Presentation on theme: "Understanding the Role of the Entrepreneur"— Presentation transcript:
1 Understanding the Role of the Entrepreneur ReviewDefinitionsApproaches to studying entrepreneursEntrepreneurial Mindset v Mangerial
2 Who or what is an entrepreneur? What do entrepreneurs do?What are the essential skills?How do they work?Can anyone be one?Can entrepreneurial behaviour be learnt?What do you think?
3 Glossary of Terms Lifestyle Business Wheeler Dealer Tycoon EntrepreneurSource: Hall D (2000) In the Company of Heroes – An Insiders Guide to Entrepreneurs at Work – Kogan Page
4 Entrepreneurs are at the Centre ProductionMarketingSales andFinanceBankingAuditLegalTechnologytransferSuppliersInventorsTransportationAdvertisingMarketResearch
5 DefinitionsAn entrepreneur is someone who perceives an opportunity and creates an organisation to pursue it.Bygrave (1997:2)A person who habitually creates and innovates to build something of recognised value around perceived opportunities.Bolton & Thompson (2003)The Entrepreneurial Process involves all the functions and actions associated with perceiving opportunities and creating organisations to pursue them.
7 Business Entrepreneur THE GROWTH ENTREPRENEUR- creates a sustained high growth businessTHE ENTREPRENEUR- creates a significant businessTHE ENTERPRISING PERSON- creates a small or micro businessBolton & Thompson (2003)
8 Types of Entrepreneurs 1) Quickie2) Wonderful Wacky MBA3) Send Money4) Dreamers5) One Stripe Zebra6) Technoid7) Guts and Brains (the dream team)Extracted from: Entrepreneur America, Lessons from Inside Rob Ryan's High Tech Start-up Boot Camp"
9 Approaches to studying Entrepreneurs Economic theories - Role of the entrepreneur in economic development.Psychological trait approach - Personality characteristics of the entrepreneur.Social behaviour approach - Influence of the social environment.
10 Historical Perspective 1730 Cantillon - A self employed person with uncertain returns1803 Say - A co-ordinator of production with managerial talent1910 Schumpeter - A Creative Innovator1921 Knight - manager responsible for direction & control, bears uncertainty1960 Stepanek - moderate risk taker1961 McLelland - Need for achievement1971 Hornaday - Need for achievement; autonomy, aggression; power; recognition; innovative/independent1973 Winter - Need for power1974 Borland - Internal locus of control1979 Kirzner - An arbitrageur - ability to spot opportunities
11 Locus of ControlInternal locus of control - Individuals who believe themselves to be in control of their own destinyExternal locus of control - People who believe that their lives are dominated by chance events outside their own control or powerful people i.e. “fate” controls their destiny.
12 Influences on owner-managers and entrepreneurs Personal characteristics and traitsAntecedent influencesCulture of societySituational factors
13 Psychological trait approach Identifies personality characteristics or traits.Entrepreneurs have innate abilities not possessed by others.Suggests that the supply of potential entrepreneurs is limited, thus there is little to be gained from direct intervention to encourage entrepreneurship.
14 Core and Desirable Attributes CORE ATTRIBUTESCommitment & DeterminationLeadershipOpportunity ObsessionTolerance of RiskAmbiguity & UncertaintyCreativity, Self-Reliance and AdaptabilityMotivation to ExcelDESIRABLE ATTRIBUTESEnergy, Health, and Emotional StabilityValuesCapacity to InspireCreativity & InnovativenessIntelligenceTHE NON-ENTREPRENEURIAL ATTRIBUTESBeing MachoPerfectionistImpulsivenessBeing anti-authoritarianCounter/dependencyKnows it allOuter ControlInvulnerabilityTimmons (2003:251)
15 Critiques of the trait approach Chell , Delmar Criticisms:Inappropriate to search for a significant single trait.Ignores environmental factors.Static analysis approach (entrepreneurship is a dynamic process).Ignores the role of learning, preparation and serendipity.
16 Definitions of Culture Culture is the sum total of knowledge, beliefs, art, morals, laws, customs and any other capabilities and habits acquired by humans as members of society. Culture is everything that people have, think and do as members of their society.Ferraro (1994)Culture is the collective programming of the mind that distinguishes the members of one category of people from those of another. Hofstede (1988)
17 Elements of Culture Language Religion Values and attitudes Education SocialorganisationMaterial cultureLaw and politicsAestheticsCULTURE
18 Mental Models Western Thinking Eastern Thinking Individualism RelationshipsDifferentiationIntegration
19 Entrepreneurial Process InnovationTriggering EventImplementationGrowthPersonalAchievementLocus of ControlAmbiguity ToleranceRisk TakingPersonal ValuesEducationExperienceJob DissatisfactionJob LossAge CommitmentEntrepreneurLeaderManagerCommitmentVisionSociologicalNetworksTeamsParentsFamilyRole ModelsOrganisationalTeamStrategyStructureCultureProductsEnvironmentOpportunitiesCreativityCompetitionResourcesIncubatorGovernment PolicyCompetitorsCustomersSuppliersInvestors, Bankers, LawyersBygrave & Zacharakis (2004)
20 Changing Role of Entrepreneur HIGHOwner’s ability to doCriticality toCompany GrowthPeople, planningand systemsOwner’s abilityto delegateLOW1Conception/Existence3Growth/Success4Expansion/Takeoff5Maturity2Survival(Adapted from: Churchill and Lewis, 1983)
22 The Power of Consequences Farrell (2001) The Entrepreneurial Age Positive/NegativeConsequencesEntrepreneurPerformanceJob/BusinessFarrell (2001) The Entrepreneurial Age
23 Tendencies towards non-entrepreneurial or entrepreneurial activity Copycat EntrepreneurOpportunistic EntrepreneurVenture CapitalistInnovative EntrepreneurInventrepreneurProfessionalManagerLabourerBureaucratLenderDependence-seekingSubsistence seekingAverse to opportunityNon-innovativeAverse to VentureAverse to riskAnalyticIndependence-seekingWealth-seekingOpportunity-seekingInnovativeVenture-seekingRisk-seekingIntuitiveTendency calibratorSource: Adapted from Entrepreneurship, John G Burch
24 Causal v Effectual Marketing Process What makes entrepreneurs entrepreneurial? Saras D. Sarasvathy
25 Comparison of Causal & Effectual Model Effectual Reasoning: The ProcessWho they are – their traits, tastes and abilitiesWhat they know – their education, training, expertise and experienceWhom they know – their social and professional networks25
26 Characteristics of Successful Entrepreneurs Four Primary Characteristics of Successful Entrepreneurs
27 Extreme Entrepreneurship Do not go where the path maylead, go instead where thereis no path and leave a trail.— Ralph Waldo EmersonFree Download ebook chapter 1