Importance of entrepreneurship

Now let us go in depth of the reasons why entrepreneurship holds a dominant position in the society? The following reasons are responsible for the same;1) Provides employment to huge mass of people; - people often hold a view that all those who do not get employed anywhere jump into entrepreneurship, a real contrast to this is that 76% of establishments of new business in the year 2003 were due to an aspiration to chase openings. This emphasizes the fact that entrepreneurship is not at all an encumbrance to an economy. What’s more is that approximately 34 million of fresh employment opportunities were created by entrepreneurs from the period of 1980. This data makes it clear that entrepreneurship heads nation towards better opportunities, which is a significant input to an economy. 2) Contributed towards research and development system; - almost 2/3% of all innovations are due to the entrepreneurs. Without the boom of inventions the world would have been a much dry place to live in. Inventions provide an easier way of getting things done through better and standardized technology. 3) Creates wealth for nation and for individuals as well; - all individuals who search business opportunities usually, create wealth by entering into entrepreneurship. The wealth created by the same play a considerable role in the development of nation. The business as well as the entrepreneur contributes in some or other way to the economy, may be in the form of products or services or boosting the GDP rates or tax contributions. Their ideas, thoughts, and inventions are also a great help to the nation. 4) Sky-scraping heights of apparent prospects; - the individual gets maximum scope for growth and opportunity if he enters into entrepreneurship. He not only earns, the right term would be he learns while he earns. This is a real motivating factor for any entrepreneur as the knowledge and skills he develops while owning his enterprise are his assets for life time which usually, lacks when a person is under employment. The individual goes through a grooming process when he becomes an entrepreneur. In this way it not only benefits him but also the economy as a whole. 5) It is a challenging opportunity for the people: - although entrepreneurship is a challenging task but in most of the cases the rewards it gives are much more than what one anticipates. It does not only reward an entrepreneur at financial levels but also on individual level. It provides self satisfaction to the entrepreneur. 6) Entrepreneurship provides self sufficiency; - the entrepreneur not only become self sufficient but also provide great standards of living to its employees. It provides opportunity to a number of people working in the organization. The basic factors which become a cause of happiness may be liberty, monetary rewards, and the feeling of contentment that one gets after doing the job. Therefore the contribution of entrepreneurs makes the economy an improved place to live in. Now as we are through with the importance of entrepreneurship let us become a bit more specific and enter into individual country details. The importance of entrepreneurship for some countries is given as under; - a) What role does entrepreneurship play in America: - American economy is well known for its flexibility, adaptability, and grasping of opportunity and it is all because of prevalence of entrepreneurial culture in the economy. The above statement can be well supported with the help of factual data given; taking into account the period 2003 to 2007 the generation of employment has reached 7.2 millions which is more than the total jobs being generated in Japan and Europe. For this the economy had to work upon the same for 41 months without any postponement. For these jobs the American workforces are taking back home hefty amounts. Post tax earnings have gone up by 9.6%

Summation After reading all the details. uniqueness of monetary ventures. The governments around the world are starting to realize that in order to sustain progress and improve a country’s economy. lawyer or a fighter pilot. as well as give power to society. The once feasible ways of doing business are no longer guarantees for future economic success! In response to this inevitable change. speeds up modernization and transforms way of thinking of the common man. p13). Some countries have taken this initiative to a higher level by introducing entrepreneurship education at elementary schools and encouraging them to be future entrepreneurs when they are of age. relevance of entrepreneurship firms to European financial system. is perceived as a ‘cool’ career and is an aspiration for many Chinese youths Prior to the ‘opening up’ of modern China. technopreneur and multipreneur are coined to keep up with the ever-changing times and business conditions that surround us. it will be laborious for policymakers to develop successful programs to inculcate entrepreneurial qualities in their people and organizations within their country. and in specific nations we can conclude the higher the levels of entrepreneurship is in the nation the higher is its level of development. In many tertiary institutes. In a recent visit to the bustling city of Shanghai in China. "Good science has to begin with good definitions (Bygra! ve & Hofer. and figures regarding the importance of entrepreneurship globally. being an entrepreneur was perceived as the ou! tcome of one’s inability to hold a good government job and those who dared to venture. many courses of entrepreneurship and innovation are being developed and offered to cater to the increasing demand. The crux motive of entrepreneurship is to transform the dreams into a profitable truth. The term "entrepreneurship" has also evolved with numerous variations. the people have to be encouraged and trained to think out-of-the-box and be constantly developing innovative products and services. The proliferation of jargons such as netpreneur.The importance of entrepreneurial activities was realized by the European economy in the year 1980. biotechpreneur. The entrepreneurs are today seen as the catalyst which speeds up the process of creating wealth for the economy. The results of the survey showed that being an entrepreneur. In a series of survey funded by Kauffman Center for Entrepreneurial Leadership. Being an entrepreneur is now the choice of the new generation as compared to the preferred career choices of yesteryears such as being a doctor. legality in dealings. it is no wonder that innovation and entrepreneurship are often seen as inseparable bedfellows." Without the proper definition. the awareness and academic studies of entrepreneurship have also heightened. managing human resources. were often scorned at by their peers. one can wind up by saying that entrepreneurship strengthens the economic growth of a nation. Recently a number of fresh opportunities for entrepreneurial proposals are being dug up in European economy. providing jobs.that is $2. an informal survey was carried out among Chinese youths by the author. Lastly. it is important that the definition of entrepreneurship be refined or redefined to enable its application in this 21st century. it was found that nearly seven out of 10 youths (aged 14-19) were interested in becoming entrepreneurs. The growth of America is in leaps and bounds and that is all because of the insistence and efficiency of American entrepreneurs. With this change in mindset and the relative knowledge that entrepreneurs bring forth increased job creations. . facts. In view of these changes. and providing an assorted range of goods and services to the consumers. In the earlier decades the importance of entrepreneurship was more than often under rated and now over a span of time it has become apparent. ntroduction: In a world where ideas drive economies. espec! ially at the tertiary level. pecuniary transactions. 1991. they are putting much emphasis on the need to train future entrepreneurs through infusing entrepreneurship components within the educational system. To put it succinctly. In the same vein. and learning entrepreneurial skills. especially in the field of computer and e-commerce. Entrepreneurial undertakings are now being introduced to college going students which could give them an idea of creating and managing firms.840 from the time when the president has taken oven the charge. Times have indeed changed. b) Importance of entrepreneurship in European economy: . some governments are rethinking the way the young are educated by infusing creative thinking and innovation in their nation’s educational curriculum.

The paper will provide a summary of the definitions of entrepreneurship provided by scholars in this subject area. Adam Smith explained clearly that it was not the benevolence of the baker but self-interest that motivated him to provide bread. Gartner (1990) found eight themes expressed by the participants that constitute the nature of entrepreneurship. uniqueness. which is the antithesis of what entrepreneurship is all about today. he perceived entrepreneurship as the creation! of a new organization. 1983) In a Delphi study. the famous economist John Stuart Mill described entrepreneurship as the founding of a private enterprise. several writers tended to see "innovation" in the form of entrepreneurship as one not of incremental change but quantum change in the new business start-ups and the goods/services that they provide (egs. He stated that the entrepreneur is one who applies "innovation" within th! e context of the business to satisfy unfulfilled market demand (Liebenstein. In the view of Drucker (1985). 1989. Though the term ‘innovation’ has different meanings to different people. -The opening of a new market. he saw an entrepreneur as an innovator who implements change within markets through the carrying out of new combinations. profit or non-profit. entrepreneurs were the economic agents who transformed demand into supply for profits. described an entrepreneur as one who bears risks by buying at certain prices and selling at uncertain prices (Barreto. The carrying out of new combinations can take several forms: The introduction of a new good or standard of quality. growth. and the owner-manager. This encompassed the risk takers. it firmly attaches the nature of entrepreneurial action with risk-taking and the bearing of uncertainty by the individual (Swoboda. Though the definition tends to be somewhat simplistic in nature. let alone make a profit. -The acquisition of a new source of new materials supply. the decision makers. Bygrave & Hofer. and -The carrying out of the new organization in any industry. One of the definitions that the author feels best exemplifies entrepreneurship was coined by Joseph Schumpeter (1934). It is this characteristic that distinguishes entrepreneurship from the routine management tasks of allocating resources in an already established business organization. The notion of an individual who starts a new business venture would be sufficient for him/her to be labeled as an entrepreneur. creating value. The themes could be seen as a derivative and expansion of Schumpter’s earlier concept. 1995. Casson 1982) which is probably closer to the term as applied today. regardless of its ability to sustain itself. In 1848. 1991). Richard ! Cantillon. In the 1776 thought-provoking book ‘The Wealth of Nations’. From Smith’s standpoint. innovation. -The introduction of a novel method of production. organization creation. Entrepreneurship through the Years: It was discovered that the term ‘entrepreneurship’ could be found from the French verb ‘entreprende’ in the twelfth century though the meaning may not be that applicable today. In elaboration. This meaning of the word then was to do something without any link to economic profits. 1995). They were the entrepreneur. and the individuals who desire wealth by managing limited resources to create new business ventures. when French economist. The author will also expand on one of the definitions by Joseph Schumpeter to create a better understanding of the definition of the term "entrepreneurship" as applied in today’s business world. It was only in the early 1700’s. Bygrave. .

by adding "innovative" features to a product or services and setting up a business based on these additional features to compete in the existing market. Though. the author has thus. he will be seen as an entrepreneur in his own rights. In the case of the hot-dog seller. Thus. the introduction o! f a new product or service. In short. Innovation in the business sense may not necessarily involve. if someone starts another run-of-the-mill hot dog stand in the streets of New York. for convenience. the notion of incremental improvements should be accepted as being innovative too. it may be argued that his addition of Oriental Sweet and Sour sauce toppings may be seen as nondescript. if he is the first to sell the same product in a virgin locale or to an untouched market segment. In the context of entrepreneurship. .! Take for example. if the above definition by Schumpeter was used as a guideline. needles and other necessities to start their own home businesses. technology. or services. creativity and innovation are key points in the whole scheme of things.Expanding on Schump! ! eter’s Definition: After digesting the numerous definitions of entrepreneurship. in the physical sense. However. it is often argued that there are no real new products or services in a case where one does not look to the past products and services for ideas for improvements. It has now become a model for several micro-loan facilities. will he termed as an entrepreneur? According to Drucker’s definition. In retrospect. As defining the term of ‘innovation’ is highly debatable and would merit a paper on its own. he will not be seen as being entrepreneurial. Innovation can be perceived simply as the transformation of creative ideas into useful applications by combining resources in new or unusual ways to provide value to society for or improved products. However. Grameen Bank has grown with over $2 billion loans granted. Yunus became an entrepreneur when he started a micro-loan program for the poor villagers in a rural part of Bangladesh named Grameen. the difficulties of defining "innovation" could be the reason for the quandary one finds in attempting to arrive at a clear-cut definition of the term " Entrepreneurship". For example. summarised the definition of innovation. new entrants may be ! able to gain this competitive advantage over existing market players. From the following example. innovation need not arise mainly from a new product or service but it could be an old product or service finding a new market for penetration. with only US$26. for example. Consistent with creating new products for sale. In this manner. On the contrary. Take Muhammad Yunus. one would tend to see a strong link between these two terms: entrepreneurship and innovation. 1985. to some extent. The loan was divided among 42 villagers to assist them to buy small items such as combs. the answer is probably ‘NO’. most of the definitions tended to be. In the past 22 years. It can be in the form of what is commonly known as creative imitations. a re-work and expansion of Schumpeter’s definition of entrepreneurship (which is that of innovation being applied in a business context). if he is the first one to start a stand selling hot-dogs with Oriental Sweet and Sour sauce topping. someone who starts a business by providing a totally new way of serving his customers/ clients is considered to be entrepreneurial too. 1991). he will be seen as one. In the author’s opinion. Yunus created banking and lending facilities i! n Grameen specifically for the poor villagers. Why? The core of the matter lies in what is so innovative about setting up another hot-dog stand which are in abundance in New York. he could be termed as an entrepreneur (even based on Schumpeter’s requirement) as he has done what others have not done before. if an individual starts selling a product that is already common in his area or country. Banking and lending money activities are not new but Yunus was the first to provide such facilities in a rural part of Bangladesh and that is definitely innovation and risk-bearing on his part as a social entrepreneur. scissors. Bygrave & Hofer. This runs in contrary to some scholars’ definition of entrepreneurship as requiring quantum changes in the products/ services to be justified as being entrepreneurial (Bygrave.

an example of creativity and innovation applied in a profitable business context.An individual could be termed as an entrepreneur if he or she sells a product or service using new systems and/ or mediums of marketing. Reel. Innovation needs to be the cornerstone of entrepreneurship as opposed to the mere setting up of another new enterprise without implementing changes or adding features of improvements to the products and services provided and/ or its business processes. Though selling books is not an innovation in itself. The paper expanded on this influential work by giving examples to illustrate what innovation in entrepreneurship was and hope ! that along the way. Read more: Entrepreneurship: What does it REALLY mean? Get more information on Entrepreneurship . A good example will be Jeff Bezos. the successful Web-based bookstore. In the author’s view. based on the definition as proposed by Schumpeter. the founder of Reel. the author hopes that this paper would further encourage the infusion of creative thinking and innovation within the educational system to nurture future entrepreneurs with a competitive edge. The founder felt that by doing so. He was one of the first to sell books on a large scale using an online store and also patented the one-click system for online buying. Conclusion: This paper has started as an attempt to redefine the term of entrepreneurship but ended up ‘updating’ the wheel.com. distribution or production methods as a basis for a new business venture. new insights were unearthed in the study of defining entrepreneurship. thus strengthening this click and mortar business venture.com is essentially one of the first cyber movie store with a very large inventory of over a 100 000 videos.com main distinction was being known as the first online store to expand by opening an offline store. Another example from the field of e-commerce is Stuart Skorman. In summary. the online store could be an advertisement for the offline store and vice versa. Though setting a movie store was revolutionary then. Reel. the founder of Amazon. the characteristics and capabilities to set up a new business venture based on doing things that have not done before should be encouraged. Jeff Bezos was innovative in the use of the Internet then as a viable ! marketing and sales channel for selling books.

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