•Review

•Definitions

•Approaches to studying entrepreneurs

•Entrepreneurial Mindset v Mangerial

Understanding the Role of the EntrepreneurUnderstanding the Role of the Entrepreneur

Who or what is an entrepreneur?Who or what is an entrepreneur?

•What are the essential skills?What are the essential skills?•How do they work?How do they work?•Can anyone be one?Can anyone be one?•Can entrepreneurial behaviour be learnt?Can entrepreneurial behaviour be learnt?•What do you think?What do you think?

What do entrepreneurs What do entrepreneurs dodo??

Lifestyle Business

Wheeler Dealer Tycoon

Entrepreneur

Glossary of TermsGlossary of Terms

Source: Hall D (2000) In the Company of Heroes – An Insiders Guide to Entrepreneurs at Work – Kogan PageSource: Hall D (2000) In the Company of Heroes – An Insiders Guide to Entrepreneurs at Work – Kogan Page

Entrepreneurs are at the CentreEntrepreneurs are at the Centre

Entrepreneur

ProductionMarketingSales and

Finance

BankingAudit

LegalTechnology

transfer

Suppliers

Inventors

Transportation

Advertising

MarketResearch

DefinitionsDefinitions

An 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.

Bygrave (1997:2)

Entrepreneurial ProcessEntrepreneurial Process

THE GROWTH ENTREPRENEUR

- creates a sustained high growth business

THE ENTREPRENEUR

- creates a significant business

THE ENTERPRISING PERSON

- creates a small or micro business

Business EntrepreneurBusiness Entrepreneur

Bolton & Thompson (2003)

1) Quickie2) Wonderful Wacky MBA 3) Send Money 4) Dreamers 5) One Stripe Zebra 6) Technoid7) Guts and Brains (the dream team)

Types of EntrepreneursTypes of Entrepreneurs

Extracted from: Extracted from: Entrepreneur America, Lessons from Inside Rob Ryan's High Tech Start-up Boot Camp"

Approaches to studying EntrepreneursApproaches 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.

Historical PerspectiveHistorical Perspective

1730 Cantillon - A self employed person with uncertain returns

1803 Say - A co-ordinator of production with managerial talent

1910 Schumpeter - A Creative Innovator

1921 Knight - manager responsible for direction & control, bears uncertainty

1960 Stepanek - moderate risk taker

1961 McLelland - Need for achievement

1971 Hornaday - Need for achievement; autonomy, aggression; power; recognition; innovative/independent

1973 Winter - Need for power

1974 Borland - Internal locus of control

1979 Kirzner - An arbitrageur - ability to spot opportunities

Locus of ControlLocus of Control

• Internal locus of control - Individuals who believe themselves to be in control of their own destiny

• External 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.

Influences on owner-managers and Influences on owner-managers and entrepreneursentrepreneurs

Antecedent

influences

Personal characteristics and traits

Situational factors

Culture of

society

Psychological trait approachPsychological 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.

Core and Desirable AttributesCore and Desirable Attributes

CORE ATTRIBUTES

Commitment & DeterminationLeadership

Opportunity ObsessionTolerance of Risk

Ambiguity & UncertaintyCreativity, Self-Reliance and Adaptability

Motivation to Excel

DESIRABLE ATTRIBUTES

Energy, Health, and Emotional Stability

Values

Capacity to Inspire

Creativity & Innovativeness

Intelligence

THE NON-ENTREPRENEURIAL ATTRIBUTES Being Macho

Perfectionist

Impulsiveness

Being anti-authoritarian

Counter/dependency

Knows it all

Outer Control

Invulnerability

Timmons (2003:251)

Critiques of the trait approachCritiques 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.

Definitions of CultureDefinitions 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)

Elements of CultureElements of Culture

Language Religion Values andattitudes

Education

Socialorganisation

Material cultureLaw and politics

Aesthetics CULTURE

Mental ModelsMental Models

Western Thinking

Eastern Thinking

Individualism

Differentiation

Relationships

Integration

Innovation Triggering Event Implementation Growth

Personal

Achievement

Locus of Control

Ambiguity Tolerance

Risk Taking

Personal Values

Education

Experience

Personal

Risk Taking

Job Dissatisfaction

Job Loss

Education

Age Commitment

Personal

Entrepreneur

Leader

Manager

Commitment

Vision

Sociological

Networks

Teams

Parents

Family

Role Models

Organisational

Team

Strategy

Structure

Culture

Products

Environment

Opportunities

Role Models

Creativity

Environment

Competition

Resources

Incubator

Government Policy

Environment

Competitors

Customers

Suppliers

Investors, Bankers, Lawyers

Resources

Government Policy

Entrepreneurial ProcessEntrepreneurial Process

Bygrave & Zacharakis (2004)

HIGH

LOW

1Conception/

Existence

2Survival

3Growth/Success

4Expansion/

Takeoff

5Maturity

Owner’s ability to do

People, planningand systems

Owner’s abilityto delegate

(Adapted from: Churchill and Lewis, 1983)

Criticality

to

Company

Growth

Changing Role of EntrepreneurChanging Role of Entrepreneur

Managerial v Entrepreneurial MindsetManagerial v Entrepreneurial Mindset

Farrell (2001) The Entrepreneurial Age

Positive/Negative Consequences

Entrepreneur PerformanceJob/Business

The Power of ConsequencesThe Power of Consequences

Dependence-seekingSubsistence seekingAverse to opportunityNon-innovativeAverse to VentureAverse to riskAnalytic

Independence-seekingWealth-seekingOpportunity-seekingInnovativeVenture-seekingRisk-seekingIntuitive

Source: Adapted from Entrepreneurship, John G Burch

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Tendencies towards non-entrepreneurial or Tendencies towards non-entrepreneurial or entrepreneurial activityentrepreneurial activity

What makes entrepreneurs entrepreneurial? Saras D. SarasvathyWhat makes entrepreneurs entrepreneurial? Saras D. Sarasvathy

Causal v Effectual Marketing ProcessCausal v Effectual Marketing Process

Comparison of Causal & Effectual ModelComparison of Causal & Effectual Model

Effectual Reasoning: The ProcessEffectual Reasoning: The Process

• Who they are – their traits, tastes and abilitiesWho they are – their traits, tastes and abilities

• What they know – their education, training, expertise and experienceWhat they know – their education, training, expertise and experience

• Whom they know – their social and professional networksWhom they know – their social and professional networks

Characteristics of Successful EntrepreneursCharacteristics of Successful Entrepreneurs

Four Primary Characteristics of Successful Entrepreneurs

Do not go where the path may

lead, go instead where there

is no path and leave a trail.

— Ralph Waldo Emerson

Extreme EntrepreneurshipExtreme Entrepreneurship

www.successmanifesto.com/

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