entrepreneurs as the catalysts and innovators behind economic progress has served as thefoundation for the contemporary use of thisconcept.
Current Theories of Entrepreneurship
Contemporary writers in management and business have presented a wide range of theoriesof entrepreneurship. Many of the leading thinkersremain true to the Say-Schumpeter tradition whileoffering variations on the theme. For instance, inhis attempt to get at what is special aboutentrepreneurs, Peter Drucker starts with Say’sdefinition, but amplifies it to focus onopportunity. Drucker does not requireentrepreneurs to cause change, but sees them asexploiting the opportunities that change (intechnology, consumer preferences, social norms,etc.) creates. He says, “this defines entrepreneur and entrepreneurship—
the entrepreneur always searches for change, responds to it, and exploits it as an opportunity
.” The notion of “opportunity”has come to be central to many current definitionsof entrepreneurship. It is the way today’smanagement theorists capture Say’s notion of shifting resources to areas of higher yield. Anopportunity, presumably, means an opportunity tocreate value in this way. Entrepreneurs have amind-set that sees the possibilities rather than the problems created by change.For Drucker, starting a business is neither necessary nor sufficient for entrepreneurship. Heexplicitly comments, “Not every new small business is entrepreneurial or representsentrepreneurship.” He cites the example of a“husband and wife who open another delicatessenstore or another Mexican restaurant in theAmerican suburb” as a case in point. There isnothing especially innovative or change-orientedin this. The same would be true of new not-for- profit organizations. Not every new organizationwould be entrepreneurial. Drucker also makes itclear that entrepreneurship does not require a profit motive. Early in his book on
Innovation and Entrepreneurship
, Drucker asserts, “No better textfor a
History of Entrepreneurship
could be foundthan the creation of the modern university, andespecially the modern American university.” Hethen explains what a major innovation this was atthe time. Later in the book, he devotes a chapter toentrepreneurship in public service institutions.Howard Stevenson, a leading theorist of entrepreneurship at Harvard Business School,added an element of resourcefulness to theopportunity-oriented definition based on researchhe conducted to determine what distinguishesentrepreneurial management from more commonforms of “administrative” management. After identifying several dimensions of difference, hesuggests defining the heart of entrepreneurialmanagement as “the pursuit of opportunitywithout regard to resources currently controlled.”He found that entrepreneurs not only see and pursue opportunities that elude administrativemanagers; entrepreneurs do not allow their owninitial resource endowments to limit their options.To borrow a metaphor from Elizabeth BarrettBrowning, their reach exceeds their grasp.Entrepreneurs mobilize the resources of others toachieve their entrepreneurial objectives.Administrators allow their existing resources andtheir job descriptions to constrain their visions andactions. Once again, we have a definition of entrepreneurship that is not limited to businessstart-ups.
Differences between Business and SocialEntrepreneurs
The ideas of Say, Schumpeter, Drucker, andStevenson are attractive because they can be aseasily applied in the social sector as the businesssector. They describe a mind-set and a kind of behavior that can be manifest anywhere. In aworld in which sector boundaries are blurring, thisis an advantage. We should build our understanding of social entrepreneurship on thisstrong tradition of entrepreneurship theory andresearch. Social entrepreneurs are one species inthe genus entrepreneur. They are entrepreneurswith a social mission. However, because of thismission, they face some distinctive challenges andany definition ought to reflect this.For social entrepreneurs, the social mission isexplicit and central. This obviously affects howsocial entrepreneurs perceive and assessopportunities. Mission-related impact becomes thecentral criterion, not wealth creation. Wealth is