Entrepreneurship and Management 💚

Entrepreneur definition

Someone who identifies a gap in the market and uses sufficient research to take calculated risks to make a profit

Factors of production

Natural resources / land, entrepreneur, labour and capital

(FOP) Entrepreneur

Owner, reward is profit

(FOP) Labour

Employees, reward is wages/salaries

(FOP) Capital

Money and fixed assets, reward is interest

(FOP)Natural resources

Land / raw materials, reward is rent

(FOP) Role of the entrepreneur

Combines the other 3 factors in a business to produce goods and services that will be sold to satisfy the needs of consumers

Types of entrepreneurial businesses 

Home-based, survivalist, micro, small and medium

(Types of entrepreneurial businesses) Home based

Skill based, may be a choice or necessity (due to disability) Eg - bookkeeping, sewing, woodwork

(Types of entrepreneurial businesses) Survivalist

Usually not by choice, high rate of unemployement and poor education and infrastructure force people to make a living by selling fresh produce, items or whatever raw materials they can find.

(Types of entrepreneurial businesses) Micro

More structured than survivalist, raw materials are obtained from suppliers and they have fixed selling points such as flea markets or caravans

(Types of entrepreneurial businesses) Small entrepreneurial

Normally startups, temporary premises until the business makes a profit, often hire staff on a temporary basis. Goal is growth not survival

(Types of entrepreneurial businesses) Medium

Employ full time staff, set target market, fixed premises and registered business

Importance of entrepreneurship

• Creates jobs

• Solves problems

• Builds wealth

• Helps the economy

• Encourages creativity 

(Importance of entrepreneurship) Creates jobs

Entrepreneurs start businesses and businesses need workers

(Importance of entrepreneurship) Solves problems

Entrepreneurs often create products or services that fix everyday problems as they are looking for gaps the market

(Importance of entrepreneurship) Builds wealth

Starting a business can help someone earn money and become financially independent

(Importance of entrepreneurship) Helps the economy

When business grow they pay taxes, buy supplies and support other businesses this helps the whole country become stronger and more succesful

(Importance of entrepreneurship) Encourages creativity

Entrepreneurship lets people turn their ideals into reality

Entrepreneurial tools

1. Market research

2. SWOT analysis

3. Business plans

Market research helps

Understand your target audience, competition and industry trends

Ethical behavior in market research

Must be followed to ensure fairness and respect for participants

Key ethical aspects in research

Clear purpose, privacy protection and voluntary participation

(Key ethical aspects in research) Clear purpose

The aim of the research must be clearly stated and understood

(Key ethical aspects in research) Privacy protection

Participants must be assured that their personal information will remain confidential

(Key ethical aspects in research) Voluntary participation

People should take part willingly and without pressure

Factors to consider when making a market research questionnaire

1. Know the goal

2. Keep questions short and clear

3. Mix of question types

4. Respect privacy

5. Test the questionnaire

(Factors to consider when making a market research questionnaire) Know your goal

Decide on the information that you want to collect

(Factors to consider when making a market research questionnaire) Keep questions short and clear

Use simple language that is easy to understand

(Factors to consider when making a market research questionnaire) Mix of question types

Includes multiple choice, yes/no, and open ended questions

(Factors to consider when making a market research questionnaire) Respect privacy

Don’t ask for personal details unless necessary and always keep responses confidential

(Factors to consider when making a market research questionnaire) Test the questionnaire

Try it with a small group first to ensure that it makes sense

SWOT Analysis (as an environmental scanning tool)

In some research it is possible to observe behavior and trends, SWOT can be used to determine the viability of a business venture

Business plan definition

An essential written document that provides a description and overview of a company’s future

Business plan importance

1. Gives direction

2. Helps get money

3. Tracks progress

4. Improves decision making

5. Prepares for challenges 

(Business plan importance) Gives direction

A business plan shows where the business wants to go and how to get there

(Business plan importance) Helps get money

If someone wants a loan or investment they need a business plan to prove their idea is serious and can make money

(Business plan importance) Tracks progress

Helps the business check if things are going well or if changes are needed

(Business plan importance) Improves decision making

With a clear plan, business owners can make smarter choices about spending, hiring and growing

(Business plan importance) Prepares for challenges

A good plan includes backup ideas in case things go wrong like sales dropping or costs going up

Critical Entrepreneurship Qualities 

Energy, patience, creativity, flexibility, problem solving, perseverance, ambition

Important factors to consider before starting a business

• Environmental scanning

• Forms of ownership

• Location

• General Management tasks and styles

Environmental scanning importance

• Spots opportunities and threats

• Guides strategic decisions

• Helps manage risks

• Boosts competitive edge

• Informs better policies

(Environmental scanning importance) Spots opportunities and threats

Helps the business see what’s coming - both good and bad

(Environmental scanning importance) Guides strategic decisions

Supports smart planning based on outside trends

(Environmental scanning importance) Helps manage risks

Warns about possible problems early

(Environmental scanning importance) Boosts competitive edge

Keeps the business ahead of others

(Environmental scanning importance) Informs better policies

Helps leaders make the right choices

Forms of ownership for a business should be based on

1. Number of owners

2. Size and type of business

3. Amount of control

4. Legal protection

5. Formation procedure

Location of a business should be based on

1. Availability of labour

2. Competitors

3. Suppliers

4. Target market

5. Crime rate

General management

A person responsible for overseeing the day to day operations of a business or department

Key responsibilities of general management

• Supervising different departments

• Making business decisions

• Managing resources

• Ensuring targets and goals are met

Management tasks

• Planning

• Organizing

• Leading

• Control

(Management tasks) Planning

Answering questions such as what tasks to do, how tasks should be done and by whom

(Management tasks) Organizing

Process of bringing together all the resources to achieve goals

(Management tasks) Leading

Directly influencing and guiding others

(Management tasks) Control

Ensuring that everything is going according to plan and then putting plans in place for any deviations

Leadership styles

• Charismatic leader

• Democratic leader

• Autocratic leader

• Laissez-Faire leader

(Leadership styles) Charismatic leader

• Leads with personality, charm and confidence

• Builds strong emotional connection with followers

• Inspires and motivates through vision and energy

(Leadership styles) Democratic leader

• Encourages team participation and decision making

• Values ideas and feedback

• Promotes collaboration and shared responsibility

(Leadership styles) Autocratic leader

• Makes decisions alone

• Expects obedience and control

• Focuses on efficiency and disciplines

(Leadership styles) Laissez-Faire leader

• Minimal guidance and supervision (experienced team)

• Allows employees to work independently

• Trusts the team to self-manage and take initiative