M5080495 Entrepreneurship And Small Business Management

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M5080495 Entrepreneurship And Small Business Management

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M5080495 Entrepreneurship And Small Business Management

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Course Code: M5080495
University: Regent University

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Country: United States

Question:

Task 1: You will need to start with introduction to the concept and phenomenon (entrepreneurship) with practical examples in relations to SME’s. You are required to write this report, by using supportive materials like books, Journals and other secondary sources of information on the findings for LO 1. The answers you will give should reflect the scenario.Explore and illustrate the range of venture types that might be considered entrepreneurial. Carry out a mini research to examine different types of entrepreneurial ventures and explain how they relate to the typology of entrepreneurship.As part of your research investigation, explore the similarities and differences between entrepreneurial ventures.Task 2:  You will continue using the above scenario as a consultant and using supportive materials like books, Journals and other secondary sources of information on the findings for LO 2. You are to report on ‘Impact of small businesses on the economy’.Assess the impact of small businesses on the economy.
Assess and interpret relevant data and statistics in your mini-research, to illustrate how micro and small businesses impact on the economy.Explain how important small businesses and business start –ups will contribute to the growth of the social economy after ‘Brexit’.Task 3:  You will continue using the above scenario as a consultant, and using supportive materials like books, Journals and other secondary sources of information on the findings for LO 3. You are to report on ‘The Mindset of the Entrepreneur’. Determine and assess the key aspects of an entrepreneurial mind-set
Carry out a mini-research to determine the characteristics, traits and skills of two successful entrepreneurs, which differentiate them from other business managers.Assess how aspects of the entrepreneurial personality as discussed in P5, reflect entrepreneurial motivation and mindset.Task 4:  You will continue using the above scenario as a consultant and using supportive materials like books, Journals and other secondary sources of information on the findings for
You are to report on ‘The different environments that foster or hinder entrepreneurship’.Examine the different environments that foster or hinder entrepreneurship. 
With practical examples obtained through your mini-research, examine how background and experience can hinder or foster entrepreneurship. 

Answer:

Introduction
An entrepreneur is an individual who organizes, takes charge and incurs the risks of an enterprise. He/she is described as an initiator or a starter or a challenger because he/she comes up with something new which can be in the form of a business or a company and he/she is the beginner and sometimes the end of that enterprise. An entrepreneur ensures that the idea is actualized by providing leadership and ensuring that the rest of the team is inspired as he/she takes the leading role. He/she is the one who takes sole responsibility as far as the destiny of the business is concerned. Passion is the main driving force of an entrepreneur, and it is the one that makes him/her have the stamina, gusto and superior energy to surmount the different challenges that go with running a venture. Some entrepreneurs are not the original developers of ideas but rather the ones who actualize them. They might be the founders of Uber taxis, a computer café starter or a second-hand vendor. They differ regarding their potential, size, and vision.
Small Business Entrepreneurship
Today, the majority of the entrepreneurs in the United Kingdom and the United States of America are small-scale business ventures. They comprise about 99% of all the companies in both countries and employ more than 50% of all the employees in the private sector. The group consists of people who run their own business and hire people locally or use their family members to help them run their businesses. Some of them make a little profit if any.Their ability to feed their families and make some small profit defines their success. Since they are unable to attract venture capital to grow their business, they rely on family, friends and small loans to fund their business.
For this category, the entrepreneurs start a business venture well aware from the onset that their business vision will revolutionize the world and create a lot of change concerning products and services. They get attraction and investments from financial investors who are equally crazy (Venture capitalists). They hire the brightest based on talent, skill, and experience. They begin their job by searching for a scalable and repeatable model of business. After they get this model, their drive changes towards getting an additional investment that they can inject into their business to expand and serve their markets better. The scale up startups that are in the innovation group such as Shanghai, Israel, Silicon Valley and New York, represent a subtle percentage of startups and entrepreneurs but because of their returns on out-size, they are prone to all the risk capital .
Large Company Entrepreneurship
Large enterprises have life cycles that are finite. These companies grow by consistently studying the market to become more innovative by introducing new products that will satisfy the ever-changing customer tastes and preferences. Due to changes in new technologies, new competitors, new legislations, and changes in consumers’ tastes and preferences, a lot of pressure is on more innovation that is disruptive to the market. This pressure requires the companies develop new products for sale to the newly found customers in the recently found markets. Most of the existing companies achieve this by trying to come up with disruptive products within or come up with an entirely different product. These big companies find it an uphill task because of their culture and large size to create disruptive innovation. Customers tend to incline themselves to a particular culture and products.
Social Entrepreneurship
These innovators’ primary objective is to innovate products and services that aim at solving the social needs of the society. They identify social gaps that they try to fill. Unlike scale up entrepreneurs who want to transform the world, social entrepreneurs have the aim of making the world a better place for humanity but not to take a share of the market or make the founders rich or wealth. They are of three types: for-profit, not for profit and hybrid.
Similarities and differences between entrepreneurial ventures      
All these ventures may have similarities or differences based on their goals. Small business entrepreneur, scale up entrepreneurs, and big entities have a lot in common. Their focus and value lie on the kind of profit that the entrepreneur and the investors aim at getting as the product gains ground and get established in the market. The large scale trader is accountable to the investors and shareholders for the generation of the profits.  They get their investment based on the leadership of the venture. They mainly aim at making money and creating wealth for the people who have invested in them because that is the essence of being in operation. The business entrepreneur does innovation with a commercial eye to it though at the end the customers will also benefit. If it becomes successful, the wealth generated belongs to the individuals behind the venture. Their success is also measured based on the amount of money that they make. They want to expand their business influence and create awareness about their business to as many people as possible. They look for gaps in the market so that they can fill them. Their gain is in material form.
The goal of the social entrepreneur, however, is how the community will accrue benefits or get transformed through meeting their social needs. Such happens when the society doesn’t have the necessary resources to meet its needs. The primary investors in the social enterprises are philanthropists. They also measure the viability of the business based on the person who holds the position of leadership. Though the activities that they are involved in generate a profit, which is not their driving force. Social enterprises structure their companies in such a way that they do not entirely focus on making profits.
 They channel any profits to the fulfillment of certain societal needs. An example is a water bottling plant that operates in San Diego that contributes a hundred percent of all the profits that they make towards water projects in developing countries. They support projects for clean water in Kenya, Nicaragua, Uganda and Sri Lanka.A social entrepreneur wants to create profits and wealth though wealth is not the primary motivation. They are focused towards eradicating suffering poverty and injustice hence creating a change in the society in a substantial way. They primarily focus on generating an impact in the community and ensure that there is ecological health and well- being of the inhabitants. Their driving force is not profit, but rather satisfying the needs and wants of the local community
All the business ventures equally have particular motivations and actions that are similar. Firstly, they are all committed to changing the status quo. Secondly, both of them try to make money so that they can remain in operation. For the social enterprise, they create wealth for the transformation of the society, but the business entrepreneur creates income to benefits the investors, stakeholders, and investors. However, the bottom line is that both aim at making profits. Both of them also fill the gaps that are left in the society socially, economically and technologically. They also endeavor to bring change to the community though through the use of different approaches.
Illustrating how micro and small businesses impact on the economy
Although critical to the growth of any economy, this category gets little media attention: only large companies capture such coverage. According to the Department for Innovation and Business Skills, in 2014, there were 5.2 million micro and small firms in the United Kingdom. In the same year, over 99 percent of all the entities were in this category. The United Kingdom regards such units as those with less than 250 employees.
Most of the businesses in the UK employ less than ten people, and they account for 33.5% of the total employment and the turnover of 19%. This data accords to a briefing paper published in May 2015, in the House of Commons library. According to the Forum of Private Business, Small business enterprises account for more than 15.2 million jobs. This business is considerably booming in this country. In the year 2015, there were 5 million such entities which denote an increase from 3.5 million in the year 2000.These figures appear on a report published by the Royal Society for the Encouragement of Arts in June 2015.
However, the numbers of other large entities have just grown marginally or declined. The economy of the United Kingdom is under the significant propulsion of micro and small business ventures. Half of the new jobs created in the United Kingdom come from this sector (Research by National Endowment for Science, Technology and the Arts published in 2015).
The micro and small scale ventures or gazelles, as commonly referred in the United Kingdom, are growing at more than 20 %( Organization for Economic Co-operation and Development).To some extent, the government has helped in this growth by offering tax breaks.
Contributions of small businesses and start-ups to the growth of the social economy
Entrepreneurs are always looking for ways in which they will help the communities that they serve. They donate their money and time to the ones who require them after identifying the needs. They also offer their much-required expertise. They do this through coaching the youth and other people who are interested in business in the community on how to succeed in life. Sometimes, they also volunteer to participate in community services such as environmental sanitation in the form of cleaning and participating even in the construction of roads bridges and much more. Regarding the donation of money, they do so by contributing to charities and other projects. Small businesses and start-ups satisfy particular needs for the society. For instance, if it is a salon, services for delivering newspapers or computer services, the community will receive these services hence helping in improving the social economy of the society.
More that ninety-nine percent of all private-sector employees in the United Kingdom are under this category. Even in the Unites States, 56 million people who represent a whopping 57% of all the workers in the private sector are under this category. These statistics mean that the societies where the employees hail benefit substantially because the salaries and wages that they earn, they take back to their homes. Such initiatives improve the social economy of the countries because the employees are empowered financially, and therefore they can contribute to their communities through projects, bursaries and much more. This observation is in accordance with the Small Business Administration.
Characteristics, traits, and skills of successful entrepreneurs, which differentiate them from other business managers
An entrepreneur and a manager differ significantly on their perceptions and actions. An entrepreneur gives birth to an idea, brings a team together, bring resources that will actualize the business idea and then raise the necessary capital that is required. The manager will only come in when all the necessary preparation is made and even the foundation laid. Therefore, the work of a manager starts after the entrepreneur has fully prepared the ground. This also means that a manager cannot function without an entrepreneur because he/she will have nothing to manage.
Managers understand the operations of their businesses very well because they are experts and have deep knowledge in their areas. They know how to make businesses grow. Entrepreneurs are generalists, and they know little about everything. They have some information about communication, accounting, business law, business systems, leadership, public speaking marketing, finance and insurance product design and sales and marketing. The cup of an entrepreneur must be full.
Entrepreneurs learn through trial and error, they learn from the mistakes of others and theirs too. Entrepreneurs start their enterprise with what they have at hand however little it is. This is one of the reasons as to why most of the successful entrepreneurs are school dropouts. On the contrally, managers have thorough knowledge on the area of business management. In colleges, business managers learn to take the proper management of people’s money, but in the streets, entrepreneurs learn how to make their money.
An entrepreneur is motivated to begin a business, however small it is, and then grow. His understanding of a venture is for his personal satisfaction. On the other hand, a manager offers services to a business that is already established. However, a manager is out to give his/her services to a company that has already been set up by an entrepreneur.
An entrepreneur being the owner of the business incurs all the costs that emanate from uncertainties and other business operation challenges. A manager being just a service provider does incur any fees as the entity runs. The only reward that an entrepreneur gets by bearing all the risks that are involved in the running of business, is the profit capital gains, cash flow, dividends and asset acquisition which is not guaranteed. However, a manager gets a salary for the services that he/she renders to the business venture. This salary is fixed unlike the profit of an entrepreneur.
An entrepreneur is ever thinking about how to beat the competitors and meet the ever-changing demands of customers. Therefore, an entrepreneur acts as a change agent as well as an innovator. The work of a manager is to implement the plans, policies, and procedures that are formulated by an entrepreneur. Therefore, the work of a manager is to translate the ideas of an entrepreneur and turn them into a reality.
The qualities that an entrepreneur requires are original thinking, risk bearing high achievement motive, foresight, and visionary. What a manager is needed to have is credible qualifications and knowledge in the management theory and the practice part of it.The qualities that an entrepreneur requires are original thinking, risk bearing high achievement motive, foresight and visionary. What a manager is needed to have are credible qualifications and knowledge in the management theory and the practice part of it.
The primary concern of an entrepreneur is to start the business and ensure its sustenance, but the managers want to run it efficiently. However, sometimes an entrepreneur can take the role of a manager, but it is not possible for a manager to be an entrepreneur. In reality, an entrepreneur is the owner of the business while the manager is just a servant of the customers and the owner.An entrepreneur wants to have freedom concerning finance so that he/she makes choices without any financial constraints and be able to do what they want. To managers, what is important is security in the form of a pay rise, pension, gratuity, promotions, a steady paycheck, bonuses and job titles.
This entrepreneur is ever suspicious. Whenever they see others’ success, they raise eyebrows because they don’t believe that can happen on personal effort. They often look at one’s business and starts looking at the breakthroughs in the success of the firm or the kind of inheritance that the entrepreneur received which made him/her successful. Their skepticism is so influential to the extent that they don’t believe that it is possible for one to make it in life through sheer effort. This group does not succeed in their business because most won’t believe in themselves. They believe that some magic has to happen for one to be successful in business. Members of this group cannot think independently because they don’t have that stamina. This entrepreneur is full of excuses, and they are so much scared of taking actions.
The copycat entrepreneur
He is an entrepreneur who sees others succeeding and then starts copying them in all the aspects. They copy the business cards, the websites and even the way they present themselves to the clients. The entrepreneur is not himself/herself but rather a carbon copy. Modeling success is imperative, but copying is a very dangerous business practice. Such a group doesn’t believe in itself and cannot take action because they are not original. They believe that somebody else has to come up with an idea so that they can copy it. They doubt themselves.
The research entrepreneur
Typically, they are entrepreneurs who love learning. They do research and look for possible outcomes and scenarios to strategies to make the business grow. Learning a lot without taking any step is of no value. Action has to be taken. They believe in conducting research in to get factual information on the ground. They learn, and later implement. This category of entrepreneurs believes that learning is important and before embarking on a business venture, it is imperative to get sufficient information. Such an attitude enables them to start from an informed point of view.
The determined entrepreneur
The entrepreneur has not reached where he/she wants to but has the zeal and energy required to reach there. The determination they have is unstoppable whatever the obstacles that they get on their way. They have a strong conviction that one can succeed if well determined and they hate copying others. They can do anything within their means to ensure that they enterprises become successful. Starting and growing a business is not easy but this is an individual who is determined to be a success story. Irrespective of the number of failures that they encounter, they do not stop, they learn from their mistakes. They relax after they have made it.
He is one who has passed all the stages that are involved in starting and building a business enterprise, and they have reached a level of success for which they are proud. Their primary focus is to take their firms to a different level so that they can leave a legacy that will extend beyond their lives. They have vast experience of spotting the gaps in business and quickly fill them. They understand the needs of the customers and how they can tailor-make their needs. They know what works and what does not work. They use time wisely because they know that it is their most valuable resource. They believe that everything is possible if there is determination and focus.
The way background and experience can hinder or foster entrepreneurship.
Experience and skills are important in entrepreneurship. This is because the two determines the extent of success of a business and affect the propensity of entrepreneurs to become successful. Most of the successful business entrepreneurs like Richard Branson rode on personal experiences and that of others by looking at what works and what does not work. He then capitalized on the failures of others to start his businesses.
While starting a business enterprise with personal experience, one can decipher the needs of customers and work out promptly and strategically to fulfill them. Out of the gaps observed, one develops a desire to fill it. The desire then is driven by the failure or underperformance of a service or a product. This, therefore, gives an entrepreneur the fuel and impetus to start looking for a solution. If somebody begins a business just because of an idea, or a business that was seen on the internet while browsing, or reads in a motivational book, the level of commitment will not be high because it is not reliant on a person’s inner passion. Personal experience or the experience from others is crucial in entrepreneurship.
Richard Branson began his business in the hotel industry from an informed perspective. He had traveled all over the world doing a critical study of the gaps in that industry. He therefore, began the business envisioning success. Therefore, he capitalized on the loopholes that he saw as he spent in different hotels all over the world. When you start a business with experience, you have several advantages. First, you already know your market and what the customers want. So you are better placed to give them the best and satisfy their needs. Second, you are aware of the tastes and preferences of your customers as well the gaps that you need to fill.
The entrepreneurial background is paramount because it is the one that will make a person who has the entrepreneur mind to identify the available opportunities, evaluate them, and create a utilization mechanism. When one is well grounded in entrepreneurship, it is very easy for him/her to identify the gaps that exist in the market and seize that opportunity to satisfy the needs of the customers as well as making a profit for him/her. One also knows how the business is operates.  
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