Defining Entrepreneurship:

Operational Considerations

Nisanka S. Kusumsiri, Ananda K.W. Jayawardane

University of Moratuwa
 The Problem – Hunting the Heffalump

“A rather large and important animal. He has been hunted by many individuals using
various trapping devices, but no one so far has succeeded in capturing him. All who
claim to have caught sight of him report that he is enormous, but disagree on his
particulars” [1].
Image: http://www.startedbyamouse.com/happenings/PoohsHeffalump03.shtml
“Good Science has to Begin with Good
Definitions”.

• Generate more productive empirical research

• Win legitimacy [5]-[6], [11]-[12]

• Identify role of entrepreneurship and the entrepreneur in

society

• Effective policy-making, training, education and support

programmes
Historic Development of the Concept of
Entrepreneurship

What is
The economic
entrepreneurship?
approach
Who is an
entrepreneur? The personality
approach
The socio-behavioural
approach
The management approach
The Economic Approach
Author Key role of entrepreneur Additional insights

Richard Cantillon Organiser of factors of production Catalyst for economic change

J.G. Say Organiser of factors of production Catalyst for economic change

J.H. Von Thünen Profit motivation Profit as a return for risk and
return for ingenuity

Kirzner opportunity exploration and Entrepreneur’s key ability is

exploitation ‘creative’ alertness

Schumpeter Innovation and creativity ‘Creative destruction’

Entrepreneur as ‘hero’ figure
Frank Knight Taking risks Profit is reward for risk-taking

G.L.S. Shackle Creativity Uncertainty creates opportunities

for profits

Casson Organiser of resources Key influence of the environment

The Psychological Characteristics Approach

Key Characteristics Authors

Need for achievement Atkinson (1957, 1958, 1964, 1967) [11] McClelland (1961,
1967)

Internal locus of control Shapero (1975) Brockhaus (1980, 1982)

Tolerance for ambiguity Budner (1962); Norton (1975); Sexton & Bowman (1985)
Low & MacMillan (1988); Carland et al. (1989)

Managing risk Sexton & Bowman (1985) Low & MacMillan (1988)
Tipu & Arain (2011)

Desire for independence Collins & Moore, 1964

Creativity Wilken (1979); Carton, Hofer, & Meeks (2004)

The Management Approach

• Entrepreneurship as a pattern of management behaviour

• Series of learned activities

• Management functions of entrepreneurship

• Emphasizes training, education and incubation

The Intrapreneurial Approach

• Development of independent units designed to create,

market, and expand innovative services, technologies or
methods within organisations

• Depends on organizational corporate strategy, structure

and employee capabilities.
Operational Considerations
Approach Measures Focus Research/training focus
Economic Opportunity Venture formation and  The process of opportunity recognition and
recognition initial stages of venture formation
Decision making organisational development  Opportunity recognition and decision making
Risk taking ability
Creativity  Techniques to stimulate creative thinking
Innovation abilities
 Environmental factors influence
entrepreneurial process
psychological Personality traits – Identifying potential  entrepreneurial individuals and their
characteristics Need for achievement, entrepreneurs and desired characteristics that relate to the venture
Locus of control, characteristics for success success
Tolerance for  Influence of early-life experiences on
ambiguity psychological characteristics
Personal values and  More targeted and individualised approach
principles towards training and education
 Personal assessment of individuals’ values

Management Business planning Planning activities and  Enhancing entrepreneurial skills and
Expertise venture growth behaviour by training and education
Technical knowledge  The role of training and education in
and skills different stages of organisational
development

Intrapreneurship Autonomy Growth and development of  Evolution of entrepreneurial management

Decision making organisations, reassessing process through organisational development
Team work and evaluating needs for  Innovation and value creation in large
Overall strategy change organisations – Strategic innovation
Creativity behaviour
 Strategic entrepreneurship
 Team and leadership
Conclusion

• Almost all the definitions of entrepreneurship and

entrepreneur are rooted in few basic
assumptions/approaches.

• All these approaches convey different facets of

entrepreneurship

• selection of one approach over another depends on aspects

of entrepreneurial process researcher or policy maker
expected to emphasise.

• Holistic view towards different approaches

 Thank you

nisankak@uom.lk; nisankalk@gmail.com; akwj@uom.lk; akwj.uom@gmail.com