ENT/ETR300 ± FUNDAMENTALS OF ENTREPRENEURSHIP

THEORIES & CONCPET OF ENTREPRENEURSHIP

THEORIES & CONCEPT OF ENTREPRENEURSHIP
Assoc. Prof. Dr Nawawi B Mohd Jan Dato¶ Dr. Adnan Alias

ENT/ETR300 ± FUNDAMENTALS OF ENTREPRENEURSHIP

THEORIES & CONCPET OF ENTREPRENEURSHIP

THEORIES & CONCEPTS OF ENTREPRENEURSHIP
Session Objectives At the end of the session, students should be able to: ‡ understand the various theories and concepts on entrepreneurship ‡ have a deeper understanding of the discipline of entrepreneurship

ENT/ETR300 ± FUNDAMENTALS OF ENTREPRENEURSHIP

THEORIES & CONCPET OF ENTREPRENEURSHIP

THE EVOLUTION OF ENTREPRENEURSHIP THEORY Definition of an Entrepreneur : ‡ ³ An entrepreneur is a person who undertakes to do a job ´ Richard Cantillon (1755). The term entrepreneur is a French word first coined by Richard Cantillon. ‡ In Malaysia the term ³usahawan´ is used for entrepreneur.

the dynamics of business set up and expansion and development.ENT/ETR300 ± FUNDAMENTALS OF ENTREPRENEURSHIP THEORIES & CONCPET OF ENTREPRENEURSHIP THE EVOLUTION OF ENTREPRENEURSHIP THEORY Definition of Entrepreneurship: ‡ Entrepreneurship involves not only the process that leads to the setting up of a business entity but also the expansion and development of an on going concern. .The study of entrepreneurship is concerned with the entrepreneurial behavior.

. ‡ Jean Babtiste Say (1803) .ENT/ETR300 ± FUNDAMENTALS OF ENTREPRENEURSHIP THEORIES & CONCPET OF ENTREPRENEURSHIP THE EVOLUTION OF ENTREPRENEURSHIP THEORY ‡ Adam Smith (1776) .An entrepreneur is a person who acts as agent in transforming demand into supply.An entrepreneur is a person who shifts resources from an area of low productivity to high productivity.

The entrepreneur transforms and gives added value.The entrepreneur acts as an economic agent who transforms resources into products and services. .The entrepreneur is the fourth factor of production after land . ‡ Carl Menger (1871) .ENT/ETR300 ± FUNDAMENTALS OF ENTREPRENEURSHIP THEORIES & CONCPET OF ENTREPRENEURSHIP THE EVOLUTION OF ENTREPRENEURSHIP THEORY ‡ John Stuart Mill (1848) .labor and capital.An entrepreneur is a prime mover in the private enterprise.

. It evolves from sole proprietorship to a public company.The process of entrepreneurship or business development is incremental or evolutionary .An entrepreneur is an innovator. ‡ Alfred Marshall (1936) . The economy moves through leaps and bounds and the prime mover is the entrepreneur through the process of creative destruction.ENT/ETR300 ± FUNDAMENTALS OF ENTREPRENEURSHIP THEORIES & CONCPET OF ENTREPRENEURSHIP THE EVOLUTION OF ENTREPRENEURSHIP THEORY ‡ Joseph Aloysius Schumpeter (1934) .

ENT/ETR300 ± FUNDAMENTALS OF ENTREPRENEURSHIP THEORIES & CONCPET OF ENTREPRENEURSHIP THE EVOLUTION OF ENTREPRENEURSHIP THEORY ‡ Ibnu Khaldun (Abdul Rahman Mohamed Khaldun) . This need for achievement is directly related to the process of entrepreneurship.The entrepreneur is a person with a high need for achievement. ‡ David McClelland .The entrepreneur is seen as a knowledgeable individual and is instrumental in the development of a city-state where enterprise will emerge. .

ENT/ETR300 ± FUNDAMENTALS OF ENTREPRENEURSHIP THEORIES & CONCPET OF ENTREPRENEURSHIP DEFINITION OF ENTREPRENEURSHIP  It is more than mere creation of business  Entrepreneurship is a process of innovation and new venture creation through four major dimensions ± individual.  The entrepreneurship process is aided by collaborative networks in government. organizational. environmental and process. education and institutions. .

.ENT/ETR300 ± FUNDAMENTALS OF ENTREPRENEURSHIP THEORIES & CONCPET OF ENTREPRENEURSHIP DEFINITION OF ENTREPRENEURS ‡ Functional definition of entrepreneurs offers the following definition: ‡ Entrepreneurs are individuals who actively form or lead their own business and nurture them for growth and prosperity.

Entreprenuership is the symbol of business steadfastness and achievement. Innovative creation of opportunity Example: Portable phones linked to faxes and laptop will turns cars.ENT/ETR300 ± FUNDAMENTALS OF ENTREPRENEURSHIP THEORIES & CONCPET OF ENTREPRENEURSHIP THE IMPORTANCE OF ENTREPRENEURSHIP TO MALAYSIAN ECONOMY 1. . and airport terminal into offices. train. Entrepreneurship may affect our future in many ways: a. Entrepreneurial revolution is critical to economic growth.

. e. Entrepreneurship is synonymous to creation of new venture and small businesses.ENT/ETR300 ± FUNDAMENTALS OF ENTREPRENEURSHIP THEORIES & CONCPET OF ENTREPRENEURSHIP THE IMPORTANCE OF ENTREPRENEURSHIP TO MALAYSIAN ECONOMY d. SMIs have been important contributors to local economic growth. Entrepreneurship not only affect our lives through innovation but represent the working future for many of us due to lays off by large organization and shrinking of job opportunities for graduates.

ENT/ETR300 ± FUNDAMENTALS OF ENTREPRENEURSHIP THEORIES & CONCPET OF ENTREPRENEURSHIP THE IMPORTANCE OF ENTREPRENEURSHIP TO MALAYSIAN ECONOMY .

Entrepreneurship is an integral parts of Islamic religion.By virtue of human nature .ENT/ETR300 ± FUNDAMENTALS OF ENTREPRENEURSHIP THEORIES & CONCPET OF ENTREPRENEURSHIP ISLAMIC ENTREPRENEURSHIP ISLAMIC ENTREPRENEURSHIP FOCUS ON EIGHT PRINCIPLES OF THOUGHTS :1. 4.Ibadah ± business activity is part of ibadah or ³good deed´ . the Moslem entrepreneurs are µkhalifah¶ and have the reponsibilities develop prosperity and sees business as part of ibadah or good deed. 3. 2.Motivation ± success in Islam is not merely measured by the end result but also the way and means of achieving them.

Islamic Entrepreneurship should operate within the domain of Islamic Economic system and act as the vehicle towards global acceptance of Islamic Economic System.ENT/ETR300 ± FUNDAMENTALS OF ENTREPRENEURSHIP THEORIES & CONCPET OF ENTREPRENEURSHIP ISLAMIC ENTREPRENEURSHIP 5.A. Islamic Economic System . . 6. Prophet Muhammad S. Position of Entrepreneurship and business in Islam ± Islam encouraged its ummah to venture into business .W expounded that 9 out 10 source of rizque (reski) can be found in business.

ENT/ETR300 ± FUNDAMENTALS OF ENTREPRENEURSHIP THEORIES & CONCPET OF ENTREPRENEURSHIP ISLAMIC ENTREPRENEURSHIP 7. Guiding Principles of Islamic Entrepreneurship is by the al-Quran and al-Hadith Entrepreneurial Ethics based on exemplary conducts of Prophet Muhammad S.W .A. 8.

There is no separation between business and religion. Islam has its own entrepreneurship culture and guiding principles based on the Al-Quran and Hadith to guide business operation .ENT/ETR300 ± FUNDAMENTALS OF ENTREPRENEURSHIP THEORIES & CONCPET OF ENTREPRENEURSHIP ISLAMIC ENTREPRENEURSHIP AS AS INTEGRAL PART OF THE RELIGION Islam is a complete way of life. .

.ENT/ETR300 ± FUNDAMENTALS OF ENTREPRENEURSHIP THEORIES & CONCPET OF ENTREPRENEURSHIP HUMAN NATURE (The fitrah of human being) By virtue of the human nature. but above all. Muslim entrepreneur should search for God¶s blessings above all other factors. He has the responsibility to perform µibadah¶ and be a µkhalifah¶. then an entrepreneur. to fulfill the µfardhu kifayah¶. the person must firstly be a Muslim. A Muslim entrepreneur perform business not solely for profit.

‡ The successful path and means for achieving success for Muslim entrepreneurs are unique. but also the means and ways of achieving them. ‡ Success in Islam is not merely measured by the end result. .ENT/ETR300 ± FUNDAMENTALS OF ENTREPRENEURSHIP THEORIES & CONCPET OF ENTREPRENEURSHIP MOTIVATION ‡ Most entrepreneurs have the desire to achieve successful business venture.

.ENT/ETR300 ± FUNDAMENTALS OF ENTREPRENEURSHIP THEORIES & CONCPET OF ENTREPRENEURSHIP SUCCESS FORMULA BY AL-QURTUBI ‡ Halal ± livelihood that are in accordance to ‡ ‡ ‡ ‡ what is being outlined by Allah SWT and syariah.Spiritual happiness Jannah ± Worldly success should act as the bridge to the ultimate success in the life hereafter (paradise).Asking for the blessing of Allah in proportion to one¶s expectation Sa¶adah. Qanaah ± be pleased and thankful with one¶s earning Taufiq .

ENT/ETR300 ± FUNDAMENTALS OF ENTREPRENEURSHIP THEORIES & CONCPET OF ENTREPRENEURSHIP SEVEN STEPS TOWARDS A SUCCESS IN LIFE ACCORDING TO IMAM AL-GHAZALI Level of Knowledge Level of Taubat or repentence Level of Temptation Level of Obstacles Level of Motivation Level of Handicap Level of Praise and Thankfulness .

ENT/ETR300 ± FUNDAMENTALS OF ENTREPRENEURSHIP THEORIES & CONCPET OF ENTREPRENEURSHIP POSSESSION OF WEALTH IS ALLOWED BASED ON THE FOLLOWING PRINCIPLES:‡ ‡ ‡ ‡ Allah s.t is the absolute owner of wealth Allah created wealth in abundance and sufficient for all Wealth is created for mankind Wealth is entrusted to mankind .w.

involving in business is part of ibadah through the fulfilment of fardhu kifayah. .ENT/ETR300 ± FUNDAMENTALS OF ENTREPRENEURSHIP THEORIES & CONCPET OF ENTREPRENEURSHIP IBADAH In Islam.

ENT/ETR300 ± FUNDAMENTALS OF ENTREPRENEURSHIP THEORIES & CONCPET OF ENTREPRENEURSHIP POSITION OF BUSINESS AND ENTREPRENEUR ISLAMIC ENTREPRENEURSHIP MODEL E X A M P L E Islam Proposed (Business Venture) Allah Prepared (Facilities) Islam Outlined (Rules and Regulation) Allah Promised (Reward) E X A M P L E .

ENT/ETR300 ± FUNDAMENTALS OF ENTREPRENEURSHIP THEORIES & CONCPET OF ENTREPRENEURSHIP ISLAMIC ECONOMIC SYSTEM Islamic Entrepreneurship should be in the framework of Islamic Economic System and should assist in establishing the Islamic Economic System .

ENT/ETR300 ± FUNDAMENTALS OF ENTREPRENEURSHIP THEORIES & CONCPET OF ENTREPRENEURSHIP GUIDING PRINCIPLES OF ISLAMIC ENTREPRENEURSHIP Guidelines for Islamic Entrepreneurship and business activities are wide and comprehensive based on AlQuran and Al-Hadith. .

ENT/ETR300 ± FUNDAMENTALS OF ENTREPRENEURSHIP THEORIES & CONCPET OF ENTREPRENEURSHIP MUSLIM ENTREPRENEURSHIP ETHICS         To prevent laziness To eradicate fear To search for legitimate ventures To avoid forbidden sources of income and property To show gratitude and thankfulness of whatever has been acquired To grow and develop capital and profit To diversify business ventures To avoid greediness .

ENT/ETR300 ± FUNDAMENTALS OF ENTREPRENEURSHIP THEORIES & CONCPET OF ENTREPRENEURSHIP THE ETHICAL BEHAVIOR OF MUSLIM ENTREPRENEURSHIP  To avoid malicious behavior  To avoid squandering  To avoid stinginess  To pay alms (zakat)  Trustworthy  To pray consistently  Tawakkal  Patience  Qana¶ah .

ENT/ETR300 ± FUNDAMENTALS OF ENTREPRENEURSHIP THEORIES & CONCPET OF ENTREPRENEURSHIP EXEMPLARY CONDUCTS OF GOOD MUSLIM ENTREPRENEURS DURING THE PROPHET MUHAMMAD S.W REIGN      Business is secondary when being called for other form of crusade Avoid using influence for self interest Afraid of accumulated wealth Leadership qualities in all aspects Practice moderate way of life .A.

ENT/ETR300 ± FUNDAMENTALS OF ENTREPRENEURSHIP THEORIES & CONCPET OF ENTREPRENEURSHIP END OF MODULE 1 .

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