Type: Definition Essays
Sample donated: Patsy Schneider
Last updated: March 23, 2019
In this essay main discussion is on entrepreneurship andnew venture in the modern world. It is clear that, there are many changes aworld has witnessed influenced by entrepreneurs who established severalcompanies that have high market share in the global. These companies formed byentrepreneurs offer services and products to the customers and satisfying theirneeds.
It is a fact that, economic development in most of countries iscontributed by existence of more entrepreneurs. Millions of people today enjoy the products and servicesfrom small and medium sizes enterprises as well as large enterprises. Mostcompanies expanded their services and operations through a knowledge presentedby entrepreneurs. It is possible to achieve success when effective new ventureis applied.
It is suggested that, when entrepreneurs consider about their goalsalso should think about new venture because has impact in the development ofenterprises. There are millions of entrepreneurs in the world fromseveral countries but few are successful ones. This is because successfulentrepreneurs have common behaviors which distinguish them from failedentrepreneurs. For instance, successful entrepreneurs must be innovative,flexible to changes, hard worker, patience, risk taker, never quit, etc. Allthese behaviors motivate entrepreneurs continue existing and establish newthings every day. Background of entrepreneurship A concept of entrepreneurship is dated back sincecenturies ago when some people had invented several concepts that served humanbeings and simplified life. Knowledge of entrepreneurship is emphasized more inthe modern world because of competitive advantage in numerous fields.
It can bedefined as the process required for designing, launching and running a newestablished business. Most entrepreneurs established small business and laterexpanded to medium and large enterprises.1 Entrepreneurship is influenced by the capability andwillingness to establish, organize and manage a business in order to generateprofits and without fearing any risks that may be encountered along the way. Itis well known that, during start up, there are many risks involved inbusinesses because of internal and external factors such as lack of funds, lackof market demand, economic crisis, bad business decisions, unfriendlygovernment regulations, etc.
All these factors sometimes may discourageentrepreneurs; therefore they may quit, but only strong ones may survive andcontinue with their goals. In order for an enterprise to grow and beingsuccessful, it is suggested that entrepreneurs should be managers because theyknow well goals of launching business, vision, and expectation in short andlong terms. In order to improve opportunities in business operations, entrepreneursare suggested to do the following: develop friendly business plan, if possiblemay hire human resources, understanding all possible ways of acquiring materialand financial resources, be a great leader, be responsible for everythingoccurring in enterprises whether failure or success, and risk consideration.2 There are some economists who have written books andpapers in the issue of entrepreneurship and its role in the economy and how itinfluence growth of small and medium enterprises. There are several approachesthat can be taken in order to improve entrepreneurship skills that may lead toinnovation and launching of new businesses. Healthy economy has a greaterchance to increase opportunities for entrepreneurs compared to collapsedeconomy. This is because healthy economy increases middle income and wealthpeople resulted into high purchasing power.
Also sometimes some entrepreneursare not for profit gain especially who work in charitable organizations andgovernment institutions. Entrepreneurship knowledge is required in several fieldssuch as:3· Establishment of laws and regulations that guide small business; · Government services and programs;· Entrepreneurship training programs and education;· Non-governmental organizations;· Financing in order to influence angel investments, venture capitalfinancing, and grants. Since 2000s, knowledge of entrepreneurship has focused ondetermining and evaluating potential opportunities and how to exploit them inorder to launch new services and products.
It is clear that, if entrepreneurshipis implemented as desired may create wealth. When opportunities are utilizedeffectively may result into more profits. Some entrepreneurs fail because theylack enough knowledge in business skills, and management of capital and missedbusiness opportunities. Successful entrepreneurs need to be aware of marketneeds, exploit the opportunity, best management in financial, human andproduction resources. There is more knowledge related to political and socialentrepreneurship. New innovation is the key successful of most entrepreneurs inthe globe because they provide products and services that may improve socialwell-being and communication.4 Most entrepreneurs have worked intensively in their workingfields for several years; therefore increased their experience and careers. Inreality there are differences in entrepreneurial activities based on theircreativity and organizations they control.
Most entrepreneurs are full-timeworkers in their workplaces in order to meet high value and increaseperformance as a team. In order to expand business always capital must beraised either from angel funding or venture capital. There are many benefitsthat may be obtained from entrepreneurship.5 Figure 1: A concept of entrepreneurship Source: Napkin Finance.
(2016). Entrepreneurship Change the World.Online. Available at: https://napkinfinance.com/napkin/entrepreneur-definition/, accessed 16 January 2018 Most entrepreneurs are innovators and designers becauseof their tendency of building capability, effective team and management skillsthat led to solving several problems in the society and make profits. Effectiveentrepreneurship is important in order to reduce uncertainty and solve severalassociated risks. It is a great challenge to introduce products or serviceswhich don’t exist in the market because it needs good decision making andefficiency so as capturing customers. Due to this managers who have entrepreneurshipskills are highly employed because they have high coaching ability.
Mostentrepreneurs need advice in order to increase their knowledge and takeresponsible measures when comes to decision making.6Effective communication is emphasized in entrepreneurshipbecause allows influencing investors and external partners that may help toventure; therefore growing business and survive in the competition.Communication is important in order to have better relationship betweenenterprises, employees and clients. It is better if entrepreneurs are beingcharismatic leaders so as providing vision and mission of enterprises so ascreating a strong team which is effective and well communicating. Successfulentrepreneurs always try to encourage commitment to other employees.7 There are several theories introduced by economists andtheorists in the communication and negotiation so as influencing entrepreneursto have ability in handling effective communication and conflict due tocultural diversity in their enterprises. Common theories include CommunicationAccommodation Theory and Face Negotiation Theory.
8Impact of entrepreneurship in small andmedium enterprises and economic development Many people when they hear about entrepreneur, they conflatedwith small business. Major of small and medium enterprises have established byentrepreneurs whether in ventures or proprietor. The target of entrepreneurshipis to increase innovative products and services as well as increasing sales.Successful entrepreneurs need to be self-motivated, have better plans, and beready to change according to environment and economic situation. Ability tohandle weakness and strengths improve entrepreneurship skills.
9 Figure 2: Needs of small and medium enterprises Source: Nnadi, C. (2014). Entrepreneurship Development and its Impacton Small Scale Business Enterprises in Developing Countries: A NigerianExperience. Online. Available at: https://www.omicsonline.org/open-access/entrepreneurship-development-and-its-impact-on-small-scale-business-enterprises-in-developing-countries-a-nigerian-experience-2169-026X-3-119.php?aid=36077, accessed 18 January2018 Many people now are interested in thesubject of entrepreneurship due to outsourcing, liberalization andtechnological change in enterprises.
It seems a gap between marketplace andscience when creating new enterprises can be reduced by using entrepreneurshipskills. There are many new products in the market impacted by entrepreneurialactivities that resulted in wide selection and customers’ satisfaction. Morejobs created in the modern world that resulted into economic development due toutilization of entrepreneurship.
Output increased and many business activitiesaccomplished and therefore increased wealth and profits. First priority of mostentrepreneurs is satisfying human needs and from that more opportunitiescreated that may led to making profits. Successful enterprises are establishedby entrepreneurs who have entrepreneurial spirit. They are ready to acceptchallenge and have high determination on achieving their goals. Entrepreneurshiphas many benefits in the society and economy such as increase products variability,creation of new jobs, increase innovation opportunities, payment of taxes, andlowering prices.10 Some of small and medium enterprisesface difficult in initial start up compared to large firms because they limitedcapital to pay for employees, production of variety of goods, and inappropriateindustrialization policies. Effectiveness of entrepreneurship differs becauseof several factors such as location (nations and regions), level ofenterprises, and entrepreneurship activities. When it is applied in better waymay bring positive impacts on the living standards of the people and economy ofa country.
Studies conducted by economists and researchers have found out thatentrepreneurship increase employment, and economic performance.11 Most of successful enterprises that are led byentrepreneurs increase their size as time progress. Customers have influence inperformance of entrepreneurs because they stimulate growth as demand increases.Entrepreneurs need to be aware of their rivalries in order to introduce newinnovation and quality products so as capturing market share and increasecompetitive advantage. Depending of services and products offered byenterprises then capital may either grow slowly or rapidly.
Productiontechniques differ between enterprises because of entrepreneurial activities.Some countries encourage their entrepreneurs by establishing friendly businessenvironment so that more enterprises can be established; therefore influenceeconomic growth.12 Small and medium enterprises in some countries are givenpriority because they create more jobs, and individual wealth compared to largeenterprises.
Some countries emphasized on entrepreneurial culture in order tomaximize productivity in local and national scale. More people improve theirfinancial gain and benefit their countries if they know how to utilizeentrepreneurial skills and consider best factors that may improve production intheir enterprises. Most countries consider entrepreneurs as the engine ofeconomic growth, technical progress and innovation growth. Innovative thoughtsare needed in the modern world in order to foster development, raise capital,increase output and income. Entrepreneurship is important because stimulate newinvestments and competitive market where more income generated, poverty isreduced, and cultural diversity reduced.13Description of new venture New venture is very common in several places in themodern world due to its importance in business.
It can be described as theglobal program that aimed to provide services in order to develop small andmedium enterprises for the sake of generating a positive social orenvironmental change in the community. A terminology became popular after 1999and was utilized by some countries known as emerging markets that includeChina, Mexico, Brazil, Indonesia, India and Colombia. Since then, new venturescapture attention of many countries around the globe in order to improveservices and products as well as manage small and medium enterprises. Newventures support the growth of capital and easy management and utilized bythousands of enterprises in the world.
14 It is difficult to distinguish between new venture andentrepreneurship because they depend on each other so as increasing innovationand technological levels in several aspects that may improve productionactivities in enterprises. In order to become a successful venture,entrepreneur needs to learn some issues such as selection, identifying,communicating, and description of products and services so that improvebusiness opportunities. Venture can contribute to entrepreneurs when creatingbusiness design for the sake of increasing competitive advantage.
When betterstrategies are used in the venture then can increase the chance andeffectiveness of commercialization in provision of new products and servicesthat are obtained in the marketplace.15 When entrepreneurs create new ventures, first should beaware on their insights and skills that can help to identify businessopportunities mainly through research and development. Business model needs tobe effective and a form a venture that can impact in better strategies andutilization of resources. Venture should be implemented based on agreementsbetween entrepreneurs, stakeholders, new investors, and other businessparticipants.16 Figure 3: Process of new venture creation Source: https://www.
researchgate.net/figure/313798202_fig2_Figure-2-The-process-of-new-venture-start-up-creationNew venture in small and mediumenterprises New venture since it was introduced has resulted inpositive and negative consequences as well in business and entrepreneurialecosystem. Some enterprises that implemented venture had experienced success inshort and long terms. It is suggested that, before applying venture inenterprises, firstly entrepreneurs should be aware of nature of their businessand on how they can execute venture. There should be agreements betweenentrepreneurs, investors, and employees on nature of the new venture and whichchanges can cause in order to reduce challenges. Consideration on properinformation about how ventures can be assessed is important in order to havebetter clarification during startup.
17 There are different new ventures in the modern world andentrepreneurs are free to decide on which one favor them. Common new venturesare social, traditional and innovative ventures that aimed to create businessvalue and satisfy customers. Effective entrepreneurs need to examine impact ofnew ventures on their enterprises especially in performance outputs. Venturesin small and medium business are important because they reduce risks, managechallenging markets, provide technical assistance and new innovative program.
Sometimes new ventures may cause problem in small and medium enterprises thatresulted into lack of management, and risk capital. Some enterprises haveexpanded their businesses, creation of more jobs, better provision of servicesand products in their local markets after they implement new ventures. Ventureshave supported economic growth in many countries because of success achieved bysmall and medium enterprises.18 Figure 4: Pathways to new ventures for entrepreneurs Source: Leng, N.
(2015). Enterprise Creation & Development. Online. Available at: https://www.slideshare.
net/gayporkkkkkk/oct-14-ecd-lecture-6-starting-the-business1, accessed 20 January 2018 Conclusion Entrepreneurship is important in the modern world becauseit contributes to the development and economic growth. Most of successfulentrepreneurs have established enterprises that operate in their countries andsometimes abroad as well. Millions of people employed by entrepreneurs andimproved their living standards and income. Governments of numerous countriescollect taxes from businesses operated by entrepreneurs. It is impossible tomention economic growth without considered contribution of entrepreneurshipspecifically in small and medium enterprises. It is suggested that, friendly regulations and laws thatmonitor enterprises should be established in order to increase theircontributions to the economic growth.
In emerging markets, small and medium enterprisescontributed a lot to the economic development and reduction of poverty. Entrepreneurshipshould be encouraged in order to create innovative society and satisfy needs ofpeople. Most successful and popular entrepreneurs had started up small businessesand later they increased their profits and revenues until they expanded tovarious countries in the world. New venture cannot be separated from entrepreneurshipbecause they share similar knowledge in the business field. Entrepreneursshould make decision on which new ventures they may implement in theirbusinesses so as increasing sales in the marketplace. They should choose newventures based on their targets.1Drucker, P.
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(2016). FactorsInfluencing Sustainable Entrepreneurship in Small and Medium-Sized Enterprisesin Iran: A Case Study of Food Industry, University of Tehran13Tambwe, M. (2015). The Impact ofEntrepreneurship Training on Micro and Small Enterprises (MSES) Performance inTanzania: The Case Study of Food Vendors in Ilala District Daressalaam,College of Business Education14Stanford University. (2016). VentureOpportunity, Concept, and Strategy.
Online. Available at: https://web.stanford.edu/group/techventures/resources/TechVentures_Chap1_2e.pdf,accessed 19 January 2018 15Vissa, B.
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Entrepreneurship, SmallBusiness, and New Venture Creation. Online. Available at: http://www.pearsoncanada.ca/media/highered-showcase/multi-product-showcase/solomon-ch04.pdf,accessed 20 January 201818Cooper, A. (2016). Strategic Management:New Ventures and Small Business, Elsevier