Entrepreneurship
Definition: Entrepreneurship refers to the process of creating a new enterprise
and bearing any of its risks, with the view of making the profit.
Corporate entrepreneurship- is the conceptualization of entrepreneurship at the
organization level. entrepreneurial firms are proactive, innovative, and risk taking
and conservative
Take a more wait and see posture
Less innovative
Risk averse
Why Become an Entrepreneur; Desire to be their own boss- entrepreneur want to be their own boss
because either they have had a longtime ambition to own their own firm
Desire to pursue their own ideas- people start their own firms is to pursue their own ideas. some people
are naturally alert and when they recognize ideas foe new products or services
Financial rewards-entrepreneur does not make more money than someone with a similar amount of
responsibility in a traditional job.
Characteristics of Successful Entrepreneurs
1.PASSION FOR THE BUSINESS: Passion is fuel for successful entrepreneurship. Passion
is what will help you find motivation when you are discouraged and it will drive your forward.
2. Product/ Customer focus--, it is a defining characteristic of successful entrepreneurs that
emphasizes producing good products with the capability to satisfy customers.
3.Tenacity despite failure-Entrepreneur are typically trying something new,the thing is to get
them in the hands of as many people as possible.
‘4 . execution intelligence: This is the ability to fashion a solid idea into a viable business is a
key characteristics of successful entrepreneurs
Types of startup firms:
salary–substitute firms.—salary –substitute firms offer common, easily available
products or services to customers that are not particularly innovative. Example-restaurant
Dry cleaners, convenience stores, restaurants, accounting firms, retail stores, and hair styling salons are
examples of salary-substitute firms.
lifestyle firms that provide their owner or owners the opportunity to pursue a particular lifestyle and
earn a living while doing so. Example: bank job.
Entrepreneurial firms bring new products and services to market by creating and seizing
opportunities. Google, Face book and Twitter are well – known, highly successful examples of
entrepreneurial firms
Economic impact of entrepreneurial firm
Innovation-- Is the process of creating something new , small businesses outperform their larger
counterparts in terms of obtaining patents. Example-alibaba
Job creation- small business platform creators most new jobs so the economic growth is increase. one of
the most positive impacts that entrepreneurs make on an economy is job creation and the reduction of
unemployment levels
Impact on Society: new products and services that make our lives easier, , improve our health,
decrease poverty .example- auto rickshaw.
Impact on larger firms: entrepreneurial firms have on the economy and society ,they also have a positive
impact on the effectiveness of larger firm.
Chapter-2
What is an opportunity. An opportunity is a favorable set of circumstances that creates a
need for a new product, service, or business.
Four Essential Qualities of an Opportunity-attractive- attractive opportunity is the
chance to take advantage of some offer or situation that could result in a desirable outcome ,timely,
dorable,anchored in a product.
Observing trends --The first approach is to observe trends and study how they created
opportunities for the entrepreneurs to pursue. Exam- is looking at who has the money to spend.
The most important trends to follow are economic trends, social trends, technological advances, and
political action and regulatory changes.
Economic forces/trends - When the economy is strong, people have more money to spend
and are willing to buy discretionary products and services that enhance their lives. example-An
example is GasBuddy.com, a company started to help consumers save money on gas.
Social forces /Trends; An understanding of the impact of social forces on trends and how
they affect the new product, service, and business ideas is a fundamental piece of the opportunity
recognition puzzle. Exam- The increasing diversity of the workplace.,aging of baby boomers
Technological advances Trends -- Technological advances also provide opportunities to
help people perform everyday tasks in better or more convenient ways. Advances in technology
frequently create business opportunities . exam;Computer industry, Internet . An example is
H20Audio, a company started by four former San Diego State University students, that makes
waterproof housings for the Apple iPhone and iPod.
Political and regulatory changes: Political action and regulatory changes also provide the
basis for opportunities Exam; Media regulation.
Finding gaps in the market place: gaps in the market place are the third source of
business ideas. which product are not available in the market then you will produce
new product
Personal Characteristics of the Entrepreneur:
Prior Experience; Prior experience or knowledge of the entrepreneur is a heavily studied
characteristic in entrepreneurial behavior.
Cognitive Factors: Cognitive factors refer to characteristics of the person that affect performance
and learning. These factors serve to modulate performance such that it may improve or decline.
Social Networks; social networks effect opportunity recognition. how much time you
are active in the social network.
Creativity: Creativity is the process of generating a novel or useful idea.
Five Steps to Generating Creative Ideas –preparation –incubation—inshaight-
evaluation -elaboration
Chapter—03
Feasibility analysis- is the process of determining a business idea viable process are –
recognizing business idea, testing the feasibility idea, writing a business plan, launching the
business
When To Conduct a Feasibility Analysis
• Timing of Feasibility Analysis: The proper time to conduct a feasibility analysis is early
in thinking through the prospects for a new business
• Components of a Properly Conducted Feasibility Analysis: A properly conducted
feasibility analysis includes four separate components. like as product/service feasibility,
industry/target market feasibility, organizational feasibility, financial feasibility.
Forms of/role of feasibility analysis
Product service feasibility-assessment of overall appeal of the product and sevice
proposed .
Management prowess: proposed business should evaluate the prowess or ability
of its initial management team.
Resource sufficiency- is capable of obtaining sufficient resource to moved
forward.
Organizational feasibility- is conducted to determine whether a proposed
business has sufficient management expertise .
Industry/target market feasibility: the overall appeal of the industry and the
target market for the product and service being proposed .
Financial Feasibility analysis : focuses specifically on the financial aspects of the
study. startup costs, operating expenses, cash flow and making a forecast of future
performance.
Components of financial feasibility analysis
Total start up cash needed: how much cash needed, when I can find my first
revenue
Financial performance of similar business :most of the time we start similar
business at that time we can get rap idea.
Overall financial attractiveness of the proposed venture:
Does it make sense? Is it reasonable? Is it something consumers will get
excited about?—PRODUCT/SERVICE DESIRABILITY.
There are two steps to assessing product/service demand.
1. Administer a Buying Intentions Survey 2: Conduct Library, Internet
Industry attractiveness: Industry Attractiveness is the (relative) future profit potential of
a market.
Characteristics of Attractive Industries-- Are young rather than old, Are early
rather than late in their life cycle.
Chapter-04
What is business plan- A business plan is a document that summarizes the operational and
financial objectives of a business.
Who Reads the Business Plan- a firms employees investors and other external
stake holder
There are three types of business plans-
Summary business plan- It should describe business, the problem that it solves, target market,
and financial highlights.
Full business plan-
Operational business plan- the operations plan section describes the physical
necessities of your business' operation, such as your physical location, facilities,
and equipment.
Industry analysis- An industry analysis is a business function completed by business
owners and other individuals to assess the current business environment .
Items to include in this section:Industry size, growth rate, and sales projections,Industry
structure,Nature of participants,Industry trends
.Wal-Mart Here is a very brief example of an Industry Analysis for the Cases using
Wal-Mart,
Market analysis- A market analysis is a quantitative and qualitative assessment of a
market. It looks into the size of the market both in volume and in value, the various customer
segments and buying patterns, the competition,
Economics of the Business : Business economics is a field of
applied economics that studies the financial, organizational, market-related, and
environmental issues faced by corporations.
Items to include in this section: Revenue drivers and profit margins, Fixed and
variable costs, Operating leverage and its implications. Start-up costs. Break-even
chart and calculations
Marketing Plan: A marketing plan is a roadmap for introducing and delivering your product
or service to potential customers.
– Items to include in this section:
• Overall marketing strategy
• Product, price, promotions, and distribution
• Sales process (or Cycle)
• Sales tactics
