The Enterprise,

Entrepreneurship and
Entrepreneur.

LEARNING OUTCOMES:
At the end of this lesson, the students will be able to do
the following:

Know and understand the definition of enterprise, entrepreneurship and entrepreneur;

Gain understanding on the importance of entrepreneurship;
Discuss the main reasons people decide to become entrepreneur;
Familiarize the important qualities and competencies of an entrepreneur.

INTRODUCTION:

Welcome to the first lesson of Module 1! This lesson introduces you to the basic terminologies used in
entrepreneurship such as enterprise and entrepreneur. This lesson is your get-to-know stage in your quest of
becoming an entrepreneur in the future. Lesson 1 also provides you the vital characteristics of a successful
entrepreneur. You will be given with the list of primary traits and competencies of an entrepreneur worth
emulating for you to be guided in embarking the world of entrepreneurship. So, enjoy and have fun reading this
lesson!

ACTIVITY: Fill me up.

In this activity, you will calibrate your understanding on how well you comprehend the words written
in the green boxes on the left. You will write a word or a phrase on the corresponding boxes on the right side
which describes the first thing that will come out in your mind when you hear these words. There will be three
answers in each word. Present your answer to the class.
1.)
2.)
3.)
Enterprise

1.)
Entrepreneurship 2.)
3.)

Entrepreneur 1.)
2.)
3.)
Activity 2. What does it take?

In this activity, you will identify the characteristics or traits that you think, must be personified by
someone in order to succeed in any business endeavour. Fill in your answers in each box provided below.

ANALYSIS: Let’s evaluate!

1. What do you think is the most important contribution of entrepreneurship?
2. What do you think is the most essential characteristic of an individual that
must be embodied in order to succeed in starting a business?
3. Do you know someone who owns a successful business whom embodies a
certain character that you identify?

ABSTRACTION:

Enterprise - is a project, undertaking or an already formed business organization that offers some goods or
services, etc. The enterprise is some business structure/object that usually carries out some commercial
activity, creates new job positions and gains some profits.

Entrepreneurship - has few meanings. But the most common is that entrepreneurship is the process
of establishing new business enterprise along with the capacity to identify the opportunities and threats and to
undertake all the risks to gain profits in results. This will also be explained on the succeeding discussion.

Entrepreneur - is a person who establishes and manages the enterprise. He/she is often the founder and
owner of the business. An entrepreneur establishes his/her own business or enterprise.
Entrepreneurship - is defined as the process by which individuals pursue opportunities without regard to
resources they currently control (Barringer and Ireland, 2012). According to Fred Wilson, a venture capitalist,
Entrepreneurship is the art of turning an idea into a business.

Entrepreneur - is someone who plans, organizes, and puts puts together all the resources required to bring a
new enterprise into existence and to run and manage it on a long-term basis (Diaz, n.d. as cited by SERDEF).
The term Entrepreneur is derived from the French words entre, meaning “between,” and prendre, meaning “to
take.” Original y, this was used to describe people who “take on the risk” between buyers and sel ers or who
“undertake” a task such as starting a new venture.

Inventors and entrepreneurs differ from each other. An Inventor creates something new while an
Entrepreneur assembles and then integrates all the resources needed—the money, the people, the business
model, the strategy, and the risk-bearing ability—to transform the invention into a viable business.

A lot of literatures defined who is an entrepreneur and what entrepreneurship is for ages. Table 1.0 below shows
the definitions, emphasis and origin.

Table 1.0. Definitions and emphasis of entrepreneur and entrepreneurship from various origins.

Definition Emphasis Origin

The entrepreneur shifts economic resources Creates value Jean Baptiste Say (1800s)
out of an area of lower and into an area of higher
productivity and greater yield
The function of entrepreneurs is to reform or Change Joseph Schumpeter
revolutionize the pattern of production … by agent/creative (1942)
exploiting an invention or, more generally, an destruction
untried technological possibility for
producing a new commodity or producing an old
one in a new way, by opening up a new source of
supply of materials or a new outlet for products, by
reorganizing an industry and so on
The pursuit of opportunity without regard to Resourcefulness and Howard Stevenson
resources currently controlled uncertainty (1983)
The entrepreneur always searches for change, Opportunity Drucker (1985a, b)
responds to it, and exploits it as an opportunity

The discovery, evaluation, and exploitation of Entrepreneurship as Shane and Venkataraman

opportunities a process (2000)
Entrepreneurial thinking differs from Effectuation Saras Sarasvathy (2005)
managerial or strategic thinking

It can be observed that entrepreneurs are called entrepreneurs not because of the size or age of business
but because of the business activity which places innovation in the center. This ability to inject innovation is
regarded as the most crucial contribution of entrepreneurs. It is therefore wrong to ask if one is an
entrepreneur but rather ask how entrepreneurial the person is. Since entrepreneurship involves discovery,
evaluation, and exploitation of opportunities, it becomes even more relevant with the current speed of
technology updates. An entrepreneur continues to discover, evaluate and exploit possible key areas to further the
growth of technology and other sectors.
Characteristics of a Successful Entrepreneur

Now, what does it take to become a successful entrepreneur? Let us study the primary characteristics
of a successful entrepreneur as illustrated in Figure 1.0.

Figure 1.0 Four Primary Characteristics of Successful Entrepreneurs (Source: Barringer and Ireland, 2012).

a. Passion for the Business

Shown in Table 2.0 the primary reasons why passion for their business is an important characteristic of
a successful entrepreneur, whether it is in the context of a new firm or an existing business. This passion typical y
stems from the entrepreneur’s belief that the business will positively influence people’s lives.

Table 2.0 Five primary reasons passion is important for the launch of a successful Entrepreneurial organization

Purpose/Reason Justification
1. The ability to learn and iterate Founders don’t have al the answers. It takes
passion and drive to solicit feedback, make
necessary changes, and move forward. The
changes won’t always be obvious.

Passion makes the search for the right

answers invigorating and fun.
2. A willingness to work hard for an extended Commonly, entrepreneurs work longer hours than
period of time people with traditional jobs. You can only do
that, on a sustained basis, if you’re passionate
about what you’re doing.
3. Ability to overcome setbacks and “no’s” It’s rare that an entrepreneur doesn’t
experience setbacks and hear many “no’s” from
potential customers, investors, and others while
building an entrepreneurial business or social
enterprise.
 The energy to continue comes from passion
for an idea.
4. The ability to listen to feedback on the You’l meet plenty of people along the way—
limitations of your organization and yourself some with good intentions and some without—
who will tell you how to improve your
organization and how to improve yourself.

You have to be willing to listen to the people

with good intentions and make changes if it
helps.

You have to be able to brush aside feedback

from people with bad intentions without
letting them get you down.

5. Perseverance and persistence when the Perseverance and persistence come from
going gets tough passion. As an entrepreneur, you’l have
down days. Building an entrepreneurial
organization is fraught with challenges.

Passion is what provides an entrepreneur the

motivation to get through tough times.

b. Product Customer Focus - This quality is exemplified by Steven Jobs, the cofounder of Apple Inc.,
who wrote, “The computer is the most remarkable tool we’ve ever built . . . but the most important
thing is to get them in the hands of as many people as possible”. Bear in mind that it is important to focus
on the right things. A product/customer focus also involves the diligence to spot product opportunities
and to see them through to completion.

c. Tenacity Despite Failure - Because entrepreneurs are typically trying something new, the failure rate
associated with their efforts is naturally high. In addition, the process of developing a new business is
somewhat similar to what a scientist experiences in the laboratory.

d. Execution Intelligence- The ability to fashion a solid idea into a viable business is a key characteristic of
successful entrepreneurs. In many cases, execution intelligence is the factor that determines whether a
start- up is successful or fails. An ancient Chinese saying warns, “To open a business is very easy; to
keep it open is very difficult”. The ability to effectively execute a business idea means developing a business
model, putting together a new venture team, raising money, establishing partnerships, managing finances,
leading and motivating employees, and so on. It also demands the ability to translate thought, creativity,
and imagination into action and measurable results. As Jeff Bezos, the founder of Amazon.com
once said, “Ideas are easy. It’s execution that’s hard”. This reality was expressed by Jodi Gallaer, the
founder of a lingerie company, who said, “The most chal enging part of my job is doing everything for
the first time.”
Other Traits

However, there are personality traits and characteristics commonly associated with entrepreneurs; these are
listed in Table 3.0. These traits are developed over time and evolve from an individual’s social context. For example,
studies show that people with parents who were self-employed are more likely to become entrepreneurs.

Table 3.0 Common personality traits and characteristics commonly associate with Entrepreneurs
Common traits and characteristics of Entrepreneurs
A moderate risk taker Optimistic disposition
A networker Persuasive
Achievement motivated Promoter
Alert to opportunities Resource assembler/leverager
Creative Self-confident
Decisive Self-starter
Energetic Tenacious
A strong work ethic Tolerant of ambiguity
Lengthy attention span Visionary

APPLICATION: Let’s connect the dots!

After learning the essentials of this lesson, let us try to apply practical situations relevant to this topic.

1. Increasingly, entrepreneurship is being practiced in countries throughout the world. Why do you
think this is the case? Do you expect entrepreneurship to continue to spread throughout the world, or
do you think its appeal will subside over time?

2. What are the three primary reasons people become entrepreneurs? Which reason is given most
commonly? Which reason best describes why you may choose to become an entrepreneur?

3. Imagine that you’re the dean of your college and you’ve suggested that more entrepreneurship courses
be taught throughout your college’s curriculum. You’re getting resistance from some professors who think
that entrepreneurship is a fad. Make the argument that entrepreneurship isn’t a fad and is an
extremely important topic.

4. Why is passion such a critical component of entrepreneurial success? If people are willing to work
hard and dedicate themselves, do you think they can build a successful business without being
passionate about their business idea?
Congratulations! Job well done! Rest
and relax a while then move on to the
next lesson. Good luck!