Entrepreneurship

Overview

Entrepreneurship is a highly relevant concept for those leading and working in

organisations and not just those starting new ventures. This concept covers technology,
creative and social enterprise dimensions and introduces the types and main principles
of entrepreneurship. The creation of an entrepreneurial culture is also addressed.

Entrepreneurship involves the identification and exploitation of opportunities to create value

that can be economic and/or social (Morrison et al., 1999).

Definition

Entrepreneurship refers to acts of organisational creation,

renewal, or innovation that occur within, or independent of,
an existing organisation (Sharma and Chrisman, 1999: 17).
Entrepreneurial activity that is instigated by individuals
acting independently of an existing organisation is known as
independent entrepreneurship. Entrepreneurial activity that is
initiated within the confines of an existing organisation is
referred to as intrapreneurship or more recently as corporate
entrepreneurship.

Description: Many definitions of entrepreneurship exist, focusing on the factors contributing

to entrepreneurship and being entrepreneurial. They include Schumpeter’s (1934) carrying
out new combinations; Knight’s (1921) being a calculated risk-taker; and Kirzner’s (1973)
being alert to market imperfections and arbitrage opportunities. The lack of a clear definition
has plagued the relatively young academic field of entrepreneurship (Cook, in Acs and
Audretsch, 2003: 21-34). Yet, there is a growing consensus that entrepreneurship involves the
identification and exploitation of opportunities to create value that can be economic and/or
social (Stevenson and Gumpert, 1985; Shane and Venkataraman, 2000). This opportunity-
centred view of entrepreneurship is sufficiently broad to encapsulate entrepreneurial activity
in a range of contexts including, corporate entrepreneurship (Dess et al., 2003), independent
start-ups and SMEs (Gartner, 1985; OECD, 2005), social entrepreneurship (Tracey and
Phillip, 2007), and public sector entrepreneurship (Morris and Jones, 1999). Entrepreneurship
is an attractive subject for economics because it is seen as a means of stimulating economic
output and productivity through harnessing personal initiative in the creation of firms and
jobs.

Entrepreneurship has also been viewed as ownership structure, in the sense that an
entrepreneur should create a new enterprise. This approach excludes firms which have
different ownership structures, such as the shareholder-owned corporate groups, charities, or
public-sector organisations (Morrison et.al, 1999). The process of entrepreneurship is
described as “The innovatory process involved in the creation of an economic enterprise
based on a new product or service which differs significantly from products or services in the
way its production is organised, or in its marketing” (Burrows, 1986: 269). Such an approach
has also been taken by Drucker (1986: 16) who describes entrepreneurship as a process which
requires “... above all application of the basic concepts, the basic techniques, of management
to new problems and new opportunities”.