1. Small business management and Entrepreneurship
David Stokes
Nicholas Wilson
Small Business Management and Entrepreneurship
Fifth Edition

2. Lecture outline What is entrepreneurship? How is an entrepreneur?
Why become an entrepreneur?
Motivations for starting a business
What does it take to become an entrepreneur?

3. What is a entrepreneurship?
It is seen as a fundamentally important part of modern economic and social life. Entrepreneurs play a key role in our lives, and yet there is an extraordinary lack of clarity concerning both what entrepreneurship is, and exactly what entrepreneurs do and what sets them apart from other managers.

4. An Austrian economist defined entrepreneurship as the “competitive behavior that drive the market process”.
Thus it creates value for both market and the society
So lets look at some simple definitions of entrepreneurship and entrepreneurs………………………

5. Entrepreneurship is a way of thinking, reasoning and acting that is opportunity-based. It results in the creation, enhancement, realization and renewal of value not just for the owners but for all the participants and stakeholders.
Entrepreneurship is the process of creating something new of value by devoting the necessary time and effort, assuming the accompanying financial, psychic and social risks, and receiving the resulting rewards of monetary and personal satisfaction and independence.

6. In short entrepreneurship comprises of the following three behavioral components:
Identification, evaluation and exploitation of an opportunity
The management of a new or transformed organization to facilitate the production of new goods and services
The creation of value through the successful exploitation of a new idea

7. Do you think that entrepreneurship is commonly linked directly to small business management?
What problems can small business face in terms of entrepreneurship?

8. Motivations for starting a business
Pull influences
Desire for independence
Desire to exploit an opportunity
Turning a hobby or previous work experience into a business
Financial incentive

9. Push influences Redundancy Threat of unemployment
Disagreement with previous employer

10. Do you think age, gender, marital status, social class, education and ethnicity has anything to do with the production of entrepreneurs?

11. Age: 35-50, and then 65+
Gender: they account for 40% of workforce in UK but less than 25% are into small business
Marital status: being married increases the chances that an individual will be self employed
Social class:
Education: there is no clear co-relation between the two
Ethnicity: minorities are among the most entrepreneural

12. Types of owners-managers and entrepreneurs
We can classify them as follows:
The craftsperson – who provide a service themselves and enjoy doing it, e.g. hair dressers
The promoter - often starts, grows and sells several different businesses in the pursuit of personal wealth
the professional manager – the owner who adopts a more structured approach to building an organization on the lines of a “little big business’.

13. Entrepreneurial traits
What does it take to become a entrepreneur?

14. Big five personality traits
Need for achievement
Need for autonomy or independence
Locus of control – ability to control their environment
Risk taking propensity – different levels of risk takers
Self efficacy – belief in their ability to undertake and accomplish some particular task or activity

15. Innovation Proactive approach Self motivation Tolerance of uncertainty
Opportunistic behavior
Creative
Visionary
Manipulative
Impatient
Energetic
Charismatic

16. Towards the entrepreneurial path
Please refers to the history of the two entrepreneurs provided to you.

17. The building blocks of successful entrepreneurship
Personal attributes
Innovative
Determined
External focus
Team leader

18. Technical skills
Product/service knowledge
Market/industry knowledge

19. Entrepreneurial management
Opportunity identification
Resource leveraging
Networking
Decision-making

20. Management competencies
Marketing
Finance
Human relations