My Own Entrepreneurship

Introduction

 The entrepreneurs are the most creative people in the world having unique personal characteristics of organizing, managing and assuming risks of starting enterprises or taking over an existing enterprise They are of three broad categories namely Novice Entrepreneurs, Serial Entrepreneurs, and portfolio entrepreneurs. ( Westhead , P and Wright , M 1998).

Novice entrepreneurs are inexperienced individuals with no prior business ownership interests, Serial entrepreneurs are those who currently own an economically active firm, and had owned a business since sold or closed down and Portfolio entrepreneurs are the individuals who simultaneously own equity stakes in two or more economically active firms. ( Matlay H 2005) They make powerful impacts on the society by creating jobs, producing new goods and services, contributing to taxes, and creating wealth thus sustaining or revitalizing country’s economy.

Self Analysis

Self Analysis gives me perspective of my personal strengths and weaknesses. I have asked my self the following questions.  See Also appendix 1

Reason for starting a business. What is my reason for entering into self-employment and why am I am doing it now? Am I being pulled into it by the lure of a great opportunity or an unfulfilled need, or pushed into it by dissatisfaction at my current job or any loss of employment.

My Personal suitability. Is this business for me? Do I have experience in this business? Will I have what it takes to make it happen?

Capital.  Do I have the cash to invest in this business, typically 10 to 25% of the total cash required to start and operate the business is required? Am I bankable (do I have good credit and good collateral)?

Income uncertainty.  Will I be comfortable with the fact that pay check (and associated benefits) are dependant upon my business, versus my employer?

Adaptability: Do I have the ability to cope with new situations and solve problems?

Competitiveness: Am I willing to compete and test myself against others?

Confidence: Do I believe that I can achieve what I set out to do?

Discipline: Have I the ability to stay focused and stick to schedule and deadlines?

Drive: What about my desire to work hard to accomplish my goals?

Honesty: My commitment to tell the truth and deal with people fairly

Organization: About my ability to structure my life and tasks and             information in order

Perseverance: My ability to refuse to quit, keep my goals in sight and work to achieve them despite obstacles.

Persuasiveness: Can I convince people to see my point of view and interest them in my ideals?

Risk Taking: Am I courageous to face possible losses?

Understanding: Can I listen to and empathize with others?

Vision: Can I visualize the end result of my goals while working to achieve them?

Understanding entrepreneurship

 An entrepreneur strongly believes in market opportunity and assumes a high level of personal, professional or financial risk to realize that opportunity.  His characteristics are natural creativity, gifted with readiness to take decisions without depending on data besides being a risk taking personality.  As entrepreneur is independent, he feels threatened when his organization grows necessitating delegation of work and formalizing the work routine.  The questioning of employees and their expectations are mostly not digested by the entrepreneur and either he quits by selling the grown up enterprise and start new enterprise or learn as his enterprise grows. In the former case, founder of Apple Computer Steve Wozniak left the company. (wisegeek)

In the latter, he remains in the enterprises and experiences what is called “ discontinuous learning”  As Deakins and Freel (1998) assert, “entrepreneurship and the growth process is essentially non-linear and discontinuous. It is a process that is characterized by significant and critical learning events. The ability of entrepreneurs to maximize knowledge as a result of experiencing these learning events will determine how successful their firm eventually becomes” It should be recognized that the entrepreneur and the business are so inextricably linked “that owner is still synonymous with business.” (Churchill and Louis, 1983: 34)

Hence research also shows that business performance also is inexorably linked to the emotional and financial well being of the entrepreneur, his family and other stakeholders. (Cope 2003)  They are action oriented and therefore their learning is experientially based. (Rae and Carswell, 2000)  It is also assumed that entrepreneurs’ learning by doing encompasses such activity as trial and error, explicit problem solving and discovery. (Deakins and Freel 1998: Young and Sexton, 1997) Studies reveal that successful entrepreneurs have the characteristics of Self-confidence, Achievement orientedness, Risk taking, Positive thinking, and Persistent action.

The entrepreneurs are also influenced by the antecedent factors and cultural background. However these antecedents and culture do not always determine their success or failures, which are due to many other factors as well. Besides the entrepreneurs are not always stable and they change over time.  They are guided by subjective judgements.

In studying their personality traits, we ignore influences of culture, environment, the role of education, learning and training and issues like age, race, sex and social class. Subject to the above observations, the entrepreneurs are found with the following characteristics with lifetime examples for better perception of the principles wherever possible. I shall show how in my own experience as an entrepreneur has had trapping of the traits though not all.

 They crave for independence and  are achievement oriented like Brent Hoberman co-founder of Lastminute.com and Charles Muirhead founder of Orchestream. (Paul Burns, 2001)

 They have gifted or acquired “internal locus of control “which habit enables them to control their destiny rather than being controlled by destiny. They are opportunistic, creating or exploiting change for profit like the serial entrepreneur like Sir Terence Conran born in 1930 dropped out of textiles course and took up an architectural job and pursued part time designing and furniture manufacturing of his own. Before too long he gave up architecture in 1952 and set up full time furniture manufacturing.

Soon in 1954 employed one assistant and part time designers and switched over to make ‘up-market soup-kitchens. 1959 he had started design consultancy for shop interiors and exhibition with 100 employees within two years. 1n 1960 he sold the restaurants. 1962 sold his 100,000 pounds stake to Morgan Grenfell and used the money start Habitat. Continuing the same serial starting of ventures from time to time, in 90 he was starting 19 restaurants and bars in London, one in Paris and more in Stockholm and New York. He also reopened Great Eastern Hotel. (Paul Burns, 2001)

They innovate and use innovation as their main tool to exploit opportunities.

They are self – confident, like Richard Thompson, founder- chairman of EMS Rupert Steiner. Thompson is quoted as saying ‘My mother gave me a massive self-belief. I will always try things. – there is nothing to lose’ (Paul Burns, 2001)

             They are proactive and decisive with high energy, like Tom Farmer, founder of Kwik-Fit (Paul Burns, 2001)

 They are self-motivated, like Martha Lane Fox co-founder of Last-minute.com (Paul Burns, 2001)

  They have vision and flair and willing to take greater risks and live with greater uncertainty, like Ernesto Schimitt founder of People-Sound.com and Ann Motley co-founder of The Iron Bed Company. ( Paul Burns, 2001)

  It must also be mentioned that education is one important antecedent influence on start-ups especially for entrepreneurial growth business.  Though unemployment is a strong push in to self-employment, entrepreneurs true to the meaning, set up business for more positive motives. A self-employed parent may motivate his son to follow his parent’s ways to set up his own business. Immigration to a foreign country is another influence that motivates immigrants to start own businesses like Anita Roddick, founder and Chairman Body Shop. (Paul Burns, 2001)

Innovation

An entrepreneur is said to engage in creative destruction in that he takes risks in the absence of established data in his chosen line of activity. This sheer risk taking character is what makes an entrepreneur unique.  The innovation is the specific tool of entrepreneur, which he uses to exploit change as opportunity

Innovation is different from Invention. Many inventors would not have been able to cash in on their invention but for the entrepreneurs who as innovators see opportunities in problems and put the inventors’ products in the market. In the words of Peter F. Drucker, innovation is the specific tool of entrepreneurs, the means by which they exploit change as an opportunity for a different business or different service.

Many instances of innovations are stated below to understand the concept of innovation better. Until Alexander Fleming, a London Doctor, in 1920 found that a pest, which was contaminating the bacteriological cultures, was actually a Bacterial Killer and the result “Pencillin mold became a valuable resource which is a trigger for innovation.

Another instance can be cited is the “Purchasing Power” which is the creation of innovator-entrepreneur.  Cyrus McCormick, invented instalment buying which virtually gave “purchasing power” to poor farmers of the US who could not buy harvesting machines paying full price. This gave them power to buy harvesting machine out of their future earnings rather than out of past savings. There are seven sources of innovative opportunities. (Peter F Drucker, 1985)

1 The Unexpected success– A department store had appliances section and fashion goods section.  Customer who came to buy primarily fashion goods bought also appliances sale of which surpassed sale of fashion goods. But their primary aim of being a fashion goods seller, made them think in terms of pushing down the sale of appliances just to restore earlier equation. Peter F drucker says that this unexpected success like in appliances sales is invariably ignored or rejected by the businesses. But for an innovator entrepreneur, he sees opportunity hidden in the appliances sales.( Peter F Drucker, 1985)

             2) Incongruities: It is a symptom of opportunity to innovate in that it speaks of underlying fault as in geology. It creates instability in which minor efforts can lead to major changes. The incongruities are not very apparent and do not manifest in figures and reports. (Peter F Drucker, 1985)

             3) Process need

As necessity is a mother of invention, a need is source of innovation. Peter F drucker calls it a process need.  It is not vague as in the above two unexpected success and incongruities. An example of the same being the development of preservative to keep the enzyme fresh under refrigeration for use in cataract surgery. Though the cataract surgery is a very old process in vogue for quite a long time without the preservative, now no eye surgeon can ever imaging doing the surgery without it. Though the process need had been there for a long time, it is the spirit of innovation by William Connor who developed the preservative, which brought it to the market. (Peter F Drucker, 1985)

            4) Industry and Market structures

            The above 4 sources are internal i.e they show up within an industry, a market or a business though they are symptoms of changes outside in the economy, in the society and in knowledge, where as the following are external sources of innovation. (Peter F Drucker, 1985)

            5)Demographics

Changes in population, its size, age structure, composition, employment, educational status, and income are unambiguous and predictable. (Peter F Drucker, 1985)

            6) Changes in perception

This is akin to seeing till now half full glass as half empty glass. This can be compared to the tremendous health care improvements in the 40 years. But with the new perceptions of the disease patterns due to advanced diagnostic methods, we are still far behind the real 100% health care. These changes in perception do give rise to innovation to bring entrepreneurship into play. (Peter F Drucker, 1985)

            7) New knowledge

Knowledge based innovation is called by Peter F Drucker as ‘Super Star” of entrepreneurship. Like super stars, these type of innovations are temperamental, capricious, and hard to manage according Peter F Drucker. The knowledge bases innovation has the longest lead-time for every stage becoming new knowledge to new technology to new processes, new products, and new services. (Peter F Drucker, 1985)

             The above discussion encompasses the meaning of entrepreneurship, entrepreneurial process and all the relevant information to have a broad understanding of entrepreneurship. Not all the characteristics need be found in an entrepreneur.

I   perceive that by becoming an entrepreneur I seize an opportunity to accumulate wealth and get opportunity work for myself, make my own decisions and be my own boss and feel a sense of independence. Besides I also derive a sense of satisfaction and contentment and a sense of high self esteem with feeling of accomplishment.  I am also able to contribute to the society by providing jobs and also motivate others to start their own businesses.

I am also aware that by being an entrepreneur I will have to face uncertainties of business failure and possibilities of losing my money and also of the investors besides incurring long term indebtedness And that there are bound to be obstacles and barriers on the way, financial insecurity, long hours of work stress due to hard work and loneliness.

  I will give brief account of my own perceived experience as an entrepreneur to show how the above theories are practically relevant and found in practice.

I am a 22-year-old female and I will soon become a budding entrepreneur in Tourism and Hospitality Industry once I am out of college and once I undergo internship in my favourite Star Hotel. It is my avowed wish to start my own Tourism & Hospitality Industry in five years time from now on by a modest beginning. The study of principles of entrepreneurship and characteristics of entrepreneur made me reflect on my past life. I feel I am already a born entrepreneur and the learning of entrepreneurship reassures me that I can launch my career in Tourism and Hospitality industry   with a qualification of ‘Born and Made’ entrepreneur.

I say born because I seem to have some inborn entrepreneurial qualities of entrepreneur and also inherited characteristics of my grand father who had been said to be running a Restaurant at the nearby Harbour. Though my father did not pursue his father’s business, the remains of my grandfather’s business kept at home as his memorial keep urging me start something of my own in future when I have to settle down in life after my graduation. Fortunately I happen to live near the sea shore and it is my plan start a Tourism spot about 3 kms away from my home where my owns a piece of land.

As the only daughter and child in the family, I have no competition in the family to inherit the property. I have plenty of innovative ideas out of which at least three ideas will click as no one has tried them.  But I do visualize opportunities in those areas where people fear to tread. I will keep the ideas close to my heart and hence I am not going to reveal them now. But the fact that I do have innovative ideas should prompt my co-students, mentor, parents and peers to think I am a potential entrepreneur.

While I will be launching my own industry after some practical orientation in my favourite Star hotel belonging to Sheraton group, I will take care to see what ever I have learnt about entrepreneurship will be applied religiously in practice. To cite a few, I have the following value added services in mind.

They are Body Feng-Shui ( yes, we can design and  reshape or dress & wear certain things at certain sides of the body according to Feng-shui). I shall offer also the most difficult of Yoga , i.e Kundalini Yoga in a simplified form as I have already received distance education on the same from the 95 years young “ recently-passed-away Vedatri Mahirishi” in South India  whose Ahsram I am planning to visit for 2 months in- house training  after my graduation.

The Kundalini yoga not only expands consciousness but also enables people to be spiritually connected to one another thus promoting mutual understanding to avoid frictions in the society.   Another one is the most delicious food from India i.e Idli & Dosai made from Hand milled rice and not from machine milled rice grown in my own farm.  This will be fibrous food to add roughage to the food, which would prevent cancer. To make it a commercial success, I shall take care to check on economics of the project and economies of scale to cross break-even point within one year of my starting the Tourism Industry.

Conclusion

It must be borne in mind that there exists no such thing as one identifiable and universal entrepreneurial culture. The key to initiating the process of entrepreneurship lies within the individual members of the society and the degree to which a spirit of enterprise exists or can be stimulated. (International Journal of Entrepreneurial Behaviour and Research- April 2000 )

References

Churchill, N. C. and Lewis, V. L. (1983) ‘The Five Stages of Small Business Growth’, Harvard Business Review (3): 30–50.

Cope Jason, Lancaster University, UK on Entrepreneurial Learning and Critical Reflection

Deakins, D. and Freel, M. (1998) ‘Entrepreneurial Learning and the Growth Process in SMEs’, The Learning Organization 5(3): 144–55.

International Journal of Entrepreneurial Behaviour and Research- April 2000 Volume 6 issue 2 pages 59-71

Matlay Harry, 2005, UCE Business School, Birmingham, UK on “What is entrepreneurship and does it matter?”

Paul Burns, 2001, Entrepreneurship and Small Business

Peter F Drucker, 1985, Innovation and Entrepreneurship, Practice and Principles.

Rae, D. and Carswell, M. (2000) ‘Using a Life-story Approach in Researching Entrepreneurial Learning: The Development of a Conceptual Model and its Implications in the Design of Learning Experiences’, Education and Training 42(4/5): 220–7.

Young, J. E. and Sexton, D. L. (1997) ‘Entrepreneurial Learning: A Conceptual Framework’,Journal of Enterprising Culture 5(3): 223–48.

Westhead, P. and Wright, M. (1998), “Novice, serial and portfolio founders: are they different?”, Journal of Business Venturing, Vol. 13 No. 3, pp. 173-204.

Wisegeek available at F:entrepreneurshipWhat is an Entrepreneur.htm accessed on 6 Aug 2006

Bibliography

Mezias, Stephen J Organizational Dynamics of Creative Destruction : Entrepreneurship and the Emergence of industries.

Paul Burns, 2001, Entrepreneurship and Small Business

Peter F Drucker, 1985, Innovation and Entrepreneurship, Practice and Principles.

Walkins, David, Annual Review of Progress in Entrepreneurship Research: Volume 2, 2002-2003