If you have seen me speak you will know that I believe the word ‘entrepreneur’ is used way too much these days. People seem to wear it as a badge instead of just getting out there and doing entrepreneurial things.
Just because you run or own a successful business doesn’t necessarily mean that you an entrepreneur.
Entrepreneurs have a different mindset to others. They will go way above and beyond to complete and finish something that they have started.
I have developed what I call the 5 senses of an entrepreneur which will highlight those differences.
We all have 5 which are sight, taste, smell, hearing and touch. The entrepreneur also has those 5 senses but to them they mean something totally different. The 5 senses relay messages to your brain which makes you operate in a certain way. This is the same for the entrepreneurial sense. The entrepreneurial senses direct an entrepreneur to operate and succeed in a certain way.
Below is how an entrepreneur uses the 5 senses.
SIGHT.
Entrepreneurs can see things normal business owners can’t. By that I mean that they can see potential in the smallest of things, whether it is a new trend or a different way of doing something and in turn gaining bigger and better results from the others around them.
They also have the foresight to see past the hurdles or obstacles that most business owners would see as a full stop and press on regardless of the issues that they may face.
They aren’t really good on the stuff that is right in front of their faces, the day to day stuff as they are already thinking far in advance.
You could say that some entrepreneurs have blinkers on. Once they are focused on something, they will see it through to the end. Whatever comes their way will be quickly dealt with so as they don’t lose momentum or become distracted.
TASTE.
Entrepreneurs can taste success in everything that they do. It doesn’t really concern them with the current taste of a deal or a venture as they know what the ultimate taste of success in that deal when it is finished and completed will actually taste like.
Even when they have a taste of something bitter; whether that is a deal gone wrong or a wrong decision, they will still press on until the sweet taste of success is filling their mouths.
Just as kids when we are all made to eat those disgusting vegetables (the cauliflower and brussel sprouts) and then as we grow up we are able to make our own choice as to what is on our plates, so does the entrepreneur. They have been through the hard yards just as everyone else. They just want to have the choice as to what taste stays in their mouths for the longest period of time.
Until they taste it, they will not give up.
SMELL.
An entrepreneur can smell success from a mile away. In fact, they can smell it before they even experience it. It is that sweet smell that keeps them driving towards touching and living it.
Just as they can smell the sweetness of success, so can they smell a bad deal. Now I am not saying that everything an entrepreneur puts his or her hands to will always work, but as they go through their lives they will know quickly if something smells a bit off.
It is this sense that is the most important one to an entrepreneur. Without the whiff of something potentially huge and exciting, an entrepreneur will usually let it go.
They also have the ability to smell “manure” a mile off.
HEARING.
With the ear, it receives a whole lot of different vibrations and sound waves which in turn it processes it into something that makes sense to our brains. This in principal is what happens to an entrepreneur. All of us hear different feedback, various business opportunities and potential deals throughout our lives. What makes an entrepreneur different from the rest is that he or she will decipher that information (usually very quickly) and either act upon it or dismiss it straight away just by the sound of the information that he or she has heard. Where as most people will go down the path of that information and potentially lose out when it isn’t what was first perceived.
The entrepreneur will also have a knack of blocking out the negative information or comments that come into their ears. They will not be the type of person who will allow that negative information to pass into their thinking an in turn, into their actions.
Entrepreneurs have selective hearing. They know what they want to hear and they know what success sounds like.
TOUCH.
An entrepreneur will not give up until they have a firm grip on what they have been pursuing. For some it may take them a short time and for others a very long time. but until they have that success by the throat, they will not let it go.
You see it is this sense that is the reward stage for an entrepreneur. It is the thrill of the hunt with the catch mounted high on their walls of life.
This is not to say that everything they set their hands to will work. It is that they know the feel that they are looking for. They know how hard they need to press or how gentle they may need to be. It is the same principal with holding a baby as opposed to a hammer. One is gentle the other is forceful. The true entrepreneur will have an understanding of the touch that is needed.
So as you see, there are many facets that set an entrepreneur apart from a normal business owner.
Why not take the entrepreneur test™ on not only yourself but also your staff and you will see where you stand and where your strengths really are.
This is a great tool for any business owner.
Go to www.justinherald.com
Justin Herald started a business with only $50.6 years later that business was turning over $20 Million. He retired at the age of 31 and is now considered one of the worlds rising stars in the field of self improvement.
Justin has 3 international best selling books:
1. Would you like Attitude with that?
2. What are you waitng for?
3. It's all a matter of attitude.
He was also named the "International Entrepreneur of the Year" 2005
http://www.justinherald.com
Friday, June 5, 2009
Selling Your Business, Entrepreneurs Role (by Jennifer Lynn)
$elling $elling $elling
What makes a great sales person? Well, the natural ability to sell
defnitely could not hurt. Sales people are a passionate, obviously
people oriented, motivated and energetic bunch. An entrepreneur
needs to be everything in one. And one key ingredient to molding an
entrepreneur is his/her ability is to be a good salesman. Why after all
how can run a business if you can't sell your product or service? It
obviously makes no sense whatsoever.
An entrepreneur either has to be the salesman or hire a kick ass
salesman to help him with the job. Sometimes they cannot be in a
position to dish out a big figure salary for whatever factors be it just
starting out, saving money and what not. An entrepreneur is then forced
to sell and become the top salesman for his team. Factoring their
creative knowledge and natural sales abilities would determine whether
or not the entrepreneur is a good candidate to make his sales quotas
succeed. However, if you want to run a business how can you run such
a business when you can't get people interested in your services?
Here are some sales tips from one hardworking entrepreneur to
another...
Tip 1. Be Passionate. Sales people are in nature passionate people.
From my past experience, the best sales people love what they do. They
love talking to the people, negotiating deals, the travel, and whatever
else comes with it. When you are passionate about something it shows.
When you want something badly enough you can easily attain it. A great
salesman has the knack to make a connection, to seal the deal. It's all
about reading people, their ability of people skills and their passions.
When someone is not passionate it shows. You can just tell that they
have no interest in what they are selling or whom they are dealing with.
You can notice it by their expressions, their words and their overall
dimeanor.
Tip 2. Don't be pushy. I personally, abhor pushy salespeople in
business. Good business etiquette involves being polite, well mannered
and respectable. No one likes a pesky salesman. No one wants to be
stalked, called on twenty times a day, visited at the office on surprise.
You begin to act like a telemarketer and look at what America has done
to these folk. Why they can now be banned, blocked on our caller id's by
calling directory serice. Being pushy is tacky. Being sensibly aggressive
in a polite manner is key.
Tip 3. Don't forget you are an entrepreneur. This is a tricky part. You can
still be a good salesman but never forget your main role. The role of an
entrepreneur. It is easy to get caught up and overbalanced in certain
positions for the entrepreneur. You are a multi tasker. You need to be
everything at once and as a businessperson your responsibility to be
the sole proprietor comes first. Learn to be the salesman and at the
same time don't let it all get overbalanced. You will soon find yourself
out of whack and scatterred before you know it.
Tip 4. Compete. Selling is a tough thing to do. Selling a service in a
world full of competitors will make you or break you. As an entrepreneur
you should surround yourself around successful sales professionals.
Observe them. Learn from them and learn what makes them tick. In my
experience working in a corporate environment and many a
conversation with those savvy salespeople, I've learned a lot of great
tips. A good salesman is always on top of his game. He is aware of his
competition, he is goal oriented, can communicate with people on all
levels, is a great talker, people reader and overall a competitive breed.
A lot of this should rub off on you. It takes strategic business savvy skills
and tactics to sell your service successfully. Hard work and
perserverance in the long run will take off.
Tip 5. The hungrier the better. We are all animals. A good salesman
knows what it's like to be full and what it is like to be hungry. Which one
are you? Hopefully you want to get to the level when your are
reasonably feeling full the majority of the time. But ever notice when one
is hungry, what kinds of inner drives it all can produce? Sales people
have a hungry mentality. They need to sell, based on their own working
survival it is in their nature. Entrepreneurs face the same challenges.
They are hungry in both ways. They need to sell their service to profit,
they are both hungry to achieve this and at the same time need to get
the rest of their business off the ground.
Tip 6. Personality. It's all about your personality, your attitude and your
dimeanor that comes with it. If you want to be successful in this area you
need to be well liked. If you can't pass the first impressions, which is so
true that first impressions are everlasting then you by far cannot sell your
product or service. When a company takes a liking to you they begin to
take interest. And hooking the potential client to take an interest in what
you offer is key. Naturally, thereafter you can pitch your idea, give them
your reasons and then it is up to them to make the ultimate decision.
This determines point blank either they like you and your service or they
don't. Which would you prefer? So it is always best be on top of this and
remember it's all about reading people and having stellar interpersonal
skills. This is a key factor to potentially landing a new account.
Tip 7. I know as an entrepreneur you want to just run the business. You
are thinking, I am not a salesman I am an entrepreneur and that's a big
difference. Very true indeed and their is no arguement in that. But to be
successful you need to be up to par with what goes on and you can't be
ignorant to the fact that this is your business. You put all this time and
energy to make it happen and you have gotten so far. It does not hurt, in
fact it will benefit you a great deal to be knowledgeable as much as you
can on every aspect of running a business. With sales being a key factor
in determing your success of your biz, any entrepreneur can benefit on
being a kick butt salesman as well successfully running his/her own
company.
As an entrepreneur, you should research for yourself what you feel will
help you in the sales department. Evaluate yourself, your strengths and
weaknesses, gain some hands on experience working for a bit with a
company in sales if you don't have a clue, talk with other successful
sales professionals for their tips and advice, do some research on the
internet, read up on sales trends and stay true to your entrepreneurial
self at the same time. It's all for the best. In the meantime, the learning
process is a fun one. You'll find yourself discovering things about you
along the way, you will be more knowledgeable about the the art of
selling and you will eventually learn to become a sharp selling
individual. Apply this all to your business and the magic should be
working in no time.
About the Author:
Jennifer Lynn is an ecommerce entrepreneur, artist, writer, and musician based in New York-Chicago.
She has written and contributed numerous articles online about adult entertainment, entrepreneurship, ecommerce, technology, pop culture, generation x, quarter life and city trends & news.
A highly creative entrepreneur with focus in web marketing, business development and ecommerce. Presently, she is involved in JMR, an online referral biz for artists in the entertainment industry. She also runs other ecommerce sites including an interactive entertainment hub and her own personal site.
Before startin' JMR, Jennifer Lynn was a tech recruiter with a Chicago based start-up company. She's also a professional pianist. Jennifer Lynn received her degree from De Paul University in liberal arts.
When she's not workin' away, you can find her lofting on a beach, into travel, and dabbling in new creative ventures with artists & entrepreneurs around town.
Jennifer Lynn believes passion in doing what ever it is you love to do is the key to one's personal success.
What makes a great sales person? Well, the natural ability to sell
defnitely could not hurt. Sales people are a passionate, obviously
people oriented, motivated and energetic bunch. An entrepreneur
needs to be everything in one. And one key ingredient to molding an
entrepreneur is his/her ability is to be a good salesman. Why after all
how can run a business if you can't sell your product or service? It
obviously makes no sense whatsoever.
An entrepreneur either has to be the salesman or hire a kick ass
salesman to help him with the job. Sometimes they cannot be in a
position to dish out a big figure salary for whatever factors be it just
starting out, saving money and what not. An entrepreneur is then forced
to sell and become the top salesman for his team. Factoring their
creative knowledge and natural sales abilities would determine whether
or not the entrepreneur is a good candidate to make his sales quotas
succeed. However, if you want to run a business how can you run such
a business when you can't get people interested in your services?
Here are some sales tips from one hardworking entrepreneur to
another...
Tip 1. Be Passionate. Sales people are in nature passionate people.
From my past experience, the best sales people love what they do. They
love talking to the people, negotiating deals, the travel, and whatever
else comes with it. When you are passionate about something it shows.
When you want something badly enough you can easily attain it. A great
salesman has the knack to make a connection, to seal the deal. It's all
about reading people, their ability of people skills and their passions.
When someone is not passionate it shows. You can just tell that they
have no interest in what they are selling or whom they are dealing with.
You can notice it by their expressions, their words and their overall
dimeanor.
Tip 2. Don't be pushy. I personally, abhor pushy salespeople in
business. Good business etiquette involves being polite, well mannered
and respectable. No one likes a pesky salesman. No one wants to be
stalked, called on twenty times a day, visited at the office on surprise.
You begin to act like a telemarketer and look at what America has done
to these folk. Why they can now be banned, blocked on our caller id's by
calling directory serice. Being pushy is tacky. Being sensibly aggressive
in a polite manner is key.
Tip 3. Don't forget you are an entrepreneur. This is a tricky part. You can
still be a good salesman but never forget your main role. The role of an
entrepreneur. It is easy to get caught up and overbalanced in certain
positions for the entrepreneur. You are a multi tasker. You need to be
everything at once and as a businessperson your responsibility to be
the sole proprietor comes first. Learn to be the salesman and at the
same time don't let it all get overbalanced. You will soon find yourself
out of whack and scatterred before you know it.
Tip 4. Compete. Selling is a tough thing to do. Selling a service in a
world full of competitors will make you or break you. As an entrepreneur
you should surround yourself around successful sales professionals.
Observe them. Learn from them and learn what makes them tick. In my
experience working in a corporate environment and many a
conversation with those savvy salespeople, I've learned a lot of great
tips. A good salesman is always on top of his game. He is aware of his
competition, he is goal oriented, can communicate with people on all
levels, is a great talker, people reader and overall a competitive breed.
A lot of this should rub off on you. It takes strategic business savvy skills
and tactics to sell your service successfully. Hard work and
perserverance in the long run will take off.
Tip 5. The hungrier the better. We are all animals. A good salesman
knows what it's like to be full and what it is like to be hungry. Which one
are you? Hopefully you want to get to the level when your are
reasonably feeling full the majority of the time. But ever notice when one
is hungry, what kinds of inner drives it all can produce? Sales people
have a hungry mentality. They need to sell, based on their own working
survival it is in their nature. Entrepreneurs face the same challenges.
They are hungry in both ways. They need to sell their service to profit,
they are both hungry to achieve this and at the same time need to get
the rest of their business off the ground.
Tip 6. Personality. It's all about your personality, your attitude and your
dimeanor that comes with it. If you want to be successful in this area you
need to be well liked. If you can't pass the first impressions, which is so
true that first impressions are everlasting then you by far cannot sell your
product or service. When a company takes a liking to you they begin to
take interest. And hooking the potential client to take an interest in what
you offer is key. Naturally, thereafter you can pitch your idea, give them
your reasons and then it is up to them to make the ultimate decision.
This determines point blank either they like you and your service or they
don't. Which would you prefer? So it is always best be on top of this and
remember it's all about reading people and having stellar interpersonal
skills. This is a key factor to potentially landing a new account.
Tip 7. I know as an entrepreneur you want to just run the business. You
are thinking, I am not a salesman I am an entrepreneur and that's a big
difference. Very true indeed and their is no arguement in that. But to be
successful you need to be up to par with what goes on and you can't be
ignorant to the fact that this is your business. You put all this time and
energy to make it happen and you have gotten so far. It does not hurt, in
fact it will benefit you a great deal to be knowledgeable as much as you
can on every aspect of running a business. With sales being a key factor
in determing your success of your biz, any entrepreneur can benefit on
being a kick butt salesman as well successfully running his/her own
company.
As an entrepreneur, you should research for yourself what you feel will
help you in the sales department. Evaluate yourself, your strengths and
weaknesses, gain some hands on experience working for a bit with a
company in sales if you don't have a clue, talk with other successful
sales professionals for their tips and advice, do some research on the
internet, read up on sales trends and stay true to your entrepreneurial
self at the same time. It's all for the best. In the meantime, the learning
process is a fun one. You'll find yourself discovering things about you
along the way, you will be more knowledgeable about the the art of
selling and you will eventually learn to become a sharp selling
individual. Apply this all to your business and the magic should be
working in no time.
About the Author:
Jennifer Lynn is an ecommerce entrepreneur, artist, writer, and musician based in New York-Chicago.
She has written and contributed numerous articles online about adult entertainment, entrepreneurship, ecommerce, technology, pop culture, generation x, quarter life and city trends & news.
A highly creative entrepreneur with focus in web marketing, business development and ecommerce. Presently, she is involved in JMR, an online referral biz for artists in the entertainment industry. She also runs other ecommerce sites including an interactive entertainment hub and her own personal site.
Before startin' JMR, Jennifer Lynn was a tech recruiter with a Chicago based start-up company. She's also a professional pianist. Jennifer Lynn received her degree from De Paul University in liberal arts.
When she's not workin' away, you can find her lofting on a beach, into travel, and dabbling in new creative ventures with artists & entrepreneurs around town.
Jennifer Lynn believes passion in doing what ever it is you love to do is the key to one's personal success.
Entrepreneurship: What does it REALLY mean? (by Alvin Chan)
Introduction:
In a world where ideas drive economies, it is no wonder that innovation and entrepreneurship are often seen as inseparable bedfellows. The governments around the world are starting to realize that in order to sustain progress and improve a country’s economy, the people have to be encouraged and trained to think out-of-the-box and be constantly developing innovative products and services. The once feasible ways of doing business are no longer guarantees for future economic success!
In response to this inevitable change, some governments are rethinking the way the young are educated by infusing creative thinking and innovation in their nation’s educational curriculum. In the same vein, they are putting much emphasis on the need to train future entrepreneurs through infusing entrepreneurship components within the educational system, especially at the tertiary level.
Some countries have taken this initiative to a higher level by introducing entrepreneurship education at elementary schools and encouraging them to be future entrepreneurs when they are of age. In a series of survey funded by Kauffman Center for Entrepreneurial Leadership, it was found that nearly seven out of 10 youths (aged 14-19) were interested in becoming entrepreneurs.
Being an entrepreneur is now the choice of the new generation as compared to the preferred career choices of yesteryears such as being a doctor, lawyer or a fighter pilot. In a recent visit to the bustling city of Shanghai in China, an informal survey was carried out among Chinese youths by the author. The results of the survey showed that being an entrepreneur, especially in the field of computer and e-commerce, is perceived as a ‘cool’ career and is an aspiration for many Chinese youths Prior to the ‘opening up’ of modern China, being an entrepreneur was perceived as the outcome of one’s inability to hold a good government job and those who dared to venture, were often scorned at by their peers. Times have indeed changed.
With this change in mindset and the relative knowledge that entrepreneurs bring forth increased job creations, the awareness and academic studies of entrepreneurship have also heightened. In many tertiary institutes, many courses of entrepreneurship and innovation are being developed and offered to cater to the increasing demand. The term “entrepreneurship” has also evolved with numerous variations. The proliferation of jargons such as netpreneur, biotechpreneur, technopreneur and multipreneur are coined to keep up with the ever-changing times and business conditions that surround us.
In view of these changes, it is important that the definition of entrepreneurship be refined or redefined to enable its application in this 21st century. To put it succinctly, “Good science has to begin with good definitions (Bygrave & Hofer, 1991, p13).” Without the proper definition, it will be laborious for policymakers to develop successful programs to inculcate entrepreneurial qualities in their people and organizations within their country.
The paper will provide a summary of the definitions of entrepreneurship provided by scholars in this subject area. The author will also expand on one of the definitions by Joseph Schumpeter to create a better understanding of the definition of the term “entrepreneurship” as applied in today’s business world.
Entrepreneurship through the Years:
It was discovered that the term ‘entrepreneurship’ could be found from the French verb ‘entreprende’ in the twelfth century though the meaning may not be that applicable today. This meaning of the word then was to do something without any link to economic profits, which is the antithesis of what entrepreneurship is all about today. It was only in the early 1700’s, when French economist, Richard Cantillon, described an entrepreneur as one who bears risks by buying at certain prices and selling at uncertain prices (Barreto, 1989, Casson 1982) which is probably closer to the term as applied today.
In the 1776 thought-provoking book ‘The Wealth of Nations’, Adam Smith explained clearly that it was not the benevolence of the baker but self-interest that motivated him to provide bread. From Smith’s standpoint, entrepreneurs were the economic agents who transformed demand into supply for profits.
In 1848, the famous economist John Stuart Mill described entrepreneurship as the founding of a private enterprise. This encompassed the risk takers, the decision makers, and the individuals who desire wealth by managing limited resources to create new business ventures.
One of the definitions that the author feels best exemplifies entrepreneurship was coined by Joseph Schumpeter (1934). He stated that the entrepreneur is one who applies “innovation” within the context of the business to satisfy unfulfilled market demand (Liebenstein, 1995). In elaboration, he saw an entrepreneur as an innovator who implements change within markets through the carrying out of new combinations. The carrying out of new combinations can take several forms:
The introduction of a new good or standard of quality;
The introduction of a novel method of production;
The opening of a new market;
The acquisition of a new source of new materials supply; and
The carrying out of the new organization in any industry.
Though the term ‘innovation’ has different meanings to different people, several writers tended to see “innovation” in the form of entrepreneurship as one not of incremental change but quantum change in the new business start-ups and the goods/services that they provide (egs, Bygrave, 1995; Bygrave & Hofer, 1991).
In the view of Drucker (1985), he perceived entrepreneurship as the creation of a new organization, regardless of its ability to sustain itself, let alone make a profit. The notion of an individual who starts a new business venture would be sufficient for him/her to be labeled as an entrepreneur. It is this characteristic that distinguishes entrepreneurship from the routine management tasks of allocating resources in an already established business organization. Though the definition tends to be somewhat simplistic in nature, it firmly attaches the nature of entrepreneurial action with risk-taking and the bearing of uncertainty by the individual (Swoboda, 1983)
In a Delphi study, Gartner (1990) found eight themes expressed by the participants that constitute the nature of entrepreneurship. They were the entrepreneur, innovation, organization creation, creating value, profit or non-profit, growth, uniqueness, and the owner-manager. The themes could be seen as a derivative and expansion of Schumpter’s earlier concept.
Expanding on Schumpeter’s Definition:
After digesting the numerous definitions of entrepreneurship, one would tend to see a strong link between these two terms: entrepreneurship and innovation. In retrospect, most of the definitions tended to be, to some extent, a re-work and expansion of Schumpeter’s definition of entrepreneurship (which is that of innovation being applied in a business context).
As defining the term of ‘innovation’ is highly debatable and would merit a paper on its own, the author has thus, for convenience, summarised the definition of innovation. Innovation can be perceived simply as the transformation of creative ideas into useful applications by combining resources in new or unusual ways to provide value to society for or improved products, technology, or services.
In the author’s opinion, the difficulties of defining “innovation” could be the reason for the quandary one finds in attempting to arrive at a clear-cut definition of the term “ Entrepreneurship”.
Take for example, if someone starts another run-of-the-mill hot dog stand in the streets of New York, will he termed as an entrepreneur? According to Drucker’s definition, he will be seen as one. However, if the above definition by Schumpeter was used as a guideline, the answer is probably ‘NO’.
Why? The core of the matter lies in what is so innovative about setting up another hot-dog stand which are in abundance in New York. On the contrary, if he is the first one to start a stand selling hot-dogs with Oriental Sweet and Sour sauce topping; he could be termed as an entrepreneur (even based on Schumpeter’s requirement) as he has done what others have not done before. In the context of entrepreneurship, creativity and innovation are key points in the whole scheme of things.
In this manner, by adding “innovative” features to a product or services and setting up a business based on these additional features to compete in the existing market, new entrants may be able to gain this competitive advantage over existing market players.
In the case of the hot-dog seller, it may be argued that his addition of Oriental Sweet and Sour sauce toppings may be seen as nondescript. This runs in contrary to some scholars’ definition of entrepreneurship as requiring quantum changes in the products/ services to be justified as being entrepreneurial (Bygrave, 1985; Bygrave & Hofer, 1991).
Consistent with creating new products for sale, someone who starts a business by providing a totally new way of serving his customers/ clients is considered to be entrepreneurial too. Though, it is often argued that there are no real new products or services in a case where one does not look to the past products and services for ideas for improvements. Thus, the notion of incremental improvements should be accepted as being innovative too.
Innovation in the business sense may not necessarily involve, in the physical sense, the introduction of a new product or service. It can be in the form of what is commonly known as creative imitations. For example, if an individual starts selling a product that is already common in his area or country, he will not be seen as being entrepreneurial. However, if he is the first to sell the same product in a virgin locale or to an untouched market segment, he will be seen as an entrepreneur in his own rights.
Take Muhammad Yunus, for example. Yunus became an entrepreneur when he started a micro-loan program for the poor villagers in a rural part of Bangladesh named Grameen, with only US$26. The loan was divided among 42 villagers to assist them to buy small items such as combs, scissors, needles and other necessities to start their own home businesses. In the past 22 years, Grameen Bank has grown with over $2 billion loans granted. It has now become a model for several micro-loan facilities.
>From the following example, Yunus created banking and lending facilities in Grameen specifically for the poor villagers. Banking and lending money activities are not new but Yunus was the first to provide such facilities in a rural part of Bangladesh and that is definitely innovation and risk-bearing on his part as a social entrepreneur. In short, innovation need not arise mainly from a new product or service but it could be an old product or service finding a new market for penetration.
An individual could be termed as an entrepreneur if he or she sells a product or service using new systems and/ or mediums of marketing, distribution or production methods as a basis for a new business venture. A good example will be Jeff Bezos, the founder of Amazon, the successful Web-based bookstore. He was one of the first to sell books on a large scale using an online store and also patented the one-click system for online buying. Though selling books is not an innovation in itself, Jeff Bezos was innovative in the use of the Internet then as a viable marketing and sales channel for selling books.
Another example from the field of e-commerce is Stuart Skorman, the founder of Reel.com. Reel.com is essentially one of the first cyber movie store with a very large inventory of over a 100 000 videos. Though setting a movie store was revolutionary then, Reel.com main distinction was being known as the first online store to expand by opening an offline store. The founder felt that by doing so, the online store could be an advertisement for the offline store and vice versa, thus strengthening this click and mortar business venture- an example of creativity and innovation applied in a profitable business context.
Conclusion:
This paper has started as an attempt to redefine the term of entrepreneurship but ended up ‘updating’ the wheel, based on the definition as proposed by Schumpeter. The paper expanded on this influential work by giving examples to illustrate what innovation in entrepreneurship was and hope that along the way, new insights were unearthed in the study of defining entrepreneurship.
In summary, the author hopes that this paper would further encourage the infusion of creative thinking and innovation within the educational system to nurture future entrepreneurs with a competitive edge. In the author’s view, the characteristics and capabilities to set up a new business venture based on doing things that have not done before should be encouraged. Innovation needs to be the cornerstone of entrepreneurship as opposed to the mere setting up of another new enterprise without implementing changes or adding features of improvements to the products and services provided and/ or its business processes.
About The Author
Dr. Alvin Chan is a Senior Research Consultant at First Quatermain Centre of Collaborative Innovation (http://www.firstquatermain.com).
For reprints permission, please contact bizguru88@hotmail.com
In a world where ideas drive economies, it is no wonder that innovation and entrepreneurship are often seen as inseparable bedfellows. The governments around the world are starting to realize that in order to sustain progress and improve a country’s economy, the people have to be encouraged and trained to think out-of-the-box and be constantly developing innovative products and services. The once feasible ways of doing business are no longer guarantees for future economic success!
In response to this inevitable change, some governments are rethinking the way the young are educated by infusing creative thinking and innovation in their nation’s educational curriculum. In the same vein, they are putting much emphasis on the need to train future entrepreneurs through infusing entrepreneurship components within the educational system, especially at the tertiary level.
Some countries have taken this initiative to a higher level by introducing entrepreneurship education at elementary schools and encouraging them to be future entrepreneurs when they are of age. In a series of survey funded by Kauffman Center for Entrepreneurial Leadership, it was found that nearly seven out of 10 youths (aged 14-19) were interested in becoming entrepreneurs.
Being an entrepreneur is now the choice of the new generation as compared to the preferred career choices of yesteryears such as being a doctor, lawyer or a fighter pilot. In a recent visit to the bustling city of Shanghai in China, an informal survey was carried out among Chinese youths by the author. The results of the survey showed that being an entrepreneur, especially in the field of computer and e-commerce, is perceived as a ‘cool’ career and is an aspiration for many Chinese youths Prior to the ‘opening up’ of modern China, being an entrepreneur was perceived as the outcome of one’s inability to hold a good government job and those who dared to venture, were often scorned at by their peers. Times have indeed changed.
With this change in mindset and the relative knowledge that entrepreneurs bring forth increased job creations, the awareness and academic studies of entrepreneurship have also heightened. In many tertiary institutes, many courses of entrepreneurship and innovation are being developed and offered to cater to the increasing demand. The term “entrepreneurship” has also evolved with numerous variations. The proliferation of jargons such as netpreneur, biotechpreneur, technopreneur and multipreneur are coined to keep up with the ever-changing times and business conditions that surround us.
In view of these changes, it is important that the definition of entrepreneurship be refined or redefined to enable its application in this 21st century. To put it succinctly, “Good science has to begin with good definitions (Bygrave & Hofer, 1991, p13).” Without the proper definition, it will be laborious for policymakers to develop successful programs to inculcate entrepreneurial qualities in their people and organizations within their country.
The paper will provide a summary of the definitions of entrepreneurship provided by scholars in this subject area. The author will also expand on one of the definitions by Joseph Schumpeter to create a better understanding of the definition of the term “entrepreneurship” as applied in today’s business world.
Entrepreneurship through the Years:
It was discovered that the term ‘entrepreneurship’ could be found from the French verb ‘entreprende’ in the twelfth century though the meaning may not be that applicable today. This meaning of the word then was to do something without any link to economic profits, which is the antithesis of what entrepreneurship is all about today. It was only in the early 1700’s, when French economist, Richard Cantillon, described an entrepreneur as one who bears risks by buying at certain prices and selling at uncertain prices (Barreto, 1989, Casson 1982) which is probably closer to the term as applied today.
In the 1776 thought-provoking book ‘The Wealth of Nations’, Adam Smith explained clearly that it was not the benevolence of the baker but self-interest that motivated him to provide bread. From Smith’s standpoint, entrepreneurs were the economic agents who transformed demand into supply for profits.
In 1848, the famous economist John Stuart Mill described entrepreneurship as the founding of a private enterprise. This encompassed the risk takers, the decision makers, and the individuals who desire wealth by managing limited resources to create new business ventures.
One of the definitions that the author feels best exemplifies entrepreneurship was coined by Joseph Schumpeter (1934). He stated that the entrepreneur is one who applies “innovation” within the context of the business to satisfy unfulfilled market demand (Liebenstein, 1995). In elaboration, he saw an entrepreneur as an innovator who implements change within markets through the carrying out of new combinations. The carrying out of new combinations can take several forms:
The introduction of a new good or standard of quality;
The introduction of a novel method of production;
The opening of a new market;
The acquisition of a new source of new materials supply; and
The carrying out of the new organization in any industry.
Though the term ‘innovation’ has different meanings to different people, several writers tended to see “innovation” in the form of entrepreneurship as one not of incremental change but quantum change in the new business start-ups and the goods/services that they provide (egs, Bygrave, 1995; Bygrave & Hofer, 1991).
In the view of Drucker (1985), he perceived entrepreneurship as the creation of a new organization, regardless of its ability to sustain itself, let alone make a profit. The notion of an individual who starts a new business venture would be sufficient for him/her to be labeled as an entrepreneur. It is this characteristic that distinguishes entrepreneurship from the routine management tasks of allocating resources in an already established business organization. Though the definition tends to be somewhat simplistic in nature, it firmly attaches the nature of entrepreneurial action with risk-taking and the bearing of uncertainty by the individual (Swoboda, 1983)
In a Delphi study, Gartner (1990) found eight themes expressed by the participants that constitute the nature of entrepreneurship. They were the entrepreneur, innovation, organization creation, creating value, profit or non-profit, growth, uniqueness, and the owner-manager. The themes could be seen as a derivative and expansion of Schumpter’s earlier concept.
Expanding on Schumpeter’s Definition:
After digesting the numerous definitions of entrepreneurship, one would tend to see a strong link between these two terms: entrepreneurship and innovation. In retrospect, most of the definitions tended to be, to some extent, a re-work and expansion of Schumpeter’s definition of entrepreneurship (which is that of innovation being applied in a business context).
As defining the term of ‘innovation’ is highly debatable and would merit a paper on its own, the author has thus, for convenience, summarised the definition of innovation. Innovation can be perceived simply as the transformation of creative ideas into useful applications by combining resources in new or unusual ways to provide value to society for or improved products, technology, or services.
In the author’s opinion, the difficulties of defining “innovation” could be the reason for the quandary one finds in attempting to arrive at a clear-cut definition of the term “ Entrepreneurship”.
Take for example, if someone starts another run-of-the-mill hot dog stand in the streets of New York, will he termed as an entrepreneur? According to Drucker’s definition, he will be seen as one. However, if the above definition by Schumpeter was used as a guideline, the answer is probably ‘NO’.
Why? The core of the matter lies in what is so innovative about setting up another hot-dog stand which are in abundance in New York. On the contrary, if he is the first one to start a stand selling hot-dogs with Oriental Sweet and Sour sauce topping; he could be termed as an entrepreneur (even based on Schumpeter’s requirement) as he has done what others have not done before. In the context of entrepreneurship, creativity and innovation are key points in the whole scheme of things.
In this manner, by adding “innovative” features to a product or services and setting up a business based on these additional features to compete in the existing market, new entrants may be able to gain this competitive advantage over existing market players.
In the case of the hot-dog seller, it may be argued that his addition of Oriental Sweet and Sour sauce toppings may be seen as nondescript. This runs in contrary to some scholars’ definition of entrepreneurship as requiring quantum changes in the products/ services to be justified as being entrepreneurial (Bygrave, 1985; Bygrave & Hofer, 1991).
Consistent with creating new products for sale, someone who starts a business by providing a totally new way of serving his customers/ clients is considered to be entrepreneurial too. Though, it is often argued that there are no real new products or services in a case where one does not look to the past products and services for ideas for improvements. Thus, the notion of incremental improvements should be accepted as being innovative too.
Innovation in the business sense may not necessarily involve, in the physical sense, the introduction of a new product or service. It can be in the form of what is commonly known as creative imitations. For example, if an individual starts selling a product that is already common in his area or country, he will not be seen as being entrepreneurial. However, if he is the first to sell the same product in a virgin locale or to an untouched market segment, he will be seen as an entrepreneur in his own rights.
Take Muhammad Yunus, for example. Yunus became an entrepreneur when he started a micro-loan program for the poor villagers in a rural part of Bangladesh named Grameen, with only US$26. The loan was divided among 42 villagers to assist them to buy small items such as combs, scissors, needles and other necessities to start their own home businesses. In the past 22 years, Grameen Bank has grown with over $2 billion loans granted. It has now become a model for several micro-loan facilities.
>From the following example, Yunus created banking and lending facilities in Grameen specifically for the poor villagers. Banking and lending money activities are not new but Yunus was the first to provide such facilities in a rural part of Bangladesh and that is definitely innovation and risk-bearing on his part as a social entrepreneur. In short, innovation need not arise mainly from a new product or service but it could be an old product or service finding a new market for penetration.
An individual could be termed as an entrepreneur if he or she sells a product or service using new systems and/ or mediums of marketing, distribution or production methods as a basis for a new business venture. A good example will be Jeff Bezos, the founder of Amazon, the successful Web-based bookstore. He was one of the first to sell books on a large scale using an online store and also patented the one-click system for online buying. Though selling books is not an innovation in itself, Jeff Bezos was innovative in the use of the Internet then as a viable marketing and sales channel for selling books.
Another example from the field of e-commerce is Stuart Skorman, the founder of Reel.com. Reel.com is essentially one of the first cyber movie store with a very large inventory of over a 100 000 videos. Though setting a movie store was revolutionary then, Reel.com main distinction was being known as the first online store to expand by opening an offline store. The founder felt that by doing so, the online store could be an advertisement for the offline store and vice versa, thus strengthening this click and mortar business venture- an example of creativity and innovation applied in a profitable business context.
Conclusion:
This paper has started as an attempt to redefine the term of entrepreneurship but ended up ‘updating’ the wheel, based on the definition as proposed by Schumpeter. The paper expanded on this influential work by giving examples to illustrate what innovation in entrepreneurship was and hope that along the way, new insights were unearthed in the study of defining entrepreneurship.
In summary, the author hopes that this paper would further encourage the infusion of creative thinking and innovation within the educational system to nurture future entrepreneurs with a competitive edge. In the author’s view, the characteristics and capabilities to set up a new business venture based on doing things that have not done before should be encouraged. Innovation needs to be the cornerstone of entrepreneurship as opposed to the mere setting up of another new enterprise without implementing changes or adding features of improvements to the products and services provided and/ or its business processes.
About The Author
Dr. Alvin Chan is a Senior Research Consultant at First Quatermain Centre of Collaborative Innovation (http://www.firstquatermain.com).
For reprints permission, please contact bizguru88@hotmail.com
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