PHILIPPINE

is an Entrepreneurial Country
S
SME
“SMALL AND MEDIUM ENTERPRISES”

(are non-subsidiary, independent firms which employ

fewer than a given number of employees)

69%
 ROLES OF
ENTREPRENEURSHIP
Creates Employment Improves Quality of Life
Develops New Market Serves as Role Models
Introduces Innovation Brings Social Benefits
Generates New Sources Utilizes Indigenous
of Materials Resources
Stimulates Investment Provides More
Interest Alternatives
 DEFINITION OF ENTREPRENEUR
in different Point of View
For Economist,
For Psychologist, For Management
Entrepreneur is someone
entrepreneur is someone Perspective, Entrepreneur
who brings resources,
who is “typically driven by is “someone who
labor, materials, and
certain forces such as the identifies opportunities,
other assets into
need to obtain or attain plans, mobilizes
combinations that make
something, to resources, manages, and
their value greater than
experiment, to assumes the risks of a
before; also one who
accomplish, or perhaps business to have a
“introduces changes,
escape the authority of positive impact on
innovations, and a new
others”. society”.
order”.
 ENTREPRENEUR’s TRAITS
Persevere Has Self-Confidence
Committed Responsible
Feedback-Seeker Innovative
Knows How To Calculate Knowledgeable About
Risks Opportunity
Has A Drive To Achieve Has High Tolerance for
Something Failure
ENTREPRENEURS
Are INTUITIVE
 ENTREPRENEURIAL
COMPETENCIES
“are the sum total of the personality, skills, and
knowledge that the entrepreneur possesses”
• Functional – skills, organized into clusters, regarding the main areas of
managerial knowledge.
• Emotional – specific behaviours grouped into five clusters, namely:
self-awareness, self-management, social awareness,
relationship management, and cognitive competencies.
• Cross-Functional – broad overall skills that are grouped into goal and
action management cluster, people management cluster,
and analytical reasoning cluster.
According to Camuffo, Gerli, and Gubitta
 According to Man and Chan

• Opportunity – Competencies related to recognizing and

developing market opportunities through various
means.
• Relationship – Competencies related to person-to-
person / individual-to-group interactions.
• Conceptual – Competencies related to different
conceptual abilities, which are reflected in the
bahaviors of the entrepreneur.
• Organizing – Competencies related to the organization
of different internal and external human, physical,
financial and technological resources.
• Strategic – Competencies related to setting, evaluating
and implementing the strategies of the firm.
• Commitment – Competencies that drive the
entrepreneur to move ahead with the business.
DECISION MAKING
As a Core Competency
Rational/Scientific Counterfactual
Method Thinking

Use of Intuition Over-Confidence

Affect Infusion Knowing Style

Attribution Style Creative Style

STARTING UP A
BUSINESS
 FACTORS TO CONSIDER IN STARTING A
BUSINESS

Focus and
Direction

Sources of
Capital
Good Legal
Network Requirements

Research and
Degree of
Development
Risk
Other Critical
Personal Availability of
Factors for New
Competencies Resources Venture
IDENTIFICATION OF
BUSINESS
OPPORTUNITIES
 POTENTIAL SOURCES OF
OPPORTUNITY
Unexpected Demographics

Incongruous Change

The Process Need New Knowledge

Industry and Market

Structures According to Drucker
TYPES OF BUSINESSES
 MICRO ENTERPRISE

• Has an asset size not exceeding P50,000

• Usually a home-based enterprise
• Operating in temporary headquarters
• The owner is the head
• Employs 1-10 people only
 COTTAGE ENTERPRISE

• Has an asset size not exceeding P500,000

• Usually a home-based enterprise
• Managed and operated by members of the
family
 SMALL ENTERPRISE

• Has an asset size of P500,000 but not

exceeding P2,500,000
• Owned by individual or group
• Employs 10-20 people
 MEDIUM ENTERPRISE

• Has an asset size not exceeding

P20,000,000
• Owned by individual or group
• Employs 100 or more workers
 LARGE ENTERPRISE

• Has an asset size of P20,000,000 or more.

• Owned and managed by a corporation
• Employs 100 or more workers
• Operates in highly formalized but complex
systems of management.
FORMS OF BUSINESSES
 SINGLE PROPRIETORSHIP
-is owned and usually managed by one person. They
register with the Department of Trade and Industry.

ADVANTAGES
• Easiest way to set up
• Decision-making left entirely to
owner
• Easy to dissolve
• •
Retention to all profits
• More flexibility
• Tax incentives and less
government regulation
DISADVANTAGES
• Demanding on owner’s personal
time
• Growth limited by owner’s financial
means
Unlimited liability
• Lack of stability
• Limited access to credit
• Limited business skills and
knowledge
 PARTNERSHIP
-is an association of two or more persons who act as co-owners of a
business. Each partner contributes money, property or service to the
business. They register with Securities and Exchange Commission
(SEC).

ADVANTAGES
• Relatively easy to set up
• Check and balance maintained
with two or more owners
• Availability of more capital and
credit
• Retention of profits to fewer
owners
DISADVANTAGES
• Endangered by conflicts
between partners
• A decision made by one partner
is binding on all other partners
• Liability for debts incurred is
unlimited
• Lack of stability
 CORPORATION
-is an artificial being created by operation of law, having the right of
succession, and the powers, attributes and properties expressly authorized
by or incident to its existence. They register with the Securities and
Exchange Commission.

ADVANTAGES
• Risks and losses are shared with the
other shareholders
• Maximum flexibility for growth
• Limited liability of individual
shareholders
• Greater room for professionalism in
management
• Easy to raise capital
• Assured of at least 50 years of
existence by law
DISADVANTAGES
• Complicated setting-up process
• Individual stockholders may have limited
influence on management
• Tendency to institutionalize a
bureaucracy
• Strictly regulated and supervised by the
government
 COOPERATIVE
-is a duly registered association of persons, with a common bond of interest,
who have voluntarily joined together to achieve a lawful common social or
economic end, making equitable contribution to the capital required, and
accepting a fair share of the risks and benefits of the undertaking in
accordance with the universally accepted principles of the cooperatives. They
register with the Cooperative Development Authority (CDA).

ADVANTAGES DISADVANTAGES
• Least likely to be dissolved • Shared control of the business
• Limited Liability • Consensual decision making
• More people benefit from the business
• Professional managers may be
employed by the members
END