Entrepreneurship Studies Chapter 1 1232804769353991 2

Entrepreneurshi
p studies
Chapter 1
Cosmopoint International University College, School of

Business 2007
Introduction to Entrepreneurship
What is Entrepreneurship?
Entrepreneurship is the process of creating
something new of value by devoting (giving)

the necessary time and effort.
By accepting and acknowledging the
necessary financial, psychological, and social

risks, and
Finally receiving the resulting rewards be it

monetary and personal satisfaction and
freedom to do what you want.
Robert D.Hisrich, M. Peters & D.A Shepherd
Introduction to
Entrepreneurship
Simple Definition
Process of creating something new and
assuming the risks and rewards.
Robert D.Hisrich, M.P.Peters &
D.A.Shepherd
Introduction to
Entrepreneurship
What is an Entrepreneur?
He or she is an individual who actively form or lead their
own business and nurture them for growth and
prosperity.
UiTM Entrepreneurship Study Group
A person who creates and manages change by the
recognition of opportunities (needs, wants,

opportunities, problems, and challenges) and develops
people and manages resources to take advantage of the
resources to take the opportunity and creates a venture
(profitable business).
Eston Kimani, MIT
Introduction to
Entrepreneurship
What are the different outcomes of engaging in
entrepreneurship?
Innovation or newness product or service.

Organizing resources finance, people, physical and information
resource.
Creating new product or service.

Generating wealth
Taking risk in a business venture.
Prepared to face uncertainty.
Create job opportunity
Increase the abundance of wealth generation for the nation.
Introduction to
Entrepreneurship
Characteristics or Personal Competency of an
Entrepreneur.
Initiative
Sees and Acts on Opportunities
Persistence
Information seeking
Concern for High Quality Work and Output Increased Productivity.
Commitment to Work Contract
Efficiency Orientation
Systematic and organized planning
Problem Solving
Self Confidence
Assertiveness Negotiation with suppliers & customers
Persuasive & Influential Peers and stakeholders
Inspirational - employees
Effective Communicator external & internal of organization.
Introduction to
Entrepreneurship
The Role of Entrepreneurship in

Economic Growth.
In order for Entrepreneurs to thrive in a
nation, the Government must play important
role in creating the kind of business
environment that create the basis for
growth, stability and future success of
entrepreneurs.
Introduction to
Entrepreneurship
The Role of Entrepreneurship in Economic Growth .
This primarily involves the:
Increasing the per capita output and income of the people of the
country.
Initiating and creating change in the structure of business and society.
Further growth and increased output arises, thus to enable more wealth
to be divided among the various participants ( stakeholders).
Generation of innovation that leads to the creation of new product and

service.
Improvisation and modification on existing product to better suit

market and customers needs.
Creation of self employment and to cut back the dependency of

potential employment of new workers in government sectors.
Streamline of the private sector and encourage the inclusion of new

technology that is less labor dependent.
Increase in the national output which in turn lead to greater and

stronger economic growth.
Laying the seed bed for creating new entrepreneur in various new
technologies such as Bio Technology, Bio Technology Medicine, Nano

Technology , New Material Technology etc.
Introduction to
Entrepreneurship
The Role of Entrepreneurship in Economic Growth.
This primarily involves the:
Acting as a catalyst to nurture intrapreneurs and
corporate entrepreneurs in a business organization.
Providing Government grant and subsidy to existing and

would be entrepreneurs to aid their business
development.
Providing Entrepreneurs in the SMI/SME various types
of business loans to act as an impetus for business and

economic growth in the nation. To facilitate this various
business developments of entrepreneurs, Commercial
Banks, SME Bank, Bank Pertanian Malaysia, EXIM
Bank, and Bank Pembangunan Berhad provide the
support.
Government decision to engage both would
be bumiputra and non-bumiputra in various

entrepreneurship development schemes.
Providing knowledge and information
through seminars, conferences, exhibitions,

various business, small business and
entrepreneurial business e-portals.
Providing of various financial, information
resources support from various government

agencies and national corporations such
MDC,MARDI, FAMA, RISDA, FELDA,
MATRADE, TELEKOMS MALAYSIA, TNB,
MAS etc.
The Entrepreneurial Process

What is the Entrepreneurial Process?
The process of pursuing (going after) a new
venture or business,
Whether it is a new product going into an

existing market OR
Existing product going into a new markets OR

The creation of a totally new organization.
Introduction to
Entrepreneurship
First Entrepreneurial Process:
Creation Process creating something new

of value.
Second Entrepreneurial Process:
Requires the commitment of the necessary
time and effort. Appreciate and understand

the importance of time and effort devoted to
create something new and make it workable.
Third Entrepreneurial Process:
Involves the enjoyment of the rewards

(Freedom, monetary) after the effort,
followed by personal satisfaction.
Introduction to
Entrepreneurship
The Entrepreneurial Process Four
distinct process: Identification and evaluation of the
opportunity.
Development of the Business Plan.

Determination of the required resources
Management of the resulting enterprise.
Introduction to
Entrepreneurship
The Benefits of Entrepreneurship:

Opportunity to create your own destiny
Owning a business provides an entrepreneurs
the independence and the opportunity to
achieve what is important to them.
Entrepreneurs want to decide what they want

in their lives, and they use their businesses to
make their desire a reality (come true).
Introduction to
Entrepreneurship
The Benefits of Entrepreneurship:
Opportunity to make a Difference
More and more entrepreneurs are starting
businesses because they see this as an opportunity to

make a difference in a route or way that is personally
important to them.
Opportunity to reach your full potential.

Many people find their work not challenging and not
exciting.
For entrepreneurs there is little difference between

work and play.
Entrepreneurs see their business as a vehicle of self
expression of personal desire and eventual self

actualization of their personal goals the pinnacle of
their career success.
The Benefits of Entrepreneurship

Opportunity to reap extraordinary (luar
biasa) profits.
The profit earned by an entrepreneur are an
important motivation and indication factor
for further increased performance. Thus
these could spur them to greater
achievement and success.
Benefits of Entrepreneurship.
Societal Responsibility and Recognition.
Small business owners are among the most
admired, respected and trusted individuals of
society.
Customers have shown their trust and

faithfulness over their years for their business.
Help to contribute employment, business

opportunity in a particular locality or area.
Benefits of Entrepreneurship.
Opportunity to engage in work of their
choice
Small business owners tend to engage in
business that gives them personal satisfaction.

Though they may work long hours and engage
in very industrious work that is beneficial to
their organization and themselves.
Most of all the work they engage in helps to
benefits the community, society and the nation.
The Drawbacks of Entrepreneurship:

Uncertainty of Income
Opening and a running a business provides no
guarantee that an entrepreneur will earn enough

money and survive.
Engaging in the wrong business and not able gain

an advantage in the short run and eventually in
the long run can be disastrous.
Great effort and proper and effective management

need to used in beginning to ensure the
organization success.
The Drawbacks of Entrepreneurship
Risk of losing your entire Investment
Small business have a high failure rate.
Though is successful initially it faces financial
difficulty within the next five years.

Entrepreneurs must be prepared to face the
consequence of failure.
Entrepreneurs must have acute sense of observation
and be able to detect the early signs of failure.
If a business fails the entrepreneur must have a
contingency plan to overcome a bankruptcy or
personal failure.
Drawbacks of Entrepreneurship
Long Hours and Hard Work
Entrepreneurs tend to be generally workaholic, and under
tremendous pressure to produce the result they expect.
Entrepreneurs seldom find time to be away from the
business but tend to pour all their effort and resources to

achieve their personal entrepreneurial objective.
Some even go to extent of making big sacrifice and deprive

themselves of a personal life, wife and children and social
and family associates.
Lower Quality of Life until the business get
established.
In order for the business to be successful the

entrepreneur must engage himself to produce
the kind of result he expects.
He cannot rest on his laurels (take it easy)

until and certain the business has stabilized
and established.
High level of stress
Starting the business can be very rewarding experience,
but it can be stressful.
An entrepreneur have left the comfort and security of

secured job to venture into their own business.
Failure can bring about tremendous personal failure,
and in turn creates intense levels of anxiety and stress.
Financial burden may increase and the entrepreneur
may face difficulty sustaining the business or may decide

to call it for day and wind up the business for good.
Complete Responsibility
Must be prepared to make decision that are
unfavorable (swallow the bitter pill).
Must make decision in areas that the

entrepreneur is not familiar at all.
Fear of making decision that can have a
devastating effect on the business and its people.
Tremendous pressure to perform as the
entrepreneur is too deeply engaged in the

business
Discouragement
To undertake a business requires a lot of dedication,
discipline and tenacity.

During running the business they will face many
difficulties, obstacles which may difficult to
overcome.
Further difficulties, discouragement and
disillusionment are common emotions.
Successful entrepreneurs escape through rough
times or difficult times through sheer hard work, self
confidence and full of optimisms.
Ten Deadly Mistakes of Entrepreneurship:
Business entrepreneurship fail because:
Management Mistakes
Lack of Experience
Poor financial control
Weak marketing efforts
Failure to develop a strategic and effective plan
Uncontrolled Growth
Poor location
Improper inventory control
Incorrect or unsuitable pricing
The inability of to move into entrepreneurial thinking mindset
from the previous secured permanent managerial position held.
How to avoid failure in a Entrepreneurial
business.
Know your business in depth.
Develop a good, effective and solid Business Plan.
Manage your financial resources effectively.
Have a thorough and complete financial statement.
Learn hire and manage people effectively.
Keep physically fit, consume healthy foods, and
avoid addictive consumption cigarettes and alcohol.

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Entrepreneurshi

Cosmopoint International University College, School of

something new of value by devoting (giving)

By accepting and acknowledging the

necessary financial, psychological, and social

Finally receiving the resulting rewards be it

Robert D.Hisrich, M. Peters & D.A Shepherd

A person who creates and manages change by the

recognition of opportunities (needs, wants,

Innovation or newness product or service.

Creating new product or service.

The Role of Entrepreneurship in

Initiating and creating change in the structure of business and society.

Generation of innovation that leads to the creation of new product and

Improvisation and modification on existing product to better suit

Creation of self employment and to cut back the dependency of

Streamline of the private sector and encourage the inclusion of new

Increase in the national output which in turn lead to greater and

technologies such as Bio Technology, Bio Technology Medicine, Nano

corporate entrepreneurs in a business organization.

Providing Government grant and subsidy to existing and

Providing Entrepreneurs in the SMI/SME various types

of business loans to act as an impetus for business and

Government decision to engage both would

be bumiputra and non-bumiputra in various

Providing knowledge and information

through seminars, conferences, exhibitions,

Providing of various financial, information

resources support from various government

The Entrepreneurial Process

Whether it is a new product going into an

Existing product going into a new markets OR

Creation Process creating something new

Second Entrepreneurial Process:

Requires the commitment of the necessary

time and effort. Appreciate and understand

Third Entrepreneurial Process:

Involves the enjoyment of the rewards

Development of the Business Plan.

The Benefits of Entrepreneurship:

Entrepreneurs want to decide what they want

businesses because they see this as an opportunity to

Opportunity to reach your full potential.

For entrepreneurs there is little difference between

Entrepreneurs see their business as a vehicle of self

expression of personal desire and eventual self

The Benefits of Entrepreneurship

Customers have shown their trust and

Help to contribute employment, business

business that gives them personal satisfaction.

The Drawbacks of Entrepreneurship:

guarantee that an entrepreneur will earn enough

Engaging in the wrong business and not able gain

Great effort and proper and effective management

difficulty within the next five years.

Entrepreneurs seldom find time to be away from the

business but tend to pour all their effort and resources to

Some even go to extent of making big sacrifice and deprive

In order for the business to be successful the