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IMPORTANCE OF ENTREPRENEURSHIP
IMPORTANCE OF ENTREPRENEURSHIP
IMPORTANCE OF ENTREPRENEURSHIP
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The entrepreneur is the pioneer, the managers the applier of existing best practices. The entrepreneur engages in strategic activity, the managers need to focus on tactical or operational activity. The entrepreneur formulates a strategy, the manager implements that strategy. Business success will depend on the continuing renewal and application of the entrepreneurial spirits. Business success depends on the application and an efficient management team. The attrition rate of any new business is extremely high. In the US, the supporter of the entrepreneurial spirit, numerous new enterprises will fail each year. However in a long-term historical perspective, business success is short-lived. Only a handful of the largest companies with break even status existing in any country at the beginning of the twentieth century will exist today. Even those enterprises that is likely to be unrecognizable as the original creations. The causes of small-business failure depending on the study cited range from inadequate accounting systems to inability to cope. Finally Growth of underlying problem appears to be an overall lack of strategic management beginning with an inability to plan at strategy to reach the customer and ending with a failure to develop a system of controls to keep track performance.' What considerations should small business entrepreneurs keep in mind when they are deciding whether a company should follow a growth or a stability strategy? The launch of any new ventures, which is best undertaken with a detailed understanding of the resources available and the strategic actions needed to achieve project objectives. There should be an indication of what should be done in various contingencies. In other words, a new venture needs to be planned in a detailed manner. This is situation an above. Frequent lack of any such planning, even significant strategic management, will help to explain the extremely high attrition rate for small businesses in all types of economy. Companies may however, choose a stability strategy because the entrepreneur is mostly generating employment for family members. Providing the family a "decent living”, and being the "boss" of a firm small enough that he or she can manage it comfortably. Finally some business owners don't pursue a growth strategy because they do not want the loss of control that results from bank debt or the sale of stock to outsiders. Question 12 What are advantages and disadvantages of privatization of state- owned business? The privatization of state-owned business enterprises is likely to continue globally for most of these enterprises must expand internationally in order to survive in the increasingly global environment.
A business needs to look at every angle for their value chain to work and to make sure their expansion is successful. They will need to review many points to
Over the past 37 years, The Nike Brand has evolved into a successful multi-billion dollar corporation. It has also grown to be the world's largest marketer of athletic footwear and apparel. The company’s products are sold in over 180 countries worldwide and 20,000 retail stores domestically. Nike also operates retail stores overseas such as Nike Towns and factory outlets. Although Nike is involved in the design, development, and marketing of the product; the products are manufactured independently. In addition to its wide range of athletic shoes and apparel, the company also sells Nike and Bauer brand athletic equipment, Cole Haan brand dress and casual footwear, and the Sports Specialties line of headwear.
In the article, "Strategies for Enhancing Small-Business Owners' Success" by Susan Turner and Al Endres, it is claimed that there is no specific reason as to why small businesses are failing in today's America. They believe, however that two factors can cause the demise of small businesses. These factors are small business financing and the marketing plans associated with those businesses. Small business owners are finding it increasingly hard to acquire funds to start up and help maintain a foothold in the business world. The authors state that this is due to the rising risks of propositions for investors and acknowledge that small businesses have to resort to using their own resources such as their own funds and bootstrap financing. Another
As the organization grows in this stage, the entrepreneurs must learn how to manage the organization. It is at this point that a crisis of leadership emerges. In the beginning, the organizational is so busy getting started and developing new products and markets that they fail to understand the importance of managing the organizational resources. The crisis can be averted, and growth can continue to stage two, if the organization can learn the skills necessary to manage the organization.
The four key approaches to corporate strategy is described as following. 1) A growth strategy is defined to increase the size and intention of a corporate’s operation by expanding through external partnership in joint ventures, mergers and acquisitions, strategic alliances which may provide faster turn around solution meeting the objective. It can be also designed through internal efforts to develope organic growth via expanding new business units with new technology on new products development or new different operation models in driving new distribution of sales, market penetration and expansion. 2) A retrenchment strategy is designed to downsize a corporate’s business scale and scope due to the change of companies’ direction, market or political environment. It may require major restructuring on cutting down labor forces, production facilities, phase out the old or declining business units, reducing liabilities or diverting overhead cost to focus on other new business interests. 3) A stability strategy is designed to protect against any change to meet the companies’ objectives and the shareholders interest. Examples, it may be limited by licenses, quotas or regulations on selling cigarette, liquor, textile, etc. It may be also related to interim strategy to stable the business from excess capacity of supply like steel or mining
The first entrepreneurs were business owners used their own finances resources to support organization that they managed themselves. Because of industrial growth rapidly and complexity, can saw the formation of large company became scarce of capital and often supplied by outsiders. It splits between owner/shareholders and management gradually become common. It also brought a new management challenges. (B., 2009)
Basing on the multiple cases study model, we listed and compared the entrepreneurial history of every firm to identify the strategy and actions implementation by the firm and represent how the Effectuation theory guided the entrepreneur ‘do the right things’. Finally, we draw tables for each form to conclude and analyze those data and information ordered by the time line (Freeze & Glassman, 2000; Reid, 1999).
...not just the financial issues for example equity shares, turnover and profitability. Before any growth entrepreneur need to have a plan to ensure that they know the risk and what problems will be appear and the solution to solve the problem. Although a growth plan is times consuming to be preparing but other company would like to look at the plan before doing anything. Also entrepreneurs always need to beware of the company vision is it similar to each other, culture and the communication also will affect the result and should be considered carefully. Those are the main reasons to make company businesses successful or failures in few years. Furthermore, this method cannot predict one thing is the timing, sometimes entrepreneurs miss the right time to growth their company because of the physical problem like earthquake or hurricane occurs which no one can predict it.
We live in an age of entrepreneurship, everyone is trying to start their own business and follow the American dream. However twenty percent of all business doesn’t make it past their first year, and half of the remaining ones will die within five years of their opening. This can be concerning since I personally am interested in running multiple business as a source of income. The fact that you can put thousands of dollars into a failing company can be disconcerting. There is an overlying problem in all companies, the need to improve. In most cases once a company stops improving it becomes stagnant and eventually it will start to regress. To some this idea may seem contradictory but you could compare any business to a fish tank. All companies
The main concern in the article was about the relationship between strategic management and entrepreneurship. Researchers have been inconsistent in their definitions of entrepreneurship. Entrepreneurship is defined as self-employment of any sort. Entrepreneurs buy at certain prices in the present and sell at uncertain prices in the future. The entrepreneur is a bearer of uncertainty (Richard Cantillon (circa 1730). Meanwhile, strategic management can be defined as the art and science of formulating, implementing and evaluating cross-functional decisions that enable an organization to achieve its objectives. Entrepreneurship focuses on innovation by identifying market opportunities and by building a unique set of resources through which the opportunities can be exploited. The key challenges for entrepreneurs is to deal with strong strategic that required the growth of enterprise. Therefore, a manageable set of the most attractive alternative strategies must be developed. The advantages, disadvantages, trade-offs, costs, and benefits of these strategies should be determined. The most obvious linkages between entrepreneurship and strategic management are opportunities. Opportunities are very familiar in entrepreneurship and part of SWOT analysis. Enterprise can identifying opportunities through internal and external environment to develop competitive advantages. For example the application of strategy in small and medium-enterprise (SME) is a main part of relationship between entrepreneurship and strategic management. There are several different strategic management instruments can be applied depends on the situation of enterprise. SWOT analysis is one of the instruments that can develop future strategies and business plan in SMEs as
Management of SMEs is an acknowledged challenge that has proved difficult to overcome (OECD, 2000). SME owners are often managers of their enterprises and usually have no formal qualifications in management and leadership (De Kok, Uhlaner, & Thurik, 2006). Pansiri and Temtime (2008) observed that although most of them understand the concepts of their business goals and objectives, they may not necessarily make good managers. The management approach adopted by owners depends on the goals and personal expectations of these individuals (Collins & Clark, 2003). In most cases, SME owners do not foresee growth beyond a certain level. They aim to achieve their personal objectives with no effort put toward expansion
Strategic renewal is another desired outcome of corporate entrepreneurship. The new economic order and business environment has created a pace of change which requires businesses to adapt more frequently and rapidly than ever before. The changes could involve corporate structure, mergers and acquisitions, addressing new market opportunities, changing product portfolios, repositioning, adapting infrastructure, or adopting new technology. Managers in an organization must be able to take stock of its situation under changing market conditions and agree on a coherent new strategy that will meet the challenges of the present as well as of the future.
There comes a time in the life of a growing business when you, as its founder and top manager, realize the company has taken on a momentum of its own. You influence it, certainly, but more and more you are swept by it.” – John Peterman Before looking at how an entrepreneur manages a growing business, it is first important to understand that as companies mature, they go through different stages and that in each stage,the entrepreneur will experience different problems. Thus an entrepreneur MUST be ready with the proper knowledge and skills to address these problems. The growing stage of an entrepreneurial firm may be divided into two. These are the early and later growth stages. In the early stage, the business may have a tendency to over-commit its capabilities because it is sales driven as opposed to being profitable. In the later stage, the company becomes more focused creating its own vision of the future where emphasis is on profitability of each endeavor and not simply closing sales. To address these challenges, an entrepreneur must be aware of how to manage the growth without being entrenched in the workload that he has been accustomed to during the startup. Financial resources may also have to be reviewed as previous structures may not be able to cope with expansion demands. And as changes are continually being implemented, the entrepreneur must be able to monitor the improvements and downfalls of the new direction the organization is going through. Thus, during these crucial stages, an entrepreneur must focus his attention on the following three aspects of his business: People Controls Financing People During the early stages of an entrepreneurial firm, the business will need members that are compassionate to the growth of the business. A lot of flexibility will be needed as adjustments will have to be made. The people needed may not necessarily have high level competencies for certain skills but must definitely have the drive to push performance to a higher level. At this stage, hard work counts for more than experience. As the business grows, there will be a need for more specialized skills and possibly more competent members. An entrepreneur may look within his organization and promote high performing members or he may opt to look for those who can “hit the road running”.
Within every major economy, a great factor in providing the energy of the core of the nations economy is the small and medium enterprises. These cluster of firms are what provide new economic activity, new innovative products and services, along with growing employment and in general a crucial system in ensuring the economy is at a stable growth level. With a majority of this activity stemming from family controlled or managed businesses, the focus on developing a global and long term perspective for these firms are ever growing in importance because of the global perspective entrepreneurship has started to take.