REVIEWER IN ENTREPRENEURSHIP Self Confidence – makes decisions and sticks to his decisions
Self-Critical – learns from his mistakes and from experiences of others
Relevance of Entrepreneurship to an Organization
1. Development of managerial capabilities
 The greatest significance of entrepreneurship lies in the fact that it helps
in identifying and developing managerial capabilities of entrepreneurs. An
entrepreneur studies a problem, identifies its alternatives, compares the
alternatives in terms of cost and benefit implications, and finally chooses
the best alternative.
2. Creation of organizations
 Entrepreneurship results in the creation of organizations when
entrepreneurs assemble and coordinate physical, human and financial
resources and direct them towards achievement of objectives through
managerial skills.
3. Improving standard of living
 By creating productive organizations, entrepreneurship helps in making a
wide variety of goods and services available to the society which results
into higher standard of living for the people.
4. Means of economic development
 Entrepreneurship involves creation and use of innovative ideas,
maximization of output from given resources, and development of
managerial skills. All these factors are essential to the economic
development of a country.
Concept of Entrepreneurship
ENTREPRENEUR was derived from the French verb enterprendre, which
means “to undertake.” This refers to those who “undertake” the risk of new
enterprises. An enterprise is created by an entrepreneur and the process of its creation
is called entrepreneurship.
Factors Affecting Entrepreneurship
1. Personality Factors
Personal factors, are an entrepreneur core competencies which include:
Initiative – does things before being asked
Proactive – identifies and utilizes opportunities
Perseverance - works against all odds to overcome obstacles and is never complacent
with success
Problem-solver – develops and maintain relationship with customers and financers;
conceives new ideas and introduces innovative solutions
Persuasion – convinces customers and financers to patronize his business
A Planner – collects information, prepares a plan, and monitors performance
Risk-taker – is willing to take calculated risks
2. Environmental Factors
 Political
 Climate
 Legal System
 Economic and Social Conditions
 Market Situations
Core Competencies in Entrepreneurship
1. Economic and dynamic activity Entrepreneurship is an economic activity
because it involves the creation and operation of an enterprise with a view to creating
value or wealth by ensuring optimum utilization of scarce resources. This value creation
activity is performed continuously in the midst of uncertain business environment.
Hence, entrepreneurship is regarded as a dynamic force.
2. Innovation Entrepreneurship involves a continuous search for new ideas. It
compels an individual to contiuously evaluate the existing modes of business operations
so that more efficient and effective systems can be evolved and adopted. In other
words, entrepreneurship is a continuous effort for synergy to ensure optimization of
performance in organization.
3. Profit potential Profit potential is the level of return or compensation to the
entrepreneur for taking on the risk of developing an idea into an actual business
venture. Without profit potential, the efforts of entrepreneurs will be merely an abstract
and a theoretical leisure activity.
4. Risk bearing The essence of entrepreneurship is the willingness to assume risk
arising from the creation and implementation of new ideas. New ideas are always
tentative and their results may not be instantaneous and positive.
Types of Entrepreneur
1. Innovative Entrepreneurs – Entrepreneurs have the ability to think newer,
better, and more economical ideas of business organization and management.
2. Imitating Entrepreneurs – Entrepreneurs are people who follow the path shown
by innovative entrepreneurs.
3. Fabian Entrepreneurs – Entrepreneurs are skeptical about the changes to be
made in the organization. They do not initiate any inventions but follow only after they
are satisfied with its success rate.
4. Drone Entrepreneurs – Drone is “a person who lives on the labor of others”.
Drone entrepreneurs are those individuals who are satisfied with the existing mode and
speed of business activity and show no inclination in gaining market leadership. Also
known as die-hard conservatives
5. Social Entrepreneurs – Social enterpreneurs drive social innovation and
transformation in various fields including education, health, human rights, workers’
rights, environment and enterprise development.
Career Opportunities for Entrepreneurship Graduates
1. Mid-level management
2. Business Consultant
3. Sales
4. Research and Development
5. Not-for-profit fundraiser
6. Teacher
7. Recruiter
8. Business Reporter
BUSINESS PLAN is “a formal statement of a set of business goals, the reasons why
they are believed attainable, and the plan for reaching those goals. It may also contain
background information about the organization or team attempting to reach those
goals.”
 Business Plans should be written in the third person point of view
Focus of a Business Plan
Business plans target intermediate goals required to reach the
external goals.
Feasibility Study
The preparation of a Business Plan compliments the project Feasibility study.
The feasibility study is a major information source in making a critical decision whether
to go or not to go into the business.
The advantages of writing down the results of the feasibility study
are as follows:
 The findings can be set out in a clear and logical way, so that potential lenders
can understand the business and its likely risks/advantages. The document
helps the entrepreneur to clarify and focus his/her ideas.
 It is a reference material that can be used to plan long term development of
the business.
 The plan can be regularly consulted and updated as a guide to the business
development.
 Mistakes can be made on paper rather than in the operation of the business.
 When the plan shows that a successful business is possible, it makes the
entrepreneur feel more confident to succeed.
 It helps the entrepreneur to decide on how much money is needed and if
properly prepared, it gives the loan agency confidence that their money will
be repaid.
Comparison between a Feasibility Study and a Business Plan
a. A feasibility study is conducted before a decision to proceed (go/no go)
b. A business plan is prepared after a decision to proceed (go/no go)
c. A feasibility study provides an investigative function
d. A business plan provides a planning function
OPPORTUNITY SCREENING
- It is the most important to come up with a short list of a few very promising
opportunities which could scrutinize in detail.
THE 12 R’s OF OPPORTUNITY SCREENING
1. RELEVANCE – must be aligned with the Vision, Mission and Objectives of the
Entrepreneur
2. RESONANCE – match the values and desired values
3. REINFORCEMENT OF ENTREPRENEURIAL INTEREST – how it
resonates with entrepreneur’s personal talents, interest, and skills
4. REVENUES – sales potential
5. REACH – expansion through branches, distributorships, or franchise outlets
6. RANGE – tapping many market segments and creating a wide array of
product/service
7. REVOLUTIONARY IMPACT – “game-changer”, “the next big thing”
8. RETURNS – low costs of production and operations sold at higher prices
9. RELATIVE EASE OF IMPLEMENTATION – what obstacle to overcome
10. RESOURCES REQUIRED – fewer resources are more favorable
11. RESPONSIVENESS – customer needs and wants
12. RISK
THE PRE-FEASIBILITY STUDY
- Conducted to ascertain the viability of the opportunity.
A. MARKET POTENTIAL AND PROSPECTS – market potential is an estimated
number of possible customers who might avail of your product or service.
 P. BALANCE SHEET
B. SEGMENTING THE MARKET – using a set of demographics (e.g. gender, a. ASSETS – all the investments in the enterprise including the initial
age, place of residence, income, class, etc.) will be the most basic approach investments.
in determining the target segment.
b. LIABILITIES – represents the enterprise debts to suppliers, banks,
C. ASSESSING COMPETITION – This process would determine how saturated government, employees and other financers.
the market is in the given area of coverage.
c. STOCKHOLDER’S EQUITY – investor’s investments in the stock
D. ESTIMATING MARKET SHARES AND SALES – Entrepreneur should (or shares) on the business.
assess the potential market share he or she can attract.
Business Plan Outline
E. TECHNOLOGY ASSESSMENT AND OPERATION VIABILITY – The
entrepreneur would be able to determine whether the product or service 1.0 Executive Summary
offering will meet the demand or not. 2.0 Opportunity
F. QUANTITIES DEMANDED – This would determine the needed capacity of 2.1 Problem worth Solving
operations. 2.2 Solution
2.3 Mission and Vision Statement
G. QUALITY SPECIFICATIONS DEMANDED – dictates the quality of input, 3.0 Market Analysis Summary
qualify assurance of the process transforming input to output, quality output,
and quality outcomes for the customers who will be looking specific results.
3.1 Market Segmentation
3.2 Target Market Segment Strategy
H. DELIVERY EXPECTATIONS – knowing how much, how to frequent, and 3.2.1 Market Needs
when to deliver to customers. 3.2.2 Market Trends
3.2.3 Market Growth
I. PRICE EXPECTATIONS – the selling price would be evaluated by the
customer. 3.3 Key Customers
3.4 Future Markets
J. INVESTMENT REQUIREMENTS AND/SERVICING COSTS – The 3.5 Competition
entrepreneur needs to determine how much money is needed to start the
3.5.1 Competition and Alternatives
business opportunity which consideration to the technologies and operation
levels required. 3.6 SWOT Analysis

K. PRE-OPERATING COSTS – These are the costs related to the preparation
for the launch of the business.
L. PRODUCTION/SERVICE FACILITATE INVESTMENTS – Long term
investments for the actual business establishments.
 Executive Summary although found on the first part of the business plan,
it is usually written last. It is the summary of the entire business plan.
 Mission and Vision Statement talk about the long term goals and
objectives of the business
 SWOT Analysis (Strengths, Weaknesses, Opportunities and Threats)

M. WORKING CAPITAL INVESTMENTS – This includes the investment
needed to operationalize the business, composed of cash, accounts
receivable, and inventories.
N. FINANCIAL FORECASTS AND DETERMINATION OF FINANCIAL
FEASIBILITY – Monetary transactions that the business is expected to
engage in. Financial forecasts will indicate the feasibility of the enterprise.
O. FINANCIAL STATEMENT – Measures an enterprise performance in terms
of revenue and expenses over a certain period.
Strengths and Weaknesses talks about the internal assessment of the
business such as Manpower (skills and knowledge), Methods used, Machines
or technologies, and Money
Opportunities and Threats talks about the external assessment of the
business such as Economy, Existing Laws, Market Situations, Climate, Social
Environment