Page 11 - DMGT310_ENTREPRENEURSHIP_AND_SMALL_BUSINESS_MANAGEMENT

Entrepreneurship and Small Business Management

Notes from captains of industry to an elusive individual who reaped profits at the expense of others.
The term ‘entrepreneur’ was relegated to obscurity in economic literature for several decades
and management writers and thinkers focused their attention on factory efficiency and
administration.
Another Austrian Economist, Joseph Schumpeter revised the concept entrepreneurship. He was
the first who recognized the importance of an entrepreneur as a human agent in economic
development. Schumpeter in his series of economic articles and treatises between 1911 and 1950
described entrepreneurship as a force of creative destruction by which the established methods
of doing things are destroyed by the creation of a new one. According to him, entrepreneurship
is a process and it is essentially a creative activity. The entrepreneurs are the innovators who
introduce something new into the economy through new combinations of resources and new
methods of commerce. It is his view that such types of innovators are rare in society and they
appear on the scene of development periodically.

Max Weber (1864-1920), a German sociologist emphasized his opinion that creative and
entrepreneurial initiatives are generated by adopting exogenous beliefs which, in turn, produce
three intense efforts in occupational goals and accumulation of productive assets leading to
manufacture of goods and services. In his opinion entrepreneurs are influenced by a particular
social condition in which they live and society itself shapes the personality of the individuals as
entrepreneurs.
In recent times, as regards entrepreneurial aspect, a few psychological theories have been
developed by a number of famous psychologists, like McClelland, Hagen and Kunkel and some
sociological theories developed by Thomas Cochran and Frank Young. McClelland stressed the
importance of achievement motivation assisting to expose the personality of entrepreneurs and
leading to economic and social development. Hagen identified the emergence of a group of
creative individual resulting on withdrawal of status in society. Thus it led to the development
of entrepreneurs and taking off the process of economic development. Kunkel conceived that
the behavioral pattern of individuals is the significant matter for the development. Such a
behavioral pattern can be directed by external stimulus. In their theories, Cochran and Young
did not lay so much importance of the society in shaping the personality of the entrepreneurs
and they suggested that certain factors, viz, agricultural values, social sanctions, role expectation
and inter-group relations in society are responsible for emergence of entrepreneurs.
Till the nineteenth century various concepts of entrepreneurship had emerged. Since then in
respect of managing the enterprise, the task of management has been recognized as an important
matter. For management, the responsibility of entrepreneurs has been delegated to the managers.
Now the term entrepreneurship cannot be clearly defined or the entrepreneurs cannot be clearly
identified as a particular person. According to modern management experts, entrepreneurship
can be considered as a behaviour encompassing an individual’s pursuit of opportunity irrespective
of the resources controlled.
In view of discussions above, it may be concluded that different researchers have expressed their
divergent opinions as regards emergence of entrepreneurship. On analysis of various researches
and their results as regards evolution of entrepreneurship, the following matters may be
observed:
Entrepreneurship has been recognized in different names at different times in various countries
of the world. Some of the different names are risk-taking, decision-making, free thinking,
agency of a change, an act of innovation, etc.

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