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  • Lecture 3: Entrepreneurship Process & Importance of Entrepreneurship

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    The document outlines the key functions of an entrepreneur including innovation, risk-taking, decision making, and organization/management. It discusses how entrepreneurs introduce new products, methods, markets, sources of supply, and forms of organization. Entrepreneurs also take on risk when investing in and expanding their enterprises. As decision makers, entrepreneurs determine objectives, develop organizations, secure financing, acquire equipment, develop markets, and maintain good public relations. Finally, the document lists the importance of entrepreneurship such as promoting capital formation, employment, wealth creation, economic growth, and development.

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    Lecture 3

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    The document outlines the key functions of an entrepreneur including innovation, risk-taking, decision making, and organization/management. It discusses how entrepreneurs introduce new products, methods, markets, sources of supply, and forms of organization. Entrepreneurs also take on risk when investing in and expanding their enterprises. As decision makers, entrepreneurs determine objectives, develop organizations, secure financing, acquire equipment, develop markets, and maintain good public relations. Finally, the document lists the importance of entrepreneurship such as promoting capital formation, employment, wealth creation, economic growth, and development.

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    16 views8 pages

    Lecture 3: Entrepreneurship Process & Importance of Entrepreneurship

    Uploaded by

    Kalidas
    The document outlines the key functions of an entrepreneur including innovation, risk-taking, decision making, and organization/management. It discusses how entrepreneurs introduce new products, methods, markets, sources of supply, and forms of organization. Entrepreneurs also take on risk when investing in and expanding their enterprises. As decision makers, entrepreneurs determine objectives, develop organizations, secure financing, acquire equipment, develop markets, and maintain good public relations. Finally, the document lists the importance of entrepreneurship such as promoting capital formation, employment, wealth creation, economic growth, and development.

    Copyright:

    © All Rights Reserved
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    Lecture 3: Entrepreneurship Process &

    Importance of Entrepreneurship
    FUNCTIONS OF AN ENTREPRENEUR
    There has been a great deal of confusion and contradiction in literature on the
    functions of an entrepreneur.
    FUNCTIONS
    1. Innovations: J.Schumpeter has made substantial contribution to the
    literature of entrepreneurship. The process of innovations may be in the
    form of:
    a) Introduction of a new product.
    b) Use of new methods of production.
    c) Opening of a new market.
    d) The conquest of new source of supply of raw material.
    e) A new form of organisation.
    2. Risk-taking: Richard cantillon states that entrepreneur is an agent who buys means
    of production at certain prices and sells them at uncertain prices.
    The entrepreneur performs the function of reducing uncertainty in his plan of investment
    and expansion of the enterprise.
    J.b. Say also stresses risk-taking as the specific function of an entrepreneur.
    3. Decision Maker: Entrepreneur as a decision maker describes the following functions
    of an entrepreneur.
    a) The determination of objectives of an enterprise and the change of those objectives
    as conditions required or made advantageous,
    b) The development of an organisation including efficient relations with subordinates
    and all employees,
    c) Securing adequate financial resources,the relations with existing and
    potential
    Investors,
    d) The acquisition of efficient technological equipment and the revision of it
    as new machinery appears,
    e)The development of a market for the products and the devising of new
    products to meet or anticipate consumer’s demand,
    f) The maintenance of good relations with public authorities and with society
    at large.
    4. Organisation and Management: Marshall recognised organisation and
    management of the enterprise as the important functions of an entrepreneur.
    When the organisation grows bigger, the entrepreneur effectively delegates
    authority and finds responsibility at various levels of management. The
    network of decision making becomes more complex.
    The functions of organisation and management includes:
    a) Planning of an enterprise,
    b) Co-ordination, administration and control,
    c) Routine type of supervision.
    Importance of Entrepreneurship
    • Promotes Capital Formation
    • Create Large Scale Employment Opportunities
    • Promotes Balanced Regional Development
    • Reduces Concentration of Economic Power
    • Wealth Creation and Distribution
    • Increasing Gross National Product and Per Capita Income
    • Improvement in the Standard of Living
    • Promotes Country's Export Trade
    • Induces Backward and Forward Linkages
    • Facilitates Overall Development
    • Creating Innovation
    • Entrepreneurs Create New Businesses
    • Entrepreneurs also Create Social Change
    • Personal Growth
    • Entrepreneurship puts New Business Ideas into Practice

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