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CHAPTER 1

THE BASIC OF
ENTREPRENEURSHIP AND
BUSINESS
Prepared by
En. Hassad bin Hassan

Entrepreneurship
The scientist who cannot understand
the way entrepreneurs think will find it
extremely difficult to employ the
business tools required to
commercialize his or her technology.
Entrepreneurs are not bound by
formulas, rules, linear patterns of
thinking
Kathleen Allen

Learning Objectives
After studying this chapter you should be ready to
describe:
The Basic of Entrepreneurship and Its Risks
Types of Business Organizations
Types Of Entrepreneur According To Business Activity
Identifying, Analyzing, Evaluating and Choosing
Business Opportunity.

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ENTREPRENEURIAL
CONCEPT

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THE DEFINITION OF ENTREPRENEUR


LAYMANS TERM
French word Entreprende, willing to take responsibility or willing to try
something new.
Malay word Usahawan. which means effort or willingness to do or
complete a task.
Oxford dictionary, someone who is handling a business and taking
business risk

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DEFINITION OF
ENTREPRENEUR
Kirzner (1979)

Entrepreneurs are individualswho are always


alert about the business opportunities that
have not be seen by others

Kuratko and
Hodgets (1992)

Entrepreneur is one who undertakes to organise,


manage and assumethe risk of business

Daft (1997)

He or she who assumes the financial and legal


risks of ownership and receives the business
profits

Peter Drucker
(1985)

Entrepreneur as someone who actually searches


for change , responds to it, and exploits change as
an opportunity

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DEFINITION OF
ENTREPRENEURSHIP
Barringer
(2008)

Entrepreneurship is the process by which


individuals pursue opportunities without
regard to resources they currently control

Schumpeter
(1934), and
Dollinger
(1995)

Entrepreneurship as a firm that operates and


implements combinations of new activities such as
product development, market research, sourcing for
raw materials, manufacturing approaches and new
organizational structures.

Cole (1969)

Entrepreneurship as activities that result in benefits


through the development of profit-oriented
business.

Stevenson,
Roberts and
Grousbeck
(1989)

Entrepreneurship as individual preparedness to


compete for opportunities without considering the
resources in hand

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WHY SOCIETY NEEDS


ENTREPRENEURS
To utilise production factors such as land, capital,
technology in producing effective product
To identify opportunities from the environment by
increasing the activity that will be beneficial to
the society
To select the best approach to utilise all the
production factors in order to minimise waste in
entrepreneurship activities
For the benefit of future generations by providing
a good platform such as infrastructure an
environment.
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ENTREPRENEURSHIP

CONTRIBUTION OF
ENTREPRENEUR

Developing New Market


Discovering New Source of Material
Mobilising Capital Resources
Introducing New Technologies,
Industries and Products
Creating Employment

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ENTREPRENEURIAL
PROFILE

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WHAT MOTIVATES PEOPLE TO


BE AN ENTREPRENEURS

Be Their Own Boss


Pursue Financial Rewards
Involve In All Aspect of Business
Prestige
Opportunity to Build Equity
Opportunity to Make
Contribution
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DREAMS OF
ENTREPRENEURS

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The Characteristic of an
Entrepreneur

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Other Characteristic of an
Entrepreneur
o
o
o
o
o
o
o
o
o
o

Commited to his/her work


Always strive for excellence,
Focus on his/her work,
Confident to do business
Discipline
Innovative and creative
Able to lead and manage
Responsible and trustworthy
Has a mission and vision
Dare to take risk and never give up
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Characteristic of Successful Entrepreneurs


(ADDED KNOWLEDGE)
Product/
customer
focus

Passion for the


business

SUCCESSFUL
ENTREPRENEU
R
Tenacity
despite
failure

Execution
intelligent
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ENTREPRENEURS
PERSONALITY

Self Confident
Willingness To Take Risk
A & B Personalities
Proactive Personality
Locus of Control
Machiavellianism

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Common Myths About Entrepreneurs


(ADDED KNOWLEDGE)
Myths
Myths
Myths
Myths

Myths
Myths
Myths
Myths

1:
2:
3:
4:

Entrepreneurs Are Doers, Not Thinkers.


Entrepreneurs Are Born, Not Made.
Entrepreneurs Are Always Inventors.
Entrepreneurs Are Academic and Social
Misfits.
5: Entrepreneurs Must Fit the Profile.
6: All Entrepreneurs Need Is Money.
7: All Entrepreneurs Need Is Luck.
8: Entrepreneurship Is Unstructured and
Chaotic.
Myths 9: Most Entrepreneurial Initiatives Fail.
Myths 10: Entrepreneurs Are Extreme Risk
Takers or The Gamblers.
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Risks Of Being An Entrepreneur


(ADDED KNOWLEDGE)
1.
2.
3.
4.
5.
6.
7.
8.

Uncertainty of Income
Risk of Losing Entire Investment
Long Hours and Hard Work
High Stress Level
Difficulty in Obtaining Customers
Complete Responsibility
Difficulty in Obtaining Loans
Discouragement
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Entrepreneur VS Businessman
(ADDED KNOWLEDGE)
Profit

Risk
Opportunity

Entrepreneur

Businessman

Plan and focus


for long term
profit
High level

Focus on short
term profit

Create
and
invent
new
business trend

Follow business
trend

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Low level

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Questions for mid term test


Question 1
[Soalan 1]
i. Who is an entrepreneur?
[Siapakah usahawan?]
Marks[Markah]
ii. What does Kirby says about entrepreneurs?
[Apakah yang dikatakan oleh Kirby mengenai usahawan?]
Marks[Markah]

Question 2
[Soalan 2]
i. Why do you want to be an entrepreneur? Give FOUR (4) reasons and
please elaborate your answers.
[Kenapa kamu ingin menjadi seorang usahawan? Berikan EMPAT(4) sebab
dan huraikan jawapan anda]
10
Marks[Markah]
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Q&A

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