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The entrepreneurship and small business management inspires people to start business or achieve opportunities of employment in small businesses. It aids in recognising employment options in small businesses and help them to spread knowledge of entrepreneurship and also in developing the skills and techniques of venture management (Lee-Ross and Lashley, 2010). The business skill is also in demand for establishment of a business which needs skills to survive. It is designed in such a way, which will help in building knowledge.
Different kinds of entrepreneurship
The word entrepreneur derived from a French word, “enterprendre”, which means, “to undertake”. It refers to that person who undertakes the risk of establishing a new enterprise. It is instituted by a person, who is tagged as entrepreneur. The process by which it is started is called entrepreneurship.
It refers to a process of establishing, designing and running of a business which started as a small business that helps in offering a product , services for sale. It is used as a key to economy development. The entrepreneurial progress helps in generating the objective of industrial development, employment generation.
Extent of entrepreneurship is as follows:
The biggest scope is to develop managerial capabilities which will help in recognition and development of directorial capabilities. It assist an entrepreneur to enhance its skills in decision making (Burns, 2010). It also aids in developing new technologies in place of older, which leads to enhancement of performance.
- It also results into establishment of organisations in assembling and coordinating resources such as physical, financial and human and also supports them to work towards the achievement of objectives.
- It assist an entrepreneur to improve living standard by the establishment of productive organisation which helps in production of goods and services that results in improving the standard of living in society.
- It also aids to maximise profit with available resources by use of creative ideas.
The four types of entrepreneurship are as follows-
Small business entrepreneurship- It includes grocery stores, travel agents, carpenters, electricians, plumbers etc. Their objective is to satisfy the needs of their family and make a profit only. They do not help in attracting the scale of venture capital as they invest in business via family or loans (Stokes, Wilson and Wilson, 2010..
Scalable entrepreneurship- These are the Silicon Valley entrepreneurs. They establish a business whose objective is to change the world. They invest in their businesses through financial investors as venture capital.
Large Company entrepreneurship- Sustaining innovation supports in the growth of these companies by providing new product. The factors which create pressure on entrepreneurs to create new products are change in taste of customer, new technologies, competitors etc. the culture and size of large company is difficult to manage.
Social entrepreneurship- These entrepreneurs emphasis on the development of product and services which helps to fulfil the social needs and problems.
The types of entrepreneurship ventures and entrepreneur both assist in the establishment of a new business (Dennis, 2011.). They also help to improve the standard of living by production of new products which will supports them to satisfy the need of the customers. They will results in increasing growth of the business.
Difference between large and small business entrepreneurship
Similarity between large and small business entrepreneurship- They both compete each other in particular circumstances such as in terms of product selection. They both are supplementary of each other so that can fulfil the gap between production and standard output. Small industry work as a complimentary to large business which produce intermediate products for them. It will also help large business in gaining higher profit (Nga and Shamuganathan, 2010).
They both are work for changing the world by fulfilling the needs of the society. which will emphasis on the development of products. These work for the society to provide better services to take a step towards the achievement of the goal of changing world.
Effects of small and micro business on the economy
Small businesses focus on the designing of policies of an enterprise. These play an important role in the growth of economy, creation of jobs, innovation and social integration. These enterprises have different structure of ownership and number of employees and unrelated levels of activities related to economy (Carraher and Paridon, 2015).
These play an important role in an economy as representing around 99% of all businesses and give employment to an increasing number of persons. There are some independent enterprises which don't related to any group of enterprise.
In accordance of employment and gross value added, dependent small businesses are more important in small countries like Denmark, Finland etc. They are also important in Germany as approx 43% of gross value achieved in these businesses in total and also help to contribute in employment around 34% of total persons employed. As a result, a large portion of total growth achieved by them (Fassin,Van Rossem and Buelens, 2011). The higher proportion of value added is created by them in service sectors.
P4 Importance of small business in growth of social economy
These are important for the growth of social economy and they also support in creating job opportunities. Innovation, employment opportunities and adaptability are the main factors which will assist in the growth of a economy. Small businesses that are creative and innovative has higher rates of growth in different areas such as innovation of product and process. It is also said that they act as seedbed for new creations.
They plays an important role in the increasing growth rate of economy in terms of employment.
Small and micro-businesses also helps to make economy more effective, competitive and attractive to investors. They support in adding diversity in towns and cities by serving communities. They not only add more values in regional areas but also aid to increase competition in local markets.
Small businesses helps to make employment more phenomenal. It is showed by official figures published by government that around 2.60 million jobs opportunities were created by them each year.
These are capable of attracting and giving training to new employees to produce innovative products that helps to achieve the goal of satisfying the social needs of their local communities.(Carland, Carland and Stewart,2015) They are more capable of dealing to contribute towards creativity. Small businesses also help to produce goods with more effective, creative and innovative ideas that will assist them to satisfy the need of the people of the community in which they live that aids them to achieve the social goal resulted in incresing the growth of the social economy.
P5 Characteristics of a successful entrepreneur
For becoming a successful entrepreneur is to establish a new venture which means that having right attitude towards an enterprise and to works for achieving success. He has a strong desire that will help him to take a step towards his success. He has a strong desire of succeeding and ability to overcome from obstacles(Blackburn, Hart,and Wainwright,2013).
For being a successful entrepreneur an individual has certain characteristics they are as follows-
Passion- It will help an entrepreneur to determine the ways which are required to become successful. If he is passionate about his success than it will helps him to overcome from all problems and assists in achieving success.
Learning- He needs to has a quality of learning constantly. Remaining sharp by learning continuously will helps to achieve the organisational objective.
Confidence level- He requires to have a high confidence level which help him to work even under pressure. He knows that success is achieved by the challenges. When most of the entrepreneurs work on challenges that time a successful entrepreneur work towards the finishing line and at rewards.
Taking risk- A successful entrepreneur never afraid of taking risk. It plays an important role in becoming a successful entrepreneur. He is a risk takers so that he can dive into a uncertain future. Taking risk helps him to work with more confidence towards achieving success.
Believe in self- He has a quality to enjoy in what he is doing. He also has a strong believe in himself and increase level of confidence which will help him to work with more dedication to his project. But the most important quality of an entrepreneur is discipline and dedication towards achieving objective.
Leadership quality- It helps him to determine the goal. The good communication skill is very important quality of an entrepreneur which helps to work with a team to achieve the common objective in such a way that leads to motivate employees and work as a team more effectively.
Self-motivation- An entrepreneur needs to be self motivated so that which will assists him in enjoying challenges and and work more effectively to overcome from obstacles. He is highly adaptable to change the conditions and situations which assists to work towards achievement of goals and opportunities.
Innovative and creative- Entrepreneur is capable of continuously developing new ideas which will help in improving continuing process. They have ability to adapt change very easily and leads towards their objective by improving the quality of the product and services in order to win success.
Competition- Entrepreneur enjoy working with challenges and He has a strong desire of winning. Competitive spirit will help him in growing his shares in the market.
Monetary management- It is essential for an entrepreneur to have the knowledge of money management which is required for financial obligations arising in present and future. A successful entrepreneur has a balance on flow of cash as it is considered as a important tool of any business.
Planning- It is important for establishment of a business with available resources such as time, money, relationships etc. Planning is very essential for everything having solution for risk which may occur in future. It will aids him to overcome from all obstacles to achieve the objective.
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Resourcefulness- It is essential for every entrepreneur to know how to obtain maximum results with available resources. Resources are very limited so that they will be utilise fully to meet the expected results.
Analytical abilities- He should be capable of identifying aspects of business through finance, marketing and sales.
Goal-oriented- He is all about planning his goals and putting efforts to achieve the goals so that he is very passionate to obtain the success of their business.
Hard work- He has ability to work hard with other people so that he can achieve organisational goal.
Expert- Being able to position as an expert in industry will help an individual to view business with confidence and getting involved in events of respective fields. Successful entrepreneurs are also called as industrial leaders.
Entrepreneurs are born or made means to become a successful entrepreneur has a unique personality and have a number of qualities that can be learned through education. Entrepreneurial skills can be developed through educational experiences in an individual. There are the some qualities which will help in becoming successful entrepreneur such as risk taker, independence, self motivation, adaptability,flexibility,innovative and creative etc.
Entrepreneurship skills are also important for becoming a successful entrepreneur which help in achieving the objectives.(Luiz,2011.) They have a creative and innovative mind that will supports them to produce goods and services according to the need of the customer which assists to satisfy their needs to achieve the goal more effectively and efficiently.
P6 Effects of entrepreneurial personality on entrepreneurial motivation
The family upbringings, cultural differences and personal motivation play an important role in enhancing the entrepreneurial personality. These all factors help in defining the characteristics of an entrepreneur.
These are the factors which supports in working for achievement of goal with passion. It assist them to become more passionate to their work which will lead in motivating their employees to work more efficiently towards achievement of objective.
Entrepreneurs need a quality of learning from their failures so that they will never repeat that mistake next time which supports them to be more confident to work.(Hall, Daneke, and Lenox, 2010)
Self motivation plays an important role in enhancing entrepreneurial personality which will help them to overcome from a number of problems. Self confident and self motivation are also key elements of entrepreneurial identityBy which they have a ability to convert a idea into reality.
Adapting changes and challenges is important for every business. Entrepreneurs are very flexible to transform an idea into reality. When new informations received by them they are capable of changing their plans.
They have a capability to see opportunities which help in developing new ideas to improve their existing products that supports in enhancing the entrepreneurial personality to achieve their goals and assist them to take a step towards their success.
Impacts of past experiences to enhance entrepreneurship
Person's background and past experiences affect the personality of an individual which will help him to become a successful entrepreneur. To have a positive influence over entrepreneurship there are also a number of business skills and experiences which will assist in managing skills and ability to adapt change.(Idogho,2011) There are so many personal attributes which are also important for an entrepreneurship such as innovative and creative, change oriented and visionary. These are received from education.
Business skills are important to the process of innovation that can be a more important factor for financing. They provides the basis for dynamic and unique capabilities of a business which help them to learn and adapt to changed circumstances. These are also important for the establishment and growth.
Personal experiences can also be enhanced by the different levels of education. In adopting changes and improving skills, education is very important because it will help them to take risk and provide solutions to overcome from the obstacles occurred which also assist in increasing self motivation and self confidence that results in reducing stress and also teach them to work under pressure and stress which will supports them to enhance their leadership skills to motivate their employees to work towards the projects so that it can help in achieving objective very effectively(Brinckmann, Grichnik and Kapsa, 2010)
The risk in starting a business is the chance of damage which means an estimated profit or outcome could not be earned by bearing a loss of investment which will results in liability of paying debt. It will also create a problem of finding job or start again a business. There is a increased rate of failure of new business establishment . It is very tough to examine a idea of business without trading. The responses of competitors area also very aggressive and they underestimate the efforts which are required for the success of a business. The reason of failure of new businesses are the insufficient demand of the customer such as bad market research and unrealistic plan, the responses of customers like price and promotion. The poor execution of good idea is equally important for the failure such as poor management by wrong people, too quick and too slow growth and fails in managing cash flows. External factors are also leads to their non-success such as change in economy, changes in legal, social & technology. Risk is a part of success and failure of a business. These cannot be avoided. Entrepreneurs needs to understand the risk and the solutions to overcome from them.(Olusegun, 2012).
Rewards of starting a new business are divided into two parts financial and non-financial.
- Profit- These are reinvested into the business
- Dividends- Taking cash and profit out of the business
- Capital Growth- Increased value of the business
Non-financial includes- Satisfaction, building something, controlling, preparing first scale, new location opening, employment to more people, achieving an industrial award and publicity, achieving good feedback from customers.(Carland and Carland,2015)
It is concluded from the above report that to become a successful in business, entrepreneurship and innovations are very essential. It focused on producing new product and services which will help in fulfilling the need of the society. The innovation and entrepreneurship also applies on companies to change how to produce new product and services. The companies can use innovation and entrepreneurial skills to achieve the objective that supports in reducing the risk and challenges so it can assist in achieving independent and personal and financial rewards therefore they can achieve their objective. It will also supports them to work with passion and also to be confident so that they can work towards the achievement of the goals. It enhances their skills to place a idea into reality by creative and innovative way so that they can produce a existing product in a different way to satisfy the need of the customers. Therefore, It leads to increase the growth of economy.
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