EntrepreneurshipEntrepreneurship

Integrated DefinitionIntegrated Definition

MythsMyths

SchoolsSchools

The Evolution of EntrepreneurshipThe Evolution of Entrepreneurship

• Entrepreneur is derived from the French Entrepreneur is derived from the French entreprendre, meaning “to undertake”.entreprendre, meaning “to undertake”.

• Although no single definition of Although no single definition of entrepreneur exists and no one profile entrepreneur exists and no one profile can represent today’s entrepreneur, can represent today’s entrepreneur, research is providing an increasingly research is providing an increasingly sharper focus on the subject.sharper focus on the subject.

Robert C. Ronstadt put together a Robert C. Ronstadt put together a summary description:summary description:

• Entrepreneurship is the dynamic process of Entrepreneurship is the dynamic process of creating incremental wealth. This wealth is creating incremental wealth. This wealth is created by individuals who assume the major created by individuals who assume the major risks in terms of equity, time, and/or career risks in terms of equity, time, and/or career commitment of providing value for some commitment of providing value for some product or service. The product or service product or service. The product or service itself may or may not be new or unique but itself may or may not be new or unique but value must somehow be infused by the value must somehow be infused by the entrepreneur by securing and allocating the entrepreneur by securing and allocating the necessary skills and resources.necessary skills and resources.

An Integrated DefinitionAn Integrated Definition• Entrepreneurship is a dynamic process of vision, Entrepreneurship is a dynamic process of vision,

change, and creation. It requires an application of change, and creation. It requires an application of energy and passion towards the creation and energy and passion towards the creation and implementation of new ideas and creative solutions. implementation of new ideas and creative solutions. Essential ingredients include the willingness to take Essential ingredients include the willingness to take calculated risks- in terms of time, equity, or career; calculated risks- in terms of time, equity, or career; the ability to formulate an effective venture team; the ability to formulate an effective venture team; the creative skill to marshall needed resources; the the creative skill to marshall needed resources; the fundamental skills of building a solid business plan; fundamental skills of building a solid business plan; and, finally, the vision to recognize opportunity and, finally, the vision to recognize opportunity where others see chaos, contradiction, and where others see chaos, contradiction, and confusion.confusion.

The Myths of EntrepreneurshipThe Myths of Entrepreneurship

• Myth 1: Entrepreneurs Are Doers, NotMyth 1: Entrepreneurs Are Doers, Not Thinkers Thinkers

• Myth 2: Entrepreneurs Are Born, Not MadeMyth 2: Entrepreneurs Are Born, Not Made

• Myth 3: Entrepreneurs Are Always InventorsMyth 3: Entrepreneurs Are Always Inventors

• Myth 4: Entrepreneurs Are Academic andMyth 4: Entrepreneurs Are Academic and Social Misfits Social Misfits

• Myth 5: Entrepreneurs Must Fit the “Profile”Myth 5: Entrepreneurs Must Fit the “Profile”

• Myth 6: All Entrepreneurs Need Is MoneyMyth 6: All Entrepreneurs Need Is Money

The Myths of EntrepreneurshipThe Myths of Entrepreneurship

• Myth 7: All Entrepreneurs Need Is LuckMyth 7: All Entrepreneurs Need Is Luck

• Myth 8: Ignorance Is Bliss For EntrepreneursMyth 8: Ignorance Is Bliss For Entrepreneurs

• Myth 9: Entrepreneurs Seek Success ButMyth 9: Entrepreneurs Seek Success But Experience High Failure Rates Experience High Failure Rates

• Myth 10: Entrepreneurs Are Extreme RiskMyth 10: Entrepreneurs Are Extreme Risk Takers (Gamblers) Takers (Gamblers)

The Corridor PrincipleThe Corridor Principle

States that with every venture States that with every venture launched, new and unintended launched, new and unintended

opportunities often arise.opportunities often arise.

Approaches to Approaches to EntrepreneurshipEntrepreneurship

• Schools of Thought ApproachSchools of Thought Approach

• Process ApproachesProcess Approaches

Entrepreneurial Schools-of-Thought ApproachEntrepreneurial Schools-of-Thought Approach

Environmental School of ThoughtEnvironmental School of ThoughtFinancial School of ThoughtFinancial School of ThoughtDisplacement School of ThoughtDisplacement School of Thought{{Macro ViewMacro View

{{Micro ViewMicro View

Entrepreneurial Trait School Entrepreneurial Trait School of Thought (People School) of Thought (People School)Venture Opportunity School Venture Opportunity School of Thought of ThoughtStrategic Formulation School Strategic Formulation School of Thought of Thought

Macro ViewMacro View(External locus of control)(External locus of control)

The Environmental School of ThoughtThe Environmental School of Thought

• The Financial/Capital School of ThoughtThe Financial/Capital School of Thought

• The Displacement School of ThoughtThe Displacement School of Thought1. Political Displacement1. Political Displacement

2. Cultural Displacement2. Cultural Displacement

3. Economic Displacement3. Economic Displacement

The Micro ViewThe Micro View(internal locus of control)(internal locus of control)

• The Entrepreneurial Trait School of ThoughtThe Entrepreneurial Trait School of Thought

• The Venture Opportunity School of ThoughtThe Venture Opportunity School of Thought

• The Strategic Formulation School of ThoughtThe Strategic Formulation School of Thought

Ronstadt Views Strategic Formulation Ronstadt Views Strategic Formulation as a Leveraging of Unique Elementsas a Leveraging of Unique Elements

• Unique Markets: mountain gap strategiesUnique Markets: mountain gap strategies

• Unique People: great chef strategiesUnique People: great chef strategies

• Unique Products: better widget strategiesUnique Products: better widget strategies

• Unique Resources: water well strategiesUnique Resources: water well strategies

Process ApproachesProcess Approaches• Integrative ApproachIntegrative Approach

• Entrepreneurial Assessment Entrepreneurial Assessment ApproachApproach

• Multidimensional ApproachMultidimensional Approach

An Integrative Model of An Integrative Model of Entrepreneurial Inputs and OutcomesEntrepreneurial Inputs and Outcomes

Identify Identify OpportunityOpportunity

Assess and Assess and acquireacquirenecessary necessary resourcesresources

ImplementationImplementation

EnvironmentalEnvironmentalopportunitiesopportunities

EntrepreneurialEntrepreneurialindividualsindividuals

An An organizational organizational contextcontext

Unique Unique business business conceptsconcepts

ResourcesResources

InputsInputs

The The Entrepreneurial Entrepreneurial

ProcessProcess

Number of eventsNumber of events(and)(and)

degree ofdegree ofentrepreneurshipentrepreneurship

•A going ventureA going venture

•Value creationValue creation

•New products,New products, services services

•ProcessesProcesses

•TechnologiesTechnologies

•Profits and/orProfits and/or personal personal benefits benefits

•Employment,Employment, asset, and asset, and revenue revenue growth growth

OutcomesOutcomes

EntrepreneurialEntrepreneurialIntensityIntensity

InnovationInnovation Proactive-Proactive-nessness

Risk takingRisk taking

Entrepreneurial Assessment ApproachEntrepreneurial Assessment Approach

TypeTypeofof

VentureVenture

TypeTypeofof

EntrepreneurEntrepreneur

TypeTypeofof

EnvironmentEnvironment

Qualitative,Qualitative,Quantitative,Quantitative,Strategic, andStrategic, and

EthicalEthical

ASSESSMENTSASSESSMENTS

Do the Results of the Assessments Make Sense Given:Do the Results of the Assessments Make Sense Given:

Prior ExperiencePrior Experienceand Educationand Education

EarlyEarlyCareerCareer

MidMidCareerCareer

LateLateCareerCareer

Stage of Entrepreneurial CareerStage of Entrepreneurial Career

Multidimensional ApproachMultidimensional Approach

Individual(s)Individual(s)

OrganizationOrganizationEnvironmentEnvironment

ProcessProcess

Entrepreneurial ManagementEntrepreneurial Management• The underlying theme of this book is the discipline The underlying theme of this book is the discipline

of entrepreneurial management:of entrepreneurial management:– Entrepreneurship is based upon the same principles, Entrepreneurship is based upon the same principles,

whether the entrepreneur is an existing large institution or whether the entrepreneur is an existing large institution or an individual starting his or her new venture single-an individual starting his or her new venture single-handed. It makes little or no difference whether the handed. It makes little or no difference whether the entrepreneur is a business or a nonbusiness public-service entrepreneur is a business or a nonbusiness public-service organization, nor even whether the entrepreneur is a organization, nor even whether the entrepreneur is a governmental or nongovernmental institution. The rules governmental or nongovernmental institution. The rules are pretty much the same, the things that work and those are pretty much the same, the things that work and those that don’t are pretty much the same, and so are the kinds that don’t are pretty much the same, and so are the kinds of innovations and where to look for them. In every case of innovations and where to look for them. In every case there is a discipline we might call Entrepreneurial there is a discipline we might call Entrepreneurial Management.Management.