Summary

• What is Entrepreneurship?
• “Entrepreneurship has wide range of meanings”- Explain.
• Explain the four key elements of Entrepreneurship.
• Who is Entrepreneur? What are the traits of Entrepreneur?
• Explain the attributes of an entrepreneur.
• What are the characteristics of an entrepreneur?
• Why one can choose to be an entrepreneur?
• “Engineers should know about entrepreneurship”- explain.
• What are the challenges of Entrepreneurship?
• Explain the total entrepreneurial process.
• What is sphere of influence? What is the importance of SOI in
entrepreneurship?
• Write the advantages and disadvantages of entrepreneurship.
• What is firm? What are its roles? Mention different types of
firms.
• Explain “Creative Destruction” in terms of entrepreneurship
with
proper example.
• Mention the importance of innovation and technology in
entrepreneurship.
Entreprenurial process

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In entrepreneurship, your sphere of influence is the circle of
individuals and groups whose decisions, opinions, or actions you can
influence — and who can also influence [Link]’s not just about power
— it’s about relationships, communication, and trust
Your sphere of influence is essentially a list of people. This list
could be quite substantial. It consists of all the people who
know you, both professionally and unprofessionally, and who
may present an opportunity for word of mouth marketing, a
referral, or even direct business.
[Link] education of your SOI about what you do and the type of
clients you are interested in.
[Link] your SOI informed of any changes in your business or
new items of interest so they can sound more knowledgeable
about your company when describing it to potential clients
[Link] them constantly that your business is built on
referrals.
[Link] them in some manner for their referrals.

• Remember it’s important that to help your SOI, you need a

firm grasp on the type of client or customer you are looking for.
• If you are unclear about which customers you’re targeting ask
yourself these questions:
i. What characteristics do most of the clients tend to have?
ii. What industry, demographic or geographic characteristics do
my potential clients have?
iii. How will my sphere of influence identify potential clients?
• Once you’ve identified who your ideal customers are you can
begin to utilise the contacts and knowledge of your sphere of
influence to refer clients to your business.
• As new clients come into your business your sphere of
influence will only continue to grow and keep reaping benefits.
Advantages of Entrepreneurship

• Autonomy: People enjoy more autonomy or freedom in

entrepreneurship as they invest their time, money, and efforts
into the business to make it successful. They are more involved
and self-driven as there is no one to interfere or ask for
explanations of their decisions.

• Motivating: As entrepreneurs start making decisions and get

successful results, they become more motivated and engaged to
work hard to ensure success in their business

• Flexibility: Entrepreneurship allows working without a fixed

routine time that helps to organize other works with better
control and flexibility. This can improve mental and physical
well-being.

• Career orientation: Entrepreneurship allows someone to align

his desire and passion into the work and incorporate his values
and beliefs into the business. This can help him to move in a
career path of his choice.
• Develop skills: Entrepreneurship involves overcoming
challenges that develop the growth mindset and professional
abilities. It gives first-hand knowledge and experience that helps
to develop leadership skills and managerial techniques.

• Economic development: A successful venture gives a lot of

scope to improve earnings by own efforts and involvement that
is not possible in any jobs. There are various opportunities and
ways that can be explored to gain a competitive advantage and
profitability.

• Meeting people: When a new business is started, there are

possibilities to connect with people having exposure and
experience in that particular field. Interaction with like-minded
people helps to focus on the work more strategically and
ambitiously.

• New experiences: Entrepreneurship gives new experiences and

challenges that are often unexpected. This helps to gain new
lessons and develop problem-solving and decision-making
abilities that are useful for the further growth of the business.

• Building your own team: Entrepreneurs have the freedom to

choose their team to work with, select their clients and partners.
He has the sole decision-making power about the functioning of
his company, its policies, and its culture.
• Get full rewards: In an entrepreneurship journey, the success of
a business is enjoyed by the entrepreneur with no one else to
claim. One can enjoy the profit and re-invest it into the business
towards further growth.

DISADVANTAGES

• Uncertain income: Entrepreneurship doesn’t ensure a steady

and certain income as in jobs. When in the job, there is a fixed
monthly income but in entrepreneurship, the income flow is
uncertain and not guaranteed especially in the early stage of a
business venture.

• Need to devote more time: As an entrepreneur, one needs to

devote a lot of time to establishing the business without having
the luxury of fixed working hours.

• Risk of failure: The initial stages of the entrepreneur journey

may be very challenging and there are risks that the business
strategies may not work resulting in losses in business
• Create new customers: Customers often prefer established
businesses for purchasing products and availing services. Some
customers often rely on public reviews and personal references.
As a startup business, it is difficult to build a customer base and
takes time to develop brand awareness.

• Financial instability: In the initial stages of entrepreneurship,

there can be more outflow of money as an investment as
compared to the return from business. As a self-employed
person, it becomes a big challenge for financial security.

• Greater competition: As an entrepreneur, it becomes difficult

to compete with established businesses in the same field due to a
lack of resources in terms of knowledge, experience, and
customer support.

• Lack of investors/partners: Some ventures require a lot of

investment but it is difficult to find investors or partners to work
with due to the absence of a history of financial success.
Sometimes
entrepreneurs start a business in debt and have to work very hard
to recover in course of time.
• More responsibilities: As an entrepreneur, one has to look after
a lot of things related to business and take care of finances, legal
issues, manpower, sales, customer support, and many other
things to keep the company functioning systematically

firms are organizations that produce goods and services.

They are typically owned and operated by individuals or groups of
individuals, and are motivated by the desire to make a profit.
They play a crucial role in the functioning of market economies by:
• allocating resources
• producing goods and services
• providing employment opportunities

Firms: Types
• Sole proprietorship: A sole proprietorship is owned and operated by
one person. It is the simplest and most common form of business
structure.
• Partnership: A partnership is owned and operated by two or more
individuals. Partners share profits and losses, and they have a say in
the management of the business.
• Corporation: A corporation is a separate legal entity from its owners. It
is owned by shareholders, who elect a board of directors to manage the
business.
• Limited Liability Company (LLC): An Limited Liability Company is a
hybrid structure that combines the personal asset protection of a
corporation with the tax benefits of a partnership or sole proprietorship.
• Cooperative: A cooperative is a business owned and operated by a
group of individuals for their mutual benefit.
• Non-Profit Organization: Non-profit organizations are established to
serve a specific social cause or purpose, rather than to make a profit.
• Publicly traded company: A publicly traded company is a company
whose shares are traded in a public stock market.

Creative Destruction

• Creative destruction can be defined as the decay of long-

standing practices, procedures, products or services followed by
more innovative, disruptive ones. It is based on the principle that
old assumptions need to be broken so that new innovations can
benefit from existing resources and energy.
• Creative Destruction is the ongoing process of innovating new
products and services to replace old ones. New products meet
customer needs better, making previous versions inadequate or
obsolete.
• Innovation and risk-taking can be important keys to success for
companies. Creative destruction ensures that there can continue
to be growth and progress and that we can generate sustainable
wealth.
From this, we can conclude the following:
• If companies are willing to constantly question their business
model and adapt it if necessary, they have a better chance of
remaining active in the market.
• Newly founded companies and start-ups should be given
special support, as innovative ideas often come from new market
participants.
These do not have to take into account already established
products and existing markets.
Examples
• Photography companies whose business was greatly replaced
by smartphone incorporated companies;
• Traditional watches increasingly becoming replaced by
smartwatches;
• Tablets and kindles replacing conventional printed books;
• Music streaming services (spotify, apple…) replacing digital
shopping of music songs or albums;
• Video streaming services replacing DVDs.

Importance of Innovation
1. Solves complex business problems
Knowing the answer to what product management life cycle is
cannot help managers or executives solve complex business
problems. Moreover, the uncertainties and complex business
situations fueled by the COVID-19 pandemic can make things
worse for them.
Therefore, to judiciously and effectively solve complex business
problems, it is imperative to use innovative ideas. Leaders must
use external (online data, literary works, etc.) and internal
sources to develop innovative ideas to solve complex business
problems. At first, it might seem like a difficult task, but it is
considered to steer your business in the right direction.
2. Increases productivity
One of the benefits of innovation in business is the increase in
productivity of individuals, processes, and business models,
among others. Simply put, innovation presents new ideas to
business leaders to increase efficiency with minimum resources.
Furthermore, reducing business and other risks.
3. Brings uniqueness and novelty to business process Business
processes have been the same for more than a few decades.
However, with the introduction of innovation in business, there
has been a disruption that is believed to be caused due to
novelty, creativity, and uniqueness. That is also helping in
making the business stand out from the rest and vicariously
contributing to increased revenue and market share.
4. Gives a competitive advantage
Thinking innovatively or creatively can help managers and
executives develop unique marketing campaigns to help them
stand out. Also, formulate promotional and advertising strategies
that will help in increasing market share and revenue, giving the
company a competitive advantage.
5. Reduces cost and increases revenue
As mentioned above, one of the biggest advantages of
innovation is that it helps increase revenue and market shares.
Subsequently, leading to a reduction in cost. Meanwhile,
innovation has many advantages in business, but the points
mentioned above will help business leaders, managers, and
executives .

Importance of Technology in
Entrepreneurship
1. Communication
Technology enables a faster, wider and more efficient means of
communication. This will include interactions within your team
or with your clients, potential customers, investors or the general
public. Video conferencing technologies, like Skype and Zoom,
make meetings from across geographical borders convenient. As
for within your organization, an app like Slack or Asana can
help you simplify communication within your team. You can
use this to track projects, details on tasks, deadlines, etc.,
regardless of whether they work from under the same
roof, or remotely. Email, newsletters, social media, and other
platforms are all equally essential resources for communication.
2. Security
With the rise in cyber-crime and data breaches, tight security is
imperative for all businesses. Today, all business assets are
mostly stored in the cloud or on endpoints. This has made it
necessary for companies to adopt strict measures to keep their
data as well as that of their customers secure. performed by
people. This helps by saving on employee costs, or having them
work in areas where they are really needed.
3. Efficiency
Technology helps increase the efficiency of systems, products
and services. It helps track and streamline processes, maintain
data flow and manage contacts and employee records. In fact,
this increased efficiency in operation helps reduce costs
as well as enable the business to grow rapidly.
4. Employee assistance
Most employees feel the need to use the latest technologies in
performing their tasks with the belief that it will help them
deliver the best results. Companies need to consider the cost-
output relationship and provide suitable technology to enhance
results.
5. Time and money
There’s no doubt that technology helps businesses achieve more
in less time, with no detriment to the quality of product or
service. In fact, technology is now performing repetitive tasks
that were earlier