An entrepreneur is an innovator, challenger, and driver. This person creates something new, in business. They are willing to invest their money to venture into business. They are great at time management. They are accountable and responsible. They grow well on criticism.
Statement about Entrepreneurship
These are the statement about entrepreneurship:
- True: The greatest essence of entrepreneurship is to help identify and develop the managerial capabilities of entrepreneurs.
- True: Entrepreneurship will lead to the creation of organizations.
- True: Entrepreneurship can improve the life of the entrepreneur only.
- False: Coward people will become a successful entrepreneurs.
- True: An entrepreneur is a "Risk Taker".
- False: Entrepreneurship is not an economic activity.
- True: Entrepreneurs are innovative.
- True: Potential profit potential is the compensation of the entrepreneur.
- True: An entrepreneur can also be a researcher.
- True: An entrepreneur can also become a salesman.
- True: Entrepreneurship graduates can become business reporters.
- True: The entrepreneur can see the results of his efforts easily.
Kinds of Entrepreneur
These are the different kinds of entrepreneur:
- small business
- scalable startup
- large company
- social entrepreneurship
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Entrepreneurship plays an important role in the economic and social development of a nation. Due to economic and social development, entrepreneurs create economic and social wealth. The importance and significance of entrepreneurship is explained as follows:
1. Economic Development: Entrepreneurship activity contributes to the economic development of a nation. Due to entrepreneurship, new and innovative materials, products, technologies, processes are developed. This increases production and distribution of goods and services, resulting in growth and development of the nation.
Developed countries like Japan, USA, Germany, etc., owe their economic development to the contribution of their entrepreneurs. Without the innovative role of entrepreneurs, economic development of a nation would get hampered.
2. Social Development: Entrepreneurs play an important role in social develipment of a nation. Professional and successful entrepeneurs recognize and respond to social development needs of the society.
The entrepreneurs contribute funds towards social development activities like health, education, and community development activities. They alsp generate new and innovative ideas to enhance social development in the society.
3. Regional Development: The entreperneurs set up industries not only in urban areas, but also in backwards areas. Due to government incentives such as cash subsidy, tax holiday, duty concessions, etc., entrepreneurs are induced to set up industries in backward areas. As a result of such initiative on the part of entrepreneurs, the backward areas get developed not only economically but also socially.
4. Development of managerial capabilities:
The biggest significance of entrepreneurship lies in the fact that it helps in identifying and developing managerial capabilities of entrepreneurs. An entrepreneur studies a problem, identifies its alternatives, compares the alternatives in terms of cost and benefits implications, and finally chooses the best alternative.
This exercise helps in sharpening the decision making skills of an entrepreneur. Besides, these managerial capabilities are used by entrepreneurs in creating new technologies and products in place of older technologies and products resulting in higher performance.
5. Creation of organisations:
Entrepreneurship results into creation of organisations when entrepreneurs assemble and coordinate physical, human and financial resources and direct them towards achievement of objectives through managerial skills.
6. Improving standards of living:
By creating productive organisations, entrepreneurship helps in making a wide variety of goods and services available to the society which results into higher standards of living for the people.
Possession of luxury cars, computers, mobile phones, rapid growth of shopping malls, etc. are pointers to the rising living standards of people, and all this is due to the efforts of entrepreneurs.
7. Capital Formation: Entrepreneurs facilitate capital formation in the country. The entrepreneurs provide employment to the people. The employees save a part of their income. The entrepreneurs also save a part of their profits. These savings lead to investment. Investment in turn facilitates capital formation, i.e., production of capital goods, which can be used for further production of consumer goods and services.
8. Consumer Welfare: Entrepreneurship activity facilitates consumer welfare. Due to innovative ideas, consumers can enjoy new and better types of goods and services. Also due to employment, purchasing power of the people increases, resulting in more demand for new and better type of goods. Therefore, the standard of living of the society improves.
Entrepreneurship is a process of actions of an entrepreneur who is a person always in search of something new and exploits such ideas into gainful opportunities by accepting the risk and uncertainty with the enterprise. The word “entrepreneur” is derived from the French verb enterprendre, which means ‘to undertake’. This refers to those who “undertake” the risk of new enterprises. An enterprise is created by an entrepreneur. The process of creation is called “entrepreneurship”.
Benefits of Entrepreneurship to an Organisation:
1. Development of managerial capabilities: The biggest significance of entrepreneurship lies in the fact that it helps in identifying and developing managerial capabilities of entrepreneurs. An entrepreneur studies a problem, identifies its alternatives, compares the alternatives in terms of cost and benefits implications, and finally chooses the best alternative.
This exercise helps in sharpening the decision making skills of an entrepreneur. Besides, these managerial capabilities are used by entrepreneurs in creating new technologies and products in place of older technologies and products resulting in higher performance.
2. Creation of organisations: Entrepreneurship results into creation of organisations when entrepreneurs assemble and coordinate physical, human and financial resources and direct them towards achievement of objectives through managerial skills.
3. Improving standards of living: By creating productive organisations, entrepreneurship helps in making a wide variety of goods and services available to the society which results into higher standards of living for the people.
Possession of luxury cars, computers, mobile phones, rapid growth of shopping malls, etc. are pointers to the rising living standards of people, and all this is due to the efforts of entrepreneurs.
4. Means of economic development: Entrepreneurship involves creation and use of innovative ideas, maximisation of output from given resources, development of managerial skills, etc., and all these factors are so essential for the economic development of a country.
Depending upon the level of willingness to create innovative ideas, there can be the following types of entrepreneurs:
1. Innovative entrepreneurs:
These entrepreneurs have the ability to think newer, better and more economical ideas of business organisation and management. They are the business leaders and contributors to the economic development of a country.
Inventions like the introduction of a small car ‘Nano’ by Ratan Tata, organised retailing by Kishore Biyani, making mobile phones available to the common may by Anil Ambani are the works of innovative entrepreneurs.
2. Imitating entrepreneurs:
These entrepreneurs are people who follow the path shown by innovative entrepreneurs. They imitate innovative entrepreneurs because the environment in which they operate is such that it does not permit them to have creative and innovative ideas on their own.
Such entrepreneurs are found in countries and situations marked with weak industrial and institutional base which creates difficulties in initiating innovative ideas.
In our country also, a large number of such entrepreneurs are found in every field of business activity and they fulfill their need for achievement by imitating the ideas introduced by innovative entrepreneurs.
Development of small shopping complexes is the work of imitating entrepreneurs. All the small car manufacturers now are the imitating entrepreneurs.
3. Fabian entrepreneurs:
The dictionary meaning of the term ‘fabian’ is ‘a person seeking victory by delay rather than by a decisive battle’. Fabian entrepreneurs are those individuals who do not show initiative in visualising and implementing new ideas and innovations wait for some development which would motivate them to initiate unless there is an imminent threat to their very existence.
4. Drone entrepreneurs:
The dictionary meaning of the term ‘drone’ is ‘a person who lives on the labor of others’. Drone entrepreneurs are those individuals who are satisfied with the existing mode and speed of business activity and show no inclination in gaining market leadership. In other words, drone entrepreneurs are die-hard conservatives and even ready to suffer the loss of business.
5. Social Entrepreneur:
Social entrepreneurs drive social innovation and transformation in various fields including education, health, human rights, workers’ rights, environment and enterprise development.
They undertake poverty alleviation objectives with the zeal of an entrepreneur, business practices and dare to overcome traditional practices and to innovate. Dr Mohammed Yunus of Bangladesh who started Gramin Bank is a case of social entrepreneur.
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