ENTREPRENEURIAL MANAGEMENT PROCESS

Entrepreneurial Management Process



Table of Contents

Entrepreneurship2

Entrepreneurs and Entrepreneurial Process5

Identification and Evaluation of the Opportunity6

Development of a Business Plan9

Determination of the Resources Required9

Management of the Enterprise10

Ingredients for a Successful New Business10

Entrepreneurial Innovation11

Creative disruption (Disruption Technology)11

Innovation and Organizational Change12

Entrepreneur Leadership13

Profit-Oriented Entrepreneur14

Founding Leaders14

Leadership Style14

Business Principles15

Social Entrepreneur15

Founding Leaders16

Leadership Style16

Business Principles17

Useful SCORE Tools for Small Business Administration17

Conclusion18

References19

Entrepreneurial Management Process

Entrepreneurship

An individual, who drives the risk of initiating a business and is also accountable for its growth and expansion, is an entrepreneur. (Shukla, 2009, p. 12 - 15) Entreprendre- a thirteenth-century French verb is the source of origin for the word “entrepreneur”. The meaning of entreprendre is “to undertake or “to do something”. Entrepreneur, by the sixteenth century, was being used as the noun form, to mention somebody who embarks on a business enterprise. In 1730, the first academic employment of the word was perhaps by an economist- Richard Cantillon, who recognized the defining characteristic of an entrepreneur as the readiness to put up with the personal financial risk of a business venture. The academic use of the word “entrepreneur” was further popularized by two economists John Stuart Mill and Jean-Baptiste Say in the early 1800s. The role of the entrepreneur was stressed by Say in making value by taking resources further into more productive ones from less productive areas. The term “entrepreneur” was used by Mill in Principles of Political Economy, his popular book brought about in 1848, to denote a person who accepts both the risk and the administration of a business. Mill, in this way, gave a more comprehensible difference than Cantillon among an entrepreneur and other owners of a business (like a corporation's shareholders); financial risk is assumed by whom but in the day to day functions or management of the firm, they do not dynamically participate.

The academic understanding of entrepreneurship was further refined by Joseph Schumpeter and Israel Kirzner who were two distinguished economists of twentieth-century. The role of the entrepreneur was emphasized by Schumpeter as an innovator who, by bringing in new goods or new production means, applies change in an economy. In the Schumpeterian view, the entrepreneur is a disruptive force in an economy. The beneficial process of creative destruction was emphasized by Schumpeter, in which the obsolescence or failure of products are resulted because of introduction of new products. One of many instances of creative destruction is the disappearance of the vinyl record with the corresponding introduction of the compact disc: the others include cars, electricity, aircraft, and personal computers. Kirzner, in contradiction of Schumpeter's view, concentrated on entrepreneurship as a discovery process. Entrepreneur is a person, according to Kirzner, who unwraps formerly overlooked profit opportunities. A process is initiated with the discovery of entrepreneur in which these recently revealed profit prospects are then followed up on in the marketplace until the profit opportunity is eliminated by market competition. Kirzner's entrepreneur is dissimilar to disruptive force of Schumpeter. He is rather an equilibrating force. An illustration of such an entrepreneur would be somebody who discovers that in a ...