic