Business Enterprise Management Learning outcome and expectation

Learning Outcomes Understanding the value of a well researched professional business plan; Understanding of entrepreneurship and the major schools of entrepreneurial thought; Understanding of the historical and latest research in entrepreneurship development; Understanding the process of developing a viable business plan concept/idea; Understanding of the main forms of business structure including legal and regulatory considerations, and the management of a business venture (involving the planning, marketing, operations; human resource and administration, financing, controls and ultimately the dissolution/exit strategy of/from the business venture).

Assessment Group Formative Assessment – Individuals in groups 'pitching' presentations, business networking, discussion groups and enterprise activity; weighting 0%. The student experience gained from the formative assessment will be the foundation for the summative assessment. Summative Assessment - Produce a well researched professional standard business plan, (4,000 word limit) based on a concept or idea developed by the student and agreed with the tutor, which relates to all knowledge and skill outcomes. Weighting 100%.

Academic Reference Main Textbook – Barringer, B. and Ireland, D. (2012), Entrepreneurship: Successfully Launching New Ventures 4 th edition, Pearson Higher Education. Optional Supplementary Textbook – Hisrich, R., Peters, M. and Shepherd, D., (2006) Entrepreneurship, 7 th edition, McGraw Hill. – Roberts, M. et al (2007), New Business Ventures and the Entrepreneur 6 th Edition, McGraw Hill.

Supplementary Readings Harvard Business Review On Entrepreneurship (1999) Harvard Business Review Press Kaplan, J.M. and Warren, A.C. (2009), Patterns of Entrepreneurship Management, 3rd edition, MA: John Wiley & Sons. Kuratko, D.F and RM Hodgetts (2007), Entrepreneurship: Theory, Process and Practice 7th edition, Mason: Thomas South Western. Stokes, D. and Wilson, N. (2006), Small Business Management and Entrepreneurship, 5th edition, Thomas Learning. Wickham, P.A. (2006), Strategic Entrepreneurship 4th edition, FT Prentice Hall. Zimmerer, T.W. and Scarborough, N.M. (2008), Essentials of Entrepreneurship and Small Business Management 5th edition, Pearson Higher Education.

Lesson 1 Entrepreneurship Text Book: Barringer B. and Ireland D. Entrepreneurship: Successfully Launching New Ventures 4 th edition, Pearson Higher Education

Nature of entrepreneurship Entrepreneur is a French word. It means “go between” or “between-taker” By this nature, it bridges between the needs of producers and consumers It links “opportunity” to “risk” It allocates resources for productive yields on the resources deployed It deploys capital for profit on ventures

Historical Developments to Entrepreneurship Earliest period – Go between to establish trade route between European continent and Far East. The merchant/trader would sign a contract with a money person to sell his goods. An example will be Macro Polo the merchant-adventurer. Middle Ages – Entrepreneurs was used to describe both an actor and a person who managed large production projects. Like a cleric in the Middle Ages taking charge of great architectural works, such as castles, public buildings, cathedral, etc.

17 th Century – An entrepreneur being a person who entered into a contract with the government to perform a service or to supply a stipulated products. The contract price was fixed, the resulting profits or losses were the entrepreneur’s 18 th Century – The one who needed the capital was differentiated from the one who provided. Industrialization saw inventors who needed capital to finance their invention. Eg. Thomas Edison, Eli Whitney.

19 th & 20 th Centuries – Entrepreneurs generally seen from an economic perspective and not differentiated from managers – Entrepreneur organizes and operates an enterprise for personal gain – Pays for the resources, eg. raw materials, use of land, labor and capital – Ingenuity in planning, organizing and administering the enterprise and assume the risk of loss and gain – Net residue of receipts after all costs have been paid were for the retains of the entrepreneur – Andrew Carnegie is one such example that invented nothing but adapted and developed new technologies to achieve economic vitality

20 th Century – Notion of an entrepreneur as an innovator was established – Schumpeter’s definition of entrepreneurship as destructive creativity – Reform or revolutionalize the pattern of production by exploiting an invention – Untried technology of producing a new commodity or making old things in a new way – Opening a new source of supply or a new outlet for products – Creating and organizing a new industry

What is Entrepreneurship? “Entrepreneurship is the process of creating something new with value by devoting the necessary time and effort, and assuming the accompanying financial, psychic, social risks, and receiving the resulting rewards of monetary and personal satisfaction of and independence.” Hisrich et al.

More definitions of entrepreneurship Academic Definition (Stevenson & Jarillo) – Entrepreneurship is the process by which individuals pursue opportunities without regard to resources they currently control. Venture Capitalist (Fred Wilson) – Entrepreneurship is the art of turning an idea into a business. Explanation of What Entrepreneurs Do – Entrepreneurs assemble and then integrate all the resources needed – the money, the people, the business model, the strategy – to transform an invention or an idea into a viable business.

The World of Entrepreneurs The three primary reasons that people become entrepreneurs and start their own firms Desire to be their own boss Financial rewards Desire to pursue their own ideas

Four Common Myths of Entrepreneurs Myth 1: Entrepreneurs are born not made Myth 2: Entrepreneurs work for money only Myth 3: Entrepreneur are gamblers Myth 4: Entrepreneurs should be young and energetic

Five key characteristics of successful entrepreneurs Opportunity driven and sense of urgency. Entrepreneur is motivated solely to pursue opportunity. Focus and committed. Entrepreneur is focused on his business venture and committed to deliver his products to the customers. Passion and ownership for the Business. Entrepreneur believes that the business will positively influence people’s lives. Tenacity and perseverance. Entrepreneur has the ability to persevere through setbacks and failures. Execution Intelligence and flexible. Entrepreneur has the ability to fashion a solid business idea into a viable business, and is able to harness relationships, networks, and be flexible to changes.

Corporate Entrepreneurship – Is the conceptualization of entrepreneurship at the firm level. – All firms fall along a conceptual continuum that ranges from highly conservative to highly entrepreneurial. – The position of a firm on this continuum is referred to as its entrepreneurial intensity.

Entrepreneurial Process Identification & evaluation of the opportunity Development of business plan Determination of the required resources Management of the business enterprise

Economic Impacts of Entrepreneurs Innovation – Is the process of creating something new, which is central to the entrepreneurial process. – It brings on more efficient way of organizing resources. Several studies have found that small businesses outperform their larger counterparts in terms of obtaining patents. Job Creation – Entrepreneurs creates businesses and provide jobs. Small businesses are the creators of most new jobs. Eg. in the U.S., small businesses employ half of all private sector employees.

Impact on Society – The innovations of entrepreneurial firms have a dramatic impact on society. – The new products and services brought about by entrepreneurs make our lives easier, enhance our productivity at work, improve our health, and entertain us in new ways. Impact on Larger Firms – Many entrepreneurs have built their entire business models around producing products and services that help larger firms become more efficient and effective.