Entrepreneu

rship
st
in the 21
Century

Session 1

Content
Definition of entrepreneur and
entrepreneurship
Difference between entrepreneur and
manager
Entrepreneurship as a discipline
Factors of entrepreneurs
Advantages and disadvantages of
entrepreneurship

Definition of
Entrepreneur
Derived from the French word
entreprendre meaning to undertake or
trying
According to our textbook, entrepreneurs
are individual who actively form or lead
their own businesses and nurture them for
growth and prosperity
Kurato and Hodgets (1992) stated that
entrepreneur is one

Definition of
Entrepreneur
An entrepreneur is more than just a risk
taker and innovator. He or she is the one
who sees the future that no one else has
seen and if perception is correct, bring
about a reordering of resources to produce
greater consumer satisfaction (Kirzner,
1979)
Entrepreneurs see changes as the norm
and as healthy. He or she always searches
for change, respond to it, and exploits it as
an opportunity (Peter Drucker in his book

Definition of
Entrepreneurship
According to our textbook,
entrepreneurship is a process of creating
and expanding businesses that collectively
form a force for national development and
societal prosperity
Schumpeter (1934) defined
entrepreneurship as a firm that operates
and implements a combination of new
activities such as product development,
marketing, resources for new materials,
manufacturing approach and new

Definition of
Entrepreneurship
Cole (1969) defined entrepreneurship as
activities that produce beneficial results
through developing profit oriented
business
Kuehl and Lambing (2006) defined
entrepreneurship is a human, creative act
that builds something of value from
practically nothing. It is the pursuit of
opportunity regardless of the resources, or
lack of resources, at hand. It requires a
vision and the passion and commitment to

Difference Between
Entrepreneur and
Manager
Entrepreneurs start the business,
managers do not, they only manage
Entrepreneurs seem to be the starter and
managers the followers
Initially, entrepreneurs assume the role of
manager, but later managerial roles are
delegated to the managers

What about
Intrapreneurs?
Intrapreneur emerge as a breed who is a
cross between entrepreneur and manager
Intrapreneurs work for the corporation but
are given the task of starting new venture
According to Pinchot (1985), intrapreneurs
are individuals in organisations with high
entrepreneurial characteristics
Intrapreneurs practice their ideas on
companys products

Comparison Between
Entrepreneur &
Intrapreneurs
Entrepreneurs

Intrapreneurs

Skills

Have freedom to exploit

skills

Have the same skills as

entrepreneurs but must
abide companys policies
and procedures

Environme
nt

Face with micro and macro

environment

Face with micro & macro

environment as well as
corporate environment

Resources
Acquisitio
n

Get all sorts of resources

from a variety of suppliers

Get resources provided by

the company only

Failures &
Mistakes

Accountable for all mistakes

Can hide behind the

companys name

Decision
Making

Make all the decisions

All decisions must refer to

companys top management

4 Aspects of
Entrepreneurship
The creation
process

The devotion of
time and effort

Title

The assumption
of risk

Rewards of
independence,
satisfaction and
money

Bases of
Entrepreneurship
The Man
The Business
The Environment
Entrepreneurship as a process
Leaning through various levels of the process

Creativity in consolidating companys

resources
Finance, human, time, information, etc.

Wanting to improve the well being of the

environment

Entrepreneur as a
Discipline
1995 in USA
Focus on big business
One small business for every 38 people

1970s Globally
Worlds attention and awareness of
entrpreneurship
Becomes separate discipline in business
Offered as major or electives in higher
institutions

2000 in USA
One small business in every 12.7 people

Entrepreneurship
as a Discipline
1980s in Malaysia
Establishment of MEDEC in UiTM (Malaysia)
Establishment of Entrepreneurial Development
Institute UiTM
http://www.uitm.edu.my/acatr/medec

1990s in Malaysia
Ministry of Entrepreneurs and Co-Operative
Development, to prepare entrepreneurial
foundation for the nation
http://www.mecd.gov.my

Factors of
Entrepreneurship

The individual

Circumstances
in society

Cultural factors

Combination of
factors

The Individual
Passion for the business
Tenacity despite failure
Confidence
Self-determination
Management of risks
Seeing changes as opportunities
Tolerance for ambiguity
Initiative and need for achievement
Detail oriented and perfectionism

The Individual
Motivating Factors

To use personal skills and abilities

To gain control of his/her life
To build something for the family
Because he/she liked the challenge
To live how and where he/she chooses

Self-Efficacy
A persons belief in his/her ability to perform a
task
Belief that success as an entrepreneur is possible

The Individual
Characteristics
Understanding their
roles
Capability
Motivation
Being prepared for
change
Locus of control
Independent
Need for
achievement

Influenced by
Childhood
environment
Education
Personal values
Age
Work history

Cultural Factors
Some ethno-cultural groups have higher
rates of entrepreneurship than do others
The effect of culture on entrepreneurial
tendencies is not completely clear because
individuals from different cultural groups do not
all become entrepreneurs for the same reason

Effect or culture and traits may be

intertwined
Different cultures have varying values and
beliefs, which affect the tendency toward
entrepreneurship

Circumstances in
Society
Downsizing
Workers who are laid off may be pushed toward
self-employment

Immigrants
Immigrants may become entrepreneurs if their
skills do not meet the need of employers

Called adaptive-response behaviours

These actions are considered adaptive-response
behaviours

Advantages of
Entrepreneurship
Autonomy
Autonomy and the freedom to make decisions is
one of the major advantages

Challenge of a start-up
The challenge of the start-up and the feeling of
achievement is exhilarating

Financial control
Entrepreneurs feel they have more personal
control over their financial situation than if they
were employed by someone else

Disadvantages of
Entrepreneurship
Personal sacrifices
Personal sacrifices may include long work hours,
a strain on family relationships, and a high level
of stress

Burden of responsibility
The entrepreneur has a large burden of
responsibility and must be a Jack of all trades

Little margin for errors

There is little margin for error because the
entrepreneur usually operates on a thin financial
cushion

Change & Effect

Downsizing
Firms systematically and substantially reduce the
number of people they employ to achieve a
reduction in cost
Organisational survival or top-management greed

Societal change
End of jobs?
Post-industrial society: a country where largescale businesses are no longer as important as
they were

Change & Effect

Consequences to an individual
Unemployment or underemployment
Uncertainties and pressures of job insecurity
Wave of interest in entrepreneurship worldwide

Changes in markets
Outsourcing
Virtual organisations
Market fragmentation

Entrepreneurs in
st
21 Century
entrepreneurs are creators, the innovators
and the leaders who give back to the
society, as philanthropists, directors and
trustees and who more than others, change
the way people live, work, learn, play and
lead. Entrepreneurs create new
technologies, products, processes and
services that become the next wave of new
industries and these in turn dive the
economy
Jeffry Timmons and Stephen Spinelli in

Competitive
Advantage of Small
Businesses
Allows a business to compete effectively
Personal relationship with customers
Small business owners tend to develop close
relationship with their customers

Ability to innovate
Small business has an excellent record of
innovation

Flexibility
flexibility and the ability to respond quickly to
changes in the competitive environment
characterize successful small firms

Entrepreneurial and
Corporate Business
Management
Entrepreneurial
Practices

Corporate or
Institutional Practices

Basic
Difference

Owner-managed firms

Large corporations and

educational institutions

Principals

Entrepreneurs

Managers and
administrators

Performance

Judgment in the market

place

Judgment by superiors

Management
Style

Hands-on: personal
attention and homemade procedures,
personalized management

Delegation: use of control

systems, procedures and
manuals

Business
Objective

Identical to the
entrepreneurs personal
objective

Rate of return to investors

or meeting the budgetary
requirements in the case of
administrators

Thank You